x
|
Registration Statement Pursuant to Section 12(b) or (g) of the Securities Exchange Act of 1934
|
¨
|
Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended __________
|
¨
|
Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
¨
|
Shell Company Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of event requiring this shell company report: __________
For the transition period from ________ to _______________
|
State of Israel
(Jurisdiction of incorporation or organization)
|
7 Haeshel Street
Caesarea Industrial Park South
38900 Israel
(Address of principal executive offices)
|
Title of each class:
American Depository Shares each representing 2
Ordinary Shares, par value NIS 0.01 per share
(1)
Ordinary shares, par value NIS 0.01 per share
(2)
|
Name of each exchange on which registered or to be registered:
NASDAQ Capital Market
|
(1)
|
Evidenced by American Depositary Receipts.
|
(2)
|
Not for trading, but only in connection with the listing of the American Depositary Shares.
|
Large accelerated filer
o
|
Accelerated filer
o
|
Non-accelerated filer
x
|
Page
|
||
5 | ||
5 | ||
6 | ||
7 | ||
7 | ||
A. | Directors and Senior Management. | 7 |
B. | Advisers. | 7 |
C. | Auditors. | 7 |
7 | ||
8 | ||
A.
|
Selected Financial Data.
|
8 |
B.
|
Capitalization and Indebtedness.
|
9 |
C.
|
Reasons for the Offer and Use of Proceeds.
|
9 |
D.
|
Risk Factors.
|
9 |
37 | ||
A.
|
History and Development of the Company.
|
37 |
B.
|
Business Overview.
|
38 |
C.
|
Organizational Structure.
|
62 |
D.
|
Property, Plants and Equipment.
|
62 |
62 | ||
62 | ||
A.
|
Operating Results.
|
62 |
B.
|
Liquidity and Capital Resources.
|
72 |
C.
|
Research and Development, Patents and Licenses, Etc.
|
75 |
D.
|
Trend Information.
|
76 |
E.
|
Off-Balance Sheet Arrangements.
|
76 |
F.
|
Tabular Disclosure of Contractual Obligations.
|
76 |
77 | ||
A.
|
Directors and Senior Management.
|
77 |
B.
|
Compensation.
|
80 |
C.
|
Board Practices.
|
84 |
D.
|
Employees.
|
94 |
E.
|
Share Ownership.
|
95 |
98 | ||
A.
|
Major Shareholders.
|
98 |
B.
|
Related Party Transactions.
|
100 |
C.
|
Interests of Experts and Counsel.
|
100 |
100 | ||
A.
|
Consolidated Statements and Other Financial Information.
|
100 |
B.
|
Significant Changes.
|
101 |
A.
|
Offer and Listing Details.
|
101 |
B.
|
Plan of Distribution.
|
102 |
C.
|
Markets.
|
102 |
D.
|
Selling Shareholders.
|
102 |
E.
|
Dilution.
|
102 |
F.
|
Expenses of the Issue.
|
102 |
103 | ||
A.
|
Share Capital.
|
103 |
B. | Articles of Association. | 103 |
C.
|
Material Contracts.
|
107 |
D.
|
Exchange Controls.
|
108 |
E.
|
Taxation.
|
108 |
F.
|
Dividends and Paying Agents.
|
119 |
G.
|
Statement by Experts.
|
119 |
H.
|
Documents on Display.
|
119 |
I.
|
Subsidiary Information.
|
120 |
120 | ||
121 | ||
A. |
Debt Securities.
|
121 |
B. |
Warrants and rights.
|
121 |
C. |
Other Securities.
|
121 |
D. |
American Depositary Shares.
|
121 |
|
128
|
|
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
128 | ||
|
129
|
|
129 | ||
129 | ||
131 | ||
132 |
|
·
|
the overall global economic environment;
|
|
·
|
the impact of competition and new technologies;
|
|
·
|
general market, political and economic conditions in the countries in which we operate;
|
|
·
|
projected capital expenditures and liquidity;
|
|
·
|
changes in our strategy;
|
|
·
|
government regulations and approvals;
|
|
·
|
changes in customers’ budgeting priorities;
|
|
·
|
litigation and regulatory proceedings; and
|
|
·
|
those factors referred to in “Item 3. Key Information – D. Risk Factors,” “Item 4. Information on the Company,” and “Item 5. Operating and Financial Review and Prospects”, as well as in this registration statement on Form 20-F generally.
|
|
·
|
“Mazor Robotics”, “Mazor,” the “Company”, the “registrant”, “us”, “we” and “our” refer to Mazor Robotics Ltd., an Israeli company, and, unless the context indicates otherwise, the Subsidiary;
|
|
·
|
“ordinary shares”, “our shares” and similar expressions refer to the our ordinary shares, par value NIS 0.01 per share;
|
|
·
|
“Dollars”, “U.S. dollars”, “U.S. $” and “$” are to United States Dollars;
|
|
·
|
“Shekels” and “NIS” are to New Israel Shekels, the Israeli currency;
|
|
·
|
“Companies Law” are to Israel’s Companies Law, 5759-1999, as amended;
|
|
·
|
“Exchange Act” are to the Securities Exchange Act of 1934, as amended;
|
|
·
|
“FDA” are to the United States Food and Drug Administration;
|
|
·
|
“IRS” are to the United States Internal Revenue Service;
|
|
·
|
“OCS” are to the Israel's Office of the Chief Scientist of the Ministry of Industry, Trade and Labor;
|
|
·
|
“SEC” are to the United States Securities and Exchange Commission;
|
|
·
|
“Subsidiary” are to Mazor Robotics, Inc., a Delaware corporation, and a wholly owned subsidiary of Mazor; and
|
|
·
|
“TASE” are to the Tel Aviv Stock Exchange.
|
A.
|
Directors and Senior Management
|
Name
|
Position
|
Jonathan Adereth
|
Chairman of the Board of Directors
|
Ori Hadomi |
Chief Executive Officer, Director
|
Gil Bianco
|
External Director
|
David Schlachet
|
External Director
|
Sarit Soccary Ben-Yochanan
|
Director
|
Sharon Levita
|
Chief Financial Officer, Secretary
|
Moshe Shoham
|
Chief Technology Officer
|
Eliyahu Zehavi
|
Chief Operating Officer
|
Avi Posen
|
Vice President of Sales, International
|
Doron Dinstein
|
Chief Medical Officer
|
Christopher Sells
|
Vice President of Sales, United States
|
Christopher Prentice
|
Vice President of Marketing
|
B.
|
Advisers
|
C.
|
Auditors
|
A.
|
Selected Financial Data
|
(in thousands except net loss per share data)
|
Years Ended December 31,
|
|
||||||||||||||||||
2012
|
|
2011
|
|
2010
|
|
|
2009
|
|
|
2008
|
|
|||||||||
Statements of Operations Data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
12,175
|
|
$
|
5,904
|
|
$
|
3,973
|
|
|
$
|
1,363
|
|
|
$
|
584
|
|
|||
Cost of sales
|
$
|
2,893
|
|
$
|
1,879
|
|
$
|
961
|
|
|
$
|
473
|
|
|
$
|
438
|
|
|||
Gross profit (loss)
|
9,282
|
|
4,025
|
|
|
3,012
|
|
|
|
890
|
|
|
|
146
|
||||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Research and development
|
$
|
2,760
|
|
$
|
3,062
|
|
$
|
2,292
|
|
|
$
|
1,382
|
|
|
$
|
1,936
|
|
|||
Selling and marketing
|
|
$
|
8,887
|
|
$
|
6,990
|
|
$
|
4,592
|
|
|
$
|
2,461
|
|
|
$
|
2,615
|
|
||
General and administrative
|
|
$
|
1,845
|
|
$
|
1,639
|
|
$
|
1,424
|
|
|
$
|
1,184
|
|
|
$
|
1,456
|
|
||
Total operating costs and expenses
|
|
$
|
13,492
|
|
$
|
11,691
|
|
$
|
8,308
|
|
|
$
|
5,027
|
|
|
$
|
6,007
|
|
||
Loss from operations
|
|
$
|
(4,210
|
)
|
|
$
|
(7,666
|
)
|
|
$
|
(5,296
|
)
|
|
$
|
(4,137
|
)
|
|
$
|
(5,861
|
)
|
Net loss
|
|
$
|
(7,064
|
)
|
|
$
|
(7,782
|
)
|
|
$
|
(5,773
|
)
|
|
$
|
(4,340
|
)
|
|
$
|
(5,531
|
)
|
Net loss attributable to ordinary shareholders
|
|
$
|
(7,064
|
)
|
|
$
|
(7,782
|
)
|
|
$
|
(5,773
|
)
|
|
$
|
(4,340
|
)
|
|
$
|
(5,531
|
)
|
Net loss per share – Basic and diluted attributable to ordinary shareholders
|
|
$
|
(0.29
|
)
|
|
$
|
(0.36
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.39
|
)
|
Weighted average common shares outstanding – Basic and diluted
|
|
24,011
|
|
21,815
|
|
|
19,717
|
|
|
|
15,280
|
|
|
|
14,153
|
|
(in thousands)
|
As of December 31,
|
|||||||||||||||||||
2012
|
2011
|
2010
|
2009
|
2008
|
||||||||||||||||
Balance Sheet Data:
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 12,797 | $ | 1,655 | $ | 4,802 | $ | 3,537 | $ | 1,108 | ||||||||||
Short-term investments
|
$ | 4,156 | $ | 14,455 | $ | 13,335 | $ | 18,419 | $ | 13,201 | ||||||||||
Total assets
|
$ | 21,344 | $ | 20,424 | $ | 21,773 | $ | 23,936 | $ | 15,688 | ||||||||||
Total non-current liabilities
|
$ | 4,490 | $ | 616 | $ | 4,233 | $ | 3,573 | $ | 3,147 | ||||||||||
Accumulated deficit
|
$ | (52,006 | ) | $ | (44,942 | ) | $ | (37,160 | ) | $ | (31,387 | ) | $ | (27,047 | ) | |||||
Total shareholders’ equity
|
$ | 12,820 | $ | 13,484 | $ | 15,145 | $ | 19,350 | $ | 11,678 |
As of
December 31, 2012
|
|
|||
(in thousands)
|
|
|||
|
||||
Liabilities
|
|
|
||
|
||||
Liabilities to the OCS
|
|
$
|
832
|
|
Derivative liabilities on account of warrants
|
$
|
3,990
|
||
|
|
|||
Shareholders' equity:
|
|
|
||
Share capital
|
$
|
73
|
|
|
Share premium
|
$
|
58,910
|
|
|
Amounts allocated to share options
|
$
|
554
|
|
|
Capital reserve for share-based payment transactions
|
$
|
3,170
|
|
|
Foreign currency translation reserve
|
$
|
2,119
|
|
|
Accumulated loss
|
|
$
|
(52,006
|
)
|
Total shareholder's equity
|
$
|
12,820
|
|
|
Total capitalization (debt and equity)
|
$
|
17,642
|
|
C.
|
Reasons for the Offer and Use of Proceeds
|
D.
|
Risk Factors
|
|
·
|
the revenue generated by sales of our current and future products;
|
|
·
|
our ability to manage our inventory;
|
|
·
|
the expenses we incur in selling and marketing our products and supporting our growth;
|
|
·
|
the costs and timing of regulatory clearance or approvals for new products or upgrades or changes to our current products;
|
|
·
|
the rate of progress, cost, and success or failure of on-going development activities;
|
|
·
|
the emergence of competing or complementary technological developments;
|
|
·
|
the costs of filing, prosecuting, defending and enforcing any patent or license claims and other intellectual property rights, or participating in litigation related activities;
|
|
·
|
the terms and timing of any collaborative, licensing, or other arrangements that we may establish;
|
|
·
|
the acquisition of businesses, products and technologies; and
|
|
·
|
general economic conditions and interest rates, including the continuing weak conditions.
|
|
·
|
Our suppliers may encounter financial hardships as a result of unfavorable economic and market conditions unrelated to our demand for components, which could inhibit their ability to fulfill our orders and meet our requirements;
|
|
·
|
Suppliers may fail to comply with regulatory requirements, be subject to lengthy compliance, validation or qualification periods, or make errors in manufacturing components that could negatively affect the efficacy or safety of our products or cause delays in supplying of our products to our customers;
|
|
·
|
Newly identified suppliers may not qualify under the stringent regulatory standards to which our business is subject;
|
|
·
|
We or our suppliers may not be able to respond to unanticipated changes in customer orders, and if orders do not match forecasts, we or our suppliers may have excess or inadequate inventory of materials and components;
|
|
·
|
We may be subject to price fluctuations due to a lack of long-term supply arrangements for key components;
|
|
·
|
We may experience delays in delivery by our suppliers due to changes in demand from us or their other customers;
|
|
·
|
We or our suppliers may lose access to critical services and components, resulting in an interruption in the manufacture, assembly and shipment of our systems;
|
|
·
|
Our suppliers may be subject to allegations by other parties of misappropriation of proprietary information in connection with their supply of products to us, which could inhibit their ability to fulfill our orders and meet our requirements;
|
|
·
|
Fluctuations in demand for products that our suppliers manufacture for others may affect their ability or willingness to deliver components to us in a timely manner;
|
|
·
|
Our suppliers may wish to discontinue supplying components or services to us (e.g., for risk management reasons); and
|
|
·
|
We may not be able to find new or alternative components or reconfigure our system and manufacturing processes in a timely manner if the necessary components become unavailable.
|
|
·
|
untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;
|
|
·
|
customer notifications, refunds, detention or seizure of our products;
|
|
·
|
refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products;
|
|
·
|
withdrawing 510(k) marketing clearances or PMA approvals that have already been granted;
|
|
·
|
refusing to provide Certificates for Foreign Government;
|
|
·
|
refusing to grant export approval for our products; or
|
|
·
|
pursuing criminal prosecution.
|
|
·
|
our ability to recruit, train and retain adequate numbers of qualified sales and marketing personnel;
|
|
·
|
the ability of sales personnel to obtain access to surgeons and persuade adequate numbers of hospitals to purchase our products;
|
|
·
|
costs associated with hiring, maintaining and expanding a sales and marketing organization; and
|
|
·
|
government scrutiny with respect to promotional activities in the healthcare industry both domestically and abroad.
|
|
·
|
significantly greater name recognition;
|
|
·
|
longer operating histories;
|
|
·
|
established exclusive relations with healthcare professionals, customers and third-party payors;
|
|
·
|
established distribution networks;
|
|
·
|
additional lines of products and the ability to offer rebates or bundle products to offer higher discounts or incentives to gain a competitive advantage;
|
|
·
|
greater experience in conducting research and development, manufacturing, clinical trials, obtaining regulatory clearance for products and marketing approved products; and
|
|
·
|
greater financial and human resources for product development, sales and marketing and patent litigation.
|
·
|
managing production yields;
|
·
|
maintaining quality control and assurance;
|
·
|
providing component and service availability;
|
·
|
hiring and retaining qualified personnel; and
|
·
|
complying with state, federal and foreign regulations.
|
|
·
|
delays in shipments due for example, to natural disasters or labor disturbances;
|
|
·
|
delays or unexpected difficulties in the manufacturing processes of our suppliers or in our assembly process;
|
|
·
|
timing of the announcement, introduction and delivery of new products or product upgrades by us and by our competitors;
|
|
·
|
timing and level of expenditures associated with expansion of sales and marketing activities and our overall operations; and
|
|
·
|
changes in third-party coverage and reimbursement, changes in government regulation, or a change in a customer’s financial condition or ability to obtain financing.
|
|
·
|
The identification of suitable acquisition candidates can be difficult, time consuming and costly;
|
|
·
|
Integrating any acquisitions that we make into our operations is difficult, time consuming, expensive, and may involve new regulatory requirements; and
|
|
·
|
Future acquisitions could result in potentially dilutive issuances of equity securities or the incurrence of debt, contingent liabilities or expenses, or other charges such as amortization of intangible assets, any of which could harm our business and materially adversely affect our financial results or cause a reduction in the price of our ordinary shares.
|
|
·
|
implementing appropriate operational and financial systems and controls;
|
|
·
|
expanding manufacturing and assembly capacity and increasing production;
|
|
·
|
developing our sales and marketing infrastructure and capabilities;
|
|
·
|
identifying, attracting and retaining qualified personnel in our areas of activity;
|
|
·
|
hiring, training, managing and supervising our personnel; and
|
|
·
|
continuous compliance with regulatory and quality assurance requirements.
|
|
·
|
approval of product submissions with healthcare systems outside the United States;
|
|
·
|
gathering the clinical data that may be required for product submissions with healthcare systems outside the United States;
|
|
·
|
import restrictions and controls and other government regulation relating to technology;
|
|
·
|
pricing pressures that we may experience internationally;
|
|
·
|
the availability and level of reimbursement within prevailing foreign healthcare payment systems;
|
|
·
|
compliance with existing and changing applicable foreign regulatory laws and requirements, including but not limited to the European Medical Device Directive (Council Directive 93/42/EEC), the U.S. Foreign Corrupt Practices Act of 1977, or FCPA, and the U.K. Bribery Act;
|
|
·
|
foreign laws and business practices favoring local companies;
|
|
·
|
longer payment cycles; and
|
|
·
|
shipping delays.
|
|
·
|
design, development and manufacturing;
|
|
·
|
testing, labeling and storage;
|
|
·
|
clinical trials;
|
|
·
|
product safety;
|
|
·
|
marketing, sales and distribution;
|
|
·
|
premarket clearance or approval;
|
|
·
|
record keeping procedures;
|
|
·
|
advertising and promotions;
|
|
·
|
recalls and field corrective actions;
|
|
·
|
post-market surveillance, including reporting of deaths or serious injuries and malfunctions that, if they were to recur, could lead to death or serious injury; and
|
|
·
|
product export.
|
|
·
|
untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;
|
|
·
|
customer notifications or repair, replacement, refunds, detention or seizure of our products;
|
|
·
|
operating restrictions or partial suspension or total shutdown of production;
|
|
·
|
refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products;
|
|
·
|
withdrawing 510(k) marketing clearances or PMA approvals that have already been granted;
|
|
·
|
refusing to provide Certificates for Foreign Government;
|
|
·
|
refusing to grant export approval for our products; or
|
|
·
|
pursuing criminal prosecution.
|
|
·
|
announcements of technological innovations or new products by us or others;
|
|
·
|
announcements by us of significant acquisitions, strategic partnerships, in-licensing, out-licensing, joint ventures or capital commitments;
|
|
·
|
expiration or terminations of licenses, research contracts or other collaboration agreements;
|
|
·
|
public concern as to the safety of our equipment we sell;
|
|
·
|
general market conditions;
|
|
·
|
the volatility of market prices for shares of medical devices companies generally;
|
|
·
|
success or failure of research and development projects;
|
|
·
|
departure of key personnel;
|
|
·
|
developments concerning intellectual property rights or regulatory approvals;
|
|
·
|
developments concerning standard-of-care in spine;
|
|
·
|
variations in our and our competitors’ results of operations;
|
|
·
|
changes in revenues, gross profits and earnings announced by the company;
|
·
|
changes in estimates or recommendations by securities analysts, if our ordinary shares or ADSs are covered by analysts;
|
·
|
changes in government regulations or patent decisions; and
|
·
|
general market conditions and other factors, including factors unrelated to our operating performance.
|
|
·
|
Our success in market penetration of our products;
|
|
·
|
The results of clinical studies;
|
|
·
|
Our ability to obtain regulatory approvals for our products in the United States and in international markets;
|
|
·
|
The cost, timing and outcome of regulatory review;
|
|
·
|
The cost of developing new products;
|
|
·
|
The cost of market penetration and expansion;
|
|
·
|
The costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our issued patents and defending intellectual property-related claims;
|
|
·
|
The extent to which we acquire or invest in businesses, products or technologies and other strategic relationships; and
|
|
·
|
The costs of financing working capital requirements.
|
|
·
|
reduced procedure-related blood-loss, pain and scarring at the incision site;
|
|
·
|
fewer complications, such as infections;
|
|
·
|
faster recovery times and shorter post-operative hospital stays; and
|
|
·
|
better aesthetic outcomes.
|
|
·
|
restricted or even no line-of-sight at the anatomical site;
|
|
·
|
cumbersome handling of surgical instruments;
|
|
·
|
dependence on two-dimensional imaging for three-dimensional surroundings; and
|
|
·
|
limited operating space.
|
|
·
|
Patient safety;
|
|
·
|
Reduced exposure to harmful X-ray radiation in the operating room - to both patient and surgical team;
|
|
·
|
Simplifying complex procedures;
|
|
·
|
Fewer complications (in minimally invasive surgeries); and
|
|
·
|
Fewer revisions.
|
|
·
|
Patients value:
safety, clinical excellence, speed of recovery, reduced risk of complications and revisions, aesthetics and less blood loss (in minimally invasive procedures).
|
|
·
|
Surgeons value
: patient value, reduced radiation exposure, facilitation of complex and minimally invasive surgeries, ease of use and prestige from the use of cutting-edge technology.
|
|
·
|
Hospitals value:
patient value, surgeon value, differentiation, reputation, incremental revenues and increased market share.
|
|
·
|
Consistently Reproducible Precision
: Consistently reproducible precision reduces the variability of procedure outcomes and increases safety. Guided instrumentation according to a precise, pre-operative plan leads to significantly improved and reliable results, compared to conventional, manually executed spine procedures. The ability to pre-operatively plan enables optimization of implant size, improved placement and alignment of implants. During the operation, Renaissance accurately guides the surgeon through each planned trajectory of the procedure. We believe that this consistently reproducible precision enables physicians to be trained in the use of Renaissance in a relatively short period of time and also will increase the number of physicians who are willing and able to perform spine surgeries.
|
|
·
|
Ease of Use
: We believe that Renaissance leverages and complements the surgical skills and techniques already familiar to the surgeon, while providing greater precision that has not previously been possible. The software for creating the customized, patient specific surgical blueprint which the surgeon creates is intuitive and easily mastered. The intra-operative set-up is straightforward as well. Hence, we believe that Renaissance’s ease of use greatly accelerates the learning curve, making it accessible to spine surgeons with a broad range of training and skills and has the potential to lead to greater adoption of minimally invasive procedures. We also believe that the ease of use provided by Renaissance may enable greater operating room efficiencies.
|
|
·
|
Facilitation of complex procedures (e.g., MIS, deformity, revisions)
: Due to the accuracy of Renaissance procedures and the consistent surgical technique, regardless of the complexity of the procedure itself, we believe that it is easier for surgeons to perform complex spine surgeries, especially minimally invasive surgeries with more than one spinal segment. As a result, patients are likely to experience a faster recovery, fewer complications, less tissue and blood loss and less visible scarring, thereby reducing the cost of hospitalization, medication and rehabilitation.
|
|
·
|
Reduced Costs for Patients, Hospitals, and Third-Party Payors
: The consistently reproducible precision of Renaissance has the potential to aid hospitals, third-party payers and patients in reducing costs by shortening hospital stays and recovery periods, decreasing the number of required revisions and reducing the amount of rehabilitation and medication.
|
|
·
|
Economic sustainability
: The benefits mentioned above, driving clinical excellence in Renaissance spine programs, may help surgeons and hospitals differentiate themselves, attracting more patients to seek medical care by them, over competitors offering less sophisticated alternatives. This can positively impact the financial investment necessary to create a Renaissance spine program.
|
|
·
|
Continuously improve our product offering to help surgeons deliver the best clinical care to their patients. Doing so requires an investment in research and development and the ability to collaborate with our customers;
|
|
·
|
Target the early adopters of technology who understand and are experienced in the adoption of new technologies into their practice. Our sales team seeks organizations where both surgeons and the hospital administration are willing to invest time, money and resources to achieve state-of-the art competence and understand the implications of such process;
|
|
·
|
Convince hospitals that through early adoption and acquisition of Renaissance they can reinforce their reputations as leading institutions for the surgical treatment of spine disease, differentiating themselves from their competition and support both their clinical and business objectives;
|
|
·
|
Provide the highest level of training and support to our customers. By providing on-site training and support to surgeons in the proper use of Renaissance, we can help the adoption and assimilation process of Renaissance, increasing familiarity and comfort in using Renaissance, thereby driving utilization;
|
|
·
|
Demonstrate the clinical and financial value proposition of Renaissance and communicate it to all key stakeholders in the adoption process, namely patients, surgeons and medical facilities. Our goal is to obtain clinical data further supporting the value of Renaissance, while demonstrating to hospitals the financial benefits of our Renaissance solution;
|
|
·
|
Be a global company using both direct and indirect sales channels. We believe that our product addresses different needs in different countries; and
|
|
·
|
Provide high quality service and work closely with the surgeons and the surgical team to better understand the needs and expectations as well as support the integration and utilization of our products into the different practices.
|
RBT Device : While the surgery is executed by the attending surgeon, the positioning of the drill and its trajectory is guided by Renaissance’s RBT Device. The RBT Device is a portable, computer-controlled, miniature (50X90 mm, 400-gram), six degrees-of-freedom, parallel hexapod robot (also known as a "Stewart Platform"), with an end-effector resolution of less than 200 microns under laboratory conditions. Using our proprietary software, the RBT Device spatially positions and orientates surgical tools intra-operatively in accordance with the planned surgical blueprint. All RBT Device movements are a result of the preoperative plan and are monitored by a closed-loop control process. |
Figure 1: RBT Device
|
Renaissance Workstation (WS ): WS runs graphical user-interface software responsible for the preoperative planning, image acquisition and correlation, kinematic calculations and real-time RBT Device motion control. It is the main console at which the computing and electronic components of Renaissance interface with our proprietary planning and execution software. The WS houses an image processing unit, a control unit and stores RBT device, and is equipped with a control panel, a multi-touch screen monitor, a rear connectors panel and storage compartments. The WS has a video-in signal connection, which receives the x-ray input from the C-Arm, the most common fluoroscopy system used to image the patient’s spine in the operating room, or other compatible intraoperative imaging systems (e.g., CT). |
Figure 2: Renaissance Workstation
|
|
·
|
Preoperative Planning
: Utilizing a preoperative CT of the patient’s spine, the surgeon segments the region of interest into separate vertebra and labels them. This map serves as the template for planning the instrumentation, providing three-dimensional views of the implants and the anatomy, and facilitating optimization of clinical considerations. The surgeon then reviews the plan, vertebra-by-vertebra, in a slice-by-slice virtual video mode to verify the plan.
|
|
·
|
Intraoperative Procedure
: In the operating room, the software performs several functions, including image acquisition from the C-Arm, automatic correlation of the images in the 3D synchronization process, trajectory calculations, determination of hardware requirements, real-time kinematic control of the RBT Device’s motion and review of the surgical plan.
|
· | Multi-Directional Bridge : The Multi-Directional Bridge is attached to the railings on both sides of the patient's bed by dedicated connectors. A third docking point is on the patient’s spine, via a 2 mm head pin, to a spinous process superior to the operated spinal segment. The Multi-Directional Bridge can be moved laterally in parallel to the patient's spinal column. This mounting option is often used in minimally invasive surgeries involving multiple levels. |
Figure 3: Multi-Directional Bridge Mounting Platform
|
· |
Hover-T: Like the Multi-Directional Bridge, the Hover-T platform has three docking points; however, it uses two Schantz pins (4 mm) which are inserted into the patient’s iliac bone, instead of the two bed-mount connectors. It is used for both open and minimally invasive procedures involving multiple levels.
|
Figure 4: Hover-T Mounting Platform
|
· |
Bed-mount: This mount is a simplified model of the Multi-Directional Bridge, with only one connector to the bed (along with the head pin in a spinous process). It is recommended for single-level, minimally invasive operations.
|
Figure 5: Bed Mount Platform
|
· |
Clamp mount: The Clamp Mount is clamped onto a spinous process. A short bridge is then attached onto the clamp, to serve as the platform for the RBT Device. Two head pins are inserted from the bridge to spinous processes, locking the spinal segment, and maximizing stability. This mounting system is most commonly used for scoliosis and deformity procedures yet can also be used in minimally invasive surgeries.
|
Figure 6: Clamp Mount Platform
|
|
·
|
Intelligent planning features to support achievement of optimal patient-specific alignments;
|
|
·
|
A high degree of precision in accordance with an image-based preoperative plan;
|
|
·
|
High accuracy when performing minimally invasive or open spinal procedures;
|
|
·
|
Easy to setup and use;
|
|
·
|
Mounted on the bony anatomy, providing a stand-alone solution that, unlike CAS Navigation systems, does not require a tracking system;
|
|
·
|
Designed to maintain accuracy despite patient breathing and minor movement;
|
|
·
|
Reduces intraoperative X-ray radiation exposure to patient and medical staff;
|
|
·
|
Miniature device size does not infringe on the surgical team's free movement and visibility during the procedure, does not put them at risk and is easily supported on the spines of even small patients;
|
|
·
|
Automatic image-based synchronization that requires no human intervention, other than approval;
|
|
·
|
Operated by the surgeon and surgical team; does not require dedicated personnel;
|
|
·
|
Off-site preoperative planning frees surgeons to work when and where they choose; and
|
|
·
|
Robust system design and protocols are unaffected by environmental conditions, such as line-of-sight, noise, vibration or humidity.
|
|
·
|
Preoperative planning;
|
|
·
|
Attachment of hardware;
|
|
·
|
Three-dimensional (3D) synchronization; and
|
|
·
|
Surgical execution.
|
|
·
|
the need for brain surgery and the inherent risk of potential complications;
|
|
·
|
permanent implantation of electrodes in the brain; and
|
|
·
|
reports of a limited life span of the clinical benefits.
|
●
|
Renaissance C-OnSite: This application merges the preoperative CT scan with an intraoperative 3D Scan generated in the operating room using the standard C-Arm. The software isolates the clearly visible implants in the 3D Scan and superimposes them in real-time on the pre-operative CT images. This provides the surgeon intra-operatively with high-quality, 3D images of the surgical work. This can help reduce the risk for revision surgeries, while exposing the patient and operating room staff to relatively low X-ray doses (about 1/10th of a CT scan).
|
●
|
Renaissance Scan and Plan: This application is designed to obviate the need for a preoperative CT scan by using an available intra-operative 3D imaging system (fluoroscopy- or CT-based). This 3D scan is performed after placing the selected Renaissance mounting system on the patient. When using this application, there is no need for correlation, as the 3D synchronization process is inherent to the image acquisition process. Once the 3D images are acquired, the surgeon utilizes them to plan the operation based on these images in the operating room.
|
|
·
|
At our current stage of market penetration, we mainly target the early adopters of cutting-edge technology.
|
|
·
|
We invest many resources in building surgeons’ clinical support for the purchase of Renaissance with their facility’s administration. This includes travel to observe Renaissance cases, participation in bio-skills workshops where the prospective customers have a chance for hands-on experience by operating on a cadaver with Renaissance, and facilitation of peer-to-peer interactions.
|
|
·
|
Our sales representatives actively target hospitals with a significant spine practice. We believe that a successful adoption process depends on the routine implementation of Renaissance into the surgeon’s and facility’s routine operations. In such facilities there is also growth potential to more surgeons’ practices.
|
|
·
|
We encourage independent clinical research by surgeons of the implementation, learning curve, clinical results radiation exposure and other variables which are inherent to or derived from the adoption and utilization of Renaissance in a surgical spine program.
|
|
·
|
We try to drive patient demand for Renaissance. We believe that patients are becoming increasingly more involved in the healthcare decision making process and have the potential to influence the adoption of new technologies such as Renaissance. Our representatives encourage medical facilities to embark on a marketing program that would promote and publicize their Renaissance spine program to educate surgeons, referring physicians and patients regarding the clinical benefits it provides and the success their patients have met with. This grows interest in both the patient and professional community, resulting in more referrals to the Renaissance program, further fueling its success.
|
|
·
|
the safety and efficacy of the procedure and product offerings, as documented through published studies and other clinical reports;
|
|
·
|
product benefits, including the ability to offer spine surgeons a complete solution for posterior thoracic-lumbar procedures;
|
|
·
|
the cost of product offerings and the availability of product coverage and reimbursement from third-party payors, insurance companies and others parties;
|
|
·
|
the strength of acceptance and adoption by spine surgeons and hospitals;
|
|
·
|
the ability to deliver new product offerings and enhanced technology to expand or improve upon existing applications through continued research and development;
|
|
·
|
the quality of training, services and clinical support provided to surgeons and hospitals;
|
|
·
|
the ability to provide proprietary products protected by strong intellectual property rights; and
|
|
·
|
the ability to offer products that are intuitive and easy to learn and use.
|
|
·
|
product design, preclinical and clinical development and manufacture;
|
|
·
|
product premarket clearance and approval;
|
|
·
|
product safety, testing, labeling and storage;
|
|
·
|
record keeping procedures;
|
|
·
|
product marketing, sales and distribution; and
|
|
·
|
post-marketing surveillance, complaint handling, medical device reporting, reporting of deaths, serious injuries or device malfunctions and repair or recall of products.
|
|
·
|
product listing and establishment registration, which helps facilitate FDA inspections and other regulatory action;
|
|
·
|
QSR, which requires manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all phases of the design and manufacturing process;
|
|
·
|
labeling regulations and FDA prohibitions against the promotion of products for uncleared, unapproved or off-label use or indication;
|
|
·
|
clearance of product modifications that could significantly affect safety or efficacy or that would constitute a major change in intended use of one of our cleared devices;
|
|
·
|
approval of product modifications that affect the safety or effectiveness of one of our approved devices;
|
|
·
|
post-approval restrictions or conditions, including post-approval study commitments;
|
|
·
|
post-market surveillance regulations, which apply, when necessary, to protect the public health or to provide additional safety and effectiveness data for the device;
|
|
·
|
the FDA’s recall authority, whereby it can ask, or under certain conditions order, device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and
|
|
·
|
notices of corrections or removals.
|
|
·
|
warning letters, fines, injunctions, consent decrees and civil penalties;
|
|
·
|
customer notifications or repair, replacement, refunds, recall, detention or seizure of our products;
|
|
·
|
operating restrictions or partial suspension or total shutdown of production;
|
|
·
|
refusing or delaying requests for 510(k) marketing clearance or PMA approvals of new products or modified products;
|
|
·
|
withdrawing 510(k) marketing clearances or PMA approvals that have already been granted;
|
|
·
|
refusal to grant export approval for our products; or
|
|
·
|
criminal prosecution.
|
●
|
The strategic investment in August 2012 of a group led by Oracle Partners, L.P. and Oracle Institutional Partners, L.P., with the total amount invested of $7.5 million and up to an additional $7.5
million to be invested upon the release of the shares and warrant shares, issued in connection with this investment, from a statutory lock up with the TASE in Israel as well the registration and
listing of our ADSs on a U.S. stock market, all as further described under “Item 10. Additional Information – C. Material Contracts” of this Registration Statement on Form 20-F.
|
|
●
|
A significant increase of our installed base globally, with 41 active systems, including 19 systems installed in the United States. During the year ended December 31, 2012, we sold 15 systems, including 13 commercial sales and two demonstration sales for regulatory purposes.
|
|
●
|
Entrance to the U.S. market with a significant increase of our sales and marketing infrastructure. Currently our U.S. sales team consists of 31 sales employees, 12 employees focusing on capital sales and 19 clinical sales representatives.
|
|
●
|
The FDA clearance of the Renaissance system from July 2012 for brain procedures designed for several applications including biopsies, shunt placements and neurostimulation electrode placement for deep brain stimulation.
|
|
●
|
Signing distribution agreements with distributors in Asia resulting in sales of our Renaissance system to customers in Japan and China to initiate the regulatory process for the approval of our Renaissance for sale in these countries and clinical sales in Vietnam and India.
|
For the Year Ended December 31,
|
|
|||||||||||||||
2012
|
|
|
2011
|
|
||||||||||||
United States
|
|
$
|
9,474
|
|
78
|
%
|
$
|
3,067
|
|
52
|
%
|
|||||
Western Europe
|
|
632
|
|
5
|
%
|
2,040
|
|
35
|
%
|
|||||||
Eastern Europe
|
|
51
|
|
0
|
%
|
188
|
|
3
|
%
|
|||||||
Asia
|
|
2,018
|
|
17
|
%
|
609
|
|
10
|
%
|
|||||||
Total
|
|
$
|
12,175
|
|
100
|
%
|
$
|
5,904
|
|
100
|
%
|
|
2012
|
2011
|
|
|||||||||||||
Systems
|
|
$
|
8,656
|
|
71
|
%
|
$
|
4,114
|
|
70
|
%
|
|||||
Sale of Disposables
|
|
1,918
|
|
16
|
%
|
954
|
|
16
|
%
|
|||||||
Services and other
|
|
1,601
|
|
13
|
%
|
836
|
|
14
|
%
|
|||||||
Total
|
|
$
|
12,175
|
|
100
|
%
|
$
|
5,904
|
|
100
|
%
|
For the Year Ended December 31,
|
|
|||||||||||||||
(in thousands)
|
|
|
Increase (decrease) in
|
|
||||||||||||
2012
|
|
2011
|
dollars
|
|
|
%
|
|
|||||||||
Research and development
|
|
$
|
2,760
|
|
$
|
3,062
|
|
(302)
|
|
|
|
(10)
|
||||
Selling and marketing
|
|
$
|
8,887
|
|
$
|
6,990
|
|
1,897
|
|
|
|
27
|
||||
General and administrative
|
|
$
|
1,845
|
|
$
|
1,639
|
|
206
|
|
|
|
13
|
||||
Total operating expenses
|
|
$
|
13,492
|
|
$
|
11,691
|
|
1,801
|
|
|
|
15
|
For the Year Ended
December 31,
|
|
|||||||
|
2012
|
|
2011
|
|||||
Research and Development cost
|
$
|
2,760
|
$
|
3,076
|
||||
Less:
|
|
|
||||||
Participation of the European Union
|
|
$
|
-
|
(14)
|
|
|||
Research and Development Expenses, Net
|
|
$
|
2,760
|
|
$
|
3,062
|
|
2011 | 2010 | |||||||||||||||
Systems
|
$ | 4,114 | 70 | % | $ | 2,933 | 74 | % | ||||||||
Sale of Disposables
|
954 | 16 | % | 804 | 20 | % | ||||||||||
Services and other
|
836 | 14 | % | 236 | 6 | % | ||||||||||
Total
|
$ | 5,904 | 100 | % | $ | 3,973 | 100 | % |
For the Year Ended December 31, | ||||||||||||||||
(in thousands)
|
Increase (decrease) in
|
|||||||||||||||
2011
|
2010
|
dollars
|
%
|
|||||||||||||
Research and development
|
$ | 3,062 | $ | 2,292 | 770 | 34 | ||||||||||
Selling and marketing
|
$ | 6,990 | $ | 4,592 | 2,398 | 52 | ||||||||||
General and administrative
|
$ | 1,639 | $ | 1,424 | 215 | 15 | ||||||||||
Total operating expenses
|
$ | 11,691 | $ | 8,308 | 3,383 | 41 |
For the Year Ended December 31,
|
||||||||
2011
|
2010
|
|||||||
Research and Development cost
|
$ | 3,076 | $ | 2,644 | ||||
Less:
|
||||||||
Capitalization of Development expenses
|
- | $ | (281 | ) | ||||
Participation of the Chief Scientist
|
- | $ | (71 | ) | ||||
Participation of the European Union
|
$ | (14 | ) | |||||
Research and Development Expenses, Net
|
$ | 3,062 | $ | 2,292 |
●
|
the revenue generated by sales of our current and future products;
|
|
●
|
the expenses we incur in selling and marketing our products and supporting our growth;
|
|
●
|
the costs and timing of regulatory clearance or approvals for new products or upgrades or changes to our products;
|
|
●
|
the expenses we incur in complying with domestic or foreign regulatory requirements imposed on medical device companies;
|
|
●
|
the rate of progress, cost and success or failure of on-going development activities;
|
●
|
the emergence of competing or complementary technological developments;
|
|
●
|
the costs of filing, prosecuting, defending and enforcing any patent or license claims and other intellectual property rights, or participating in litigation related activities;
|
|
●
|
the costs of registration and listing of our ADSs in the United States;
|
|
●
|
the terms and timing of any collaborative, licensing, or other arrangements that we may establish;
|
|
●
|
the future unknown impact of recently enacted healthcare legislation;
|
|
●
|
the acquisition of businesses, products and technologies; and
|
|
●
|
general economic conditions and interest rates.
|
E.
|
Off-Balance Sheet Arrangements
|
F.
|
Tabular Disclosure of Contractual Obligations
|
(in thousands)
|
Payment Due by Period
|
|||||||||||||||||||
Total
|
Less than 1 year
|
1-3 years
|
3-5 years
|
more than 5 years
|
||||||||||||||||
Contractual Obligations
|
|
|
||||||||||||||||||
Royalty obligations*
|
|
$
|
940
|
|
$
|
572
|
|
$
|
368
|
|
$
|
—
|
|
$
|
—
|
|||||
Premises leasing obligations
|
|
$
|
208
|
|
$
|
109
|
|
$
|
99
|
|
$
|
—
|
|
$
|
—
|
|||||
Car leasing obligations
|
|
$
|
294
|
|
$
|
184
|
|
$
|
110
|
|
$
|
—
|
|
$
|
—
|
|||||
Purchase commitments and obligations
|
|
$
|
1,279
|
|
$
|
848
|
|
$
|
431
|
|
$
|
—
|
|
$
|
—
|
|||||
Total
|
|
$
|
2,721
|
|
$
|
1,713
|
|
$
|
1,008
|
|
$
|
—
|
|
$
|
—
|
A.
|
Directors and Senior Management
|
Name
|
Age
|
Position
|
||
Jonathan Adereth
|
65 |
Chairman of the Board of Directors
|
||
Ori Hadomi
|
45 |
Director and Chief Executive Officer
|
||
Gil Bianco
|
60 |
External Director
|
||
David Schlachet
|
67 |
External Director
|
||
Sarit Soccary Ben-Yochanan
|
40 |
Director
|
Name
|
Age
|
Position
|
||
Sharon Levita
|
45 |
Chief Financial Officer, Secretary
|
||
Moshe Shoham
|
60 |
Chief Technology Officer
|
||
Eliyahu Zehavi
|
57 |
Chief Operating Officer
|
||
Christopher Sells
|
50 |
Vice President of Sales, United States
|
||
Avi Posen
|
45 |
Vice President of International Sales
|
||
Doron Dinstein
|
41 |
Chief Medical Officer
|
||
Christopher Prentice
|
42 |
Vice President of Marketing
|
B.
|
Compensation
|
|
Salary and Related
Benefits
|
|
|
Pension, Retirement and other similar benefits accrued
|
|
|
Total
|
|
||||
Directors
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Jonathan Adereth
|
|
$
|
109,352
|
|
|
$
|
6,291
|
|
|
$
|
115,643
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation to directors not employed by the Company
|
|
$
|
66,877
|
|
|
|
—
|
|
|
$
|
66,877
|
|
Annual Compensation
|
Long Term Compensation
|
|||||||||||||||
Executive Officer
|
Salary and Related Benefits
|
|
Pension, Retirement and Other Similar Benefits
|
Share Based Compensation*
|
|
Total
|
||||||||||
Ori Hadomi
|
$
|
371,647
|
(1)
|
$
|
-
|
$
|
34,088
|
$
|
405,735
|
|||||||
|
|
|
|
|
||||||||||||
Eli Zehavi
|
$
|
237,991
|
(2)
|
$
|
18,315
|
$
|
36,812
|
$
|
293,118
|
|||||||
|
|
|
|
|
||||||||||||
Avi Posen
|
$
|
206,032
|
(3)
|
$
|
-
|
$
|
34,250
|
$
|
241,723
|
|||||||
|
|
|
|
|
||||||||||||
Christopher Sells
|
$
|
464,525
|
(4)
|
-
|
$
|
101,640
|
$
|
566,165
|
||||||||
|
|
|
|
|
||||||||||||
Sharon Levita
|
$
|
204,799
|
(2)
|
$
|
1,145
|
$
|
64,222
|
$
|
270,165
|
|||||||
Christopher Prentice
|
$
|
438,975
|
(5)
|
$
|
-
|
$
|
39,653
|
$
|
478,628
|
C.
|
Board Practices
|
●
|
the director holds an academic degree in one of these areas: economics, business administration, accounting, law or public administration;
|
●
|
the director holds an academic degree or has other higher education, all in the main business sector of the company or in a relevant area for the board position; or
|
●
|
the director has at least five years’ experience in one or more of the following (or a combined five years’ experience in at least two or more of these): (a) senior management position in a corporation of significant business scope; (b) senior public office or senior position in the public sector; or (c) senior position in the main business sector of the company.
|
●
|
accounting issues and accounting control issues characteristic to the segment in which the company operates and to companies of the size and complexity of the company;
|
●
|
the functions of the external auditor and the obligations imposed on such auditor; and
|
●
|
preparation of financial reports and their approval in accordance with the Companies Law and the securities law.
|
●
|
an employment relationship;
|
●
|
a business or professional relationship maintained on a regular basis;
|
●
|
control; and
|
●
|
service as an office holder, excluding service as a director of a private company prior to the first offering of its shares to the public if such director was appointed as a director of the private company in order to serve as an external director following the initial public offering.
|
●
|
at least a majority of the shares held by shareholders who are not controlling shareholders and do not have personal interest in the appointment (excluding a personal interest that did not result from the shareholder’s relationship with the controlling shareholder) have voted in favor of the proposal (shares held by abstaining shareholders shall not be considered); or
|
●
|
the total number of shares of such shareholders voted against the election of the external director does not exceed 2% of the aggregate voting rights of our company.
|
|
·
|
information on the advisability of a given action brought for his approval or performed by him by virtue of his position; and
|
|
·
|
all other important information pertaining to these actions.
|
|
·
|
refrain from any conflict of interest between the performance of his duties in the company and his performance of his other duties or personal affairs;
|
|
·
|
refrain from any action that constitutes competition with the company’s business;
|
|
·
|
refrain from exploiting any business opportunity of the company to receive a personal gain for himself or others; and
|
|
·
|
disclose to the company any information or documents relating to the company’s affairs which the office holder has received due to his position as an office holder.
|
|
·
|
the office holder acts in good faith and the act or its approval does not cause harm to the company; and
|
|
·
|
the office holder disclosed the nature of his or her interest in the transaction (including any significant fact or document) to the company at a reasonable time before the company’s approval of such matter.
|
|
·
|
the office holder’s relatives; or
|
|
·
|
any corporation in which the office holder or his or her relatives holds 5% or more of the shares or voting rights, serves as a director or general manager or has the right to appoint at least one director or the general manager.
|
|
·
|
not in the ordinary course of business;
|
|
·
|
not on market terms; or
|
|
·
|
that is likely to have a material impact on the company’s profitability, assets or liabilities.
|
|
·
|
at least a majority of the shares held by shareholders who have no personal interest in the transaction and are voting at the meeting must be voted in favor of approving the transaction, excluding abstentions; or
|
|
·
|
the shares voted by shareholders who have no personal interest in the transaction who vote against the transaction represent no more than 2% of the voting rights in the company.
|
|
·
|
an amendment to the articles of association;
|
|
·
|
an increase in the company’s authorized share capital;
|
|
·
|
a merger; and
|
|
·
|
the approval of related party transactions and acts of office holders that require shareholder approval.
|
●
|
a breach of his or her duty of care to the company or to another person;
|
●
|
a breach of his or her duty of loyalty to the company, provided that the office holder acted in good faith and had reasonable cause to assume that his or her act would not prejudice the company’s interests; and
|
●
|
a financial liability imposed upon him or her in favor of another person concerning an act performed by such office holder in his or her capacity as an officer holder.
|
●
|
a financial liability imposed on him or her in favor of another person by any judgment concerning an act performed in his or her capacity as an office holder;
|
●
|
reasonable litigation expenses, including attorneys’ fees, expended by the office holder or charged to him or her by a court relating to an act performed in his or her capacity as an office holder, in connection with: (1) proceedings that the company institutes, or that another person institutes on the company's behalf, against him or her; (2) a criminal charge of which he or she was acquitted; or (3) a criminal charge for which he or she was convicted for a criminal offense that does not require proof of criminal thought; and
|
●
|
reasonable litigation expenses, including attorneys’ fees, expended by the office holder as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (1) no indictment (as defined in the Companies Law) was filed against such office holder as a result of such investigation or proceeding; and (2) no financial liability as a substitute for the criminal proceeding (as defined in the Companies Law) was imposed upon him or her as a result of such investigation or proceeding, or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent.
|
●
|
to categories of events that the board of directors determines are likely to occur in light of the operations of the company at the time that the undertaking to indemnify is made; and
|
●
|
in amount or criterion determined by the board of directors, at the time of the giving of such undertaking to indemnify, to be reasonable under the circumstances.
|
D.
|
Employees.
|
|
As of December 31,
|
|||||||||||
|
2012
|
2011
|
2010
|
|||||||||
Numbers of employees by category of activity
|
|
|||||||||||
Management and administrative
|
|
10
|
|
10
|
|
8
|
||||||
Research and development
|
|
16
|
|
14
|
|
12
|
||||||
Operations
|
|
13
|
|
6
|
|
5
|
||||||
Sales and marketing
|
|
41
|
|
26
|
|
17
|
||||||
Total workforce
|
|
80
|
|
56
|
|
42
|
||||||
Numbers of employees by geographic location
|
|
|
|
|||||||||
Israel
|
|
44
|
|
42
|
|
33
|
||||||
United States
|
|
36
|
|
14
|
|
9
|
||||||
Total workforce
|
|
80
|
|
56
|
|
42
|
E.
|
Share Ownership.
|
|
|
Number of Ordinary Shares Beneficially Owned
(1)
|
|
|
Percent of Class
(2)
|
|
||
Directors
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Jonathan Adereth
|
|
|
40,000
|
(3)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Ori Hadomi
|
|
|
547,631
|
(4)
|
|
|
1.85%
|
|
|
|
|
|
|
|
|
|
|
Gil Bianco
|
|
|
40,000
|
(5)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
David Shlachet
|
|
|
40,000
|
(6)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Sarit Soccary Ben-Yochanan
|
|
|
-
|
(7)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Executive Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sharon Levita
|
|
|
172,000
|
(8)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Moshe Shoham
|
|
|
443,000
|
(9)
|
|
|
1.51%
|
|
|
|
|
|
|
|
|
|
|
Eliyahu Zehavi
|
|
|
319,435
|
(10)
|
|
|
1.08%
|
|
|
|
|
|
|
|
|
|
|
Christopher Sells
|
|
|
117,500
|
(11)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Avi Posen
|
|
|
239,635
|
(12)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Doron Dinstein
|
|
|
57,500
|
(13)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
Christopher Prentice
|
|
|
32,900
|
(14)
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
All directors and executive officers as a group (12 persons)
|
|
|
2,049,601
|
(15)
|
6.69%
|
|
*
|
Less than 1%.
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. Except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares shown as beneficially owned by them.
|
(2)
|
The percentages shown are based on 29,244,491 ordinary shares issued and outstanding as of March 31, 2013.
|
(3)
|
Consists of 40,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options is NIS 12.4 ($3.32) per share, and the options expire in January 2018.
|
(4)
|
Includes 319,986 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013, of which (a) 227,645 options have an exercise price of $2.18 per share, and (b) 92,341 options have an exercise price that ranges between NIS 6.26 ($1.68) and NIS 9.94 ($2.66) per share. These options expire between May 2015 and July 2019. Does not include 150,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 9.94 ($2.66) per share, and the options expire between March 2018 and August 2019.
|
(5)
|
Consists of 40,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options is NIS 12.4 ($3.32) per share, and the options expire in January 2018.
|
(6)
|
Consists of 40,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options is NIS 12.4 ($3.32) per share, and the options expire in January 2018.
|
(7)
|
Does not include 40,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options is NIS 4.521 ($1.21) per share, and the options expire in August 2019.
|
(8)
|
Consists of 172,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 6.26 ($1.68) and NIS 10.5 ($2.81) per share, and the options expire between June 2018 and December 2017. Does not include 100,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 9.64 ($2.58) per share, and the options expire between December 2017 and August 2019.
|
(9)
|
Includes 33,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options is $2.73 per share, and the options expire in May 2017. Does not include 100,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options is NIS 4.521 ($1.21) per share, and the options expire in August 2019.
|
(10)
|
Includes 319,435 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013, of which (a) 182,391 options have an exercise price that ranges between $0.91 and $2.18 per share, and (b) 137,044 options that have an exercise price that ranges between NIS 6.26 ($1.68) and NIS 10 ($2.68) per share. These options expire between December 2014 and July 2019. Does not include 50,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 9.64 ($2.58) per share, and the options expire between December 2017 and August 2019.
|
(11)
|
Consists of 117,500 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 8.29 ($2.22) and NIS 10.36 ($2.78) per share, and the options expire between October 2017 and February 2020. Does not include 132,500 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 8.29 ($2.22) per share, and the options expire between October 2017 and February 2020.
|
(12
|
Includes 221,135 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013, of which (a) 115,500 options have an exercise price that ranges between $0.91 and $2.73 per share, and (b) 105,635 options that have an exercise price that ranges between NIS 6.26 ($1.68) and NIS 10 ($2.68) per share. These options expire between May 2014 and July 2019. Does not include 50,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between $1.21 and $2.58 per share, and the options expire between December 2017 and August 2019.
|
(13)
|
Consists of 57,500 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 8.29 ($2.22) and NIS 9.64 ($2.58) per share, and the options expire between December 2017 and February 2020. Does not include 52,500 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between $ between NIS 8.29 ($2.22) 2 and NIS 9.64 ($2.58) per share, and the options expire between December 2017 and February 2020.
|
(14)
|
Includes 30,000 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013. The exercise price of these options is NIS 10.36 ($2.78) per share, and the options expire in October 2017. Does not include 90,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 10.36 ($2.78) per share, and the options expire between October 2017 and August 2019.
|
(15)
|
Includes 1,390,556 ordinary shares issuable upon exercise of outstanding options within 60 days of March 31, 2013, of which (a) 525,536 options have an exercise price that ranges between $0.91 and $2.73 per share, and (b) 865,020 options that have an exercise price that ranges NIS 6.26 ($1.68) and NIS 10.5 ($2.81) per share. These options expire between May 2014 and February 2020. Does not include 765,000 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 31, 2013. The exercise price of these options ranges between NIS 4.521 ($1.21) and NIS 10.36 ($2.78) per share, and the options expire between October 2017 and February 2020.
|
Total | Aggregate | Aggregate | Weighted | |||||||||||||||||
Plan
|
Ordinary
Shares
|
Number of
|
Shares |
Number of
|
Average
|
|||||||||||||||
Reserved | Options | Available for | Options | Exercise Price of | ||||||||||||||||
for Option Grants
|
Exercised
(1)
|
Future Grants
|
Outstanding | Options | ||||||||||||||||
2003 plan
|
3,000,000 | 462,935 |
-
|
1,635,628 | $ | 2.13 | ||||||||||||||
2011 plan
|
2,191,632 | - | 199,452 | 1,992,180 | $ | 1.9 | ||||||||||||||
5,191,632 | 462,935 | 199,452 | 3,627,808 | $ | 2.00 |
A.
|
Major Shareholders
|
Name
|
|
Number of
Ordinary Shares Beneficially Owned
(1)
|
|
|
Percent of Class
(2)
|
|
||
|
|
|
|
|
|
|
||
Migdal Insurance & Finance Holdings Ltd.
|
|
|
3,150,252
|
(3)
|
|
|
10.8%
|
|
Oracle Associates, LLC
|
|
|
7,523,764
|
(4)
|
|
|
22.8%
|
|
|
|
|
|
|
|
|
||
Jack Schuler
|
|
|
3,291,646
|
(5)
|
|
|
10.7%
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Ordinary shares relating to options currently exercisable or exercisable within 60 days of the date of this table are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person.
|
|
|
(2)
|
The percentages shown are based on 29,244,491 ordinary shares issued and outstanding as of March 31, 2013.
|
|
|
(3)
|
Of which: (1) 3,150,252 ordinary shares are held for members of the public through, among others, provident funds, mutual funds, pension funds and insurance policies, which are managed by subsidiaries of Migdal Insurance and Financing Holdings Ltd., as follows: (a) 2,093,042 ordinary shares are held by profit participating life insurance accounts, (b) 883,121 ordinary shares are held by provident funds and companies that manage provident funds, and (c) 84,459 ordinary shares are held by companies for the management of funds for joint investments in trusteeship, each of which subsidiaries operates under independent management and makes independent voting and investment decisions; and (2) 89,630 ordinary shares are beneficially held for Migdal Insurance & Financing Holdings Ltd.’s own account (Nostro account).
|
|
|
(4)
|
Of which: (1) 3,761,882 ordinary shares are held for Oracle Associates, LLC, as follows: (a) 2,821,412 ordinary shares are held by Oracle Partners, L.P., and (b) 940,470 ordinary shares are held by Oracle Institutional Partners, L.P. Larry Feinberg is the managing member of Oracle Associates, which is the general partner of this investor. As such, he has sole voting and dispositive power with respect to these shares; and (2) 3,761,882 ordinary shares issuable upon exercise of outstanding warrants within 60 days of March 31, 2013 are held for Oracle Associates, LLC, as follows: (a) 2,821,412 ordinary shares issuable upon exercise of outstanding warrants within 60 days of March 31, 2013 are held by Oracle Partners, L.P., (b) 940,470 ordinary shares issuable upon exercise of outstanding warrants within 60 days of March 31, 2013 are held by Oracle Institutional Partners, L.P. See “Item 10. Additional Information – C. Material Contracts,”
for more details on these warrants.
|
|
|
(5)
|
Includes 1,645,823 ordinary shares issuable upon exercise of outstanding warrants within 60 days of March 31, 2013. See “Item 10. Additional Information – C. Material Contracts”,
for more details on the warrants.
|
B.
|
Related Party Transactions
|
C.
|
Interests of Experts and Counsel
|
A.
|
Consolidated Statements and Other Financial Information.
|
|
|
For the year ended December 31,
|
||||||||||
|
|
2012
|
|
|
2011
|
|
|
2010
|
|
|||
Total export sales*
|
|
$
|
12,043
|
|
|
$
|
5,634
|
|
|
|
3,830
|
|
as a percentage of total revenues
|
|
|
98.9%
|
|
|
|
95%
|
|
|
|
96%
|
|
B.
|
Significant Changes
|
A.
|
Offer and Listing Details
|
|
|
NIS
|
|
|
|
|
|
U.S.$
|
|
|
|
|
||||
|
|
Price Per
|
|
|
|
|
|
Price Per
|
|
|
|
|
||||
|
|
Ordinary Share
|
|
|
|
|
|
Ordinary Share
|
|
|
|
|
||||
|
|
High
|
|
|
Low
|
|
|
High
|
|
|
Low
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Annual:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
2012
|
|
|
9.00
|
|
|
|
3.46
|
|
|
|
2.38
|
|
|
|
0.88
|
|
2011
|
|
|
10.80
|
|
|
|
2.82
|
|
|
|
2.99
|
|
|
|
0.76
|
|
2010
|
|
|
12.00
|
|
|
|
7.29
|
|
|
|
3.18
|
|
|
|
1.93
|
|
2009
|
|
|
10.06
|
|
|
|
4.33
|
|
|
|
2.57
|
|
|
|
1.04
|
|
2008
|
|
|
10.76
|
|
|
|
5.75
|
|
|
|
2.85
|
|
|
|
1.49
|
|
Quarterly
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter 2013
|
|
|
15.59
|
|
|
|
8.28
|
|
|
|
4.27
|
|
|
|
2.21
|
|
Fourth Quarter 2012
|
|
|
9.00
|
|
|
|
5.89
|
|
|
|
2.38
|
|
|
|
1.51
|
|
Third Quarter 2012
|
|
|
5.85
|
|
|
|
4.08
|
|
|
|
1.49
|
|
|
|
1.03
|
|
Second Quarter 2012
|
|
|
4.67
|
|
|
|
3.46
|
|
|
|
1.24
|
|
|
|
0.88
|
|
First Quarter 2012
|
|
|
4.38
|
|
|
|
3.55
|
|
|
|
1.14
|
|
|
|
0.95
|
|
Fourth Quarter 2011
|
|
|
5.07
|
|
|
|
3.53
|
|
|
|
1.41
|
|
|
|
0.95
|
|
Third Quarter 2011
|
|
|
8.06
|
|
|
|
2.82
|
|
|
|
2.34
|
|
|
|
0.76
|
|
Second Quarter 2011
|
|
|
9.96
|
|
|
|
7.41
|
|
|
|
2.87
|
|
|
|
2.12
|
|
First Quarter 2011
|
|
|
10.80
|
|
|
|
9.18
|
|
|
|
2.98
|
|
|
|
2.58
|
|
Fourth Quarter 2010
|
|
|
10.81
|
|
|
|
9.30
|
|
|
|
2.97
|
|
|
|
2.53
|
|
Third Quarter 2010
|
|
|
10.59
|
|
|
|
8.96
|
|
|
|
2.81
|
|
|
|
2.35
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Most Recent Six Months:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 2013
|
|
|
15.59
|
|
|
|
10.80
|
|
|
|
4.27
|
|
|
|
2.90
|
|
February 2013
|
|
|
10.48
|
|
|
|
9.53
|
|
|
|
2.81
|
|
|
|
2.59
|
|
January 2013
|
|
|
8.99
|
|
|
|
8.28
|
|
|
|
2.41
|
|
|
|
2.21
|
|
December 2012
|
|
|
9.00
|
|
|
|
8.29
|
|
|
|
2.38
|
|
|
|
2.21
|
|
November 2012
|
|
|
8.38
|
|
|
|
6.81
|
|
|
|
2.19
|
|
|
|
1.75
|
|
October 2012
|
|
|
7.30
|
|
|
|
5.89
|
|
|
|
1.91
|
|
|
|
1.51
|
|
B.
|
Plan of Distribution
|
C.
|
Markets
|
D.
|
Selling Shareholders
|
E.
|
Dilution
|
F.
|
Expenses of the Issue
|
A.
|
Share Capital
|
B.
|
Articles of Association
|
·
|
equal right to attend and to vote at all general meetings of the Company, whether regular or special, with each ordinary share entitling the holder thereof, which attend the meeting and participate at the voting, either in person or by a proxy or by a written ballot, to one vote;
|
·
|
equal right to participate in distribution of dividends, whether payable in cash or in bonus shares, in distribution of assets or in any other distribution, on a per share pro rata basis; and
|
·
|
equal right to participate, upon dissolution of the Company, in the distribution of the Company assets legally available for distribution, on a per share pro rata basis.
|
|
·
|
amendments to our Articles of Association;
|
|
·
|
the exercise of our Board of Director’s powers if our Board of Directors is unable to exercise its powers;
|
|
·
|
appointment or termination of our auditors;
|
|
·
|
appointment of directors, including external directors;
|
|
·
|
approval of acts and transactions requiring general meeting approval pursuant to the provisions of the Companies Law and any other applicable law;
|
|
·
|
increases or reductions of our authorized share capital; and
|
|
·
|
a merger (as such term is defined in the Companies Law).
|
|
·
|
increase the Company’s registered share capital by the creation of new shares from the existing class or a new class, as determined by the general meeting;
|
|
·
|
cancel any registered share capital which have not been taken or agreed to be taken by any person;
|
|
·
|
consolidate and divide all or any of its share capital into shares of larger nominal value than its existing shares;
|
|
·
|
subdivide the Company’s existing shares or any of them, the Company’s share capital or any of it, into shares of smaller nominal value than is fixed;
|
|
·
|
reduce the Company’s share capital and any fund reserved for capital redemption in any manner, and with and subject to any incident authorized, and consent required, by the Companies Law; and
|
|
·
|
reduce shares from the issued and outstanding share capital of the Company, in such manner that those shares shall be cancelled and the nominal par value paid for those shares will be registered at the Company's books as capital fund, which shall be deemed as a premium paid on those shares which shall remain in the issued and outstanding share capital of the Company.
|
C.
|
Material Contracts
|
D.
|
Exchange Controls
|
E.
|
Taxation.
|
Manufacturing Volume Outside of Israel
|
R
oyalties to the Chief Scientist as a Percentage of Grant
|
|
Up to 50%
|
120%
|
|
between 50% and 90%
|
150%
|
|
90% and more
|
300%
|
|
·
|
amortization of purchases of know-how and patents over an eight-year period for tax purposes;
|
|
·
|
deductions over a three-year period of expenses involved with the issuance and listing of shares on a stock market;
|
|
·
|
the right to elect, under specified conditions, to file a consolidated tax return with additional related Israeli Industrial Companies; and
|
|
·
|
accelerated depreciation rates on equipment and buildings.
|
|
·
|
75% or more of our gross income (including our pro rata share of gross income for any company, U.S. or foreign, in which we are considered to own 25% or more of the shares by value), in a taxable year is passive; or
|
|
·
|
At least 50% of our assets, averaged over the year and generally determined based upon value (including our pro rata share of the assets of any company in which we are considered to own 25% or more of the shares by value), in a taxable year are held for the production of, or produce, passive income.
|
F.
|
Dividends and Paying Agents
|
G.
|
Statement by Experts
|
H.
|
Documents on Display
|
I.
|
Subsidiary Information.
|
a.
|
Foreign currency denominated monetary assets and liabilities.
|
|
|
Total as at
December 31,
|
|
|
|
|
2012
|
|
|
|
|
(U.S. $ in thousands)
|
|
|
Current Assets:
|
|
|
|
|
Shekels
|
|
|
4,746
|
|
Euro
|
|
|
489
|
|
Total
|
|
|
5,235
|
|
|
|
|
|
|
Long term Assets:
|
|
|
|
|
Shekels
|
|
|
64
|
|
Total
|
|
|
64
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
Shekels
|
|
|
1,548
|
|
Euro
|
|
|
71
|
|
Total
|
|
|
1,619
|
|
Long term Liabilities:
|
|
|
|
|
Shekels
|
|
|
3,990
|
|
Total
|
|
|
3,990
|
Persons depositing or withdrawing shares or ADS holders must pay
:
|
For:
|
|
$5.00 (or less) per 100 ADSs (or portion of 100 ADSs).
|
●
●
|
Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property.
Cancellation of ADSs for the purpose of withdrawal, including if the deposit agreement terminates.
|
$.05 (or less) per ADS.
|
● |
Any cash distribution to ADS holders.
|
A fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited for issuance of ADSs.
|
● |
Distribution of securities distributed to holders of deposited securities which are distributed by the depositary to ADS holders.
|
$.05 (or less) per ADSs per calendar year.
|
● |
Depositary services.
|
Registration or transfer fees.
|
● |
Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw shares.
|
Expenses of the depositary.
|
●
●
|
Cable, telex and facsimile transmissions (when expressly provided in the deposit agreement).
Converting foreign currency to U.S. dollars.
|
Taxes and other governmental charges the depositary or the custodian have to pay on any ADS or share underlying an ADS, for example, stock transfer taxes, stamp duty or withholding taxes.
|
● |
As necessary.
|
Any charges incurred by the depositary or its agents for servicing the deposited securities.
|
● |
As necessary.
|
If we: |
Then:
|
|
●
●
●
●
|
Change the nominal or par value of our shares.
Reclassify, split up or consolidate any of the deposited securities.
Distribute securities on the shares that are not distributed to you.
Recapitalize, reorganize, merge, liquidate, sell all or substantially all of our assets, or take any similar action.
|
The cash, shares or other securities received by the depositary will become deposited securities. Each ADS will automatically represent its equal share of the new deposited securities.
The depositary may distribute new ADSs representing the new deposited securities or ask you to surrender your outstanding ADRs in exchange for new ADRs identifying the new deposited securities.
|
|
·
|
are only obligated to take the actions specifically set forth in the deposit agreement without negligence or bad faith;
|
|
·
|
are not liable if we are or it is prevented or delayed by law or circumstances beyond our control from performing our or its obligations under the deposit agreement;
|
|
·
|
are not liable if we or it exercises discretion permitted under the deposit agreement;
|
|
·
|
are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the deposit agreement, or for any special, consequential or punitive damages for any breach of the terms of the deposit agreement;
|
|
·
|
have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the deposit agreement on your behalf or on behalf of any other person; and
|
|
·
|
may rely upon any documents we believe or it believes in good faith to be genuine and to have been signed or presented by the proper person.
|
|
·
|
payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any shares or other deposited securities;
|
|
·
|
satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and
|
|
·
|
with regulations it may establish, from time to time, consistent with the deposit agreement, including presentation of transfer documents.
|
|
·
|
When temporary delays arise because: (i) the depositary has closed its transfer books or we have closed our transfer books; (ii) the transfer of shares is blocked to permit voting at a shareholders' meeting; or (iii) we are paying a dividend on our shares.
|
|
·
|
When you owe money to pay fees, taxes and similar charges.
|
|
·
|
When it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of shares or other deposited securities.
|
|
Page
|
|
Audited Consolidated Financial Statements as at December 31, 2012
|
|
F-2
|
Report of Independent Registered Public Accounting Firm
|
||
Consolidated Statements of Financial Position
|
|
F-3 – F-4
|
Consolidated Comprehensive
Income Statements
|
|
F-5
|
Consolidated Statements of Changes in Equity
|
|
F-6 – F-7
|
Consolidated Statements of Cash Flows
|
|
F-8
|
Notes to Consolidated Financial Statements
|
|
F-9 – F-50
|
Contents
|
|
Page
|
|
F-2
|
|
F-3 - F-4
|
|
F-5
|
|
F-6 - F-7
|
|
F-8
|
|
F-9 - F-50
|
2012
|
2011
|
||||||||
Note
|
USD thousands
|
USD thousands
|
|||||||
Assets
|
|||||||||
Cash and cash equivalents
|
5
|
12,797 | 1,655 | ||||||
Deposits
|
6
|
- | 1,859 | ||||||
Investments in marketable securities
|
6
|
4,156 | 12,596 | ||||||
Trade receivables
|
7
|
1,147 | 1,356 | ||||||
Other accounts receivable
|
7
|
680 | 268 | ||||||
Inventory
|
8
|
1,257 | 1,326 | ||||||
20,037 | 19,060 | ||||||||
Total current assets
|
|||||||||
Prepaid lease fees
|
9, 19B
|
64 | 55 | ||||||
Deferred tax assets, net
|
18
|
80 | 87 | ||||||
Property and equipment, net
|
10
|
766 | 523 | ||||||
Intangible assets, net
|
11
|
387 | 699 | ||||||
Total non-current assets
|
1,297 | 1,364 | |||||||
Total assets
|
21,334 | 20,424 |
2012
|
2011
|
||||||||
Note
|
USD thousands
|
USD thousands
|
|||||||
Current liabilities
|
|||||||||
Trade payables
|
12
|
1,318 | 996 | ||||||
Other accounts payable
|
13
|
2,706 | 1,833 | ||||||
Convertible debentures
|
14
|
- | 3,495 | ||||||
Total current liabilities
|
4,024 | 6,324 | |||||||
Employee benefits
|
15
|
199 | 190 | ||||||
Liabilities to the OCS
|
16
|
301 | 426 | ||||||
Derivative liabilities on account of warrants
|
17
|
3,990 | - | ||||||
Total non-current liabilities
|
4,490 | 616 | |||||||
Total liabilities
|
8,514 | 6,940 | |||||||
Equity
|
28
|
||||||||
Share capital
|
73 | 55 | |||||||
Share premium
|
58,910 | 51,122 | |||||||
Amounts allocated to share options
|
554 | 1,267 | |||||||
Amounts allocated to conversion option
|
- | 795 | |||||||
Capital reserve for share-based payment transactions
|
3,170 | 2,787 | |||||||
Foreign currency translation reserve
|
2,119 | 2,400 | |||||||
Accumulated loss
|
(52,006 | ) | (44,942 | ) | |||||
Total equity
|
12,820 | 13,484 | |||||||
Total liabilities and equity
|
21,334 | 20,424 |
2012
|
2011
|
2010
|
|||||||||||
Note
|
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Revenues
|
20
|
12,175 | 5,904 | 3,973 | |||||||||
Cost of sales
|
22
|
2,893 | 1,879 | 961 | |||||||||
Gross profit
|
9,282 | 4,025 | 3,012 | ||||||||||
Research and development expenses, net
|
25
|
2,760 | 3,062 | 2,292 | |||||||||
Selling and marketing expenses
|
23
|
8,887 | 6,990 | 4,592 | |||||||||
General and administrative expenses
|
24
|
1,845 | 1,639 | 1,424 | |||||||||
Operating loss
|
(4,210 | ) | (7,666 | ) | (5,296 | ) | |||||||
Financing income
|
26
|
925 | 764 | 591 | |||||||||
Financing expenses
|
26
|
(3,756 | ) | (948 | ) | (1,060 | ) | ||||||
Financing expenses, net
|
(2,831 | ) | (184 | ) | (469 | ) | |||||||
Loss before taxes on income
|
(7,041 | ) | (7,850 | ) | (5,765 | ) | |||||||
Income tax (benefit) expense
|
18
|
23 | (68 | ) | 8 | ||||||||
Loss for the year
|
(7,064 | ) | (7,782 | ) | (5,773 | ) | |||||||
Other comprehensive (loss) income:
|
|||||||||||||
Foreign currency translation differences
|
(281 | ) | (950 | ) | 999 | ||||||||
Total comprehensive loss for the year
|
(7,345 | ) | (8,732 | ) | (4,774 | ) | |||||||
Loss per share
|
|||||||||||||
Basic and diluted loss per share (in USD)
|
30
|
(0.29 | ) | (0.36 | ) | (0.29 | ) |
Capital
|
||||||||||||||||||||||||||||||||
Amounts
|
reserve for
|
Foreign
|
||||||||||||||||||||||||||||||
Amounts
|
allocated to
|
share-based
|
currency
|
|||||||||||||||||||||||||||||
Share
|
Share
|
allocated
|
conversion
|
payment
|
translation
|
Accumulated
|
Total
|
|||||||||||||||||||||||||
capital
|
premium
|
to options
|
option
|
transactions
|
reserve
|
loss
|
Equity
|
|||||||||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||||||||||
For the year ended
|
||||||||||||||||||||||||||||||||
December 31, 2012
|
||||||||||||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
January 1, 2012
|
55 | 51,122 | 1,267 | 795 | 2,787 | 2,400 | (44,942 | ) | 13,484 | |||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
||||||||||||||||||||||||||||||||
Loss for the year
|
- | - | - | - | - | - | (7,064 | ) | (7,064 | ) | ||||||||||||||||||||||
Other comprehensive income
|
||||||||||||||||||||||||||||||||
for the year, net of tax
|
- | - | - | - | - | (281 | ) | - | (281 | ) | ||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
- | - | - | - | - | (281 | ) | (7,064 | ) | (7,345 | ) | |||||||||||||||||||||
Issuance of
|
||||||||||||||||||||||||||||||||
shares
|
18 | 6,105 | - | - | - | - | - | 6,123 | ||||||||||||||||||||||||
Exercise of share options
|
(1) - | 3 | - | - | - | - | - | 3 | ||||||||||||||||||||||||
Expiration of share options
|
- | 885 | (713 | ) | - | (172 | ) | - | - | - | ||||||||||||||||||||||
Share-based payments
|
- | - | - | - | 555 | - | 555 | |||||||||||||||||||||||||
Expiration of conversion
|
||||||||||||||||||||||||||||||||
options
|
- | 795 | - | (795 | ) | - | - | - | - | |||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
December 31, 2012
|
73 | 58,910 | 554 | - | 3,170 | 2,119 | (52,006 | ) | 12,820 | |||||||||||||||||||||||
For the year ended
|
||||||||||||||||||||||||||||||||
December 31, 2011
|
||||||||||||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
January 1, 2011
|
48 | 43,097 | 2,850 | 795 | 2,165 | 3,350 | (37,160 | ) | 15,145 | |||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
||||||||||||||||||||||||||||||||
Loss for the year
|
- | - | - | - | - | - | (7,782 | ) | (7,782 | ) | ||||||||||||||||||||||
Other comprehensive income
|
||||||||||||||||||||||||||||||||
for the year, net of tax
|
- | - | - | - | - | (950 | ) | - | (950 | ) | ||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
- | - | - | - | - | (950 | ) | (7,782 | ) | (8,732 | ) | |||||||||||||||||||||
Issuance of share options
|
||||||||||||||||||||||||||||||||
and shares
|
7 | 5,554 | 825 | - | - | - | - | 6,386 | ||||||||||||||||||||||||
Exercise of share options
|
(1) - | 65 | (2 | ) | - | (10 | ) | - | - | 53 | ||||||||||||||||||||||
Expiration of share options
|
- | 2,406 | (2,406 | ) | - | - | - | - | - | |||||||||||||||||||||||
Share-based payments
|
- | - | - | - | 632 | - | - | 632 | ||||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
December 31, 2011
|
55 | 51,122 | 1,267 | 795 | 2,787 | 2,400 | (44,942 | ) | 13,484 |
(1)
|
Less than USD 1 thousand.
|
Capital
|
||||||||||||||||||||||||||||||||
Amounts
|
reserve for
|
Foreign
|
||||||||||||||||||||||||||||||
Amounts
|
allocated to
|
share-based
|
currency
|
|||||||||||||||||||||||||||||
Share
|
Share
|
allocated
|
conversion
|
payment
|
translation
|
Accumulated
|
Total
|
|||||||||||||||||||||||||
capital
|
premium
|
to options
|
option
|
transactions
|
reserve
|
loss
|
Equity
|
|||||||||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||||||||||
For the year ended
|
||||||||||||||||||||||||||||||||
December 31, 2010
|
||||||||||||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
January 1, 2010
|
48 | 43,000 | 2,850 | 795 | 1,693 | 2,351 | (31,387 | ) | 19,350 | |||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
||||||||||||||||||||||||||||||||
Loss for the year
|
- | - | - | - | - | - | (5,773 | ) | (5,773 | ) | ||||||||||||||||||||||
Other comprehensive income
|
||||||||||||||||||||||||||||||||
for the year, net of tax
|
- | - | - | - | - | 999 | - | 999 | ||||||||||||||||||||||||
Total comprehensive income
|
||||||||||||||||||||||||||||||||
for the year
|
- | - | - | - | - | 999 | (5,773 | ) | (4,774 | ) | ||||||||||||||||||||||
Exercise of share options
|
(1) - | 97 | - | - | (27 | ) | - | - | 70 | |||||||||||||||||||||||
Share-based payments
|
- | - | - | - | 499 | - | - | 499 | ||||||||||||||||||||||||
Balance as at
|
||||||||||||||||||||||||||||||||
December 31, 2010
|
48 | 43,097 | 2,850 | 795 | 2,165 | 3,350 | (37,160 | ) | 15,145 |
(1)
|
Less than USD 1 thousand.
|
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Cash flows from operating activities
|
||||||||||||
Loss for the year
|
(7,064 | ) | (7,782 | ) | (5,773 | ) | ||||||
Adjustments:
|
||||||||||||
Depreciation and amortization
|
545 | 451 | 379 | |||||||||
Financing expenses, net
|
2,938 | 205 | 290 | |||||||||
Capital gain on sale of property and equipment
|
- | - | (1 | ) | ||||||||
Share-based payment transactions
|
555 | 632 | 499 | |||||||||
Income tax (benefit) expense
|
23 | (68 | ) | 8 | ||||||||
4,061 | 1,220 | 1,175 | ||||||||||
Change in inventory
|
(51 | ) | (448 | ) | (829 | ) | ||||||
Change in trade and other accounts receivable
|
(218 | ) | (623 | ) | (592 | ) | ||||||
Change in prepaid lease fees
|
(9 | ) | (12 | ) | 1 | |||||||
Change in trade and other accounts payable
|
1,194 | 407 | 1,096 | |||||||||
Change in employee benefits
|
12 | 48 | (26 | ) | ||||||||
928 | (628 | ) | (350 | ) | ||||||||
Interest received
|
470 | 574 | 660 | |||||||||
Interest paid
|
(215 | ) | (218 | ) | (221 | ) | ||||||
Income tax received
|
- | - | 20 | |||||||||
Income tax paid
|
- | (19 | ) | (8 | ) | |||||||
255 | 337 | 451 | ||||||||||
Net cash used in operating activities
|
(1,820 | ) | (6,853 | ) | (4,497 | ) | ||||||
Cash flows from investing activities
|
||||||||||||
Proceeds from sale of property and equipment
|
- | - | 1 | |||||||||
Proceeds from sale (acquisition) of deposits and
|
||||||||||||
investment in marketable securities, net
|
9,949 | (2,213 | ) | 5,831 | ||||||||
Acquisition of property and equipment
|
(372 | ) | (275 | ) | (153 | ) | ||||||
Development costs recognized as intangible assets
|
- | - | (282 | ) | ||||||||
Net cash from (used in) investing activities
|
9,577 | (2,488 | ) | 5,397 | ||||||||
Cash flows from financing activities
|
||||||||||||
Proceeds from warrants and shares issue, net
|
7,298 | 6,386 | - | |||||||||
Proceeds from exercise of share options to
|
||||||||||||
employees and service providers
|
3 | 53 | 70 | |||||||||
Repayment of convertible
debentures
|
(3,916 | ) | - | - | ||||||||
Receipt of loans from the OCS
|
- | - | 169 | |||||||||
Repayment of loans to the OCS
|
(317 | ) | (229 | ) | (27 | ) | ||||||
Net cash from financing activities
|
3,068 | 6,210 | 212 | |||||||||
|
||||||||||||
Net increase (decrease) in cash and cash equivalents
|
10,825 | (3,131 | ) | 1,112 | ||||||||
Cash and cash equivalents at the beginning of the year
|
1,655 | 4,802 | 3,537 | |||||||||
Exchange rate
differences
on
|
||||||||||||
cash and cash equivalents
|
317 | (16 | ) | 153 | ||||||||
Cash and cash equivalents at the end of the year
|
12,797 | 1,655 | 4,802 | |||||||||
Supplementary cash flows information:
|
||||||||||||
Transfer of inventory to fixed assets
|
87 | 190 | - |
A.
|
Mazor Robotics Ltd. (hereinafter – the “Company”) is an Israeli company incorporated in Israel. The address of the Company’s registered office is 7 HaEeshel St., Caesarea Industrial Park, Caesarea, Israel. These consolidated financial statements as at and for the year ended December 31, 2012 comprise the Company and its wholly owned subsidiary, Mazor Robotics Inc. (together referred to as the “Group”). The Group is a leading innovator in spine surgery and has pioneered surgical guidance systems and complementary products in the spine and brain surgical markets that provide a safer surgical environment for patients, surgeons and operating room staff. The Group engages in the development, production and marketing of innovative medical devices for supporting surgical procedures in the field of orthopedics and neurosurgery. The Group operates in the field of image guided surgery (also known as computer assisted surgery) that enables the use of surgical instruments with high precision and minimal invasiveness and that simplifies complex surgical procedures. Since August 2007, the securities of the Company have been registered for trade on the Tel Aviv Stock Exchange .
|
B.
|
Definitions
|
|
(1)
|
International Financial Reporting Standards (hereinafter – IFRS)
– Standards and interpretations that were adopted by the International Accounting Standards Board (IASB) and which include international financial reporting standards and international accounting standards (IAS) along with the interpretations of these standards by the International Financial Reporting Interpretations Committee (IFRIC) or interpretations of the Standing Interpretations Committee (SIC), respectively.
|
|
(2)
|
The Company
– Mazor Robotics Ltd.
|
|
(3)
|
The Group
– Mazor Robotics Ltd. and its subsidiary.
|
|
(4)
|
Subsidiary
– A company, the financial statements of which are fully consolidated, directly or indirectly, with the financial statements of the Company.
|
|
(5)
|
Related party
– Within its meaning in IAS 24 (2009), “Related Party Disclosures”.
|
|
(6)
|
CPI
– The Consumer Price Index as published by the Israeli Central Bureau of Statistics.
|
|
(7)
|
OCS
- Office of the Chief Scientist of the Israeli Ministry of Industry, Trade and Labor.
|
A.
|
Statement of compliance
|
|
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as issued by the IASB. The Group adopted IFRSs for the first time in 2008, with the date of transition to IFRSs being January 1, 2007.
|
|
The consolidated financial statements were authorized for issue by the Company’s Board of Directors on April 11, 2013.
|
B.
|
Reporting and functional currency
|
|
These consolidated financial statements are presented in US dollars (USD), which is the company’s functional currency as of the date of these consolidated financial statements.
|
|
·
|
Assets and liabilities are translated at the exchange rate prevailing at the end of the reporting period;
|
|
·
|
Income and expenses are translated at the exchange rate prevailing on the date of the relevant transaction (or based on an average exchange rate which is approximate to that rate).
|
|
·
|
Capital transactions are translated at exchange rates prevailing on the date of the relevant transaction.
|
|
·
|
Adjustments derived from translating the financial statements from the functional currency to the reporting currency as of the transition date are presented in other comprehensive income.
|
C.
|
Basis of measurement
|
D.
|
Use of estimates and judgments
|
|
The preparation of financial statements in conformity with IFRSs requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
|
|
The preparation of accounting estimates used in the preparation of the Company’s financial statements requires management to make assumptions regarding circumstances and events that involve considerable uncertainty. Management of the Company prepares the estimates on the basis of past experience, various facts, external circumstances, and reasonable assumptions according to the pertinent circumstances of each estimate.
|
|
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any affected future periods.
|
D.
|
Use of estimates and judgments (cont’d)
|
|
Material accounting estimates and judgments
|
|
Fair value measurement of Warrants convertible into a variable number of Company's shares
|
|
During the period, the Company entered into an investment agreement as described in Note 28C(6), according to which investors were issued warrants convertible into a variable number of the Company's shares, thereby representing a financial liability that is a derivative instrument. This liability is measured at fair value using standard valuation technique for this type of instrument (Monte Carlo model) on the basis of observable inputs (such as the price of the Company's shares and the NIS/dollar exchange rate) and the following unobservable inputs: expected volatility, correlation between the share price and the change in the exchange rate, risk-free interest rate, expected life and the probability of mandatory exercise
will
occur.
|
E.
|
Capital management – objectives, procedures and processes
|
|
Management’s policy is to maintain a solid capital base in order to preserve the ability of the Company to continue operating so that it may provide a return on capital to its shareholders, benefits to other holders of interests in the Company such as credit providers and employees of the Company, and sustain future development of the business. Neither the Company nor its subsidiary are subject to externally imposed capital requirements.
|
A.
|
Basis of consolidation
|
|
(1)
|
Subsidiaries
|
|
(2)
|
Transactions eliminated on consolidation
|
B.
|
Foreign currency transactions
|
C.
|
Financial instruments
|
|
(1)
|
Non-derivative financial assets
|
C.
|
Financial instruments (cont’d)
|
|
(1)
|
Non-derivative financial assets (cont’d)
|
|
(2)
|
Non-derivative financial liabilities
|
|
(3)
|
Compound financial instruments
|
C.
|
Financial instruments (cont’d)
|
|
(4)
|
CPI-linked assets and liabilities that are not measured at fair value
|
|
(5)
|
Share capital
|
|
(6)
|
Share options
|
|
Receipts in respect of share options are classified as equity to the extent that they confer the right to purchase a fixed number of shares for a fixed exercise price.
|
|
(7)
|
Issuance of compound financial instruments
|
|
(a)
|
The consideration received from the issuance of compound financial instruments, which consist of equity components and liability-classified options, is attributed at first to financial liabilities that are measured each period at fair value through profit or loss, and then to financial liabilities that are measured only upon initial recognition at fair value. The remaining amount is the value of the equity component.
|
|
(b)
|
Direct issuance costs are attributed to the specific securities in respect of which they were incurred, whereas joint issuance costs are attributed to the securities on a proportionate basis according to the allocation of the consideration from the issuance of the compound financial instruments , as described in sub-paragraph (a) above.
|
D.
|
Property and Equipment
|
|
(1)
|
Recognition and measurement
|
|
Property and Equipment
are measured at cost less accumulated depreciation and accumulated impairment losses.
|
|
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labor, any other costs directly attributable to bringing the assets to a working condition for their intended use.
|
|
Gains and losses on disposal of property and equipment are determined by comparing the proceeds from disposal with the carrying amount of the asset, and are recognized net within “other income” or “other expenses”, as relevant, in profit or loss.
|
|
(2)
|
Subsequent costs
|
|
The cost of replacing part of a fixed asset item is recognized in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognized. The costs of day-to-day servicing are recognized in profit or loss as incurred.
|
D.
|
Fixed assets (cont’d)
|
|
(3)
|
Depreciation
|
|
Depreciation is a systematic allocation of the depreciable amount of an asset over its useful life. The depreciable amount is the cost of the asset, or other amount substituted for cost.
|
|
Depreciation is recognized in profit or loss on a straight-line basis over the estimated useful lives of the property and equipment, since this most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.
|
|
The estimated useful lives for the current and comparative periods are as follows:
|
Computers
|
3 years
|
Machinery and equipment
|
4-7 years
|
Office furniture and equipment
|
10-17 years
|
Motor vehicles
|
5 years
|
Leasehold improvements
|
4-6 years
|
E.
|
Intangible assets
|
|
(1)
|
Research and development
|
|
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss when incurred.
|
|
Development activities involve plans or design for the production of new or substantially improved products and processes.
|
|
·
|
development costs can be measured reliably;
|
|
·
|
the product or process is technically and commercially feasible;
|
|
·
|
future economic benefits are probable;
|
|
·
|
the Group intends to and has sufficient resources to complete development and to use or sell the asset.
|
|
The capitalized expenditure includes the cost of materials, direct labor and overhead costs that are directly attributable to developing the asset for its intended use. Other development expenditure is recognized in profit or loss as incurred.
|
|
Capitalized development expenditure is measured at cost less accumulated amortization and accumulated impairment losses.
|
|
(2)
|
Subsequent expenditure
|
|
Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure, including expenditure on internally generated brands, is recognized in profit or loss as incurred.
|
E.
|
Intangible assets (cont’d)
|
|
(3)
|
Amortization
|
|
Amortization is a systematic allocation of the amortizable amount of an intangible asset over its useful life. The amortizable amount is the cost of the asset.
|
|
Amortization is recognized in profit or loss on a straight-line basis over the estimated useful lives of the intangible assets, from the date they are available for use, since these methods most closely reflect the expected pattern of consumption of the future economic benefits embodied in each asset.
|
|
Capitalized development costs 4 years.
|
|
Amortization methods and useful lives are reviewed at each reporting date and adjusted if appropriate.
|
F.
|
Inventory
|
G.
|
Impairment
|
|
(1)
|
Financial assets
|
|
A financial asset not carried at fair value through profit or loss is tested for impairment when objective evidence indicates that one or more events had a negative effect on the estimated future cash flows of the asset.
|
|
An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. All individually significant financial assets are assessed for specific impairment, and all impairment losses are recognized in profit or loss.
|
|
An impairment loss is reversed if the reversal can be related objectively to an event occurring after the recognition of the impairment loss. For financial assets measured at amortized cost the reversal is recognized in profit or loss.
|
|
(2)
|
Non-financial assets
|
|
The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.
|
|
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its net selling price (fair value less costs to sell). In assessing value in use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”).
|
|
An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its estimated recoverable amount. Impairment losses are recognized in profit or loss. Impairment losses recognized in respect of cash-generating units are allocated to reduce the carrying amounts of the assets in the cash-generating unit on a pro rata basis.
|
G.
|
Impairment (cont’d)
|
|
(2)
|
Non-financial assets (cont’d)
|
|
Impairment losses recognized in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.
|
H.
|
Employee benefits
|
|
(1)
|
Post-employment benefits
|
|
Defined contribution plans
|
|
(2)
|
Short-term benefits
|
|
(3)
|
Share-based payment transactions
|
I.
|
Provisions
|
|
A provision is recognized if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation.
|
J.
|
Revenue Recognition
|
|
The Group recognizes revenue in accordance with IAS 18 Revenue Recognition, including provisions related to recognition of revenue from multiple-component transactions. Accordingly, the Group recognizes revenue from the sale of goods when:
|
|
·
|
The significant risks and rewards of ownership of the goods have been transferred to the customer;
|
|
·
|
It is probable that the economic benefits associated with the transaction will flow to the Group;
|
|
·
|
The costs incurred or to be incurred in respect of the transaction can be measured reliably;
|
|
·
|
The Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; and
|
|
·
|
The amount of revenue can be measured reliably.
|
J.
|
Revenue Recognition (cont’d)
|
|
In general, the Group's sales agreements include several components:
|
|
·
|
systems;
|
|
·
|
disposable components and accessories; and
|
|
·
|
warranty and maintenance services related to the systems sold, which includes replacement parts, software updates, preventive maintenance and on-call support as detailed in the agreement and spare parts.
|
|
·
|
Sales to end customers – Upon the completion of installation of the system, training of at least one surgeon, which typically occurs prior to or concurrent with the system installation, and customer acceptance, if required.
|
|
|
·
|
Sales to distributors - Upon delivery to the distributor, provided that the significant risks and rewards of ownership of the system are transferred to the distributor upon delivery, the distributor has no right of return, receipt of the consideration is probable and not dependent on the distributor’s ability to collect from the end customer, the commitment to carry out installation and training for the end customer lies with the distributor and that the distributor has been authorized to perform the installation and training for the end customers. If the above conditions are not met, the Group recognizes revenue at the time of fulfillment of the conditions for recognition of revenue from the end customer
.
|
·
|
In sales to end customers – Upon delivery.
|
·
|
In sales to distributors –Upon delivery to the distributor, provided that the significant risks and rewards of ownership of the components are transferred to the distributor upon delivery, the distributor has no right of return and that the receipt of the consideration is probable and not dependent on the distributor’s ability to collect from the end customer.
|
K.
|
OCS grants
|
L.
|
Financing income and expenses
|
M.
|
Income tax expense
|
N.
|
Loss per share
|
O.
|
New standards and interpretations not yet adopted
|
(1)
|
IFRS 9
Financial Instruments
(2010), IFRS 9
Financial Instruments
(2009)
|
(2)
|
IFRS 10
Consolidated Financial Statements
and IFRS 12
Disclosure of Interests in Other Entities
(2011)
|
O.
|
New standards and interpretations not yet adopted (cont’d)
|
(3)
|
IFRS 13
Fair Value Measurement
(2011)
|
A.
|
Investments in debt instruments
|
|
The fair value of financial assets at fair value through profit or loss is determined by reference to their quoted closing bid price at the reporting date.
|
B.
|
Non-derivative financial liabilities
|
|
Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date. In respect of the liability component of convertible notes, the market rate of interest is determined by reference to the market terms of similar liabilities that do not have a conversion option.
|
C.
|
Share-based payment transactions
|
|
The fair value of share options granted to employees and service providers is measured using the binomial model. Measurement inputs include the share price on the measurement date, the exercise price of the instrument, expected volatility (based on the historical volatility), an early exercise multiple, and the risk-free interest rate (based on government debentures). Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value.
|
D.
|
Warrants convertible into a variable derivative
|
|
The fair value of the derivative instrument which is a financial liability, as described in Note 17, is measured using standard valuation technique for this type of instrument (Monte Carlo Model) on the basis of observable inputs (such as the price of the Company's shares and the NIS/dollar exchange rate) and the following unobservable inputs: expected volatility, correlation between the share price and the change in the exchange rate, risk-free interest rate, expected life and the probability of mandatory exercise
will
occur.
|
|
Changes in this financial liability fair value are realized in the financial expenses.
|
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Current balances in banks
|
11,245 | 1,582 | ||||||
Deposits held at financial institutions, with original
|
||||||||
maturity periods of up to three months
|
1,552 | 73 | ||||||
12,797 | 1,655 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Short-term deposits
|
||||||||
Deposits held at financial institutions, in NIS
|
- | 1,859 | ||||||
Investments in marketable securities
|
||||||||
CPI-linked government debentures
|
1,564 | 4,241 | ||||||
Government debentures
|
2,013 | 6,166 | ||||||
CPI-linked corporate debentures
|
507 | 1,495 | ||||||
Corporate debentures
|
72 | 228 | ||||||
USD-linked corporate debentures
|
- | 466 | ||||||
4,156 | 12,596 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Trade receivables
|
||||||||
Open accounts
|
1,149 | 1,358 | ||||||
Less – provision for doubtful debts
|
(2 | ) | (2 | ) | ||||
1,147 | 1,356 | |||||||
Other accounts receivable
|
||||||||
Institutions
|
203 | 174 | ||||||
Prepaid expenses
|
418 | 75 | ||||||
Advances to suppliers
|
58 | 11 | ||||||
Other receivables
|
1 | 8 | ||||||
680 | 268 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Raw materials and spare parts
|
424 | 684 | ||||||
Work in progress
|
139 | 28 | ||||||
Finished goods
|
694 | 614 | ||||||
1,257 | 1,326 |
Office
|
||||||||||||||||||||||||
Machinery
|
furniture
|
|||||||||||||||||||||||
and
|
and
|
Leasehold
|
||||||||||||||||||||||
Vehicles
|
equipment
|
equipment
|
improvements
|
Computers
|
Total
|
|||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||
Cost:
|
||||||||||||||||||||||||
Balance as at January 1, 2012
|
33 | 280 | 81 | 92 | 575 | 1,061 | ||||||||||||||||||
Additions
|
- | 132 | 44 | 94 | 189 | 459 | ||||||||||||||||||
Effect of changes in exchange rates
|
- | 261 | (1 | ) | (2 | ) | (4 | ) | 254 | |||||||||||||||
Balance as at
|
||||||||||||||||||||||||
December 31, 2012
|
33 | 673 | 124 | 184 | 760 | 1,774 | ||||||||||||||||||
Balance as at January 1, 2011
|
35 | 75 | 67 | 91 | 405 | 673 | ||||||||||||||||||
Additions
|
- | 224 | 20 | 8 | 213 | 465 | ||||||||||||||||||
Effect of changes in exchange rates
|
(2 | ) | (19 | ) | (6 | ) | (7 | ) | (43 | ) | (77 | ) | ||||||||||||
Balance as at
|
||||||||||||||||||||||||
December 31, 2011
|
33 | 280 | 81 | 92 | 575 | 1,061 | ||||||||||||||||||
Depreciation
|
||||||||||||||||||||||||
Balance as at January 1, 2012
|
6 | 76 | 26 | 60 | 370 | 538 | ||||||||||||||||||
Depreciation for the year
|
5 | 60 | 8 | 34 | 124 | 231 | ||||||||||||||||||
Effect of changes in exchange rates
|
- | 262 | (1 | ) | (2 | ) | (20 | ) | 239 | |||||||||||||||
Balance as at
|
||||||||||||||||||||||||
December 31, 2012
|
11 | 398 | 33 | 92 | 474 | 1,008 | ||||||||||||||||||
Balance as at January 1, 2011
|
1 | 58 | 22 | 43 | 325 | 449 | ||||||||||||||||||
Depreciation for the year
|
5 | 24 | 6 | 21 | 73 | 129 | ||||||||||||||||||
Effect of changes in exchange rates
|
- | (6 | ) | (2 | ) | (4 | ) | (28 | ) | (40 | ) | |||||||||||||
Balance as at
|
||||||||||||||||||||||||
December 31, 2011
|
6 | 76 | 26 | 60 | 370 | 538 | ||||||||||||||||||
Carrying amount
|
||||||||||||||||||||||||
Balance as at January 1, 2011
|
34 | 17 | 45 | 48 | 80 | 224 | ||||||||||||||||||
Balance as at December 31, 2011
|
27 | 204 | 55 | 32 | 205 | 523 | ||||||||||||||||||
Balance as at December 31, 2012
|
22 | 275 | 91 | 92 | 286 | 766 |
Capitalized
development
|
||||
costs
|
||||
Cost
|
||||
Balance as at January 1, 2011
|
1,298 | |||
Foreign currency translation differences
|
(92 | ) | ||
Balance as at December 31, 2011
|
1,206 | |||
Foreign currency translation differences
|
41 | |||
Balance as at December 31, 2012
|
1,247 | |||
Amortization
|
||||
Balance as at January 1, 2011
|
221 | |||
Amortization for the year
|
322 | |||
Foreign currency translation differences
|
(36 | ) | ||
Balance as at December 31, 2011
|
507 | |||
Amortization for the year
|
314 | |||
Foreign currency translation differences
|
39 | |||
Balance as at December 31, 2012
|
860 | |||
Carrying amount
|
||||
December 31, 2011
|
699 | |||
December 31, 2012
|
387 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Open accounts
|
1,102 | 921 | ||||||
Checks and notes payable
|
216 | 75 | ||||||
1,318 | 996 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Accrued expenses
|
345 | 198 | ||||||
Institutions
|
121 | 100 | ||||||
Liabilities to the Chief Scientist (see Note 16)
|
531 | 519 | ||||||
Salary and related liabilities
|
1,116 | 653 | ||||||
Related parties*
|
17 | 14 | ||||||
Deferred income
|
576 | 349 | ||||||
2,706 | 1,833 |
*
|
See Note 27 on related and interested parties for information on payables due to related and interested parties.
|
A.
|
General
|
USD thousands
|
||||
Proceeds from issuance of convertible debentures
|
3,131 | |||
Transaction costs
|
(242 | ) | ||
Net proceeds
|
2,889 | |||
Amount recognized as equity *
|
795 | |||
Amount initially recognized as liability
|
2,094 |
B.
|
Movement in the liability component
|
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Balance as at January 1*
|
3,495 | 3,293 | ||||||
Accrued interest expenses
|
681 | 697 | ||||||
Interest paid
|
(215 | ) | (231 | ) | ||||
Repayment of principal
|
(3,916 | ) | - | |||||
Foreign currency translation differences
|
(45 | ) | (264 | ) | ||||
Balance as at December 31*
|
- | 3,495 |
|
*
|
Does not include accrued interest in the amount of NIS 72 thousand (approximately USD 19 thousand).
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Amount recognized as expense in respect of
|
||||||||||||
defined contribution plan
|
107 | 45 | 63 |
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Balance as at January 1
|
945 | 1,096 | ||||||
Amounts received
|
- | - | ||||||
Royalties paid during the year
|
(317 | ) | (227 | ) | ||||
Amounts recognized in the statement of income
|
178 | 147 | ||||||
Foreign currency translation differences
|
26 | (71 | ) | |||||
832 | 945 | |||||||
Presentation in the statement of financial position:
|
||||||||
Current liabilities
|
531 | 519 | ||||||
Long-term liabilities
|
301 | 426 | ||||||
832 | 945 |
A
.
|
General
|
December 31
|
||||||||
2012
|
date of issuance
|
|||||||
Observable inputs:
|
||||||||
share price (NIS)
|
8.385 | 5.734 | ||||||
NIS/dollar Exchange rate
|
3.733 | 3.918 | ||||||
Unobservable inputs:
|
||||||||
expected volatility
|
44.26 | % | 45.5 | % | ||||
risk-free interest rate
|
1.71 | % | 2.18 | % | ||||
correlation between the share price and the change
|
||||||||
in the exchange rate
|
(13.99 | )% | (14.71 | )% | ||||
estimated life - if mandatory exercise will occur (years)
|
0.48 | 0.74 | ||||||
estimated life - if mandatory exercise will not occur (years)
|
2.74 | 3 |
USD thousands
|
||||
Proceeds from share options and shares issue
|
7,500 | |||
Issuance expenses
|
(202 | ) | ||
Proceeds, net
|
7,298 | |||
Amount recorded as equity
|
6,123 | |||
Amount recorded as liabilities
|
1,175 |
B.
|
Movement in the Derivative instruments
|
USD thousands
|
||||
Date of issuance:
|
1,175 | |||
Financial expenses
|
2,815 | |||
As of December 31, 2012
|
3,990 |
fair value of Derivative instruments
|
||||||||||||||||||||||||||||
Share price (NIS)
|
16.77 | 12.578 | 10.062 | 9.224 | 8.385 | 7.547 | 6.708 | |||||||||||||||||||||
change
|
100%
|
50%
|
20%
|
10%
|
0%
|
-10%
|
-20%
|
|||||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||||||
Effect of changes in
|
||||||||||||||||||||||||||||
the company's share
|
||||||||||||||||||||||||||||
price on income
|
||||||||||||||||||||||||||||
statement and equity
|
(10,967 | ) | (5,364 | ) | (1,989 | ) | (1,052 | ) | - | 1,030 | 1,879 |
A.
|
Details regarding the tax environment of the Group
|
(1)
|
Amendments to the Income Tax Ordinance and the Land Appreciation Tax Law
|
|
(a)
|
On July 14, 2009, the Knesset passed the Economic Efficiency Law (Legislation Amendments for Implementation of the 2009 and 2010 Economic Plan) – 2009, which provided, inter alia, a gradual reduction in the company tax rate to 18% as from the 2016 tax year. In accordance with the aforementioned amendments, the company tax rate in 2010 and 2011 was 25% and 24%, respectively.
|
|
(b)
|
On February 4, 2010 Amendment 174 to the Income Tax Ordinance (New Version) – 1961 (hereinafter – “the Ordinance”) was published in the Official Gazette. The amendment added Section 87A to the Ordinance, which provides a temporary order whereby Accounting Standard No. 29 “Adoption of International Financial Reporting Standards (IFRS)” that was issued by the Israel Accounting Standards Board shall not apply when determining the taxable income for the 2007, 2008 and 2009 tax years even if this standard was applied when preparing the financial statements (hereinafter – “the Temporary Order”). On January 12, 2012 Amendment 188 to the Ordinance was issued, by which the Temporary Order was amended so that Standard 29 shall not apply also when determining the taxable income for 2010 and 2011.
|
(2)
|
Benefits under the Israeli Law for the Encouragement of Capital Investments – 1959 (hereinafter - “the Law”)
|
|
(a)
|
In April 2004 the Company was granted “Approved Enterprise” status in accordance with the Law with respect to a plan to construct a plant in Caesarea for the manufacture of systems for assisting and guiding complex surgical procedures. In February 2007 the aforementioned approved enterprise status was revoked at the request of the Company, and in respect of an expansion of its plant in the Caesarea industrial park it was granted “Beneficiary Enterprise” status per the definition of this term in the Law. In accordance with this status, the Company will be entitled to the tax benefits provided by the Law with respect to income of the beneficiary enterprise from productive activity. Income of the beneficiary enterprise from productive activity will be exempt from tax for two years from the year in which the Company first has taxable income, and will be subject to tax of 25% in the following 5 years, providing that 12 years have not passed from the beginning of the year of election (2005). In the event of a dividend distribution from income that is exempt from company tax, as aforementioned, the Company will be required to pay tax of 25% on that income. In July 2009 the Company submitted a request that 2008 be the year of election.
|
|
In addition, in the event of a change in the field of activity and/or business model and/or a significant reduction in production levels or in product variety, the tax ruling will become void. The Company will be controlled and managed in Israel throughout the benefit period.
|
|
(b)
|
On December 29, 2010 the Knesset approved the Economic Policy Law for 2011-2012, which includes an amendment to the Law for the Encouragement of Capital Investments – 1959 (hereinafter – “the Amendment to the Law”). The Amendment to the Law was published in the Official Gazette on January 6, 2011. The Amendment to the Law is effective from January 1, 2011 and its provisions will apply to preferred income derived or accrued in 2011 and thereafter by a preferred company, per the definition of these terms in the Amendment to the Law. Companies can choose to not be included in the scope of the Amendment to the Law and to stay in the scope of the law before its amendment until the end of the benefits period. The 2012 tax year is the last year companies can choose as the year of election, providing that the minimum qualifying investment began in 2010.
|
A.
|
Details regarding the tax environment of the Group (cont’d)
|
(2)
|
Benefits under the Israeli Law for the Encouragement of Capital Investments – 1959 (hereinafter - “the Law”) (cont’d)
|
|
(b)
|
(cont’d)
|
|
The Amendment provides that the existing tax benefit tracks were eliminated and two new tax tracks were introduced in their place, a preferred enterprise and a special preferred enterprise, which mainly provide a uniform and reduced tax rate for all of the company’s income entitled to benefits, such as: in the 2011-2012 tax years – a tax rate of 15%, in the 2013-2014 tax years – a tax rate of 12.5%, and as from the 2015 tax year –a tax rate of 12%.
|
(3)
|
Tax benefits under the Law for the Encouragement of Industry (Taxes), 1969
|
|
The Company is an ‘industrial company’ as defined by this law and as such is entitled to certain tax benefits, consisting mainly of accelerated depreciation as prescribed by regulations published under the Inflationary Adjustments Law, recognition of share issuance costs as an expense over three years and amortization of patents and certain other intangible property.
|
(4)
|
Taxation of the subsidiary in the USA
|
B.
|
Composition of income tax (benefit) expense
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Current tax expense
|
||||||||||||
Current tax
|
16 | 19 | 8 | |||||||||
Deferred tax income
|
||||||||||||
Changes in deferred tax asset in subsidiary
|
7 | (87 | ) | - |
C.
|
Reconciliation between the theoretical tax on the pre-tax profit and the tax expense
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Loss before taxes on income
|
(7,041 | ) | (7,850 | ) | (5,765 | ) | ||||||
Primary tax rate of the Company
|
25 | % | 24 | % | 25 | % | ||||||
Tax calculated according to the Company’s
|
||||||||||||
primary tax rate
|
(1,760 | ) | (1,884 | ) | (1,441 | ) | ||||||
Additional tax (tax saving) in respect of:
|
||||||||||||
Different tax rate of foreign subsidiaries
|
21 | 4 | (6 | ) | ||||||||
Non-deductible expenses
|
257 | 284 | 200 | |||||||||
Utilization of tax losses for which deferred
|
||||||||||||
taxes were not created in prior years
|
(66 | ) | (4 | ) | (105 | ) | ||||||
Creation of deferred taxes in respect of tax losses
|
||||||||||||
for which deferred taxes were not created
|
||||||||||||
in prior years
|
(37 | ) | (87 | ) | - | |||||||
Tax losses and benefits for which deferred
|
||||||||||||
tax assets were not created
|
1,819 | 1,601 | 1,352 | |||||||||
Currency differences
|
(213 | ) | - | - | ||||||||
Other differences
|
2 | 18 | 8 | |||||||||
Income tax (benefit) expense
|
23 | (68 | ) | 8 |
D.
|
Deferred tax assets and liabilities
|
(1)
|
The Company has recognized deferred tax assets and liabilities in respect of the following items:
|
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Marketable securities
|
(65 | ) | - | |||||
Tax losses and other temporary differences
|
145 | 87 | ||||||
80 | 87 |
(2)
|
Unrecognized deferred tax assets
|
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Deductible temporary differences, net
|
7,671 | 3,344 | ||||||
Tax losses
|
43,537 | 39,703 |
D.
|
Deferred tax assets and liabilities (cont’d)
|
(2)
|
Unrecognized deferred tax assets (cont’d)
|
E.
|
Tax assessments
|
A.
|
The Company and the subsidiary have operating lease agreements with respect to the buildings they use. The agreements will end in 2014 and 2013, respectively. The Company provided a promissory note in the amount of NIS 60 thousand (approximately USD 16 thousand) as security for the lease.
|
December 31, 2012
|
||||
USD thousands
|
||||
2013
|
109 | |||
2014
|
99 | |||
208 |
B.
|
The Company leases motor vehicles under operating lease agreements for a period 36 months. As regards-these agreements, the Company has deposited amounts as security for the future rent payments. As at the reporting date the balance of prepaid expenses on account of the lease of motor vehicles is NIS 239 thousand (approximately USD 64 thousand) (see Note 9). The deposits are linked to the CPI and do not bear interest. The minimum annual payments according to the agreements are as follows:
|
December 31, 2012
|
||||
USD thousands
|
||||
2013
|
184 | |||
2014
|
85 | |||
2015
|
25 | |||
294 |
C.
|
In February 2007 the Company signed a software development agreement with a third party (hereinafter: “the developer”). According to the agreement, the developer will provide to the Company software research and development services that are essential to the development of one of the Company’s products. In consideration of the development services, the Company will also pay royalties at the rate of 6% of the sales of the future product, which will be gradually reduced to 1% in the tenth year of selling the product. These payments will commence only after the royalty commitment will exceed the agreed amount of NIS 650 thousand (approximately USD 154 thousand).
|
D.
|
In January 2012 the Company entered into a distribution agreement with Mazor Robotics GmbH (hereinafter: “Mazor Germany”). According to the agreement, the Company will grant to Mazor Germany exclusive distribution rights in Germany, Austria and Switzerland (“the territory”) with respect to various products of the Company, and limited service also in other European countries according to the needs of the Company, and will also pay a monthly fee to support penetration cost to the territory. The monthly fee will be agreed by both parties in advanced each calendar year. The monthly fee will be paid 3 months in advance each calendar month . The Company granted to Mazor Germany the right to use the name “Mazor”, and this right will expire on the last date of a binding agreement. The intellectual property will at all times continue to be the property of the Company. The agreement will continue until terminated by other parties within 180 days written notice. During the 180 day advance notice the company will continue to pay the monthly fee as agreed. An amount of 46 thousands Euro was agreed as the monthly fee for the year 2012.
|
E.
|
As of December 31, 2012 the company has purchase obligations in the amount of USD 1,279 thousand which mainly represent outstanding purchase commitments for inventory components ordered in the normal course of business.
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Sales of systems
|
8,656 | 4,114 | 2,933 | |||||||||
Sales of consumables
|
1,918 | 954 | 804 | |||||||||
Services and other
|
1,601 | 836 | 236 | |||||||||
12,175 | 5,904 | 3,973 |
A.
|
Information about reportable segments
|
For the year ended December 31, 2012
|
||||||||||||||||||||
Eastern
|
Western
|
|||||||||||||||||||
USA
|
Europe
|
Europe
|
Asia
|
Total
|
||||||||||||||||
USD thousands
|
||||||||||||||||||||
Total revenues
|
9,474 | 51 | 632 | 2,018 | 12,175 |
For the year ended December 31, 2011
|
||||||||||||||||||||
Eastern
|
Western
|
|||||||||||||||||||
USA
|
Europe
|
Europe
|
Asia
|
Total
|
||||||||||||||||
USD thousands
|
||||||||||||||||||||
Total revenues
|
3,067 | 188 | 2,040 | 609 | 5,904 |
For the year ended December 31, 2010
|
||||||||||||||||||||
Eastern
|
Western
|
|||||||||||||||||||
USA
|
Europe
|
Europe
|
Asia (*)
|
Total
|
||||||||||||||||
USD thousands
|
||||||||||||||||||||
Total revenues
|
1,711 | 891 | 1,228 | 143 | 3,973 |
B.
|
Entity level disclosures
|
2012
|
2011
|
2010
|
|||||||||||||
Segment
|
Customer
|
USD thousands
|
Customer
|
USD thousands
|
Customer
|
USD thousands
|
|||||||||
Western Europe
|
Customer A
|
1,303 |
Customer A
|
945 | |||||||||||
USA
|
Customer J
|
1,446 |
Customer F
|
629 |
Customer B
|
892 | |||||||||
USA
|
Customer G
|
674 |
Customer C
|
488 | |||||||||||
USA
|
Customer H
|
639 |
Customer D
|
561 | |||||||||||
USA
|
Customer I
|
679 |
Customer E
|
542 | |||||||||||
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Materials and subcontractors
|
1,602 | 971 | 490 | |||||||||
Salaries, wages and related expenses
|
654 | 355 | 146 | |||||||||
Depreciation and amortization*
|
332 | 334 | 279 | |||||||||
Other manufacturing expenses
|
305 | 219 | 46 | |||||||||
2,893 | 1,879 | 961 |
*
|
Including amortization of intangible assets
.
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Salaries, wages and related expenses
|
5,063 | 3,397 | 2,262 | |||||||||
Marketing fees to representatives overseas
|
585 | 880 | 949 | |||||||||
Advertising, demonstrations and exhibitions
|
1,006 | 815 | 252 | |||||||||
Foreign travel
|
1,133 | 766 | 450 | |||||||||
Consultation
|
227 | 580 | 275 | |||||||||
Depreciation
|
91 | 41 | 48 | |||||||||
Other selling and marketing expenses
|
782 | 511 | 356 | |||||||||
8,887 | 6,990 | 4,592 |
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Salaries, wages and related expenses
|
1,042 | 976 | 840 | |||||||||
Professional services
|
580 | 423 | 314 | |||||||||
Depreciation
|
52 | 33 | 30 | |||||||||
Other general and administrative expenses
|
171 | 207 | 240 | |||||||||
1,845 | 1,639 | 1,424 |
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Raw materials and subcontractors
|
953 | 1,370 | 1,340 | |||||||||
Salaries, wages and related expenses
|
1,412 | 1,278 | 1,050 | |||||||||
Depreciation
|
69 | 43 | 22 | |||||||||
Patent registration expenses
|
125 | 143 | 102 | |||||||||
Other research and development expenses
|
201 | 242 | 130 | |||||||||
Total research and development expenses
|
2,760 | 3,076 | 2,644 | |||||||||
Less – capitalization of development costs**
|
- | - | (281 | ) | ||||||||
Less – participation of the European Union in expenses*
|
- | (14 | ) | - | ||||||||
Less – participation of the Chief Scientist in expenses
|
- | - | (71 | ) | ||||||||
2,760 | 3,062 | 2,292 |
*
|
Grants received from European Union do not carry a commitment to refund or royalties.
|
**
|
As mentioned in Note 11, as of July 2008 the Group began capitalizing development costs relating to one of its products in accordance with IAS 38. Composition of the capitalized development costs:
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Interest income on bank deposits
|
11 | 27 | 72 | |||||||||
Interest income and net change in fair value of
|
||||||||||||
financial assets held-for-trading
|
543 | 584 | 519 | |||||||||
Net income from change in exchange rates
|
371 | 153 | - | |||||||||
Financing income recognized in profit or loss
|
925 | 764 | 591 | |||||||||
Net expenses from change in exchange rates
|
- | - | (253 | ) | ||||||||
Financing expenses on liabilities to the Chief Scientist
|
(178 | ) | (147 | ) | (79 | ) | ||||||
Effective interest on convertible debentures
|
(681 | ) | (697 | ) | (593 | ) | ||||||
Change in fair value of derivative liability on account
|
||||||||||||
of warrants
|
(2,815 | ) | - | - | ||||||||
Other financing expenses
|
(82 | ) | (104 | ) | (135 | ) | ||||||
Financing expenses recognized in profit or loss
|
(3,756 | ) | (948 | ) | (1,060 | ) | ||||||
Net financing expenses recognized in profit or loss
|
(2,831 | ) | (184 | ) | (469 | ) |
A.
|
Key management personnel compensation (including directors)
|
For the year ended December 31
|
||||||||||||||||||||||||
2012
|
2011
|
2010
|
||||||||||||||||||||||
Number
|
USD
|
Number of
|
USD
|
Number
|
USD
|
|||||||||||||||||||
of people
|
thousands
|
people
|
thousands
|
of people
|
thousands
|
|||||||||||||||||||
Short-term employee
|
||||||||||||||||||||||||
benefits
|
6 | 1,945 | 5 | 1,182 | 5 | 1,308 | ||||||||||||||||||
Share-based payments
|
6 | 311 | 5 | 305 | 5 | 296 | ||||||||||||||||||
2,256 | 1,487 | 1,604 |
For the year ended December 31
|
||||||||||||||||||||||||
2012
|
2011
|
2010
|
||||||||||||||||||||||
Number
|
USD
|
Number of
|
USD
|
Number
|
USD
|
|||||||||||||||||||
of people
|
Thousands
|
people
|
thousands
|
of people
|
thousands
|
|||||||||||||||||||
Total compensation
|
||||||||||||||||||||||||
to directors employed
|
||||||||||||||||||||||||
by the Company*
|
1 | 116 | 1 | 121 | 2 | * 227 | ||||||||||||||||||
Compensation to
|
||||||||||||||||||||||||
independent directors**
|
3 | *** 67 | 3 | 55 | 3 | ** 68 |
|
*
|
Including share-based payments in the amount of NIS 47 thousand (approximately USD 13 thousand) in 2010.
|
|
**
|
Including share-based payments in the amount of NIS 94 thousand (approximately USD 25 thousand) in 2010.
|
|
***
|
Including share-based payments in the amount of NIS 13 thousand (approximately USD 3 thousand) in 2012.
|
B.
|
Engagements between the Company and related parties
|
(1)
|
On August 15, 2010 the Company’s general meeting approved that as from August 2010 the CEO would relocate to the USA in the framework of his position as the CEO of Mazor USA. The engagement with the CEO in the capacity of CEO of Mazor USA will be in effect until August 2013 and can be extended at the parties’ mutual consent. Notwithstanding the aforementioned, engagement of the CEO as the CEO of Mazor USA can be terminated at any time and for any reason (other than in the event of breach of trust) by the CEO or Mazor USA at an advance notice of 60 days.
|
B.
|
Engagements between the Company and related parties (cont’d)
|
(2)
|
On June 28, 2009 the Company’s general meeting decided to approve a private offer pursuant to which the Company will grant to the CEO 79,861 non-marketable options that are exercisable into 79,861 ordinary shares of the Company with a par value of NIS 0.01 par value. The exercise price of the options is NIS 6.26 for each underlying share, and their vesting period is 48 months with one quarter of the options vesting on February 17, 2011 and the remaining options vesting over a period of two years, 9.375% of the options each quarter. On July 9, 2009 the Tel Aviv Stock Exchange approved the listing of the shares with respect to the aforementioned grant. The fair value of the options that were granted to the CEO is NIS 498 thousand (approximately USD 132 thousand) and is measured according to the binomial model (see Note 29).See also note 29(c) in respect of additional share-based compensation to the CEO during the period.
|
(3)
|
As from October 2007 the Company’s Chairman of the Board (hereinafter – the Chairman) provides management services for a monthly payment of NIS 30 thousand (approximately USD 7.8 thousand). He is also entitled to social benefits comprised of paid vacation, recreation allowance and severance pay as provided by law. In addition, the Chairman was granted options to purchase shares of the Company at an exercise price of NIS 12.40 (approximately USD 3.3) per each underlying share.
|
(4)
|
On November 22, 2007 the Company approved letters of appointment for two external directors who were appointed by the Company’s general meeting of shareholders on November 27, 2007 and were approved by the Company’s Audit Committee, Board of Directors and general meeting in December 2007 and January 2008, respectively, pursuant to which they would be paid fixed annual compensation as provided in the Companies Regulations (Rules Regarding Compensation and Expense Reimbursement of External Director) – 2000 (“the compensation regulations”).
|
(5)
|
On August 15, 2010 the Company’s general meeting of shareholders approved and ratified an annual participation compensation of NIS 32 thousand (approximately USD 8.3 thousand) and a per meeting participation compensation of NIS 1.6 thousand (approximately USD 0.4 thousand) for a director of the Company, effective as of January 1, 2010.
|
(6)
|
On December 4, 2012 the Company’s general meeting of shareholders approved additional share based compensation to one of the external directors - see Note 29(c).
|
A.
|
Share capital
|
December 31
|
||||||||
Ordinary shares
|
||||||||
2012
|
2011
|
|||||||
Thousands of shares of
|
||||||||
NIS 0.01 par value
|
||||||||
Issued and paid-in share capital as at January 1
|
22,178 | 19,733 | ||||||
Issued for cash during the period
|
7,053 | 2,421 | ||||||
Exercise of share options during the period
|
4 | 24 | ||||||
Issued and paid-in share capital as at December 31
|
29,235 | 22,178 | ||||||
Authorized share capital
|
75,000 | 75,000 |
B.
|
Share Options
|
December 31
|
||||||||
Number of options
|
||||||||
2012
|
2011
|
|||||||
Thousands of options of
|
||||||||
NIS 0.01 par value
|
||||||||
Number of outstanding options as at January 1
|
1,734 | 7,535 | ||||||
Issued during the period*
|
7,053 | 968 | ||||||
Exercised during the period
|
- | (15 | ) | |||||
Expired during the period
|
(765 | ) | (6,754 | ) | ||||
Number of outstanding options as at December 31
|
8,022 | 1,734 |
C.
|
Issuances of share capital
|
(1)
|
Public issuance in 2007
|
C.
|
Issuances of share capital (cont’d)
|
(2)
|
Private placement in 2008
|
(3)
|
Exercise of options by the CEO
|
(4)
|
Shelf registration
|
|
•
|
According to the shelf registration prospectus that the Company issued on August 26, 2009 the Company issued a shelf registration offer for ordinary shares and marketable options on October 22, 2009. On the basis of the issuance results at that date, the Company issued to the public 5,263,800 registered ordinary shares with a par value of NIS 0.01 as well as 3,947,850 options that are exercisable until August 25, 2011 into 3,947,850 ordinary shares with a par value of NIS 0.01. The gross issuance proceeds amounted to USD 12,615 thousand. Issuance expenses amounted to USD 1,081 thousand, not including options to two of the distributors as described in the next paragraph.
|
|
On August 25, 2011, 3,947,850 unexercised options expired.
|
|
•
|
On November 1, 2009 the Tel Aviv Stock Exchange approved allotting to two distributors as aforementioned 210,552 non-marketable options that are exercisable into 210,552 ordinary shares with a par value of NIS 0.01 at an exercise price of NIS 9.1 (approximately USD 1.58 thousand) for each underlying share (105,276 options to each one of the distributors). The options will be exercisable, fully or partly, on any business day for a period of three years from the day of their allotment. The Company assessed the fair value of the aforesaid options at USD 198 thousand on the basis of the Black & Scholes model. The award was accounted for in accordance with IFRS 2.
|
C.
|
Issuances of share capital (cont’d)
|
(5)
|
Private placement - 2011
|
|
(1)
|
The Company will allot to The Phoenix Insurance Company Ltd., for itself and for other companies of the Phoenix Group (together “Phoenix”), on the basis of an internal distribution agreed to by the parties, 2,000,000 ordinary shares of the Company with a par value of NIS 0.01, and 800,000 non-marketable options that will not be listed for trading and are exercisable into 800,000 ordinary shares of the Company with a par value of NIS 0.01 over a period of five years from the date of their allotment at an exercise price of NIS 14 (approximately USD 3.88) per option.
|
|
(2)
|
The Company will allot to Leader Issuances (1993) Ltd. 421,053 ordinary shares of the Company with a par value of NIS 0.01, and 168,421 non-marketable options that will not be listed for trading and are exercisable into 168,421 ordinary shares of the Company with a par value of NIS 0.01 over a period of five years from the date of closing at an exercise price of NIS 14 (approximately USD 3.88) per each option.
|
(6)
|
Private placement - 2012
|
C.
|
Issuances of share capital (cont’d)
|
(6)
|
Private placement - 2012 (cont’d)
|
A.
|
Grant of share options to employees and directors of the Company
|
|
The Company regularly compensates its employees, directors and members of the advisory committee by means of options to purchase shares of the Company. As at December 31, 2012 the Company has granted options to purchase 4,413,506 ordinary shares of the Company with a par value of NIS 0.01. All of the grants are equity grants.
|
|
As at that date, options to purchase 1,826,848 ordinary shares are exercisable.
|
B.
|
As of December 31, 2012, the Company has 2 stock option plans for employees, directory, consultants and other service providers of the company and the subsidiary.
|
|
On May 30, 2011 the Company’s Board of Directors approved granting options of the Company to employees, directors, consultants and other service providers of the Company and the subsidiary (“2011 option plan”). The Company will be able to grant up to 2,191,632 options at any time throughout a period of 10 years from the date of approval of the plan according to the terms of the plan.
|
|
As of December 31, 2012, there are 199,452 additional options available for grant under the 2011 Share Option Plan.
|
C.
|
The fair value of the options granted by the Company is based on an option pricing model.
|
|
The table below summarizes the grant terms and the parameters that were used to determine the fair value of the benefit:
|
Share price
|
||||||||||||||||||||||||||||||||||
Contractual
|
that served
|
Total
|
||||||||||||||||||||||||||||||||
Vesting
|
life of the
|
Average
|
as a basis
|
fair value of
|
||||||||||||||||||||||||||||||
Grant date
|
Number of
|
period
|
options
|
Interest
|
Expected
|
exercise
|
for pricing
|
the benefit on
|
||||||||||||||||||||||||||
DD/MM/YEAR
|
Offerees
|
instruments*
|
(Years)
|
(Years)
|
rate
|
volatility
|
price*
|
the option*
|
the grant date
|
|||||||||||||||||||||||||
%
|
%
|
USD
|
USD
|
USD thousands
|
||||||||||||||||||||||||||||||
19/7/2009
|
Employees
|
399,879 | 2-4 | 10 | 1.3-7 | 62-63 | 1.65 | 2.6 | 533 | |||||||||||||||||||||||||
9/7/2009
|
CEO
|
79,861 | 2-4 | 10 | 2-7.2 | 62-63 | 1.65 | 2.4 | 132 | |||||||||||||||||||||||||
15/2/2010
|
Officers
|
120,000 | 2-4 | 10 | 2-7.2 | 62-65 | 2.34 | 2.38 | 154 | |||||||||||||||||||||||||
22/3/2010
|
Employees
|
39,000 | 2-4 | 10 | 2-7.2 | 60-63 | 2.86 | 3.13 | 49 | |||||||||||||||||||||||||
17/5/2010
|
Consultants
|
26,200 | 2-4 | 10 | 2-7.2 | 60-64 | 3.06 | 2.8 | 52 | |||||||||||||||||||||||||
25/11/2010
|
Consultants
|
361,000 | 2-4 | 10 | 2.2-6.4 | 44-64 | 2.92 | 2.68 | 520 | |||||||||||||||||||||||||
21/11/2010
|
Consultants
|
35,000 | 2 | 7 | 2.2-6.4 | 48.18 | 2.54 | 2.54 | 52 | |||||||||||||||||||||||||
20/12/2010
|
Officers
|
200,000 | 2-4 | 7 | 2.3-6 | 47.63 | 2.54 | 2.54 | 261 | |||||||||||||||||||||||||
23/3/2011
|
Employees
|
35,000 | 2-4 | 7 | 3.2-6.3 | 46.63 | 2.54 | 2.54 | 51 | |||||||||||||||||||||||||
23/3/2011
|
CEO
|
12,480 | 2-4 | 7 | 3.2-6.3 | 46.63 | 2.54 | 2.54 | 16 | |||||||||||||||||||||||||
20/6/2011
|
Employees
|
57,500 | 2-4 | 7 | 3.2-6.3 | 46.63 | 2.54 | 2.54 | 83 | |||||||||||||||||||||||||
1/7/2012
|
Consultants
|
5,000 | 2 | 7 | 1.8-5.8 | 47.23 | 1.04 | 1.04 | 3 | |||||||||||||||||||||||||
1/7/2012
|
Employees
|
480,000 | 1-3 | 7 | 1.8-5.8 | 47.23 | 1.39 | 1.04 | 223 | |||||||||||||||||||||||||
5/8/2012
|
Officers
|
320,000 | 1-3 | 7 | 1.8-5.8 | 47.33 | 1.16 | 1.13 | 173 | |||||||||||||||||||||||||
4/12/2012
|
CEO
|
150,000 | 1-3 | 7 | 1.8-5.8 | 47.33 | 1.15 | 2.19 | 200 | |||||||||||||||||||||||||
4/12/2012
|
Director
|
40,000 | 1-3 | 7 | 1.8-5.8 | 47.33 | 1.15 | 2.19 | 53 | |||||||||||||||||||||||||
11/12/2012
|
Employees
|
255,000 | 1-3 | 7 | 1.8-5.8 | 47.27 | 2.24 | 2.33 | 263 | |||||||||||||||||||||||||
11/12/2012
|
Officers
|
20,000 | 1-3 | 7 | 1.8-5.8 | 47.27 | 2.24 | 2.33 | 23 |
*
|
The exercise price and share price are denominated in NIS .
|
D.
|
The number and weighted average exercise prices of share options are as follows:
|
Weighted
|
Weighted
|
|||||||||||||||||||||||
average
|
Weighted
|
average
|
||||||||||||||||||||||
exercise
|
Number of
|
average
|
Number of
|
exercise
|
Number of
|
|||||||||||||||||||
price*
|
options
|
exercise price*
|
options
|
price*
|
options
|
|||||||||||||||||||
2012
|
2012
|
2011
|
2011
|
2010
|
2010
|
|||||||||||||||||||
US dollars
|
US dollars
|
US dollars
|
||||||||||||||||||||||
Balance at January 1
|
2.35 | 2,399,958 | 2.03 | 2,153,226 | 2.63 | 1,658,026 | ||||||||||||||||||
Forfeited during the year
|
1.94 | (38,300 | ) | 2.54 | (84,448 | ) | 1.9 | (51,000 | ) | |||||||||||||||
Exercised during the year
|
0.91 | (3,850 | ) | 0.76 | (8,800 | ) | - | - | ||||||||||||||||
Granted during the year
|
1.40 | 1,270,000 | 2.54 | 339,980 | 2.78 | 546,200 | ||||||||||||||||||
Outstanding at
|
||||||||||||||||||||||||
December 31
|
2.06 | 3,627,808 | 2.35 | 2,399,958 | 2.03 | 2,153,226 | ||||||||||||||||||
Exercisable at
|
||||||||||||||||||||||||
December 31
|
2.37 | 1,826,848 | 2.32 | 1,321,609 | 2.62 | 1,140,786 |
*
|
The exercise price is denominated in NIS .
|
A.
|
Basic loss per share
|
B.
|
Loss attributable to ordinary shareholders
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
Continuing
|
Continuing
|
Continuing
|
||||||||||
operations
|
operations
|
operations
|
||||||||||
USD thousands
|
USD thousands
|
USD thousands
|
||||||||||
Loss for the year
|
7,064 | 7,782 | 5,773 |
C.
|
Weighted average number of ordinary shares
|
For the year ended December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
Continuing
|
Continuing
|
Continuing
|
||||||||||
operations
|
operations
|
operations
|
||||||||||
thousands
|
thousands
|
thousands
|
||||||||||
Balance as at January 1
|
22,178 | 19,733 | 19,702 | |||||||||
Effect of shares issued during the year
|
1,833 | 2,082 | 15 | |||||||||
Weighted average number of ordinary shares
|
||||||||||||
used to calculate basic loss per share
|
24,011 | 21,815 | 19,717 |
D.
|
Diluted loss per share
|
A.
|
Overview
|
B.
|
Risk management framework
|
C.
|
Credit risk
|
D.
|
Liquidity risk
|
E.
|
Market risks
|
A.
|
Credit risk
|
(1)
|
Exposure to credit risk
|
December 31
|
||||||||
2012
|
2011
|
|||||||
Carrying
|
Carrying
|
|||||||
amount
|
Amount
|
|||||||
USD thousands
|
||||||||
CPI-linked government debentures
|
1,564 | 4,241 | ||||||
Government debentures
|
2,013 | 6,166 | ||||||
CPI-linked corporate debentures
|
507 | 1,495 | ||||||
USD-linked corporate debentures
|
- | 466 | ||||||
Corporate debentures
|
72 | 228 | ||||||
Deposits in NIS - held at banks
|
- | 1,859 | ||||||
Trade receivables
|
1,147 | 1,356 | ||||||
Cash and cash equivalents
|
12,797 | 1,655 | ||||||
18,100 | 17,466 |
|
The Maximum exposure to credit risk for trade receivables at the reporting date by geographic region was as follows:
|
December 31
|
||||||||
2012
|
2011
|
|||||||
USD thousands
|
||||||||
Israel
|
60 | 38 | ||||||
United States
|
800 | 717 | ||||||
Eastern Europe
|
- | 578 | ||||||
Western Europe
|
25 | 23 | ||||||
Asia
|
262 | - | ||||||
1,147 | 1,356 |
(2)
|
Aging of debts and impairment losses
|
December 31
|
||||||||||||||||
2012
|
2011
|
|||||||||||||||
Gross
|
Impairment
|
Gross
|
Impairment
|
|||||||||||||
USD thousands
|
USD thousands
|
|||||||||||||||
Not past due
|
1,041 | - | 1,331 | - | ||||||||||||
Past due 0-30 days
|
106 | - | 25 | - | ||||||||||||
Past due more than 121 days
|
2 | (2 | ) | 2 | (2 | ) | ||||||||||
1,149 | (2 | ) | 1,358 | (2 | ) |
December 31
|
||||||||||||
2012
|
2011
|
2010
|
||||||||||
USD thousands
|
||||||||||||
Balance as at January 1
|
(2 | ) | (2 | ) | (6 | ) | ||||||
Impairment loss recognized
|
- | - | 4 | |||||||||
Balance as at December 31
|
(2 | ) | (2 | ) | (2 | ) |
B.
|
Liquidity risk
|
December 31, 2012
|
||||||||||||||||||||
Carrying
|
Contractual
|
Up to 6
|
6-12 | 1-2 | ||||||||||||||||
amount
|
cash flow
|
months
|
months
|
years
|
||||||||||||||||
USD thousands
|
||||||||||||||||||||
Non-derivative financial
|
||||||||||||||||||||
Liabilities
|
||||||||||||||||||||
Trade payables
|
1,318 | 1,318 | 1,318 | - | - | |||||||||||||||
Other accounts payable
|
1,599 | 1,599 | 1,599 | - | - | |||||||||||||||
Liability to OCS
|
832 | 940 | 239 | 333 | 368 | |||||||||||||||
Total
|
3,749 | 3,857 | 3,156 | 333 | 368 |
December 31, 2011
|
||||||||||||||||||||||||
Carrying
|
Contractual
|
Up to 6
|
6-12 | 1-2 | 2-5 | |||||||||||||||||||
amount
|
cash flow
|
months
|
months
|
years
|
years
|
|||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||
Non-derivative financial
|
||||||||||||||||||||||||
Liabilities
|
||||||||||||||||||||||||
Trade payables
|
996 | 996 | 996 | - | - | - | ||||||||||||||||||
Other accounts payable
|
965 | 965 | 965 | - | - | - | ||||||||||||||||||
Convertible debentures*
|
3,496 | 4,142 | - | 4,142 | - | - | ||||||||||||||||||
Liability to OCS
|
944 | 1,233 | 125 | 235 | 369 | 504 | ||||||||||||||||||
Total
|
6,401 | 7,336 | 2,086 | 4,377 | 369 | 504 |
C.
|
Linkage and foreign currency risks
|
|
The exposure to linkage and foreign currency risk
|
December 31, 2012
|
||||||||||||||||||||||||
Israeli currency
|
Foreign currency
|
Non-
|
||||||||||||||||||||||
Unlinked CPI
|
Linked CPI
|
US dollar
|
Euro
|
monetary
|
Total
|
|||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||
CURRENT ASSETS
|
||||||||||||||||||||||||
Cash and cash equivalents
|
338 | - | 11,980 | 479 | - | 12,797 | ||||||||||||||||||
Deposits
|
- | - | - | - | - | - | ||||||||||||||||||
Investments in marketable securities
|
2,085 | 2,071 | - | - | - | 4,156 | ||||||||||||||||||
Trade receivables
|
49 | - | 1,088 | 10 | - | 1,147 | ||||||||||||||||||
Other accounts receivable
|
203 | - | - | - | 477 | 680 | ||||||||||||||||||
Inventory
|
- | - | - | - | 1,257 | 1,257 | ||||||||||||||||||
Total current assets
|
2,675 | 2,071 | 13,068 | 489 | 1,734 | 20,037 | ||||||||||||||||||
Prepaid lease fees
|
- | 64 | - | - | - | 64 | ||||||||||||||||||
Deferred tax assets, net
|
- | - | - | - | 80 | 80 | ||||||||||||||||||
Property and equipment, net
|
- | - | - | - | 766 | 766 | ||||||||||||||||||
Intangible assets, net
|
- | - | - | - | 387 | 387 | ||||||||||||||||||
Total non-current assets
|
2,675 | 2,135 | 13,068 | 489 | 2,967 | 21,334 | ||||||||||||||||||
CURRENT LIABILITIES
|
||||||||||||||||||||||||
Trade payables
|
792 | - | 455 | 71 | - | 1,318 | ||||||||||||||||||
Other accounts payable
|
756 | - | 1,374 | - | 576 | 2,706 | ||||||||||||||||||
Total current liabilities
|
1,548 | - | 1,829 | 71 | 576 | 4,024 | ||||||||||||||||||
Employee benefits
|
- | - | - | - | 199 | 199 | ||||||||||||||||||
Derivative liabilities on account
|
||||||||||||||||||||||||
of warrants
|
3,990 | - | - | - | - | 3,990 | ||||||||||||||||||
Liabilities to the OCS
|
- | - | 301 | - | - | 301 | ||||||||||||||||||
Total liabilities
|
5,538 | - | 2,130 | 71 | 775 | 8,514 | ||||||||||||||||||
Total balance, net
|
(2,863 | ) | 2,135 | 10,938 | 418 | 2,192 | 12,820 |
C.
|
Linkage and foreign currency risks (cont’d)
|
December 31, 2011
|
||||||||||||||||||||||||
Israeli currency
|
Foreign currency
|
Non-
|
||||||||||||||||||||||
Unlinked CPI
|
Linked
CPI
|
US dollar
|
Euro
|
Monetary
|
Total
|
|||||||||||||||||||
USD thousands
|
||||||||||||||||||||||||
CURRENT ASSETS
|
||||||||||||||||||||||||
Cash and cash equivalents
|
460 | - | 1,154 | 41 | - | 1,655 | ||||||||||||||||||
Deposits
|
1,859 | - | - | - | - | 1,859 | ||||||||||||||||||
Investments in marketable securities
|
6,394 | 5,736 | 466 | - | - | 12,596 | ||||||||||||||||||
Trade receivables
|
38 | - | 717 | 601 | - | 1,356 | ||||||||||||||||||
Other accounts receivable
|
182 | - | - | - | 86 | 268 | ||||||||||||||||||
Inventory
|
- | - | - | - | 1,326 | 1,326 | ||||||||||||||||||
Total current assets
|
8,933 | 5,736 | 2,337 | 642 | 1,412 | 19,060 | ||||||||||||||||||
Prepaid lease fees
|
- | 55 | - | - | - | 55 | ||||||||||||||||||
Deferred tax assets, net
|
- | - | - | - | 87 | 87 | ||||||||||||||||||
Property and equipment, net
|
- | - | - | - | 523 | 523 | ||||||||||||||||||
Intangible assets, net
|
- | - | - | - | 699 | 699 | ||||||||||||||||||
Total non-current assets
|
8,933 | 5,791 | 2,337 | 642 | 2,721 | 20,424 | ||||||||||||||||||
CURRENT LIABILITIES
|
||||||||||||||||||||||||
Trade payables
|
738 | - | 212 | 46 | - | 996 | ||||||||||||||||||
Other accounts payable
|
482 | - | 1,001 | - | 350 | 1,833 | ||||||||||||||||||
Convertible debentures
|
3,495 | - | - | - | - | 3,495 | ||||||||||||||||||
Total current liabilities
|
4,715 | - | 1,213 | 46 | 350 | 6,324 | ||||||||||||||||||
Employee benefits
|
- | - | - | - | 190 | 190 | ||||||||||||||||||
Liabilities to the OCS
|
- | - | 426 | - | - | 426 | ||||||||||||||||||
Total liabilities
|
4,715 | - | 1,639 | 46 | 540 | 6,940 | ||||||||||||||||||
Total balance, net
|
4,218 | 5,791 | 698 | 596 | 2,181 | 13,484 |
For the year ended
|
For the year ended
|
|||||||||||||||||||||||
2012
|
2011
|
2010
|
2012
|
2011
|
2010
|
|||||||||||||||||||
% of change
|
Spot price at the reporting date
|
|||||||||||||||||||||||
1 NIS
|
2.3 | (7.1 | ) | 6.4 | 0.2679 | 0.2617 | 0.2818 | |||||||||||||||||
1 euro
|
2 | (3.2 | ) | (7.4 | ) | 1.3183 | 1.2923 | 1.3350 | ||||||||||||||||
CPI in points
|
1.6 | 2.1 | 2.7 | 112.14 | 110.3 | 108 |
*
|
According to an average basis of 2008=100.
|
D.
|
Interest rate risk
|
(1)
|
Profile
|
December 31
|
||||||||
2012
|
2011
|
|||||||
Carrying
|
Carrying
|
|||||||
amount
|
amount
|
|||||||
USD thousands
|
USD thousands
|
|||||||
Fixed rate instruments
|
||||||||
CPI-linked government debentures
|
1,564 | 4,241 | ||||||
Government debentures
|
2,013 | 6,166 | ||||||
CPI-linked corporate debentures
|
507 | 1,495 | ||||||
USD-linked corporate debentures
|
- | 466 | ||||||
Unlinked corporate debentures
|
72 | 228 | ||||||
Convertible debentures
|
- | (3,495 | ) | |||||
4,156 | 9,101 | |||||||
Variable rate instruments
|
||||||||
NIS deposits
|
- | 1,859 | ||||||
Liability to the OCS
|
(832 | ) | (945 | ) | ||||
(832 | ) | 914 |
E.
|
Fair value
|
|
1.
|
As of December 31, 2012 the marketable securities in the amount of USD 4,156 thousand held for trading are presented at fair value through profit or loss. The fair value is determined on the basis of quoted prices (unadjusted) in active markets for identical instruments (level 1).
|
|
2.
|
As of December 31, 2012 the financial liability that is a derivative instrument in the amount of USD 3,990 thousand presented at fair value (level 3). For more details regarding the fair value calculation and sensitivity analysis see Note 17.
|
Loans the
|
|||||||||||||
The Company’s
|
Company
|
Total
|
|||||||||||
Country of
|
ownership
|
granted to the
|
investment in
|
||||||||||
incorporation
|
interest
|
subsidiary
|
the subsidiary
|
||||||||||
USD thousands
|
USD thousands
|
||||||||||||
2012
|
|||||||||||||
Mazor Robotics Inc.
|
USA
|
100 | % | 6,806 | (2,708 | ) | |||||||
2011
|
|||||||||||||
Mazor Robotics Inc.
|
USA
|
100 | % | 3,430 | (2,244 | ) |
Exhibit
|
Description
|
1.1
|
Articles of Association of Mazor Robotics Ltd. (unofficial English translation from Hebrew original).
|
|
|
2.1
|
Form of Deposit Agreement between Mazor Robotics Ltd., The Bank of New York Mellon as Depositary, and owners and holders from time to time of ADSs issued thereunder, including the Form of American Depositary Shares.
|
|
|
2.2
|
Form of Ordinary Shares Purchase Warrant issued to the Oracle Investors in August 2012.
|
|
|
2.3
|
Registration Rights Agreement dated September 27, 2012, among Mazor Robotics Ltd. and the Oracle Investors.
|
4.1
|
Mazor Robotics Ltd. 2003 Stock Option Plan.
|
|
|
4.2
|
Mazor Robotics Ltd. 2011 Share Option Plan.
|
|
|
4.3
|
Summary of Lease Agreement dated April 30, 2003, between Mazor Robotics Ltd. and Hayel Investments and Properties Ltd., as amended on March 27, 2007, February 28, 2009, September 16, 2009, and July 10, 2011.
|
|
|
4.4
|
Share Purchase Agreement dated August 8, 2012, among Mazor Robotics Ltd. and the Oracle Investors.
|
|
|
4.5
|
Form of Allocation Agreement used in February 2011 private placement with the Phoenix Insurance Company and Leader Underwriters (1993) Ltd. (unofficial English translation from Hebrew original).
|
|
|
4.6
|
Employment Agreement dated December 26, 2007, between Mazor Robotics Ltd. and Jonathan Adereth (unofficial English translation from Hebrew original).
|
|
|
4.7
|
Personal Employment Agreement dated April 9, 2013, between Mazor Robotics Ltd. and Ori Hadomi.
|
|
|
4.8
|
Employment Agreement dated December 12, 2007, between Mazor Robotics Ltd. and Sharon Levita (unofficial English translation from Hebrew original).
|
|
|
4.9^
|
Sub-Contracting and Supply Agreement dated September 28, 2005, between Mazor Robotics Ltd. and MPS Micro Precision Systems AG.
|
4.10
|
Extension letter dated January 18, 2013, to the Sub-Contracting and Supply Agreement dated September 28, 2005, between Mazor Robotics Ltd. and MPS Micro Precision Systems AG.
|
|
|
4.11^
|
Manufacturing Agreement dated February 15, 2005, between Mazor Robotics Ltd. and Yizrael Tamuz Ltd.
|
4.12
|
Extension letter dated January 10, 2013, to the Manufacturing Agreement dated May 15, 2005, between Mazor Robotics Ltd. and Yizrael Tamuz Ltd.
|
|
|
4.13
|
Form of Directors and Officers
Letter of Indemnification and Letter of Exemption (unofficial English translation from Hebrew original).
|
|
|
4.14
|
Employment Agreement dated November 28, 2000, between Mazor Robotics Ltd. and Eliyahu Zehavi, including an amendment thereto dated January 2003 (unofficial English translation from Hebrew original).
|
|
|
4.15
|
Employment Agreement dated July 22, 2003, between Mazor Robotics Ltd. and Avi Posen (unofficial English translation from Hebrew original).
|
|
|
4.16
|
Commercial Lease Agreement dated March 7, 2013, between Mazor Robotics Inc. and ACM DT Properties, LLC.
|
8.1
|
List of Subsidiaries.
|
|
|
15.1
|
Consent of Somekh Chaikin, Certified Public Accountants (Israel), a member of KPMG International independent registered public accounting firm.
|
15.2
|
Consent of Financial Immunities Dealing Room Ltd.
|
MAZOR ROBOTICS LTD.
|
|||
|
By:
|
/s/ Ori Hadomi | |
Ori Hadomi
|
|||
Chief Executive Officer
|
|||
1.
|
Company's name
|
2.
|
Company's goals
|
|
2.1.
|
The development, manufacturing and marketing of innovative medical devices for supporting surgical procedures in the field of orthopedics and neurosurgery.
|
|
2.2.
|
Any other lawful commercial and business goal.
|
3.
|
Limitations on the Company's business policy
|
4.
|
Borrowing powers
|
5.
|
Interpretation
|
|
5.1.
|
The singular shall include the plural, and vice versa; the masculine shall include the feminine and vice versa.
|
|
5.2.
|
Each word and term included in these Articles, if not specifically defined herein, shall have the meaning afforded thereto in the Companies Law, 5759-1999 (the "
Companies Law
"), unless such interpretation contradicts the subject matter or its content.
|
|
5.3.
|
For the avoidance of doubt it is clarified that the provisions of the Companies Law shall apply to matters which are regulated therein in a non-mandatory manner, and which these articles do not stipulate otherwise in relation thereto.
|
6.
|
The Company's share capital and rights attached to shares
|
|
6.1.
|
The Company's authorized share capital is NIS 750,000, divided into 75,000,000 ordinary shares par value NIS 0.01 each.
|
|
6.2.
|
The ordinary shares shall confer on their holders –
|
|
6.2.1.
|
An equal right to participate and vote in the Company's general meetings, whether regular meetings or special meetings, and each of the Company's shares shall confer on its holder, who is present at the meeting and voting therein, whether in person, through a proxy or by a voting card, one vote;
|
|
6.2.2.
|
An equal right to participate in the distribution of dividends, whether in cash or in stock dividend, in the distribution of assets or any other distribution, according to the ratio of the par value of the shares held by them;
|
|
6.2.3.
|
An equal right to participate in the distribution of the Company's Surplus Assets at the time of its dissolution, according to the ratio of the par value of the shares held by them.
|
|
6.3.
|
The Board of Directors may issue shares and other securities, convertible into or exercisable for shares, up to the limit of the Company's authorized share capital. For the purpose of calculating the limit or the authorized capital, securities available for conversion into or exercise for shares shall be deemed to have been converted or exercised at the time of their issuance.
|
7.
|
Limitation of liability
|
8.
|
Co-holding of shares and share certificate
s
|
|
8.1.
|
A shareholder registered in the shareholders' register is entitled to receive from the Company, free of charge, within three months from the allotment or registration of transfer, one share certificate, imprinted with the Company's stamp, with respect to all of the shares which are registered in his name, specifying the number of shares. In case a share is co-held, the Company shall issue one share certificate to all of the share's co-holders, and the delivery of such certificate to one of them shall be deemed as delivery to all of them.
|
|
8.2.
|
A certificate that shall have been defaced, destroyed or lost, may be renewed on the basis of such proofs and guarantees as the Company shall require from time to time.
|
9.
|
The Company's remedies in relation to shares which are not fully paid
|
|
9.1.
|
In the event that the consideration which a shareholder is liable to pay the Company for his shares shall have not been paid, in full or in part, timely and according to the terms and conditions stated in the allotment thereof and/or in the call stated in Section 9.2 below, the Company may, by the Board's resolution, forfeit the shares which were not fully paid up. The forfeiture of the shares shall be executed, provided that the Company delivered to the shareholder a written notice of its intention to forfeit his shares, within no less than 7 days from the date of the receipt of the notice, if the payment shall have not been made within the period stipulated in the notice. So long as a share that shall have been forfeited is not sold, re-allotted or otherwise transferred, the Board of Directors may cancel the forfeiture under such conditions as it shall deem fit.
|
|
9.2.
|
If, according to the terms of issue of the shares, there is no fixed time for the payment of any part of the consideration to be paid therefor, the Board of Directors may, from time to time, make calls on shareholders for any amount yet unpaid for the shares held by them, and each shareholder shall pay the Company the amount required from him, at such scheduled time, provided that he had received a 14 days advanced notice regarding the time and place of payment (the "
Call
"). The Call shall specify that the failure of payment on time, or earlier, at the specified place, might result in the forfeiture of shares which payment is being called. A Call may be cancelled or postponed to another date, all as shall be resolved by the Board of Directors.
|
|
9.3.
|
Unless otherwise determined in the terms of issue of the shares, a shareholder shall not be entitled to receive dividend or exercise any right as a shareholder in relation to shares which are not yet fully paid.
|
|
9.4.
|
Co-holders of a share will be jointly and severally liable for payment of any amount due to the Company in relation to the share.
|
|
9.5.
|
The provisions of this Section shall not derogate from any of the Company's remedies vis-à-vis the shareholder who has failed to pay his debt to the Company in relation to his shares.
|
10.
|
Transfer of shares
|
|
10.1.
|
The Company's shares may be transferred.
|
|
10.2.
|
The transfer of shares must be in writing, and it shall not be registered unless-
|
|
10.2.1.
|
A correct deed of transfer shall have been delivered to the Company at its registered office, together with the certificates of shares which are about to be transferred, if issued. The deed of transfer shall be signed by the transferor, and by a witness certifying the transferor's signature. In the case of transfer of shares which were not yet fully paid at the time of the transfer, the deed of transfer shall be also signed by the recipient of the shares and a by witness certifying his signature; or
|
|
10.2.2.
|
A court order for the amendment of registration shall have been delivered to the Company; or
|
|
10.2.3.
|
It had been proven to the Company that lawful conditions for the endorsement of the right in the share have been fulfilled.
|
|
10.3.
|
A transfer of shares which have not yet been fully paid requires the approval of the Board of Directors, which may refuse the same, at its absolute discretion and without stating any reason therefor.
|
|
10.4.
|
The transfer recipient shall be considered as shareholder with respect to the transferred shares from the time at which his name is registered in the shareholders’ register.
|
|
10.5.
|
The guardians and administrators of a deceased shareholder, or in the absence of administrators or guardians, the persons who have a right as the heirs of the deceased shareholder, will be the only persons whom the Company shall recognize as having a right to the share that was registered in the deceased's name.
|
|
10.6.
|
In the event that a share had been registered in the name of two holders or more, the Company shall only recognize the living co-holder or co-holders as the persons who have the right to the share or any benefit therein. In the event that a share had been registered in the name of several co-holders as aforesaid, each one of them shall be entitled to transfer his right.
|
|
10.7.
|
The Company may recognize a receiver or liquidator of a shareholder which is a corporation under liquidation or dissolution, or a trustee in bankruptcy or any receiver of assets of a bankrupt shareholder as having a right to the shares registered in the name of such shareholder.
|
|
10.8.
|
Any person conferred with rights in shares as a consequence of the death of a shareholder shall be entitled, upon showing proof of probate or of the appointment of a guardian or of the issuance of an inheritance order, attesting that he has the right in the shares of the deceased shareholder, to be registered as shareholder with respect to such shares, or, subject to the provisions of these Articles, to transfer such shares.
|
|
10.9.
|
The receiver or liquidator of a shareholder which is a corporation under liquidation or dissolution, or the trustee in bankruptcy or any receiver of assets of a bankrupt shareholder shall be entitled, upon showing such proof as shall have been demanded therefrom by the Board of Directors, attesting that he has the right to the shares of the shareholder under liquidation, dissolution or bankruptcy, with the consent of the Board of Directors, to be registered as a shareholder in respect of such shares, or may, subject to the provisions of these Articles, transfer such shares.
|
11.
|
Capital Changes
|
|
11.1.
|
Increase the Company's authorized share capital by creating new shares, of the existing class or of a new class, all as shall be determined by the general meeting.
|
|
11.2.
|
Cancel registered un-allotted authorized share capital, provided there is no undertaking of the company, including a contingent undertaking of the Company, to allot the shares;
|
|
11.3.
|
Consolidate and re-distribute its share capital, or any part thereof, into shares of a greater par value than the par value of its existing shares;
|
|
11.4.
|
Divide, through the re-distribution of its existing shares, in whole or in part, its share capital, in whole or in part, into shares of a lesser par value than the par value of its existing shares;
|
|
11.5.
|
Reduce its share capital and any reserved fund for capital redemption in such a way and on such terms and upon the receipt of such approval as shall be required by the Companies Law.
|
|
11.6.
|
Reduce shares in the Company's issued share capital, such that these shares shall be cancelled and the entire consideration paid with respect to the par value of the shares which shall have been so cancelled shall be registered in the Company's books as a capital reserve which shall be deemed, for any matter and purpose, as premium paid on the shares which shall have remained in the Company's issued share capital.
|
12.
|
Modification of rights attached to classes of shares
|
|
12.1.
|
As long as it was not otherwise determined in the terms of issue of the shares, and subject to the provisions of any law, the rights of a certain class of shares may be modified, upon the adoption of a resolution of the Board of Directors and the approval thereof by the general meeting of the holders of shares of the said class, or a written consent of all the holders of the shares of the said class. The provisions of the Company's Articles regarding general meetings shall apply,
mutatis mutandis
, to class meetings.
|
|
12.2.
|
The rights conferred on the holders of shares of a certain class which were issued by special rights, shall not be deemed as modified by the creation or issuance of additional shares on the same level therewith, unless it was otherwise stipulated in the issuance conditions of such shares.
|
13.
|
General Meetings
|
|
13.1.
|
The following of the Company's resolutions shall be made by the general meeting-
|
|
13.1.1.
|
Modifications of the Articles of Association;
|
|
13.1.2.
|
Exercising the powers of the Board of Directors, at times when the Board of Directors is unable to do so;
|
|
13.1.3.
|
The appointment of the Company's auditor and the termination of its employment;
|
|
13.1.4.
|
The appointment of directors, including external directors;
|
|
13.1.5.
|
The approval of acts and transactions which require the approval of the general meeting according to the provisions of the Companies Law and any other law;
|
|
13.1.6.
|
The increase of the authorized share capital and the decrease thereof;
|
|
13.1.7.
|
Merger, as defined by the Companies Law.
|
14.
|
Convening general meeting
s
|
|
14.1.
|
Annual general meetings shall be convened at least once a year, at the time and place as shall be determined by the Board of Directors, but not later than 15 months after the last annual meeting. These general meetings shall be called "annual meetings". All other general meetings of the Company shall be called "special meetings".
|
|
14.2.
|
The annual meeting shall appoint an auditor, appoint the directors according to these articles and discuss all other matters which should be discussed in the Company's annual meeting, according to these Articles, or to the Companies Law, as well as any other matter which shall be determined by the Board of Directors.
|
|
14.3.
|
The Board of Directors may convene a special meeting per its decision, and shall do so if it received a written demand by any of the following (a "
Convening Demand
"):
|
|
14.3.1.
|
Two directors holding office; and/or
|
|
14.3.2.
|
One or more shareholders holding at least five percent of the voting rights in the Company.
|
|
14.4.
|
Any Convening Demand must specify the purposes for which the general meeting should be convened, signed by the demanders and delivered at the Company's registered office. The Demand might be composed of several identically drafted documents, each signed by one demander or more.
|
|
14.5.
|
The Board of Directors, upon being demanded to convene a special meeting, shall convene the same within twenty one days after the delivery of the Convening Demand, to a date which shall be determined in the notice according to Section 14.6 below, and subject to any law.
|
|
14.6.
|
A notice to the Company's members regarding the convening of a general meeting shall be published in the manner determined in the Companies Regulations (Publication of a Notice of a General Meeting and a Class Meeting in a Public Company), 5760-2000 and according to any law.
|
|
14.7.
|
The Company is not obligated to deliver personal notices of the convening of a general meeting to the shareholders who are registered in the Company's shareholder register.
|
15.
|
Deliberations in general meetings
|
|
15.1.
|
The deliberations of the general meeting shall not be commenced unless a quorum is present at the time of opening. A quorum shall be formed upon the presence of at least two shareholders, holding at least twenty five percent of the voting rights (including presence by proxy or by voting card), within one half hour from the time scheduled for the opening of the meeting.
|
|
15.2.
|
In the event that no quorum shall have formed within one half hour after the time at which the general meeting was scheduled to open, the general meeting shall stand adjourned for one week, to the same day and at the same time and place, or to a later date if so noted in the invitation to the meeting or in the notice of the meeting (the "
Adjourned Meeting
").
|
|
15.3.
|
The quorum for the opening of the Adjourned Meeting shall be any number of participants.
|
|
15.4.
|
The chairman of the Board of Directors shall act as chairman of the general meeting, and in his absence the chairman of the general meeting shall be appointed by the participants of the general meetings at the beginning of the meeting.
|
|
15.5.
|
A general meeting with a present quorum may resolve the adjournment of the meeting to another place and another date as it shall determine and in such a case, notices shall be published regarding the said place and date according to the provisions of the Companies Regulations (Publication of a Notice of a General Meeting and a Class Meeting in a Public Company), 5760-2000.
|
16.
|
Voting at the general meeting
|
|
16.1.
|
A shareholder in the Company may vote at general meetings either in person or through a proxy or a voting card.
|
|
16.2.
|
At any vote, each shareholder shall have the number of votes according to the number of shares held by him.
|
|
16.3.
|
A resolution of the general meeting shall be adopted by a simple majority, unless otherwise determined in the Companies Law or in these Articles.
|
|
16.4.
|
The declaration by the meeting's chairman that a resolution has been adopted, either unanimously or by a certain majority shall serve as ostensible evidence thereof.
|
|
16.5.
|
In the event of a tie in the meeting, the chairman of the meeting shall have no additional or casting vote, and the proposed resolution put to the vote shall be voted down.
|
|
16.6.
|
A shareholder may indicate his vote in a voting card, and deliver it to the Company not later than 48 hours prior to the opening of the meeting. The voting card in which a shareholder had indicated his vote, and which arrived at the Company at least 48 hours before the opening of the meeting (and in the case of an Adjourned Meeting – 48 hours prior to the opening of the Adjourned Meeting) shall be deemed as attending the meeting, including for the purpose of quorum as stated in Section 14.1 above.
|
|
16.7.
|
The appointment of a proxy shall be in writing, and signed by the appointer ("
Power of Attorney
"). A corporation shall vote through its representatives who shall be appointed in a document duly signed by the corporation ("
Letter of Appointment
").
|
|
16.8.
|
Voting in accordance with the terms of the Power of Attorney shall be lawful notwithstanding the prior death, incapacitation, dissolution, or bankruptcy of the principal or his cancellation of the Letter of Appointment or transfer of the share in relation to which it was given, unless a written notice of such death, incompetence, dissolution, bankruptcy, cancellation or transfer as aforesaid was received at the office before the meeting.
|
|
16.9.
|
The Letter of Appointment and Power of Attorney or a copy thereof shall be delivered at the Company's registered office (by hand or through facsimile) at least forty eight (48) hours prior to the time scheduled for the meeting or the Adjourned Meeting at which the individual mentioned in the document is about to vote according thereto.
|
|
16.10.
|
A shareholder in the Company shall be entitled to vote at the Company's meetings through a number of proxies, who shall be appointed by him, so long as each proxy is appointed with regard to different portions of shares held by the shareholder. There shall be no prevention that each such proxy shall vote differently at the Company's general meetings.
|
|
16.11.
|
If a shareholder is legally incompetent, he may vote by his board of trustees, receiver, natural guardian or other lawful guardian, and they may vote in person or through a proxy or a voting card.
|
|
16.12.
|
In case two persons or more are co-holders of a share, the vote of the person named first in the shareholders' register as the holder of that share shall be accepted in the voting on any matter, whether in person or through a proxy, and he shall be entitled to deliver voting cards to the Company.
|
17.
|
The Board of Directors
|
18.
|
Appointment and termination of office of directors
|
|
18.1.
|
The number of the Company's directors (including external directors) shall be determined from time to time by the annual general meeting (and subject to Section 18.3 below), so long as it shall be no less than five and no more than nine.
|
|
18.2.
|
The Company's directors shall be elected at an annual meeting and/or a special meeting, and shall serve in office until the end of the next annual meeting (namely, at the end of the annual meeting all of the Company's directors who served until that meeting, with the exception of the external directors, shall resign, subject to the end of this Section below) or until they resign or cease to hold office according to the provision of these Articles or any law, whichever is earlier. In the event that the number of directors appointed by the Company's general meeting is less than the minimum number of directors determined by these Articles, the persons serving as directors until that meeting shall continue to hold office until they are replaced by the Company's general meeting.
|
|
18.3.
|
In addition to the provisions of Section 18.2 above, the Board of Directors may appoint a director to replace a director whose office had been vacated and/or as an addition to the Board of Directors and subject to the maximum number of directors in the Board of Directors as aforesaid in Section 18.1 above. The appointment of a director by the Board of Directors shall be in effect until the next annual meeting or until he ceases to hold office according to the provisions of these Articles or any law, whichever is earlier.
|
|
18.4.
|
A director whose term of office had expired may be re-elected.
|
|
18.5.
|
The term of office of a director shall begin upon his appointment by the annual meeting and/or the special meeting and/or the Board of Directors, or at a later date if such date was set in the appointment resolution of the annual meeting and/or the special meeting and/or the Board of Directors.
|
|
18.6.
|
The Board of Directors shall elect one of its members to serve as the Chairman of the Board of Directors. If no chairman was elected, or if the Chairman is not present at the end of 15 minutes after the time scheduled for the meeting, the present directors shall elect one of them to be the chairman at that meeting, and the elected person shall chair the meeting and sign the minutes.
|
|
18.7.
|
The general meeting may remove any director prior to the expiration of his term of office, whether the director was appointed thereby by virtue of Section 18.2 above or by the Board of Directors by virtue of Section 18.3 above, so long as the director was given a reasonable opportunity to present his position before the general meeting.
|
|
18.8.
|
In the event that a director's office has been vacated, the remaining directors may continue to act, as long as their number had not decreased below the minimum number of directors as stipulated in these Articles. If the number of directors is lower than the said minimum, the remaining directors may only act in order to replace the director whose office has been vacated as aforesaid or to convene a general meeting of the Company, and until the general meeting is convened as aforesaid they may act for the management of the Company's business only on urgent matters.
|
|
18.9.
|
Each member of the Board of Directors may, with the consent of the Board, appoint a substitute for himself (an "
Alternate Director
") subject to the provisions of any law.
|
|
18.10.
|
A director's office will be vacated upon any of the following events:
|
18.10.1.
|
He shall have resigned his office, through a letter signed by him and delivered to the Company and specifying the reasons for his resignation;
|
18.10.2.
|
He shall have been removed from office by the general meeting;
|
18.10.3.
|
He shall have been convicted of an offense as stated in Section 232 of the Companies Law;
|
18.10.4.
|
According to a court decision, as stated in Section 233 of the Companies Law;
|
18.10.5.
|
He shall have been declared incompetent;
|
18.10.6.
|
He shall have been declared bankrupt, and if the director is a corporation, it shall have resolved to be voluntarily dissolved or a dissolution order shall have been issued with respect thereto.
|
19.
|
Board Meetings
|
|
19.1.
|
The Board of Directors will convene for meetings according to the needs of the Company and at least once every three months.
|
|
19.2.
|
The Chairman of the Board may convene the Board of Directors at any time. Furthermore, the Board of Directors shall convene, on a specified matter, in the following cases:
|
|
19.2.1.
|
Upon the demand of two directors, however if at that time the Board of Directors is comprised of only five members or less – upon the demand of one director
;
|
|
19.2.2.
|
Upon the demand of one director, if his call to convene the board of directors specifies that he had become aware of a matter of the Company, wherein alleged violations of the law were discovered, or prejudice to the ordinary way of business;
|
|
19.2.3.
|
A notice or a report by the CEO require action by the Board of Directors;
|
|
19.2.4.
|
The auditor had notified the Chairman of the Board of significant deficiencies in the internal controls of the Company.
|
|
19.3.
|
Notice of the convening of a meeting of the Board of Directors shall be delivered to all members thereof at least two days prior to the date of the Board's meeting. The notice shall be delivered at the director's address which was provided ahead of time to the Company, and it shall specify the date of the meeting and the place of convention as well as reasonable detail of all matters on the agenda.
|
|
19.4.
|
The quorum for the opening of a board meeting shall be the majority of board members. If there is no quorum present at a board meeting after one half hour from the time scheduled for the opening of the meeting, the meeting shall stand adjourned to another date which shall be decided by the Chairman of the Board of Directors, or in his absence by the directors present at the convened meeting, so long as a notice regarding the date of the adjourned meeting is delivered to all directors two days in advance. The quorum for the opening of an adjourned meeting shall be any number of participants. The aforesaid notwithstanding, the quorum for the Board's deliberations and resolution regarding the termination or suspension of the internal auditor shall be the majority of members of the Board of Directors.
|
|
19.5.
|
The Board of Directors may hold meetings through the use of any means of communication, provided that all participating directors can hear each other simultaneously.
|
|
19.6.
|
The Board of Directors may adopt resolutions even without actually convening, so long as all of the directors who are eligible to participate in the discussion and vote on the matter presented for decision have agreed thereto (i.e. agreed that the resolution shall be adopted without actually convening). If resolutions shall have been adopted according to this Section, the Chairman of the Board shall keep minutes of the resolutions, stating the vote of each director regarding the matters presented for decision as well as the fact that all of the directors have agreed to adopt the resolution without convening.
|
20.
|
Voting at the Board of Directors
|
|
20.1.
|
Each member of the Board of Directors will have one vote when voting at the Board of Directors.
|
|
20.2.
|
The Board's resolutions shall be adopted by a majority vote. The Chairman of the Board shall have no right to an additional or casting vote, and in the event of a tie the resolution put to the vote shall be voted down.
|
21.
|
Board Committees
|
|
21.1.
|
The Board of Directors may establish committees and appoint members thereto from the members of the Board of directors (a "
Board
Committee
"). Upon the establishment of Board Committees, the Board of Directors shall determine, in their terms of authorization, whether they are delegated certain powers of the Board of Directors such that a resolution of the Board Committee shall be deemed as a resolution of the Board of Directors, or that a resolution of the Board Committee shall be but a recommendation, subject to the Board's approval, so long as a Committee is not delegated the power to adopt resolutions regarding the matters specified in Section 112 of the Companies Law.
|
|
21.2.
|
The provisions of these Articles pertaining to Board meetings and the voting therein shall apply,
mutatis mutandis
, and subject to the Board's resolutions (if any) regarding the procedures of the committee's meetings, to all meetings and deliberations of any Board Committee comprised of at least two members.
|
22.
|
Audit Committee
|
|
22.1.
|
The Company's Board of Directors shall appoint, from its members, an audit committee. The number of members of the audit committee shall be no less than three, and all external directors shall be included therein. The Chairman of the Board shall not be appointed to the audit committee, nor will any director who is employed by the Company or is regularly providing services thereto, or the Company's controlling party or his relative.
|
|
22.2.
|
The responsibilities of the audit committee shall be to-
|
|
22.2.1.
|
Point out deficiencies in the business management of the Company,
inter alia
through consultation with the Company's internal auditor or auditor, and suggest to the Board of Directors measures for their repair;
|
|
22.2.2.
|
Resolve whether to approve acts and transactions which require the approval of the audit committee according to the Companies Law.
|
|
22.3.
|
The audit committee shall hold, at least once a year, a meeting to discuss deficiencies in the Company's business management, in the presence of the internal auditor and the auditor, and in the absence of officers of the Company who are not members of the committee, after being given the opportunity to present their position.
|
23.
|
The Company's management
|
24.
|
Exemption from liability, insurance and indemnification
|
|
24.1.
|
Exemption from liability
|
|
24.2.
|
Liability insurance
|
|
24.2.1.
|
A breach of the duty of care vis-à-vis the Company or another person;
|
|
24.2.2.
|
A breach of the fiduciary duty vis-à-vis the Company, provided that the officer acted in good faith and had reasonable grounds to assume that the action would not prejudice the best interests of the Company;
|
|
24.2.3.
|
A monetary liability that shall be imposed upon him in favor of another person, including by way of administrative enforcement;
|
|
24.2.4.
|
Any other liability which could be lawfully insured.
|
|
24.3.
|
Indemnification
|
|
24.3.1.
|
A financial liability imposed on him in favor of another person pursuant to a judgment, including a judgment issued in a settlement or an arbitration award approved by a court;
|
|
24.3.2.
|
Reasonable litigation expenses, including attorney's fees incurred by an officer as a result of an investigation or other proceeding held against him by an authority which is empowered to conduct an investigation or a proceeding and which ended without an indictment or an imposition of financial liability as a substitute for criminal proceedings, or which ended with no indictment but with the imposition of financial liability as a substitute for criminal proceedings, in an offense which requires no proof of general intent, or in relation to monetary sanction; in this Section –
|
|
24.3.2.1.
|
"Termination of proceeding without indictment in a matter in which a criminal investigation had been held" shall mean the closing of the file according to Section 62 of the Criminal Procedure Law [consolidated version] 5742-1982 (in this subsection – the Criminal Procedure Law), or the stay of proceedings by the Attorney General according to Section 231 of the Criminal Procedure Law;
|
|
24.3.2.2.
|
"Financial liability as a substitute for of a criminal proceeding" – a financial liability lawfully imposed as a substitute for a criminal proceeding, including administrative fine according to the Administrative Offense law 5946-1985, a fine for an offense which was determined as an infraction according to the provisions of the Criminal Procedure Law, monetary penalty or sanction.
|
|
24.3.3.
|
Reasonable litigation expenses, including attorney's fees, incurred by the officer or charged to him by a court, in a proceeding filed against him by or on behalf of the Company or by another person, or in a criminal charge from which he shall have been acquitted, or in a criminal charge in which he shall have been convicted of an offense which requires no proof of general intent
.
|
|
24.3.4.
|
A monetary liability that shall have been imposed upon him in a procedure of administrative enforcement in favor of the person injured by the breach as stated in Section 52-54(a)(1)(a) of the Securities Law and/or for expenses incurred by the officer in relation to the administrative enforcement proceeding conducted in his case, including reasonable litigation expenses, including attorney's fees.
|
|
24.3.5.
|
Any other liability or expense imposed on him or which he shall have incurred due to an act he took in his capacity as an officer of the Company, for which he can be indemnified according to the provisions of any law, as they shall be from time to time.
|
|
24.3.6.
|
The Company may undertake in advanced to indemnify an officer thereof, provided that the indemnification undertaking with respect to the aforesaid in Section 24.3 on the whole shall not exceed an amount equal to 25% of the Company's equity according to its latest financial statements as being at the time of the actual granting of the indemnification, all in addition to the amounts received, if any, from an insurance company within an insurance policy which the Company had taken out (the "
Maximum Indemnification Amount
"), and that the indemnification undertaking shall specify the events which the directors deem as foreseeable considering the Company's actual business at the time of the undertaking.
|
|
24.3.7.
|
The Company may indemnify an officer thereof retroactively.
|
25.
|
Internal Auditor
|
|
25.1.
|
The Company's Board of Directors shall appoint an internal auditor in accordance with the audit committee's proposal. Any person who is an interested party in the Company, an officer thereof or a relative of any of the above shall not serve as the Company's internal auditor, nor will the auditor or anyone on its behalf.
|
|
25.2.
|
The Board of Directors shall determine the officer who will be the organizational supervisor of the internal auditor.
|
|
25.3.
|
The internal audit plan prepared by the internal auditor shall be submitted for the approval of the audit committee; however, the Board of Directors may determine that the plan shall be submitted for the approval of the Board of Directors.
|
26.
|
Auditor
|
|
26.1.
|
The annual meeting shall appoint an auditor for the Company and he shall serve in his position until the end of the following annual meeting.
|
|
26.2.
|
The auditor's fee for the audit function shall be determined by the Board of Directors. The Board of Directors shall be entitled to delegate this power to a board committee.
|
|
26.3.
|
The Board of Directors shall report to the annual meeting of the auditor's fee.
|
27.
|
Signature on behalf of the Company
|
|
27.1.
|
The Company's signatories shall be determined from time to time by the Company's Board of Directors.
|
|
27.2.
|
Any person signing on behalf of the Company shall do so with an imprint of the Company's stamp, or on or alongside its printed name.
|
28.
|
Dividend and stock dividend
|
|
28.1.
|
The Company's resolution regarding the distribution of dividend and/or the distribution of stock dividend shall be adopted by the Company's Board of Directors.
|
|
28.2.
|
The shareholders entitled to receive a dividend are the shareholders at the time of the resolution on the dividend or at a later date, if such other date was specified in the resolution to distribute the dividend.
|
|
28.3.
|
Unless otherwise determined by the Board of Directors, any dividend may be paid by check or payment order delivered by mail according to the registered address of the shareholder or the person entitled thereto, or in the event of registered co-holders, to that shareholder who is named first in the shares register in relation to the co-holding. Each such check shall be made out to the order of the person to whom it is delivered. A receipt by a person who, on the date of declaration of the dividend, is named in the shareholders' register as a shareholder, or, in case of co-holders, by one of them, shall serve as confirmation regarding all payments made in relation to that share and regarding which the receipt had been received.
|
|
28.4.
|
For the purpose of the execution of any resolution as per the provisions of this Section, the Company's Board of Directors may settle any difficulty which might arise in relation to the distribution of dividend and/or stock dividend as it shall deem fit, including determining the value for the purpose of the said distribution of certain assets and resolving that cash payments shall be made to members on the basis of the value which was so determined, determine instructions regarding share fractions or regarding the non-payment of amounts lower than NIS 200.
|
29.
|
Redeemable securities
|
30.
|
Donations
|
31.
|
Accounts
|
|
31.1.
|
The company shall run its accounts and prepare financial statements according to the Securities Law and any other law.
|
|
31.2.
|
The accounting books shall be kept at the Company's registered office or in such other place as the directors shall deem fit, and will be open for the directors' review on regular business hours.
|
32.
|
Notices
|
|
32.1.
|
Subject to any law, a notice or any other document which the Company delivers and which it is entitled or required to give pursuant to the provisions of these Articles and/or the Companies Law shall be personally delivered by the Company to any person, whether through mail delivery in an addressed letter according to the registered address of that shareholder in the shareholders' register or to that address which the shareholder had provided in writing to the Company as an address for the delivery of notices or other documents, and whether through facsimile transmission to the number which the shareholder had noted as the number for delivery of notices through facsimile. Notices which the Company shall publish to all shareholders shall be published through publication in two daily newspapers published in Israel.
|
|
32.2.
|
Any notice which should be delivered to shareholders shall be delivered, in relation to shares which are co-held, to the person who is first named in the shareholders' register as the owner of that share, and any notice so delivered shall be a sufficient notice to the holders of that share.
|
|
32.3.
|
Any notice or other document which shall be delivered according to the provisions of Section 32.1 shall be deemed as having been delivered within 3 business days – if sent by registered mail and/or regular mail in Israel and if delivered by hand or by facsimile it shall be deemed as having been delivered on the first business day after the receipt thereof. When proving the delivery it is sufficient to prove that the letter sent by mail contained the notice and was addressed to the correct address and was delivered at the post office as a stamped letter or a stamped registered letter, and regarding facsimile it is sufficient to produce a confirmation of transmission sheet from the dispatching machine. In relation to a notice published in newspapers – the date of publication in the newspaper shall be deemed as the date of delivery of the notice to all shareholders.
|
|
32.4.
|
Any record which is ordinarily entered in the Company's register shall be deemed as
prima facie
evidence of the delivery as recorded in the said register.
|
|
32.5.
|
When it is necessary to provide notice a certain number of days in advance, or a notice that is valid for a certain period of time, the date of delivery shall be counted in the number of days or the period of time.
|
33.
|
Amendment of these Articles
|
34.
|
Dissolution
of the Company
|
|
34.1
|
The liquidator shall first use all of the Company's assets in order to repay its debts (the Company's assets after the payment of its debts shall be referred to as the "
Surplus Assets
").
|
|
34.2
|
Subject to special rights attached to shares, the liquidator shall distribute the Surplus Assets between the shareholders
pari passu
to the par value of the shares.
|
|
34.3
|
Upon the Company's approval, in a resolution which shall be adopted in the general meeting by a majority of at least 50% of the shareholders' votes, the liquidator may distribute the Company's Surplus Assets, or any part thereof, between the shareholder, in kind, and also transfer any of the Surplus Assets to a trustee in a deposit in favor of the shareholders as the liquidator shall deem fit.
|
ARTICLE 1. | DEFINITIONS | 1 | ||
SECTION 1.01
|
American Depositary Shares.
|
1 | ||
SECTION 1.02
|
Commission.
|
2 | ||
SECTION 1.03
|
Company.
|
2 | ||
SECTION 1.04
|
Custodian.
|
2 | ||
SECTION 1.05
|
Deliver; Surrender.
|
2 | ||
SECTION 1.06
|
Deposit Agreement.
|
3 | ||
SECTION 1.07
|
Depositary; Corporate Trust Office.
|
3 | ||
SECTION 1.08
|
Deposited Securities.
|
3 | ||
SECTION 1.09
|
Dollars.
|
3 | ||
SECTION 1.10
|
DTC.
|
3 | ||
SECTION 1.11
|
Foreign Registrar.
|
3 | ||
SECTION 1.12
|
Holder.
|
4 | ||
SECTION 1.13
|
Owner.
|
4 | ||
SECTION 1.14
|
Receipts.
|
4 | ||
SECTION 1.15
|
Registrar.
|
4 | ||
SECTION 1.16
|
Restricted Securities.
|
4 | ||
SECTION 1.17
|
Securities Act of 1933.
|
4 | ||
SECTION 1.18
|
Shares.
|
5 | ||
ARTICLE 2. | FORM OF RECEIPTS, DEPOSIT OF SHARES, DELIVERY, TRANSFER AND SURRENDER OF AMERICAN DEPOSITARY SHARES | 5 | ||
SECTION 2.01
|
Form of Receipts; Registration and Transferability of American Depositary Shares.
|
5 | ||
SECTION 2.02
|
Deposit of Shares.
|
6 | ||
SECTION 2.03
|
Delivery of American Depositary Shares.
|
7 | ||
SECTION 2.04
|
Registration of Transfer of American Depositary Shares; Combination and Split-up of Receipts; Interchange of Certificated and Uncertificated American Depositary Shares.
|
7 | ||
SECTION 2.05
|
Surrender of American Depositary Shares and Withdrawal of Deposited Securities.
|
8 | ||
SECTION 2.06
|
Limitations on Delivery, Transfer and Surrender of American Depositary Shares.
|
9 | ||
SECTION 2.07
|
Lost Receipts, etc.
|
10 | ||
SECTION 2.08
|
Cancellation and Destruction of Surrendered Receipts.
|
11 | ||
SECTION 2.09
|
Pre-Release of American Depositary Shares.
|
11 |
SECTION 2.10
|
DTC Direct Registration System and Profile Modification System.
|
11 | ||
SECTION 2.11
|
Maintenance of Records.
|
12 | ||
ARTICLE 3. | CERTAIN OBLIGATIONS OF OWNERS AND HOLDERS OF AMERICAN DEPOSITARY SHARES | 12 | ||
SECTION 3.01
|
Filing Proofs, Certificates and Other Information.
|
12 | ||
SECTION 3.02
|
Liability of Owner for Taxes.
|
13 | ||
SECTION 3.03
|
Warranties on Deposit of Shares.
|
13 | ||
SECTION 3.04
|
Disclosure of Beneficial Ownership.
|
13 | ||
ARTICLE 4. | THE DEPOSITED SECURITIES | 14 | ||
SECTION 4.01
|
Cash Distributions.
|
14 | ||
SECTION 4.02
|
Distributions Other Than Cash, Shares or Rights.
|
15 | ||
SECTION 4.03
|
Distributions in Shares.
|
15 | ||
SECTION 4.04
|
Rights.
|
16 | ||
SECTION 4.05
|
Conversion of Foreign Currency.
|
18 | ||
SECTION 4.06
|
Fixing of Record Date.
|
18 | ||
SECTION 4.07
|
Voting of Deposited Securities.
|
19 | ||
SECTION 4.08
|
Changes Affecting Deposited Securities.
|
20 | ||
SECTION 4.09
|
Reports.
|
20 | ||
SECTION 4.10
|
Lists of Owners.
|
21 | ||
SECTION 4.11
|
Withholding.
|
21 | ||
ARTICLE 5. | THE DEPOSITARY, THE CUSTODIANS AND THE COMPANY | 22 | ||
SECTION 5.01
|
Maintenance of Office and Transfer Books by the Depositary.
|
22 | ||
SECTION 5.02
|
Prevention or Delay in Performance by the Depositary or the Company.
|
22 | ||
SECTION 5.03
|
Obligations of the Depositary, the Custodian and the Company.
|
23 | ||
SECTION 5.04
|
Resignation and Removal of the Depositary.
|
24 | ||
SECTION 5.05
|
The Custodians.
|
25 | ||
SECTION 5.06
|
Notices and Reports.
|
26 | ||
SECTION 5.07
|
Distribution of Additional Shares, Rights, etc.
|
26 | ||
SECTION 5.08
|
Indemnification.
|
27 | ||
SECTION 5.09
|
Charges of Depositary.
|
28 | ||
SECTION 5.10
|
Retention of Depositary Documents.
|
29
|
||
SECTION 5.11
|
Exclusivity.
|
29 | ||
SECTION 5.12
|
List of Restricted Securities Owners.
|
29 |
ARTICLE 6. | AMENDMENT AND TERMINATION | 30 | ||
SECTION 6.01
|
Amendment.
|
30 | ||
SECTION 6.02
|
Termination.
|
30 | ||
ARTICLE 7. | MISCELLANEOUS | 31 | ||
SECTION 7.01
|
Counterparts.
|
31 | ||
SECTION 7.02
|
No Third Party Beneficiaries.
|
31 | ||
SECTION 7.03
|
Severability.
|
32 | ||
SECTION 7.04
|
Owners and Holders as Parties; Binding Effect.
|
32 | ||
SECTION 7.05
|
Notices.
|
32 | ||
SECTION 7.06
|
Submission to Jurisdiction; Appointment of Agent for Service of Process; Jury Trial Waiver.
|
33 | ||
SECTION 7.07
|
Waiver of Immunities.
|
34 | ||
SECTION 7.08
|
Governing Law.
|
34 |
|
MAZOR ROBOTICS LTD.
|
||
By: | |||
Name: | |||
Title: | |||
THE BANK OF NEW YORK MELLON,
as Depositary
|
|||
By: | |||
Name: | |||
Title: |
AMERICAN DEPOSITARY SHARES
(Each American Depositary Share represents
_______ deposited Share[s])
|
19.
|
RESIGNATION AND REMOVAL OF THE DEPOSITARY; APPOINTMENT OF SUCCESSOR CUSTODIAN
.
|
22.
|
DTC DIRECT REGISTRATION SYSTEM AND PROFILE MODIFICATION SYSTEM
.
|
23.
|
SUBMISSION TO JURISDICTION; JURY TRIAL WAIVER; WAIVER OF IMMUNITIES
.
|
24.
|
DISCLOSURE OF BENEFICIAL OWNERSHIP
.
|
1.
|
Exercise Date
. Subject to the provisions herein, this Warrant may be exercised at any time from the date of this Warrant, and until August ____, 2015 (the “
Exercise Period
”).
|
2.
|
Exercise of Warrant
.
|
|
(a)
|
The Warrant Holder may exercise this Warrant during the Exercise Period, in whole or in part, and subject to the Company’s rights to cause a mandatory exercise pursuant to
Section 8
of this Warrant, by presentation and surrender of this Warrant at the office of the Company, accompanied by a duly executed exercise notice in the form attached hereto as
Schedule 2(a)
(the “
Exercise Notice
”), the details of the Warrant Holder’s securities account in Israel and a certified or official bank check, wire transfer, or other form of payment acceptable to the Company for the amount equal to the product obtained by multiplying the number of Warrant Shares being purchased upon such exercise by the applicable Exercise Price. Upon exercise, the Warrant Holder will receive a number of Warrant Shares equal to the Warrant consideration delivered by such Warrant Holder to the Company divided by the Exercise Price.
|
|
(b)
|
In the event that the Exercise Price is lower than NIS 4.25 per share, then the Warrant Holder will be entitled to exercise only up to 50% of the Total Warrant Consideration at such Exercise Price (and any exercise with respect the balance of such Total Warrant Consideration shall be at an Exercise Price of NIS 6.00).
|
|
(c)
|
In the event that any Warrant Holder exercises some or all of its Warrants (including any Partial Exercise), the Warrant Holder shall designate in the Exercise Notice the number of Ordinary Shares that it wishes to purchase or the aggregate number of underlying Ordinary Shares represented by the portion of the Warrant it wishes to exercise, as applicable. Upon any partial exercise, the Company shall forthwith issue and deliver to the Warrant Holder a new Warrant of like tenor, in the name of the Warrant Holder, which shall be exercisable for such number of Ordinary Shares represented by this Warrant that have not been purchased upon such exercise. For avoidance of doubt, the Exercise Period of such newly issued warrant shall be identical to the Exercise Period hereunder.
|
3.
|
Effective Date of Exercise
. The exercise of all or a portion of this Warrant, as applicable, shall be deemed to have been effected immediately prior to the close of business on the Business Day on which this Warrant is surrendered to the Company in accordance with the terms provided in
Section 2(a)
hereof;
provided
that no exercise may be made on the Record Date (as defined in the TASE Rules) of the distribution of a dividend, bonus shares, rights offering, consolidation, sub-division or reduction of share capital (each, a “
Company Event
”). No exercise of the Warrants may be made on the Ex-Day (as defined in the TASE Rules) of a Company Event, should it occur prior to the Record Date of such Company Event.
|
4.
|
Delivery on Exercise
. As soon as practicable after the exercise of this Warrant in full or in part pursuant to
Section 2(a)
, and in any event within five (5) Business Days thereafter, the Company will issue to the Warrant Holder, by depositing into a securities account in Israel designated by the Warrant Holder (the details of which shall be provided by the Warrant Holder as specified above), the Ordinary Shares to which such holder shall be entitled on such exercise, free and clear of all Encumbrances.
|
5.
|
Adjustment of Exercise Price and Number of Shares
. All references to a specific amount of NIS, as well as the Exercise Price of this Warrant and the number of Ordinary Shares issuable upon exercise of this Warrant (or any shares or other securities at the time issuable upon exercise of this Warrant) (i) shall be proportionately adjusted to reflect any share split, combination of shares, reclassification, recapitalization and distribution of bonus shares by the Company and (ii) shall be reduced to reflect any dividends declared and paid with respect to the Ordinary Shares between the date of this Warrant and the exercise date; in each case in accordance with TASE Rules for any such adjustment. For example, if there should be a 2-for-1 share split, the Exercise Price would be divided by two and such number of shares would be doubled.
|
6.
|
Replacement of Warrant
. On receipt of (i) evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and (ii) delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or surrender and cancellation of such Warrant, as applicable, the Company shall execute and deliver, at its own cost and expense, a new Warrant of like tenor and update the books and records of the Company accordingly.
|
7.
|
Assignment and Transfer
. This Warrant may not be assigned and/or transferred by the Warrant Holder, unless agreed otherwise in writing by the Company which consent shall not be unreasonably withheld;
provided
,
however
, that the Warrant Holder shall be permitted to assign or transfer this Warrant without seeking the Company’s consent to any of its Subsidiaries or Affiliates. In any event, the Warrant and the Warrant Shares shall be subject to the lock-up restrictions imposed by the Israeli Securities Law and Regulations.
|
8.
|
Mandatory Exercise of the Warrant
.
|
|
8.1.
|
The Company shall notify the Warrant Holder of the satisfaction of the Conditions Precedent in the form attached hereto as
Schedule 8.1
. Within thirty (30) days after receipt of such Company notice, the Warrant Holder will exercise the Warrant by paying an Exercise Price per Warrant Share equal to the lower of (i) NIS 6.00 and (ii) the Average Price preceding the implementation of the ADR Program as set forth in the notice of completion, in each case based on the Rate of Exchange;
provided
that if such Exercise Price per share is lower than NIS 4.25, then the Company will have the right, at its sole discretion, to compel the Warrant Holder to exercise 50% of its Total Warrant Consideration at such Average Price.
|
|
8.2.
|
In the event that the Average Price equals or exceeds NIS 6.00 per share at any time following a Partial Exercise pursuant to
Section 8.1
above, and during the Exercise Period, the Warrant Holder shall be compelled to exercise the balance of the Warrant issued to it, up to the remaining Total Warrant Consideration, at an Exercise Price of NIS 6.00 per share within 30 days after the receipt of the Company’s notice in the form attached hereto as
Schedule 8.2
.
|
|
8.3.
|
Notwithstanding anything herein to the contrary, if the Conditions Precedent do not occur within the first anniversary of the date hereof, then the Warrant Holder shall have no obligation to exercise the Warrant under this
Section 8
.
|
|
8.4.
|
Notwithstanding anything herein to the contrary, the aggregate number of Ordinary Shares purchased by the Warrant Holder under this Warrant (whether in connection with a mandatory exercise pursuant to this
Section 8
or otherwise) shall not exceed the Warrant Cap.
|
9.
|
No Rights or Liability as a Shareholder
. This Warrant does not entitle the Warrant Holder to any voting rights or other rights as a shareholder of the Company, until such Warrant is exercised by the Warrant Holder.
|
10.
|
Notices
. All notices, requests, consents and other communications to be given or otherwise made to any part to this Warrant shall be deemed to be sufficient if contained in a written instrument, delivered by hand in person, by express overnight courier service, or by electronic mail or facsimile transmission (with a confirming copy sent by mail, first class, postage prepaid mail), or by registered or certified mail, return receipt requested, postage prepaid, addressed to such party at the address first set forth above or at such other address as may hereafter be designated in writing by the addressee to the address or listing all parties. All notices shall be considered to be delivered 7 days after dispatch in the event of first class or registered mail, and on the next succeeding Business Day in the event of electronic mail or facsimile transmission (with confirmation of receipt) or overnight courier service.
|
11.
|
Material Transactions
. The Company shall provide the Warrant Holder with not less than 15 days written notice of any proposed transaction in which the Company will merge with or into any other Person, or sell, transfer or convey all or substantially all of its assets to any other Person, so as to provide such Warrant Holder with the opportunity to exercise the Warrants prior to the consummation of such transaction.
|
12.
|
Assumption of Warrants
. If the Company engages in any capital reorganization, or consolidation or merger with or into any other person, pursuant to which holders of the Ordinary Shares are entitled to receive stock, securities, cash or other property with respect to or in exchange for its Ordinary Shares, then, as a condition of such reorganization, consolidation or merger, lawful and adequate provision shall be made whereby the Warrant Holder shall have the right to acquire and receive upon exercise of such Warrant such shares of stock, securities, cash or other property issuable or payable with respect to or in exchange for such number of outstanding Ordinary Shares as would have been received upon exercise of such Warrants had such Warrants been exercised immediately before such transaction, subject to adjustments (as determined in good faith by the Board of Directors of the Company). In such case, effective provisions shall be made in the certificate or articles of incorporation of the resulting or surviving person, so that the provisions set forth herein for the protection of the rights of the Warrant Holder shall thereafter continue to be applicable; and any such resulting or surviving person shall expressly assume the obligation to deliver, upon exercise of the Warrants, such shares of stock, securities, cash and other property. The provisions of this
Section 12
shall similarly apply to successive reorganizations, consolidations or mergers.
|
13.
|
Payment of Taxes
. All Ordinary Shares issued upon the exercise of this Warrant shall be validly issued, fully paid and non-assessable. The Warrant Holder shall pay all taxes and other governmental charges that may be imposed in respect to the issue, delivery, holding, transferring this Warrant or receiving Ordinary Shares underlying this Warrant upon exercise hereof.
|
14.
|
Reservation of Shares, etc., Issuable on Exercise of Warrants
. The Company will at all times reserve and keep available, solely for issuance and delivery on the exercise of the Warrant, all Ordinary Shares from time to time issuable on the exercise of the Warrant.
|
15.
|
Additional Purchases of Ordinary Shares
. For the avoidance of doubt, the Warrant Holder shall not be restricted from acquiring additional Ordinary Shares from any third party, subject to applicable law.
|
16.
|
Miscellaneous
. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the Warrant Holder and the Company. This Warrant shall be governed by and construed and enforced in accordance with the laws of the State of Israel, without regard to any applicable principles of conflicts of laws. Any dispute arising under or in relation to this Agreement shall be resolved exclusively in the competent court located in Israel, Tel Aviv, and each of the parties hereby irrevocably submits to the exclusive jurisdiction of such court. The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof.
|
MAZOR ROBOTICS LTD.
|
|
By: ___________________________________
|
|
Name: __________________________________
|
|
Title: ___________________________________
|
(To be Executed by the Warrant Holder
upon Exercise of the Warrant)
|
____________________
Signature: _______________________________
|
MAZOR ROBOTICS LTD.
By:____________________________
Name: _________________________
Title: __________________________
|
MAZOR ROBOTICS LTD.
By:____________________________
Name: _________________________
Title: __________________________
|
1.
|
Enforceability may be limited by applicable bankruptcy, insolvency, reorganization, receivership, preference, moratorium arrangement or winding up laws or other similar laws affecting the enforcement of creditors’ rights, including, without limitation, the Companies Law, 5759-1999, the Bankruptcy Ordinance [New Version], 5740-1980, the Pledge Law, 5727-1967, the Execution Law, 5727-1967 and laws regarding the limitation of actions.
|
2.
|
We express no opinion as to compliance with anti-fraud and/or minority oppression provisions of Applicable Laws.
|
3.
|
Enforceability of the Agreement or any part thereof or document or instrument referred to therein may be limited by equitable principles, including the principle that specific performance and injunction may only be granted in the discretion of the court of competent jurisdiction.
|
4.
|
The performance of contracts (as well as the negotiations leading up to the execution of any contract) must be conducted in good faith and in a reasonable manner. Lack of such good faith (by a contracting party or its agents) may be deemed a breach of contract. Notwithstanding any term or condition contained in any instrument, including, without limitation, the right of any party to exercise its sole discretion, a court of competent jurisdiction, may retain the discretion to determine when the actions of such party or its agents have been conducted in good faith and in a reasonable or “commercially reasonable” manner.
|
5.
|
The enforceability of any of the provisions of any instrument entitling a party to exercise rights and remedies, may be limited by Applicable Law requiring creditors and secured parties to afford debtors a reasonable time to rectify any default or to repay as demanded prior to taking any action to exercise such rights and remedies.
|
6.
|
We express no opinion as to the enforceability of any provision of any instrument which may be characterized in a court as an unenforceable penalty and not as a genuine pre-estimate of damages.
|
7.
|
The validity and enforceability of provisions inserted in any agreement or instrument, which purport to sever from the agreement or instrument any provision which is prohibited or unenforceable under Applicable Law without affecting the enforceability or validity of the remainder of the agreement or instrument may be limited by the operation of law.
|
8.
|
An agreement may be void or voidable if the agreement was entered into under certain circumstances such as, if (i) the will of one of the parties was flawed; (ii) fraud or willful misrepresentation by a party to the agreement; (iii) mistake by a party to the agreement; (iv) exploitation by one party of the other.
|
9.
|
Enforceability of an agreement or of any provisions thereof may be limited by frustration of contract.
|
10.
|
We are members of the Bar of the State of Israel, we express no opinion as to any matter relating to the laws of any jurisdiction other than the laws of the State of Israel as the same are in force on the date hereof and we have not, for the purpose of giving this opinion, made any investigation of the laws of any other jurisdiction. In addition, we express no opinion as to any documents, agreements or arrangements other than those subject to the laws of the State of Israel, if any. As used herein, the term “Applicable Law” means only those laws of the jurisdictions for which we express opinions hereunder.
|
a.
|
The Company is duly organized and validity existing under the laws of the State of Israel and has the requisite corporate power and authority to own, operate and lease its assets and properties and carry on its business as now being conducted.
|
b.
|
The Company has the requisite corporate power and authority to execute, deliver and perform its obligations under the Warrant, including without limitation to issue, sell and deliver the Warrant Shares upon their exercise in accordance with the terms of the Warrant. The execution and delivery of the Company notice under Section
[8.1/8.2]
of the Warrant has been duly authorized by all necessary corporate action of the Company, has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company.
|
c.
|
The Warrant Shares have been duly authorized and, when issued and paid for in accordance with the provisions of the Warrant, will be validly issued, non-assessable and fully paid.
|
d.
|
Except for such as have been obtained, the issuance of the Warrant Shares upon exercise of the Warrants does not require any consent, approvals, Order or authorization of, or registration, qualification, designation, declaration or filing with, any Israeli Governmental Authority on the part of the Company.
|
Company
MAZOR ROBOTICS LTD.
By:
/s/ Ori Hadomi
Name: Ori Hadomi
Title: CEO
By:
/s/ Jonathan Adereth
Name: Jonathan Adereth
Title: Chairman of the Board
|
|
Purchasers
ORACLE PARTNERS, L.P.
By:
/s/ Larry Feinberg
Name: Larry Feinberg
Title: Managing Member
|
ORACLE INSTITUTIONAL PARTNERS, L.P.
By:
/s/
Larry Feinberg
Name: Larry Feinberg
Title: Managing Memeber
|
FEINBERG CHILDREN’S TRUST
By:
/s/Adam Usden
Name: Adam Usden
Title: Authorized Person
|
TRELLUS PARTNERS LP
By:
/s/
Adam Usden
Name: Adam Usden
Title: President
|
VERITION MULTI-STRATEGY MASTER FUND LTD.
By:
/s/ Ted Hagan
Name: Ted Hagan
Title: CFO
|
PAUL AND CAROLYN CLARK REVOCABLE TRUST
By:
/s/ Paul Clark
Name: Paul Clark
Title: Trustee
|
JACK SCHULER
/s/ Jack Schuler
Name: Jack Schule
|
MATT STROBECK
/s/ Matt Strobeck
Name: Matt Strobeck
|
Name of Purchaser & Address
|
Oracle Partners, L.P.
c/o Oracle Investment Management, Inc.
200 Greenwich Avenue, 3rd Floor
Greenwich, CT 06830
Attention: Larry Feinberg
Phone: (203) 862-7901
Fax: (203) 862-7903
Email: larry@oraclepartners.com
|
Jack Schuler
c/o Crab Tree Partners
28161 North Keith Drive
Lake Forest, IL 60045
Attention: Jack Schuler
Phone: (847) 607-2067
Fax: (847) 367-9586
Email: jack.schuler@ctreepartnerscom
|
Oracle Institutional Partners, L.P.
c/o Oracle Investment Management, Inc.
200 Greenwich Avenue, 3rd Floor
Greenwich, CT 06830
Attention: Larry Feinberg
Phone: (203) 862-7901
Fax: (203) 862-7903
Email: larry@oraclepartners.com
|
Trellus Partners LP
c/o Trellus Management Company, LLC
350 Madison Avenue, 9th floor
New York, NY 10017
Attention: Adam Usdan
Phone: (212) 389-8780
Fax: (212) 389-8798
Email: ausdan@trellus.com
|
Name of Purchaser & Address
|
Verition Multi-Strategy Master Fund Ltd.
One American Lane
Greenwich CT 06831
Attention: Josh Goldstein
Fax: (203) 742-7715
Email: jgoldstein@veritionfund.com
|
Paul Clark
c/o ICOS Corp.
22021 20th Ave. SE
Bothell, WA 98021
Attention: Paul Clark
Phone: (425) 415-2285
Fax: (425) 485-1911
Email: pclarkt71@gmail.com
|
Feinberg Children’s Trust
c/o Trellus Management Company, LLC
350 Madison Avenue, 9th floor
New York, NY 10017
Attention: Adam Usdan
Phone: (212) 389-8780
Fax: (212) 389-8798
Email: ausdan@trellus.com
|
Matt Strobeck
3 Lakeview Terrace
Winchester, MA 01890
Phone: (781) 721-0241
Email: matthew.strobeck@gmail.com
|
1.
|
PURPOSES OF THE PLAN
|
2.
|
TYPES OF AWARDS. The Plan is intended to enable the Company to issue Awards (as defined in Section 4 below) subject to Applicable Law (as defined in Section 4 below) and to Section 3, including without limitation (i) Stock Options without a trustee pursuant and subject to the provisions of Section 102 of the Israeli Income Tax Ordinance (New Version) 1961 (the “
Ordinance
”), as amended and any regulations, rules, orders or procedures promulgated there under including tax rules (Preferential Tax Treatment regarding Issuance of Shares to Employees), 2003 (“
Section 102
) (such options, “
Non Trustee
102 Stock Options
”); (ii) Stock Options allocated to a trustee (as defined in section 4) under the capital gains track pursuant and subject to the provisions of Section 102 of the Ordinance (such options, “
102 Capital Gain Stock Options
”);
(iii) Stock Options allocated to a Trustee (as defined in section 4 below) under the ordinary income track pursuant and subject to the provisions of Section 102 of the Ordinance (such options, “
102 Ordinary Income Stock Options
”) (iv) Stock Options pursuant to Section 3(9) of the Ordinance (“
3(9) Stock Options)
(all Non Trustee 102 Stock Options, 102 Capital Gain Stock Options, 102 Ordinary Income Stock Options, 3(9) Stock Options each an “Option”, and collectively, the “
Options
”); Apart from issuance under the relevant tax regimes in the State of Israel, the Plan contemplates issuances to Grantees (as defined in Section 4 below) in other jurisdictions with respect to which the Administrator (as defined in Section 4 below) is empowered to make the requisite adjustments in the Plan and set forth the relevant conditions in the Company’s agreement with the Grantee in order to comply with the requirements of the tax regimes in said jurisdictions.
|
3.
|
THE ELECTION
|
4.
|
DEFINITIONS
|
|
(a)
|
“
Administrator
” means the Board or any of its committees as shall be appointed by the Board to administer the Plan, in accordance with Section 6 hereof.
|
|
(b)
|
“
Adoption Date
” means the later of the date on which the Board adopted this Plan and the date the Plan was approved by the Company’s shareholders, if such approval is necessary under Applicable Laws.
|
|
(c)
|
“
Applicable Laws
” means the requirements relating to the adoption of and/or the administration of stock option plans under the relevant internal laws and regulations of the State of Israel, any stock exchange or quotation system on which the Shares may be listed or quoted and the applicable laws of any other country or jurisdiction where Awards are granted under the Plan, as well as the Articles of Association of the Company.
|
|
(d)
|
“Articles of Association”
means the Certificate of Incorporation of the Company as amended from time to time, the articles of association of the Company as amended from time to time and all shareholders rights agreements, as amended from time to time, entered or to be entered into by the Company and/or its Shareholders.
|
|
(e)
|
“
Award
” shall mean any Option granted to a Grantee under the Plan.
|
|
(f)
|
“
Award Agreement
” means a written agreement between the Company and a Grantee evidencing the terms and conditions of an individual Award grant, as further specified in Section 8.
|
|
(g)
|
“
Award Share
” means the Shares subject to an Award.
|
|
(h)
|
“
Board
” means the board of directors of the Company.
|
|
(i)
|
“
Cause
” means: (i) any action by a Grantee involving willful malfeasance or a willful breach of such a Grantee’s fiduciary duties in connection with such Grantee’s employment
or engagement with the Company or with any Subsidiary; (ii) the conviction of a Grantee in a court of law of, or a guilty plea by the Grantee to, a felony or a fraud or any other similar act; (iii) substantial and continuing refusal or neglect by a Grantee to perform the duties requested of him or her (including without limitation, abiding policies relating to confidentiality and reasonable workplace conduct) provided such duties are expected to be performed by a person engaged for a similar capacity (other than as a result of death, illness or other objective incapacity) which refusal or neglect continues for a period of ten days after written notice thereof is provided to the Grantee from the Company or from the respective Subsidiary; or (iv) an act of moral turpitude, or any similar act, to the extent that such act causes or may cause injury to the reputation of the Company and/or to any of the Company’s Subsidiaries; (v) any other act or omission which, in the reasonable opinion of the Company, could materially financially harm the Company and/or any of the Company’s Subsidiaries or harm the business reputation of the Company and/or any of the Company’s Subsidiaries; (vi) any other circumstance deemed by law to constitute termination for cause, including circumstances relieving an employer from the duty to pay severance pay to the Grantee or (vii) termination of a Grantee’s employment for cause in accordance with provisions of his or her employment agreement or engagement agreement, if any, with the Company.
|
|
(j)
|
“
Committee
” means a committee of directors appointed by the Board in accordance with Section 6 hereof.
|
|
(k)
|
“
Consultant
” means any person who is engaged by the Company and/or a Subsidiary to render consulting or advisory services to the Company and/or the Subsidiary.
|
|
(l)
|
“
Effective Date
” means the date on which the Award Agreement is signed by the Company and the Grantee. The “
Effective Date
” of Trustee Stock Options shall be the date on which such Trustee Stock Options are allocated to the Trustee.
|
(m)
|
“
Employee
” means any person employed by the Company or any Subsidiary or any person who is engaged as an officer of the Company or any Subsidiary, who is not a
"controlling party", as defined in section 32 (9) of the Ordinance, prior to and after the issuance of
the
Awards
.
A person employed by the Company or any Subsidiary shall not cease to be an Employee for the purposes of the Plan in the case of (i) any leave of absence approved by the Company or any Subsidiary or, (ii) transfers between locations of the Company or, (iii) transfer of employment between the Company, its Subsidiaries and any successor.
|
|
(n)
|
“
Exercise Date
” means the date on which the Grantee exercises his Awards, subject to the compliance with all of provisions set out in Section 11 of this Plan.
|
|
(o)
|
“
Exercise Price
” means the amount stipulated in the Award Agreement, to be paid by the Grantee to the Company in order to exercise an Award into an Award Share.
|
|
(p)
|
“
Grantee
” means the holder of an outstanding Award granted under the Plan.
|
|
(q)
|
“
Merger or Acquisition
”
shall mean (i) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation); or (ii) a sale of all or substantially all of the assets of the Company (including, for purposes of this Section, intellectual property rights which, in the aggregate, constitute substantially all of the Company’s material assets); unless in each case, the Company’s stockholder of record as constituted immediately prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue of securities issued as consideration for the Company’s acquisition or sale or otherwise) hold at least fifty percent (50%) of the voting power of the surviving or acquiring entity; or (iii) more than fifty percent (50%) of the voting power of the Company is transferred to an unrelated third party pursuant to a transaction or series of related transactions.
|
|
(r)
|
“
Purchaser
” means the Company (if and as permitted by law) and/or any of its Subsidiaries and/or any other person or entity designated for this purpose by the Company.
|
|
(s)
|
“
Service Provider
” means an Employee or a Consultant
of the Company.
|
|
(t)
|
“
Share
” means a share of the Company's ordinary shares having a par value of NIS 0.01.
|
|
(u)
|
“
Subsidiary
” means any company other than the Company, whether now or hereafter existing, in an unbroken chain of companies beginning with the Company if at the time of granting of the Awards each of the companies other than the last company in an unbroken chain owns shares possessing 50 percent or more of the total combined voting power of all classes of shares in one of the other companies in such chain.
|
|
(v)
|
“
Trustee
” means a person or entity appointed by the Board or the Committee and approved by the Income Tax Officer to hold Trustee Stock Options on behalf of the Grantee according to the conditions set forth in Section 102.
|
(w)
|
“
Vesting Schedule
” has the meaning set forth in Section 8(d).
|
|
(x)
|
“Trustee Stock Options
” means all 102 Capital Gain Stock Options and 102 Ordinary Income Stock Options.
|
5.
|
AUTHORIZED SHARES
|
|
(a)
|
Awards may be granted under the Plan, subject to the provisions of Section 16(a) of the Plan, for up to an aggregate of 110,000 Shares. The Awards may be granted at any time, during a period of 7 years beginning on the Adoption Date.
|
|
(b)
|
In case of Trustee Stock Options, such Trustee Options may be granted after the passage of thirty days (or a shorter period as and if approved by the tax authorities) following the delivery by the Company to the appropriate Israeli Income Tax Authorities of a request for approval the Plan and the Trustee according to Section 102.
|
|
(c)
|
Notwithstanding the above, if within 90 days of delivery of the abovementioned request, the tax officer notifies the Company of its decision not to approve the Plan, the Awards that were intended to be granted as a Trustee Stock Options shall be deemed to be Non Trustee 102 Stock Options, unless otherwise was approved by the Tax officer.
|
(d)
|
If an Award expires, is cancelled or otherwise becomes unexercisable without having been exercised in full, the unexercised, canceled or terminated Award Shares which were subject thereto shall (unless the Plan shall have been terminated) become available for future grant under the Plan; provided, however, that Award Shares that have actually been issued under the Plan shall not be returned to the Plan and shall not become available for future grant under the Plan.
|
(e)
|
The number of Shares that are subject to Awards under the Plan shall not exceed the number of Shares reserved for the grant of Awards that then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available a sufficient number of Shares to satisfy the requirements of the Plan. The Board may, at any time during the term of the Plan, increase the number of the Awards available for grant under the Plan. Such increase must be approved by the Company’s shareholders if so required under the Applicable Laws.
|
6.
|
ADMINISTRATION
|
|
(a)
|
Procedure
. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.
The
Committee will hold its meetings at such times and places as it may determine and will maintain written minutes of its meetings.
|
|
(b)
|
Powers of the Administrator
. Subject to the terms and conditions of the Plan, and in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities and Applicable Laws, the Administrator shall have the authority, in its discretion:
|
|
(i)
|
to select the Service Providers to whom Awards may from time to time be granted hereunder, and to grant said Service Providers the Awards. This authority shall be granted solely to the Board, which will take into consideration the recommendations of the Committee.
|
|
(ii)
|
to determine, from time to time, the type of Awards to be granted to eligible Employees under the Plan, including the determination which Employee will receive Non Trustee 102 Stock Options and subject to the Election pursuant to Section 3 and the provisions of Section 7 below, which Employee will receive 102 Capital Gain Stock Options and/or 102 Ordinary Income Stock Options , and to prescribe the terms and conditions (which need not be identical) of Awards granted under the Plan to such persons;
|
|
(iii)
|
to approve forms of the Award Agreements for use under the Plan;
|
|
(iv)
|
to determine the terms and conditions of any Award granted hereunder, including, without limitation, the Vesting Schedule;
|
|
(v)
|
to exercise such powers and to perform such acts as are deemed necessary or expedient to promote the best interests of the Company with respect to the Plan, including but not limited to prescribing, amending and rescinding any provisions related to the Plan;
|
|
(vi)
|
to amend any outstanding Award, subject to Section 17 hereof, and to accelerate the vesting or extend the exercisability of any Award and to waive conditions or restrictions on any Award, to the extent it shall deem appropriate provided that this authority shall be granted to the Board, and only subject to its prior approval to the Committee which approval shall specifically state the number and identity of Grantees which rights the Committee will be authorized to determine.
|
|
(vii)
|
to allow Grantees to satisfy withholding tax obligations by electing to have the Company, if permitted under Applicable Laws, withhold from the Award Shares to be issued upon exercise of an Award that number of Award Shares having a value equal to the minimum statutory withholding amount. The value of the Award Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by Grantees to have Award Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable and after consolation with the Company’s counsel; and
|
|
(viii)
|
to construe and interpret the terms of the Plan, the Award Agreements and Awards.
|
|
(c)
|
The Board may fill all vacancies, however caused, in the Committee. The Board may from time to time appoint additional members to the Committee, and may at any time remove one or more Committee members and substitute others.
|
(d)
|
Effect of Administrator's Decision
. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Grantees. Each member of the Board and the Committee shall be indemnified and held harmless by the Company against any cost or expense (including fees of counsel) reasonably incurred by him, or 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 Laws. Such indemnification shall be in addition to any rights of indemnification the member may have as director or otherwise under the Articles of Association of the Company, any agreement, any vote of share or disinterested directors, or otherwise.
|
7.
|
ELIGIBILITY
|
(a)
|
General
. Awards may be granted to Service Providers as defined in this Plan.
|
(b)
|
Non Trustee 102 Stock Options and Trustee Stock Options may be granted only to Employee Grantees who are Israeli residents or are deemed to be Israeli residents for purposes of taxation, and to members of the Board, and shall be granted subject to the Ordinance
|
|
(c)
|
3(9) Stock Options may be granted only to Service Providers who are Israeli residents or are deemed to be Israeli residents for purposes of taxation, who are not Employees, and to Employee who is a “controlling party” as defined in section 32 (9) of the Ordinance.
|
|
(d)
|
Continuing Relationship
. The Plan and the Award Agreements shall not confer upon any Grantee any right with respect to continuing the Grantee’s relationship as a Service Provider with the Company or its Subsidiary, nor shall it interfere in any way with his right or the Company's right, or the right of a Subsidiary, to terminate such relationship at any time, with or without Cause.
|
8.
|
AWARD AGREEMENTS.
|
|
(a)
|
Number of Shares. Each Award Agreement shall state the number of Award Shares to which the Awards relates.
|
|
(b)
|
Type of Award. Each Award Agreement shall specifically state the type of Awards granted thereunder and whether they constitute Non Trustee 102 Stock Option, 102 Capital Gain Stock Options , 102 Ordinary Income Stock Options , 3(9) Stock Options, or otherwise.
|
|
(c)
|
Exercise Price. Each Award Agreement shall state the Exercise Price of the Award Shares to which the Award relates. The Exercise Price shall be subject to adjustment as provided in Section 16 hereof.
|
|
(d)
|
Term and Vesting of Options. Each Award Agreement shall provide the schedule according to which such Awards may be exercised (“
Vesting Schedule
”). The Vesting Schedule for the Awards will be determined by the Administrator, provided that (to the extent permitted under Applicable Laws) the Administrator, in its absolute discretion, shall have the authority to accelerate the vesting of any outstanding Option at such time and under such circumstances as it, in its sole discretion, deems appropriate. Subject to the Vesting Schedule, Awards may be exercised into Award Shares during the longer period of (i) ten years from the Effective Date; or (ii) two years from the IPO; (the “
Exercise Period
”) unless otherwise determined by the Administrator (to the extent permitted under Applicable Laws and this Plan). The Exercise Period shall be subject to earlier termination as provided in Section 11 hereof.
|
|
(e)
|
THE RIGHTS OF GRANTEE AS A SHAREHOLDER. Upon signing an Award Agreement and as a condition to the grant of any Awards under those Awards Agreements, the Grantee shall sign the irrevocable proxy attached to the Award Agreement as Appendix A. By this proxy the Grantee’s right to vote any Award Share, if any, shall be given to the person or persons designated by the Board (the “
Representative
”) until the consummation of the Company’s Initial Public Offering (“
IPO
”). If prior to the consummation of the Company’s IPO, the right to vote any Award Share is held by the Trustee, then the Trustee shall be eligible to provide the right to vote any Award Share to the Representative. Such Award Shares shall be voted by the Representative in the same proportion as the result of the shareholder vote (as voted by the stockholders without taking the Award Shares in consideration). To avoid doubt, all Award Shares issued upon exercise of Awards shall entitle the holder thereof to receive any dividends and other distributions thereon granted to all holders of common stock as such, if any.
|
|
(f)
|
Other Provisions. The Award Agreements evidencing Awards under the Plan shall contain such other terms and conditions not inconsistent with the Plan as the Administrator may determine.
|
9.
|
TERM OF THE PLAN
|
|
The Plan shall become effective upon the Adoption Date. The Plan shall continue in effect during the Exercise Period, unless sooner terminated under Section 17 of the Plan (the “
Term
”).
|
|
(a)
|
Expiration
.
Unless otherwise stated in the Award Agreement, each Award shall expire on the later of (i) the tenth anniversary of the Effective Date; (ii) two years from the IPO.
|
(b)
|
Exercise.
The Awards granted will be exercisable into Award Shares of the Company according to the Vesting Schedule set forth in the Award Agreement or in this Plan.
|
(c)
|
Exercise Price
. The Exercise Price per Award Share subject to each Award
Agreement shall be determined by the Administrator, provided however, that such Exercise Price shall not be less than the par value of the share into which such Option is exercisable.
|
|
(d)
|
Transfer
. No Award granted hereunder shall be transferable by the Grantee other then by will or by the laws of descent and distribution. Awards may be exercised during the Grantee’s lifetime only by the Grantee, or his guardian or legal representative. Award Shares acquired upon exercise of the Awards shall be subject to such restrictions on transfer as are generally applicable to ordinary shares of stock of the Company in accordance with the Company’s Articles of Association. Without derogating from any other provision in this Plan, it is expressly clarified that no transfer of Award Shares shall become effective unless the Grantee has delivered to the Company a written notice thereof, together with a confirmation in writing by any transferee of the Award Shares that it is bound by all terms and conditions of this Plan and the Award Agreement. In case of transfer of the Award Shares after the death of the Grantee, the transfer shall become effective only after the transferee delivers such a written confirmation.
|
(e)
|
Restrictions on Transfer of Awards Shares
.
|
(i)
|
Securities Law Restrictions
. Regardless of whether the offering and
sale of Award Shares under the Plan have been registered under the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the “
Securities Act
”) or have been registered or qualified under the securities laws of
any state or other laws of any other jurisdiction, the Company at its discretion may
impose restrictions upon the sale, pledge or other transfer of such
Award Shares (including the placement of appropriate legends on stock
certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in
order to achieve compliance with the Securities Act, the securities laws
of any state or any other law.
|
(ii)
|
Market Stand-Off
. In connection with any underwritten public
offering by the Company of its equity securities pursuant to an
effective registration statement filed under the Securities Act or equivalent law in another jurisdiction, including the Company’s Initial
Public Offering of its shares, the Grantee shall not directly or indirectly sell, make
any short sale of, loan, hypothecate, pledge, offer, grant or sell any
Award or other contract for the purchase of, purchase any or
other contract for the sale of, or otherwise dispose of or transfer, or
agree to engage in any of the foregoing transactions with respect to,
any Award Shares acquired under this Agreement without the prior written consent of the Company or its underwriters. Such restriction (the
“
Market Stand-Off
”) shall be in effect for such period of time following
the date of the final prospectus for the offering as may be requested by
the Company or such underwriters. In the event of the declaration of a stock
dividend, a spin-off, a stock split, an adjustment in conversion ratio,
a recapitalization or a similar transaction affecting the Company’s outstanding securities without receipt of consideration, any new,
substituted or additional securities which are by reason of such
transaction distributed with respect to any Award Shares subject to the Market
Stand-Off, or into which such Award Shares thereby become convertible, shall
immediately be subject to the Market Stand-Off. In order to enforce the
Market Stand-Off, the Company may impose stop-transfer instructions with
respect to the Award Shares acquired under this Plan until the end of the
applicable stand-off period. The Company’s underwriters shall be
beneficiaries of the agreement set forth in this Subsection. This
Subsection shall apply to Award Shares held by Grantees registered in the public
offering under the Securities Act or equivalent law in another
jurisdiction, only if the directors and officers of the Company are subject to similar
arrangements.
|
10.
|
CONDITIONS UPON ISSUANCE OF AWARD SHARES
|
(a)
|
Legal Compliance
. Award Shares shall not be issued pursuant to the exercise of an Award unless the exercise of such Award, the method of payment and the issuance and delivery of such Award Shares shall comply with Applicable Laws (for Non Trustee 102 Stock Option and Trustee Stock Options , comply with Section 102,) and shall be further subject to the approval of counsel of the Company with respect to such compliance.
|
(b)
|
Investment Representations
. As a condition to the exercise of an Award, the Administrator may require the person exercising such Award to represent and warrant at the time of any such exercise that the Award Shares are being purchased only for investment purposes and without any present intention to sell or distribute such Award Shares if, in the opinion of counsel for the Company, such a representation is in the best interests of the Company.
|
11.
|
METHOD OF EXERCISE
|
|
(a)
|
Procedure for Exercise and Rights as a Shareholder
. Any Award granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and/or set forth in the Award Agreement with respect to Employee Grantees and unless the Administrator provides otherwise, vesting of Awards granted hereunder shall be tolled during any unpaid leave of absence other than leave which according to the law does not impair employment continuity.
|
|
(b)
|
Termination of Relationship with a Grantee
. Except as provided in this Subsection and Subsections (c) through (g), an Award may not be exercised unless the Grantee is then a Service Provider of the Company or a Subsidiary thereof. If a Grantee ceases to be a Service Provider, other then in cases as specified in Subsections (c) through (g) below, the Grantee may exercise any vested Award on the date of termination within a period of ninety days following the Grantee's termination (but in no event later then the expiration date of the term of such Award as set forth in Section 9 or in the Plan). In addition, but only if the Grantee ceases to be a Service Provider at least 12 months subsequent to the Employee Grantee’s beginning of employment with the Company, the Grantee will be eligible to exercise a relative portion of the Awards included in the next installment not yet vested, based on the number of employment months elapsed (rounded downwards) since the later of the vesting date of the previous installment or the Effective Date compared to the total number of months (rounded downwards) between the vesting date of the previous installment or the Effective Date (as appropriate) and the vesting date of the nearest installment. The Board, considering the recommendations made by the Administrator, is authorized to approve the exercise of additional Awards. If the Grantee dies during this ninety day period, his rights according to this Subsection 11(b) shall be transferred to the Grantee’s estate or to the person who acquires the right to exercise the Awards by bequest or inheritance, who will be allowed to exercise such vested Awards and additional relative portion of the Awards included in the next installment not yet vested (as mentioned above) during a period of six months from the date of death. Unless otherwise determined by the Administrator, if, on the date of termination, the Grantee is not vested as to his or her entire Award, the unvested portion, with the exception of any additional unvested Awards approved for exercise as detailed above, shall not be exercisable and the Award Shares covered by the unvested portion of the Awards shall revert to the Plan.
|
(c)
|
Dismissal
.
In case of dismissal of an Employee, such Employee Grantee will be eligible to exercise, within 90 days of the date of termination (but in no event later then the expiration date of the term of such Award as set forth in Section 9 or in the Plan), any vested Award, and, in addition, but only if the dismissal occurs at least 12 months subsequent to the Employee Grantee’s beginning of employment with the Company, the Employee Grantee will be eligible to exercise a relative portion of the Awards included in the next installment not yet vested, based on the number of employment months elapsed (rounded downwards) since the later of the vesting date of the previous installment or the Effective Date compared to the total number of months (rounded downwards) between the vesting date of the previous installment or the Effective Date (as appropriate) and the vesting date of the nearest installment, as long as the Grantee was not dismissed for Cause. The Board, considering the recommendations made by the Administrator, is authorized to approve the exercise of additional Awards. If, after termination, the Grantee does not exercise within the time specified by the Award Agreement, the Plan or the Administrator the Awards to which he is eligible, then such Awards shall terminate, and the Award Shares covered by such Awards shall revert to the Plan.
|
(d)
|
Dismissal for Cause
. In the event of termination of relationship with a Service Provider for Cause, the Service Provider’s right to exercise vested Awards shall terminate immediately upon such termination, and all such Awards shall be forfeited without any payment being due. In addition, the Purchaser will be entitled to repurchase, within twelve months of such termination, any or all of the Award Shares resulting from the exercise of any Awards exercised prior to the date of the repurchase. The price paid for each Award Share will be determined by the Administrator, in its sole discretion, but shall not be less than the par value of the Shares being repurchased.
|
|
(e)
|
Disability of a Grantee
. If an a Grantee ceases to be an Employee or Service Provider as a result of a physical or mental impairment, which has lasted or is expected to last for a continuous period of not less than six consecutive months or an aggregate of six months in any twelve-month period and which causes the Grantee’s total and permanent disability to engage in any substantial gainful activity (“
Disability
”), the Grantee may exercise his Awards within twelve months of the date of termination, to the extent the Award is vested on the date of termination, but in no event later than the expiration date of the term of such Awards as set forth in Section 9 or in the Award Agreement. In addition, such an Employee Grantee will also be eligible to exercise Awards included in the next installment which has not yet vested as of the date of termination. If, after termination, the Awards are not exercised within the time specified herein, the Award shall terminate, and the Award Shares covered by such Awards shall revert to the Plan.
|
|
(f)
|
Death of an Employee Grantee
. If an Employee Grantee dies while considered an Employee, the vested Awards, as well as Awards included in the next installment may be exercised within nine months following the Grantee’s death, (but in no event later than the expiration date of the term of such Awards as set forth in Section 9 or in the Award Agreement) by the Grantee's estate or by a person who acquires the right to exercise the Awards by bequest or inheritance. If the Awards are not so exercised within the time specified herein, the Award shall terminate, and the Award Shares covered by such Awards shall revert to the Plan.
|
|
(g)
|
Retirement of an Employee Grantee
. In the event of an Employee Grantee’s retirement, at the age of 65 years for a man and 60 years for a woman, he/she will be eligible to exercise, within six months of such retirement (but in no event later than the expiration date of the term of such Award as set forth in Section 9 or in the Award Agreement), any vested Awards in addition to a relative portion of the Awards included in the nearest installment not yet vested, based on the number of employment months elapsed (rounded downwards) since the later of the vesting date of the previous installment or the Effective Date compared to the total number of months (rounded downwards) between the vesting date of the previous installment or the Effective Date (as appropriate) and the vesting date of the nearest installment. If the Awards are not so exercised within the time specified herein, the Awards shall terminate, and the Award Shares covered by such Awards shall revert to the Plan.
|
12.
|
PAYMENT OF EXERCISE PRICE
|
13.
|
TRUSTEE STOCK OPTIONS.
|
|
(a)
|
Options granted pursuant to this Section 13 are intended to constitute Trustee Stock Options subject to Section 102, the general terms and conditions specified the Plan, except for said provisions of the Plan applying to Awards under a different tax law or regulations.
|
|
(b)
|
Trustee Stock Options shall be granted either as 102 Capital Gain Stock Options or 102 Ordinary Income Stock Options according to the Election and for then subject to the provisions in Section 3.
|
|
(c)
|
Anything herein to the contrary notwithstanding, all Trustee Stock Options granted under this Plan shall be granted by the Company to a Trustee designated by the Administrator and the Trustee shall hold each such Award and the Award Shares issued upon exercise thereof in trust for the benefit of the Grantee in respect of whom such Award was granted. All certificates representing Award Shares issued to the Trustee under the Plan shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Award Shares are released from the trust.
|
|
(d)
|
With regard to 102 Capital Gains Stock Options and 102 Ordinary Income Stock Options , the Awards or the Award Shares and all rights related to them, including bonus shares, will be held by the Trustee for a period of at least 24 months and 12 months, respectively, from the end of the tax year in which the Effective Date or a shorter period as approved by the tax authorities (the “
Lock-up Period”
), under the terms set in Section 102.
|
|
(e)
|
In accordance with Section 102, the Grantee is prohibited from selling the Awards or the Awards Shares, until the end of the Lock-up Period. The meaning of this Section for purposes of income tax is that if the Employee voluntarily sells the Awards or the Awards Shares before the end of the Lock-up Period, the provision of Section 102, relating to non-compliance with the Lock-up Period, will apply.
|
|
(f)
|
Anything to the contrary notwithstanding, the Trustee shall not release any Awards which were not already exercised into Award Shares by the Grantee nor release any Award Shares issued upon exercise of the Award, prior to the full payment of the Exercise Price and Grantee’s tax liability arising from Trustee Stock Options which were granted to him and/or Awards Shares issued upon exercise of such Trustee Stock Options. Upon receipt of the Award, or earlier, the Grantee will sign an undertaking to release 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 granted or Award Share issued to him thereunder.
|
|
(
g
)
|
Trustee Stock Options may only be granted to Employees and members of the Board. (subject to approval of the Plan by the tax authorities).
|
14.
|
3(9) STOCK OPTIONS.
|
|
(a)
|
Options granted pursuant to this Section 14 are intended to constitute 3(9) Stock Options and shall be subject to the general terms and conditions specified in the Plan, except for said provisions of the Plan applying to Awards under a different tax law or regulations.
|
|
(b)
|
3(9) Options may not be granted to Employees or members of the Board.
|
|
(c)
|
The 3(9) Stock Options which shall be granted pursuant to the Plan may be issued to a trustee appointed by the Administrator.
|
15.
|
NON TRUSTEE 102 STOCK OPTIONS
|
|
(a)
|
Options granted pursuant to this Section 15 are intended to constitute Non Trustee 102 Stock Options and shall be subject to the general terms and conditions specified the Plan, except for said provisions of the Plan applying to Awards under a different tax law or regulations.
|
|
(b)
|
Non Trustee 102 Stock Options may only be granted to Employees and members of the Board.
|
|
(c)
|
The Non Trustee 102 Stock Options which shall be granted pursuant to the Plan may be issued to a trustee appointed by the Administrator.
|
|
(d)
|
If the Grantee’s employment with the Company is terminated for any reason, the Grantee will be obligated to provide the Company, to its satisfaction and subject to its sole discretion, with a security or guarantee to cover any future tax obligation resulting from the disposition of the Awards or the Award Shares.
|
16.
|
ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER
|
(a)
|
Changes in Capitalization
. Subject to any required action by the shareholders of the Company, the number of Award Shares covered by or underlying each outstanding Award and the number of Award Shares which have been authorized for issuance under the Plan but as to which no Awards have been granted or which have been returned to the Plan upon cancellation or expiration of an Award, as well as the
Exercise Price per Share of each such outstanding Award shall be appropriately
adjusted in the case of a payment of a large non-recurring dividend or for any increase or decrease in the number of issued Shares resulting from a share split, reverse share split, share dividend, recapitalization, combination or reclassification of the Shares, rights issues or any other increase or decrease in the number of issued Shares in each case effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Award Shares subject to an Award.
|
|
|
(b)
|
Dissolution or Liquidation
. It is hereby clarified that in the event of dissolution or
liquidation
of the Company, the Company shall have no obligation to notify the Grantee of such event and any Awards that have not been previously exercised, will terminate immediately prior to the consummation of such proposed action.
|
|
(c)
|
Voluntary Liquidation
. Notwithstanding Subsection (b) above, in the event of a voluntary liquidation of the Company, which is not considered a Merger or Acquisition, the Administrator shall notify each Grantee as soon as practicable, but not less than 7 working days, prior to the effective date of such proposed transaction. The Grantee will have the right to exercise his or her vested Awards within 5 working days from receipt of such
notice
but in any case not later then the effective date of such transaction. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed action, unless the Board has authorized a longer period to exercise vested Awards to certain Grantees.
|
|
(d)
|
Merger or Acquisition
. In the event of a Merger or Acquisition, each outstanding Award shall be
assumed
or an equivalent Award substituted by the successor company or a parent or subsidiaries of the successor company. In the case of such assumption and/or substitution of Awards, appropriate adjustments shall be made in the Exercise Price to reflect such action, and all other terms and conditions of the Award Agreements, such as the vesting dates, shall remain in force, all as will be determined by the Board whose determination shall be final.
|
|
(e)
|
Bring-Along
– Award Shares acquired upon exercise of the Awards may be subject to “
bring-along
” provisions in the Articles of Association. In the event that the Award Shares acquired upon exercise of the Awards are not subject to “bring-along” provisions in the Articles of Association, then at any time prior to the Company’s IPO, in the event that (i) one or more bona fide offers (the “
Offeror
”) is made to purchase Shares
comprising
at least eighty percent 80% of the Company’s issued and outstanding common stock on an as-converted to common stock basis (the “
Threshold Percent
”), (ii) such sale is conditioned upon the sale of Shares of the Company at the Threshold Percent, and (iii) all shareholders, with the exception of the Grantees under this Plan (the “
Proposing Shareholders
”) propose to sell all of their Shares to such Offeror, then the Grantees shall be required, if so demanded by the Proposing Shareholders, to sell all Award Shares acquired by the Grantees pursuant to this Plan to such Offeror at the same price and under the same terms and conditions as in the offer made to the Proposing Shareholders up to the Threshold Percent. Should the Offeror purchase less than 100% of the Company’s Shares, the number of Shares purchased by the Offeror in excess of those sold by the Proposing Shareholders would be divided proportionally between the Grantees. In the event that the Threshold Percent is met, any sale, assignment, transfer, pledge, hypothecation, mortgage, disposal or encumbrance of Award shares by the Grantee other then in connection with the proposed acquisition shall be absolutely prohibited.
|
(f)
|
Other Restrictions.
It is herby clarified that Award Shares acquired upon exercise of the Awards will be subject to all restrictions and limitations to which Shares are subject to pursuant to the Articles of Association of the Company.
|
17.
|
AMENDMENT AND TERMINATION OF THE PLAN
|
|
(a)
|
Amendment and Termination
. The Board may at any time amend, alter, suspend or terminate the
Plan
.
|
|
(b)
|
Shareholder Approval
. The Board shall obtain shareholder approval of any Plan amendment to
the
extent necessary to comply with Applicable Laws.
|
|
(c)
|
Effect of Amendment or Termination
. Without derogating from any other provisions of this Plan, any amendment, alteration, suspension or termination of the Plan that the Administrator
finds
, at its discretion, as impairing the legitimate rights of any Grantee, shall be made in a mutual agreement between the Grantee and the Administrator, which agreement must be in writing and signed by the Grantee and the Company. Termination of the Plan shall not affect the Administrator's ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination and the terms of the plan shall continue to be in effect with regard to any Awards and Award Shares granted pursuant to it. Notwithstanding the foregoing, the Board may exercise its authority under Section 16 without the consent of Grantees.
|
18.
|
INABILITY TO OBTAIN AUTHORITY
|
19.
|
RESERVATION OF SHARES
|
20.
|
NO OBLIGATION TO CONTINUE EMPLOYMENT WITH THE EMPLOYEE
|
21.
|
GOVERNING LAW
|
22.
|
DISPUTES
|
23.
|
JURISDICTION
|
24.
|
TAX CONSEQUENCES
|
25.
|
PROVISIONS FOR FOREIGN PARTICIPANTS
|
26.
|
NON-EXCLUSITY OF THE PLAN
|
1.
|
PURPOSES OF THE PLAN
|
2.
|
DEFINITIONS
|
|
2.1
|
Administrator
means the Board or any of its committees as shall be appointed by the Board to administer the Plan, in accordance with Section 6 hereof.
|
|
2.2
|
Adoption Date
means the later of the date on which the Board adopted this Plan and the date the Plan was approved by the Company’s shareholders, if such approval is necessary under Applicable Laws.
|
|
2.3
|
Applicable Laws
means the requirements relating to the adoption of and/or the administration of stock option plans under the relevant laws and regulations of the State of Israel, any stock exchange or quotation system on which the Shares and/or may be listed or quoted and the applicable laws of any other country or jurisdiction where Awards are granted under the Plan, as well as the Articles of Association of the Company.
|
|
2.4
|
Articles of Association
means the articles of association of the Company as amended from time to time and all shareholders rights agreements, as amended from time to time, which may be entered into by the Company and/or its Shareholders.
|
|
2.5
|
Award
shall mean any option granted to a Grantee under the Plan.
|
|
2.6
|
Award Agreement
means a written agreement between the Company and a Grantee evidencing the terms and conditions of an individual Award grant, as further specified in Section 8.
|
|
2.7
|
Award Share
means the Shares subject to an Award.
|
|
2.8
|
Board
means the board of directors of the Company.
|
|
2.9
|
Business Day
means a day (not being a Friday or Saturday) on which banks are open for business in Israel.
|
|
2.10
|
Cause
means: (i) any action by a Grantee involving willful malfeasance or a willful breach of such a Grantee’s fiduciary duties in connection with such Grantee’s employment
or engagement with the Company or with any Subsidiary; (ii) the conviction of a Grantee in a court of law of, or a guilty plea by the Grantee to, a felony or a fraud or any other similar act; (iii) substantial and continuing refusal or neglect by a Grantee to perform the duties requested of him or her (including without limitation, abiding policies relating to confidentiality and reasonable workplace conduct) provided such duties are expected to be performed by a person engaged for a similar capacity (other than as a result of death, illness or other objective incapacity) which refusal or neglect continues for a period of ten days after written notice thereof is provided to the Grantee from the Company or from the respective Subsidiary; (iv) an act of moral turpitude, or any similar act, to the extent that such act causes or may cause injury to the reputation of the Company and/or to any of the Company’s Subsidiaries; (v) any other act or omission which, in the reasonable opinion of the Company, could materially financially harm the Company and/or any of the Company’s Subsidiaries or harm the business reputation of the Company and/or any of the Company’s Subsidiaries; (vi) any other circumstance deemed by law to constitute termination for cause, including circumstances relieving an employer from the duty to pay severance pay to the Grantee; or (vii) termination of a Grantee’s employment for cause in accordance with provisions of his or her employment agreement or engagement agreement, if any, with the Company.
|
|
2.11
|
Committee
means a committee of directors appointed by the Board in accordance with Section 6 hereof.
|
|
2.12
|
Consultant
means any person who is engaged by the Company and/or a Subsidiary to render consulting or advisory services to the Company and/or the Subsidiary.
|
|
2.13
|
Disability
means any physical or mental impairment, which has lasted or is expected to last for a continuous period of not less than six consecutive months or an aggregate of six months in any twelve month period and which causes the Grantee's total and permanent disability to engage in any substantial gainful activity.
|
|
2.14
|
Effective Date
means the date on which the Award Agreement is signed by the Company and the Grantee. The “
Effective Date
” of Trustee Stock Options shall be the date on which such Trustee Stock Options are allocated to the Trustee.
|
|
2.15
|
Election
shall have the meaning ascribed to it in Section 4 below.
|
|
2.16
|
Employee
means any person employed by the Company or any Subsidiary or any person who is engaged as a director or officer of the Company or any Subsidiary, who is not a "Controlling Shareholder", as defined in Section 32 (9) of the Ordinance, prior to and after the issuance of the Awards.
A person employed by the Company or any Subsidiary shall not cease to be an Employee for the purposes of the Plan in the case of (i) any leave of absence approved by the Company or any Subsidiary or, (ii) transfers between locations of the Company or, (iii) transfer of employment between the Company, its Subsidiaries and any successor.
|
|
2.17
|
Exercise Date
means the date on which the Grantee exercises his Awards, subject to the compliance with all of provisions set out in Section 11 of this Plan.
|
|
2.18
|
Exercise Price
means the amount stipulated in the Award Agreement, to be paid by the Grantee to the Company in order to exercise an Award into an Award Share.
|
|
2.19
|
Grantee
means the holder of an outstanding Award granted under the Plan.
|
|
2.20
|
IPO
means the initial public offer of the Company's shares.
|
|
2.21
|
ITA
means the Israeli Tax Authorities.
|
|
2.22
|
Merger or Acquisition
shall mean (i) the acquisition of the Company by another entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation); or (ii) a sale of all or substantially all of the assets of the Company (including, for purposes of this Section, intellectual property rights which, in the aggregate, constitute substantially all of the Company’s material assets); unless in each case, the Company’s stockholder of record as constituted immediately prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue of securities issued as consideration for the Company’s acquisition or sale or otherwise) hold at least fifty percent (50%) of the voting power of the surviving or acquiring entity; or (iii) more than fifty percent (50%) of the voting power of the Company is transferred to an unrelated third party pursuant to a transaction or series of related transactions.
|
|
2.23
|
Ordinance
means the 1961 Israeli Income Tax Ordinance [New Version] 1961 as now in effect or as hereafter amended.
|
|
2.24
|
Plan
means this Mazor Robotics Ltd. 2011 Share Option Plan.
|
|
2.25
|
Purchaser
means the Company (if and as permitted by law) and/or any of its Subsidiaries and/or any other person or entity designated for this purpose by the Company.
|
|
2.26
|
Privatization
means an event pursuant to which the Company's shares shall cease to be publicly traded and revert to private ownership.
|
|
2.27
|
Service Provider
means an Employee or a Consultant.
|
|
2.28
|
Share
means a share of the Company's Ordinary Shares having a par value of NIS 0.01.
|
|
2.29
|
Subsidiary
means any company other than the Company, whether now or hereafter existing, in an unbroken chain of companies beginning with the Company if at the time of granting of the Awards each of the companies other than the last company in an unbroken chain owns shares possessing 50 percent or more of the total combined voting power of all classes of shares in one of the other companies in such chain.
|
|
2.30
|
Stock Exchange
means the Tel Aviv Stock Exchange Ltd. or the stock exchange of any other state.
|
|
2.31
|
Trustee
means a person or entity appointed by the Board or the Committee and approved by the Income Tax Officer to hold Trustee Stock Options on behalf of the Grantee according to the conditions set forth in Section 102.
|
|
2.32
|
Trustee Stock Options
means all 102 Capital Gain Stock Options and 102 Ordinary Income Stock Options.
|
|
2.33
|
Vesting Schedule
has the meaning set forth in Section 8.4.
|
3.
|
TYPES OF AWARDS
|
4.
|
THE ELECTION
|
5.
|
AUTHORIZED SHARES
|
|
5.1
|
Awards may be granted under the Plan, subject to the provisions of Section 16.1 of the Plan, for up to an aggregate of 2,191,632 Shares. The Awards may be granted at any time, during a period of ten (10) years beginning on the Adoption Date.
|
|
5.2
|
In case of Trustee Stock Options, such Trustee Options may be granted after the passage of thirty days (or a shorter period as and if approved by the tax authorities) following the delivery by the Company to the appropriate Israeli Income Tax Authorities of a request for approval the Plan and the Trustee according to Section 102.
|
|
5.3
|
Subject to receipt of required consents under applicable law for the Plan and making grants thereunder, as long as the Company is publically traded on TASE, Awards may be granted at any time following the lapse of the requisite period under the Securities Law, 5748-1968 and regulations promulgated thereunder. The Awards shall be granted to the Grantees for no consideration and shall not be registered for trade on a stock exchange.
|
|
5.4
|
Notwithstanding the above, if within 90 days of delivery of the abovementioned request, the tax officer notifies the Company of its decision not to approve the Plan, the Awards that were intended to be granted as a Trustee Stock Options shall be deemed to be Non Trustee 102 Stock Options, unless otherwise was approved by the Tax officer.
|
|
5.5
|
If an Award expires, is cancelled or otherwise becomes unexercisable without having been exercised in full, the unexercised, canceled or terminated Award Shares which were subject thereto shall become available for future grants under the Plan, and under any other plans or sub-plans, as the Board may determine at its discretion, from time to time; provided, however, that Award Shares that have actually been issued under the Plan shall not be returned to the Plan and shall not become available for future grant under the Plan or under the Company's other share option plans.
|
|
5.6
|
The number of Shares that are subject to Awards under the Plan shall not exceed the number of Shares reserved for the grant of Awards that then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available a sufficient number of Shares to satisfy the requirements of the Plan. The Board may, at any time during the term of the Plan, increase the number of the Awards available for grant under the Plan. Such increase must be approved by the Company’s shareholders if so required under the Applicable Laws.
|
6.
|
ADMINISTRATION
|
|
6.1
|
Procedure
. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.
The
Committee will hold its meetings at such times and places as it may determine and will maintain written minutes of its meetings.
|
|
6.2
|
Powers of the Administrator
. Subject to the terms and conditions of the Plan, and in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities and Applicable Laws, the Administrator shall have the authority, in its discretion:
|
|
6.2.1
|
to select the Service Providers to whom Awards may from time to time be granted hereunder, and to grant said Service Providers the Awards. This authority shall be granted solely to the Board, which will take into consideration the recommendations of the Committee.
|
|
6.2.2
|
to make the Election and to determine, from time to time, the type of Awards to be granted to eligible Employees under the Plan, including the determination which Employee will receive Non Trustee 102 Stock Options and subject to the Election pursuant to Section 4 and the provisions of Section 7 below, which Employee will receive 102 Capital Gain Stock Options and/or 102 Ordinary Income Stock Options , and to prescribe the terms and conditions (which need not be identical) of Awards granted under the Plan to such persons;
|
|
6.2.3
|
to approve forms of the Award Agreements for use under the Plan;
|
|
6.2.4
|
to determine the terms and conditions of any Award granted hereunder, including, without limitation, the Vesting Schedule;
|
|
6.2.5
|
to exercise such powers and to perform such acts as are deemed necessary or expedient to promote the best interests of the Company with respect to the Plan, including but not limited to prescribing, amending and rescinding any provisions related to the Plan;
|
|
6.2.6
|
to amend any outstanding Award, subject to Section 17 hereof, and to accelerate the vesting or extend the exercisability of any Award and to waive conditions or restrictions on any Award, to the extent it shall deem appropriate provided that this authority shall be granted to the Board, and only subject to its prior approval to the Committee which approval shall specifically state the number and identity of Grantees which rights the Committee will be authorized to determine.
|
|
6.2.7
|
to allow Grantees to satisfy withholding tax obligations by electing to have the Company, if permitted under Applicable Laws, withhold from the Award Shares to be issued upon exercise of an Award that number of Award Shares having a value equal to the minimum statutory withholding amount. The value of the Award Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by Grantees to have Award Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable and after consolation with the Company’s counsel.
|
|
6.2.8
|
to construe and interpret the terms of the Plan, the Award Agreements and Awards.
|
|
6.2.9
|
to grant, at its discretion, to the holder of an outstanding Award, in exchange for the surrender and cancellation of such Award, a new Award having an exercise price equal to, lower than or higher than the Exercise Price of the original Award so surrendered and canceled and containing such other terms and conditions as the Administrator may prescribe in accordance with the provisions of the Plan.
|
|
6.3
|
The Board may fill all vacancies, however caused, in the Committee. The Board may from time to time appoint additional members to the Committee, and may at any time remove one or more Committee members and substitute others.
|
|
6.4
|
Effect of Administrator's Decision
. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Grantees. Each member of the Board and the Committee shall be indemnified and held harmless by the Company against any cost or expense (including fees of counsel) reasonably incurred by him, or 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 Laws. Such indemnification shall be in addition to any rights of indemnification the member may have as director or otherwise under the Articles of Association of the Company, any agreement, any vote of share or disinterested directors, or otherwise.
|
7.
|
ELIGIBILITY
|
|
7.1
|
General
. Awards may be granted to Service Providers as defined in this Plan.
|
|
7.2
|
Non Trustee 102 Stock Options and Trustee Stock Options may be granted only to Employee Grantees who are Israeli residents or are deemed to be Israeli residents for purposes of taxation, and to members of the Board, and shall be granted subject to the Ordinance.
|
|
7.3
|
3(i) Stock Options may be granted only to Service Providers who are Israeli residents or are deemed to be Israeli residents for purposes of taxation, who are not Employees or members of the Board and to an Employee who is a “Controlling Shareholders” as defined in Section 32 (9) of the Ordinance.
|
|
7.4
|
The grant of an Award hereunder shall neither entitle the Grantee to participate nor disqualify the Grantee from participating in, any other grant of Awards pursuant to the Plan or any other option or share plan of the Company or any of its Affiliates.
|
|
7.5
|
Anything in the Plan to the contrary notwithstanding, all grants of Award to directors and office holders shall be authorized and implemented in accordance with the provisions of the Companies Law, 5759-1999 and regulations promulgated thereunder, as in effect from time to time.
|
|
7.6
|
Continuing Relationship
. The Plan and the Award Agreements shall not confer upon any Grantee any right with respect to continuing the Grantee’s relationship as a Service Provider with the Company or its Subsidiary, nor shall it interfere in any way with his right or the Company's right, or the right of a Subsidiary, to terminate such relationship at any time, with or without Cause.
|
8.
|
AWARD AGREEMENTS
|
|
8.1
|
A Service Provider will be entitled to an Award only if such Award is granted to the Service Provider by the Administrator and an Award Agreement is signed between the Company and him/her. Subject to the terms and conditions of the Plan, each Award Agreement shall contain provisions as the Administrator shall from time to time deem appropriate. Award Agreements need not be identical, but each Award Agreement shall include, by appropriate language, the substance of the applicable provisions set forth herein, and any such provision may be included in the Award Agreement by reference to the Plan. Unless otherwise defined specifically in the Award Agreement and approved by the Board, in the case of a conflict between the terms of any Award Agreement and the Plan, the terms of the Plan shall govern in all cases. An Award Agreement shall include the following:
|
|
8.1.1
|
Number of Shares
. Each Award Agreement shall state the number of Award Shares to which the Awards relates.
|
|
8.1.2
|
Type of Award
. Each Award Agreement shall specifically state the type of Awards granted thereunder and whether they constitute Non Trustee 102 Stock Option, 102 Capital Gain Stock Options , 102 Ordinary Income Stock Options , 3(i) Stock Options, or otherwise.
|
|
8.1.3
|
Exercise Price
. Each Award Agreement shall state the Exercise Price of the Award Shares to which the Award relates. The Exercise Price shall be subject to adjustment as provided in Section 16 hereof.
|
|
8.1.4
|
Term and Vesting of Options
. Each Award Agreement shall provide the schedule according to which such Awards may be exercised (“
Vesting Schedule
”). The Vesting Schedule for the Awards will be determined by the Administrator, provided that (to the extent permitted under Applicable Laws) the Administrator, in its absolute discretion, shall have the authority to accelerate the vesting of any outstanding Option at such time and under such circumstances as it, in its sole discretion, deems appropriate. Subject to the Vesting Schedule, Awards may be exercised into Award Shares during the period of seven (7) years from the Effective Date (the “
Exercise Period
”) unless otherwise determined by the Administrator (to the extent permitted under Applicable Laws and this Plan). The Exercise Period shall be subject to earlier termination as provided in Section 11 hereof.
|
|
8.1.5
|
The Rights of Grantee as a Shareholder
. In the event of the consummation of a Privatization, then following such Privatization, the Grantees under the Plan shall sign an irrevocable proxy pursuant to which the Grantee’s right to vote any Award Share, if any, shall be given to the person or persons designated by the Board (the “
Representative
”) until the consummation of an IPO following such Privatization. If prior to the consummation of the Company’s IPO, the right to vote any Award Share is held by the Trustee, then the Trustee shall be eligible to provide the right to vote any Award Share to the Representative. Such Award Shares shall be voted by the Representative in the same proportion as the result of the shareholder vote (as voted by the stockholders without taking the Award Shares in consideration). To avoid doubt, all Award Shares issued upon exercise of Awards shall entitle the holder thereof to receive any dividends and other distributions thereon granted to all holders of ordinary shares of the Company as such, if any. The holder of the proxy shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him/her, 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 voting of such proxy unless arising out of such member's own fraud, bad faith or gross negligence, to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the person(s) may have as a director or otherwise under the Company's Articles of Association, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. Without derogating from the above, with respect to 102 Stock Options, such Shares shall be voted in accordance with the provisions of Section 102 and any rules, regulations or orders promulgated thereunder.
|
|
8.1.6
|
No Right of First Refusal or Preemptive Right
. Notwithstanding anything to the contrary in the Articles of Association of the Company, none of the Grantees shall have a right of first refusal in relation with any sale of shares in the Company, nor any pre-emptive rights to purchase, along with the other shareholders in the Company, a pro rata portion of any securities proposed to be offered by the Company prior to the offering thereof to any third party.
|
|
8.1.7
|
Other Restrictions
.
It is herby clarified that Award Shares acquired upon exercise of the Awards will be subject to all restrictions and limitations to which Shares are subject to pursuant to the Articles of Association of the Company.
|
|
8.2
|
Other Provisions
. The Award Agreements evidencing Awards under the Plan shall contain such other terms and conditions not inconsistent with the Plan as the Administrator may determine. It is herby clarified that Award Shares acquired upon exercise of the Awards will be subject to all restrictions and limitations to which Shares are subject to pursuant to the Articles of Association of the Company.
|
9.
|
TERM OF THE PLAN
|
|
The Plan shall become effective upon the Adoption Date. The Plan shall continue in effect Tduring a period of ten (10) years beginning on the Adoption Date, unless sooner terminated under Section 17 of the Plan (the “
Term
”).
|
|
9.1
|
Expiration
.
Unless otherwise stated in the Award Agreement, each Award shall expire on the seventh anniversary of the Effective Date.
|
|
9.2
|
Exercise
. The Awards granted will be exercisable into Award Shares of the Company according to the Vesting Schedule set forth in the Award Agreement or in this Plan.
|
|
9.3
|
Exercise Price
. The Exercise Price per Award Share subject to each Award
Agreement shall be determined by the Administrator, provided however, that such Exercise Price shall not be less than the par value of the share into which such Option is exercisable.
|
|
9.4
|
Transfer
. No Award granted hereunder shall be transferable by the Grantee or given as collateral to any third party whatsoever other then by will or by the laws of descent and distribution. Awards may be exercised during the Grantee’s lifetime only by the Grantee, or his guardian or legal representative. Award Shares acquired upon exercise of the Awards shall be subject to such restrictions on transfer as are generally applicable to Ordinary Shares of the Company in accordance with the Company’s Articles of Association. Without derogating from any other provision in this Plan, following a Privatization of the Company, it is expressly clarified that no transfer of Award Shares shall become effective unless the Grantee has delivered to the Company a written notice thereof, together with a confirmation in writing by any transferee of the Award Shares that it is bound by all terms and conditions of this Plan and the Award Agreement. In case of transfer of the Award Shares after the death of the Grantee, the transfer shall become effective only after the transferee delivers such a written confirmation. As long as Awards and/or Award Shares are held by the Trustee on behalf of the Grantee, all rights of the Grantee over the Award Shares are personal, cannot be transferred, assigned, pledged or mortgaged, other than by will or pursuant to the laws of descent and distribution.
Any transfer that is not made in accordance with the Plan, the Articles of Association or the applicable Award Agreement shall be null and void.
|
|
9.5
|
Restrictions on Transfer of Awards Shares
.
|
|
9.5.1
|
Securities Law Restrictions
. Regardless of whether the offering and
sale of Award Shares under the Plan have been registered under the Israeli Securities Law 5728-1968, as amended, and the rules and regulations promulgated thereunder (the “
Securities Law
”) or have been registered or qualified under the securities laws of
any state or other laws of any other jurisdiction, the Company at its discretion may
impose restrictions upon the sale, pledge or other transfer of such
Award Shares (including the placement of appropriate legends on stock
certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in
order to achieve compliance with the Securities Law, the securities laws
of any state or any other law.
|
|
9.5.2
|
Market Stand-Off
. In connection with any underwritten public
offering by the Company of its equity securities pursuant to an
effective registration statement filed under the Securities Law or equivalent law in another jurisdiction, including the Company’s IPO of its shares in a foreign jurisdiction, the Grantee shall not directly or indirectly sell, make
any short sale of, loan, hypothecate, pledge, offer, grant or sell any
Award or other contract for the purchase of, purchase any or
other contract for the sale of, or otherwise dispose of or transfer, or
agree to engage in any of the foregoing transactions with respect to,
any Award Shares acquired under this Agreement without the prior written consent of the Company or its underwriters. Such restriction (the
“
Market Stand-Off
”) shall be in effect for such period of time following
the date of the final prospectus for the offering as may be requested by
the Company or such underwriters. In the event of the declaration of a stock
dividend, a spin-off, a stock split, an adjustment in conversion ratio,
a recapitalization or a similar transaction affecting the Company’s outstanding securities without receipt of consideration, any new,
substituted or additional securities which are by reason of such
transaction distributed with respect to any Award Shares subject to the Market
Stand-Off, or into which such Award Shares thereby become convertible, shall
immediately be subject to the Market Stand-Off. In order to enforce the
Market Stand-Off, the Company may impose stop-transfer instructions with
respect to the Award Shares acquired under this Plan until the end of the
applicable stand-off period. The Company’s underwriters shall be
beneficiaries of the agreement set forth in this Subsection. This
Subsection shall apply to Award Shares held by Grantees registered in the public
offering under the Securities Law or equivalent law in another
jurisdiction, only if the directors and officers of the Company are subject to similar
arrangements.
|
10.
|
CONDITIONS UPON ISSUANCE OF AWARD SHARES
|
|
10.1
|
Legal Compliance
. Award Shares shall not be issued pursuant to the exercise of an Award unless the exercise of such Award, the method of payment and the issuance and delivery of such Award Shares shall comply with Applicable Laws (for Non Trustee 102 Stock Option and Trustee Stock Options, comply with Section 102,) and shall be further subject to the approval of counsel of the Company with respect to such compliance.
|
|
10.2
|
Investment Representations
. The Company’s obligation to issue or allocate Award Shares upon exercise of an Award granted under the Plan may be conditioned by the Administrator upon (a) the Company’s completion of any registration or other qualifications of such Award Shares under any state and/or federal law, rulings or regulations or (b) representations and undertakings by the Grantee (or his legal representative, heir or legatee, in the event of the Grantee’s death), to assure that the sale of the Award 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 Grantee (or his legal representative, heir, or legatee): (a) is purchasing such Award Shares for investment and not with any present intention of selling or otherwise disposing thereof; and (b) agrees to have placed upon the face and reverse of any certificates evidencing such Award Shares a legend setting forth (i) any representations and undertakings which such Grantee has given to the Company or a reference thereto and (ii) that, prior to effecting any sale or other disposition of any such Award Shares, the Grantee must furnish to the Company an opinion of counsel, satisfactory to the Company, that such sale or disposition will not violate the applicable laws, rules, and regulations of the State of Israel or any other State having jurisdiction over the Company and the Grantee.
|
11.
|
METHOD OF EXERCISE
|
|
11.1
|
Procedure for Exercise and Rights as a Shareholder
. Any Award granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and/or set forth in the Award Agreement with respect to Employee Grantees and unless the Administrator provides otherwise, vesting of Awards granted hereunder shall be tolled during any unpaid leave of absence other than leave which according to the law does not impair employment continuity.
|
|
11.2
|
Termination of Relationship with a Grantee
. Except as provided below, an Award may not be exercised unless the Grantee is then a Service Provider:
|
|
11.2.1
|
If a Grantee ceases to be a Service Provider, other then in cases specified in Subsections 11.2.2 through 11.2.4 below, the Grantee may exercise any vested Award on the date of cessation of the relationship with the Service Provider (the "
Date of Cessation
"), within a period of ninety (90) days following such date of cessation, but in no event later then the expiration date of the term of such Award as set forth in Section 9.1 or in the Award Agreement.
|
|
11.2.2
|
Death or Disability of a Grantee
. If a Grantee ceases to be a Service Provider as a result of death or Disability, the Grantee may exercise his Awards within twelve months of the Date of Cessation, to the extent the Award is vested on such Date of Cessation, but in no event later than the expiration date of the term of such Awards as set forth in Section 9 or in the Award Agreement.
|
|
11.2.3
|
Retirement of an Employee Grantee
. In the event of an Employee Grantee’s retirement, at the age of retirement under applicable law, he/she will be eligible to exercise, within twelve months of such retirement (but in no event later than the expiration date of the term of such Award as set forth in Section 9.1 or in the Award Agreement), any vested Awards.
|
|
11.2.4
|
Dismissal for Cause
. In the event of termination of relationship with a Service Provider for Cause, the Service Provider’s right to exercise vested Awards whether vested or non vested shall terminate immediately upon the Date of Cessation, and all such Awards shall be forfeited without any payment being due. In addition, the Purchaser will be entitled, at its sole discretion, to repurchase, within twelve months of such Date of Cessation, any or all of the Award Shares resulting from the exercise of any Awards exercised prior to the date of the repurchase. The price paid for each Award Share will be determined by the Administrator, in its sole discretion, but shall not be less than the par value of the Shares being repurchased.
|
|
11.3
|
In addition to the vested portion of the Award on the Date of Cessation, the Board, considering the recommendations made by the Administrator, is authorized to approve the exercise of additional Awards. If, after the Date of Cessation, the Awards are not exercised within the time specified in Subsections 11.2.1 through 11.2.3, the Award shall terminate, and the Award Shares covered by such Awards shall revert to the Plan. Unless otherwise determined by the Administrator, the unvested portion of the Award on the Date of Cessation, shall not be exercisable and the Award Shares covered by such unvested portion of the Awards shall not vest, shall not become exercisable, and shall revert to the Plan.
|
12.
|
PAYMENT OF EXERCISE PRICE
|
|
12.1
|
Payment of Exercise Price may be made in such form and method as shall be acceptable to the Administrator in its sole discretion. In making its determination as to the type and/or method of consideration to accept, the Administrator shall consider if acceptance of such and/or method of consideration may be reasonably expected to benefit the Company. Payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by Applicable Laws, the Award Agreement and the Plan.
|
|
12.2
|
Except as otherwise determined by the Administrator, all monetary values with respect to Awards granted pursuant to this Plan, including without limitation the fair market value and the Exercise Price, shall be stated in New Israeli Shekels. In the event that the Exercise Price is in fact to be paid in any foreign currency, the conversion rate shall be the last known representative rate of such foreign currency to the New Israeli Shekels on the date of payment.
|
13.
|
TRUSTEE STOCK OPTIONS
|
|
13.1
|
Options granted pursuant to this Section 13 are intended to constitute Trustee Stock Options subject to Section 102, the general terms and conditions specified the Plan, except for said provisions of the Plan applying to Awards under a different tax law or regulations.
|
|
13.2
|
Trustee Stock Options shall be granted either as 102 Capital Gain Stock Options or 102 Ordinary Income Stock Options according to the Election and for then subject to the provisions in Section 3.
|
|
13.3
|
Anything herein to the contrary notwithstanding, all Trustee Stock Options granted under this Plan shall be granted by the Company to a Trustee designated by the Administrator and the Trustee shall hold each such Award and the Award Shares issued upon exercise thereof in trust for the benefit of the Grantee in respect of whom such Award was granted. All certificates representing Award Shares issued to the Trustee under the Plan shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Award Shares are released from the trust.
|
|
13.4
|
With regard to 102 Capital Gains Stock Options and 102 Ordinary Income Stock Options the Awards or the Award Shares and all rights related to them, including bonus shares, will be held by the Trustee for a period of at least 24 months and 12 months, respectively, from the end of the tax year in which the Effective Date took place or a shorter period as approved by the tax authorities (the “
Lock-up Period”
), under the terms set in Section 102.
|
|
13.5
|
In accordance with Section 102, the Grantee is prohibited from selling the Awards or the Awards Shares, until the end of the Lock-up Period. The meaning of this Section for income tax purposes is that if the Employee voluntarily sells the Awards or the Awards Shares before the end of the Lock-up Period, the provision of Section 102, relating to non-compliance with the Lock-up Period, shall apply.
|
|
13.6
|
Anything to the contrary notwithstanding, the Trustee shall not release any Awards which were not already exercised into Award Shares by the Grantee nor release any Award Shares issued upon exercise of the Award, prior to the full payment of the Exercise Price and Grantee’s tax liability arising from Trustee Stock Options which were granted to him/her and/or Awards Shares issued upon exercise of such Trustee Stock Options. On or prior to the receipt of the Award, the Grantee will sign an undertaking to release 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 granted or Award Share issued to him thereunder.
|
|
13.7
|
Trustee Stock Options may only be granted to Employees and members of the Board. (subject to approval of the Plan by the tax authorities).
|
14.
|
3(i) STOCK OPTIONS.
|
|
14.1
|
Options granted pursuant to this Section 14 are intended to constitute 3(i) Stock Options and shall be subject to the general terms and conditions specified in the Plan, except for said provisions of the Plan applying to Awards under a non-Israeli regime.
|
|
14.2
|
3(i) Options may not be granted to Employees or members of the Board.
|
|
14.3
|
The 3(i) Stock Options which shall be granted pursuant to the Plan may be issued to a trustee appointed by the Administrator.
|
15.
|
NON TRUSTEE 102 STOCK OPTIONS
|
|
15.1
|
Options granted pursuant to this Section 15 are intended to constitute Non Trustee 102 Stock Options and shall be subject to the general terms and conditions specified the Plan, except for said provisions of the Plan applying to Awards under a different tax law or
regulations
.
|
|
15.2
|
The Non Trustee 102 Stock Options which shall be granted pursuant to the Plan may be issued to a trustee appointed by the Administrator.
|
|
15.3
|
If the Grantee’s employment with the Company is terminated for any reason, the Grantee will
be
obligated to provide the Company, to its satisfaction and subject to its sole discretion, with a security or guarantee to cover any future tax obligation resulting from the disposition of the Awards or the Award Shares.
|
16.
|
ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER
|
|
16.1
|
Changes in Capitalization
. Subject to any required action by the shareholders of the Company, the number of Award Shares covered by or underlying each outstanding Award and the number of Award Shares which have been authorized for issuance under the Plan but as to which no Awards have been granted or which have been returned to the Plan upon cancellation or expiration of an Award, as well as the
Exercise Price per Share of each such outstanding Award shall be appropriately
adjusted in the case of any increase or decrease in the number of issued Shares resulting from a share split, reverse share split, share dividend, recapitalization, combination or reclassification of the Shares. Such adjustment shall be made by the Board, whose determination shall be final, binding and conclusive. Except as expressly provided herein no: (i) issuance by the Company of shares of any class, or securities convertible into shares of any class, (ii) conversion of any convertible securities of the Company; (ii) payment of a cash dividend and/or; (iv) rights issue; shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Award Shares subject to an Award.
|
|
16.2
|
Dissolution or Liquidation
. It is hereby clarified that in the event of dissolution or liquidation of the Company, the Company shall have no obligation to notify the Grantee of such event and any Awards that have not been previously exercised, will terminate immediately prior to the consummation of such proposed action.
|
|
16.3
|
Voluntary Liquidation
. Notwithstanding Subsection 16.2 above, in the event of a voluntary liquidation of the Company, which is not considered a Merger or Acquisition, the Administrator shall notify each Grantee as soon as practicable, but not less than 7 Business Days prior to the effective date of such proposed voluntary liquidation. The Grantee will have the right to exercise his or her vested Awards within 5 Business Days from receipt of such notice but in any case not later then the effective date of such voluntary liquidation. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed action, unless the Board has authorized a longer period to exercise vested Awards to certain Grantees.
|
|
16.4
|
Merger or Acquisition
. In the event of a Merger or Acquisition, each outstanding Award shall be assumed or an equivalent Award substituted by the successor company or a parent or subsidiaries of the successor company. In the case of such assumption and/or substitution of Awards, appropriate adjustments shall be made in the Exercise Price to reflect such action, and all other terms and conditions of the Award Agreements, such as the vesting dates, shall remain in force, all as will be determined by the Board whose determination shall be final.
|
17.
|
AMENDMENT AND TERMINATION OF THE PLAN
|
|
17.1
|
Amendment and Termination
. The Board may at any time amend, alter, suspend or terminate the Plan.
|
|
17.2
|
Shareholder Approval
. The Board shall obtain shareholder approval of any Plan amendment to the extent necessary to comply with Applicable Laws.
|
|
17.3
|
Effect of Amendment or Termination
. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Grantee under an Award Agreement, unless mutually agreed otherwise between the Grantee and the Company, which agreement must be in writing and signed by the Grantee and the Company. Termination of the Plan shall not affect the Administrator's ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination and the terms of the Plan shall continue to be in effect with regard to any Awards and Award Shares granted pursuant to it. Notwithstanding the foregoing, the Board may exercise its authority under Section 16 without the consent of Grantees.
|
18.
|
INABILITY TO OBTAIN AUTHORITY
|
19.
|
GOVERNING LAW& JURISDICTION; GOVERNMENT REGULATIONS
|
20.
|
DISPUTES
|
21.
|
TAX CONSEQUENCES
|
22.
|
PROVISIONS FOR FOREIGN PARTICIPANTS
|
23.
|
NON- EXCLUSIVITY OF THE PLAN
|
1.
|
The Parties
: Mazor Robotics Ltd. (“
Mazor
”) and Hayel Investments and Properties Ltd. (“
Hayel
”).
|
2.
|
Signing Date
: April 30, 2003.
|
3.
|
Term
: The term of the Lease Agreement is two years. Mazor has an option to extend the term of the Lease Agreement by additional two years.
|
4.
|
Premises
: 345 square meters at 7 Haeshel Street, Caesarea Industrial Park South, 38900 Israel.
|
5.
|
Lease Payments
: (1) A monthly lease payment of $2,000; (2) management fees of $276 per month; and (3) the proportionate share of the premises insurance policy of $331 per annum.
|
6.
|
Guarantees
: In order to secure its undertakings under this agreement, Mazor shall provide Hayel with a guarantee (the “
Guarantee
”) in an amount of $8,000.
|
7.
|
Amendments to the Lease Agreement
:
|
|
a.
|
On March 27, 2007, the parties amended the Lease Agreement to extend the term of the Lease Agreement by two years.
|
|
b.
|
On February 28, 2009, the parties amended the Lease Agreement to extend the term of the Lease Agreement by two years.
|
|
c.
|
On September 16, 2009, the parties amended the Lease Agreement to (i) increase the premises to 569 square meters; (ii) extend the term of the Lease Agreement until April 30, 2011, with an option to extend the term of the Lease Agreement until April 30, 2012; (iii) increase the monthly lease payment to NIS 18,539 (linked to Israeli Consumer Price Index) through May 1, 2011, and to NIS 19,317 through April 30, 2012; and (iv) increase the Guarantee amount to $15,000.
|
|
d.
|
On July 10, 2011, the parties amended the Lease Agreement to (i) increase the premises to 769 square meters; (ii) extend the term of the Lease Agreement until December 31, 2014, with an option to extend the term of the Lease Agreement until December 31, 2017; and (iii) increase the monthly lease payment to NIS 27,659 (linked to Israeli Consumer Price Index).
|
|
e.
|
Subject to the amendments to the Lease Agreement set forth in subsections (a) through (d), all other terms and conditions of the Lease Agreement remains in full force and effect.
|
Company
MAZOR ROBOTICS LTD.
By:
/s/ Ori Hadomi
Name: Ori Hadomi
Title: CEO
By:
/s/ Jonathan Adereth
Name: Jonathan Adereth
Title: Chairman of the Board
|
|
Purchasers
ORACLE PARTNERS, L.P.
By:
/s/ Larry Feinberg
Name: Larry Feinberg
Title: General Partner
|
ORACLE INSTITUTIONAL PARTNERS, L.P.
By:
/s/
Larry Feinberg
Name: Larry Feinberg
Title: General Partner
|
FEINBERG CHILDREN’S TRUST
By:
/s/Adam Usden
Name: Adam Usden
Title: Autorized Person
|
TRELLUS PARTNERS LP
By:
/s/
Adam Usden
Name: Adam Usden
Title: President
|
VERITION MULTI-STRATEGY MASTER FUND LTD.
By:
/s/ Josh Goldstein
Name: Josh Goldstein
Title: COO
|
PAUL AND CAROLYN CLARK REVOCABLE TRUST OF 2009 dtd 4/20/09
By:
/s/ Paul Clark
Name: Paul Clark
Title: Trustee
|
JACK SCHULER
/s/ Jack Schuler
Name: Jack Schuler
|
MATT STROBECK
/s/ Matt Strobeck
Name: Matt Strobeck
|
Name of Purchaser & Address
|
Purchase Price
|
Number of Issued Shares
|
Maximum Consideration for Full Exercise of Warrants
|
Oracle Partners, L.P.
c/o Oracle Investment Management, Inc.
200 Greenwich Avenue, 3rd Floor
Greenwich, CT 06830
Attention: Larry Feinberg
Phone: (203) 862-7901
Fax: (203) 862-7903
Email: larry@oraclepartners.com
|
$ 3,000,000
|
2,821,412
|
$ 3,000,000
|
Jack Schuler
c/o Crab Tree Partners
28161 North Keith Drive
Lake Forest, IL 60045
Attention: Jack Schuler
Phone: (847) 607-2067
Fax: (847) 367-9586
Email: jack.schuler@ctreepartnerscom
|
$ 1,750,000
|
1,645,823
|
$ 1,750,000
|
Oracle Institutional Partners, L.P.
c/o Oracle Investment Management, Inc.
200 Greenwich Avenue, 3rd Floor
Greenwich, CT 06830
Attention: Larry Feinberg
Phone: (203) 862-7901
Fax: (203) 862-7903
Email: larry@oraclepartners.com
|
$ 1,000,000
|
940,470
|
$ 1,000,000
|
Trellus Partners LP
c/o Trellus Management Company, LLC
350 Madison Avenue, 9th floor
New York, NY 10017
Attention: Adam Usdan
Phone: (212) 389-8780
Fax: (212) 389-8798
Email: ausdan@trellus.com
|
$ 500,000
|
470,235
|
$ 500,000
|
Verition Multi-Strategy Master Fund Ltd.
One American Lane
Greenwich CT 06831
Attention: Josh Goldstein
Fax: (203) 742-7715
Email: jgoldstein@veritionfund.com
|
$ 500,000
|
470,235
|
$ 500,000
|
Paul Clark
c/o ICOS Corp.
22021 20th Ave. SE
Bothell, WA 98021
Attention: Paul Clark
Phone: (425) 415-2285
Fax: (425) 485-1911
Email: pclarkt71@gmail.com
|
$ 250,000
|
235,118
|
$ 250,000
|
Feinberg Children’s Trust
c/o Trellus Management Company, LLC
350 Madison Avenue, 9th floor
New York, NY 10017
Attention: Adam Usdan
Phone: (212) 389-8780
Fax: (212) 389-8798
Email: ausdan@trellus.com
|
$ 250,000
|
235,118
|
$ 250,000
|
Matt Strobeck
3 Lakeview Terrace
Winchester, MA 01890
Phone: (781) 721-0241
Email: matthew.strobeck@gmail.com
|
$ 250,000
|
235,118
|
$ 250,000
|
Total
|
$ 7,500,000
|
7,053,529
|
$ 7,500,000
|
__________________
|
|
Ori Hadomi, CEO
|
|
Mazor Robotics Ltd.
|
|
Date: _______ __, 2012
|
|
1.
|
Attached to this Certificate as
Exhibit A
is a true, complete and correct copy of the resolutions adopted by the Board of the Company (the “
Resolutions
”) authorizing the execution, delivery and performance of the Agreement and each of the Transaction Documents to which it is a party and the consummation of the transactions contemplated thereby. As of the date hereof, such Resolutions have not been altered, amended or repealed and are in full force and effect.
|
|
2.
|
Set forth below are the names and signatures of each of the Officers of the Company authorized to sign the Transaction Documents:
|
Name
|
Title
|
Signature
|
Jonathan Adereth
|
Chairman
|
_____________________
|
Ori Hadomi
|
Chief Executive Office
|
_____________________
|
Dated: August ___, 2012
|
_____________________________________
Name: _____________________________
Title: _____________________________
|
Narda Ben-Zvi
|
נרדה בן-צבי
|
Lori Almouli-Confino*
|
*לורי אלמולי-קונפינו
|
Barak Luchtenstein
|
ברק לוכטנשטיין
|
David Schottenfels
|
דוד שוטנפלס
|
Tsafi Erlich Goldman
|
צפי ארליך גולדמן
|
Ori Kasir
|
אורי קסיר
|
Inbal Baruch-Rotter
|
ענבל ברוך-רוטר
|
Lena Mor
|
לנה מור
|
Diana Albu
|
דיאנה אלבו
|
Yoash Dvir
|
יואש דביר
|
Dan Adar
|
דן אדר
|
Yuval Beer
|
יובל בר
|
Naama Ben-Bassat
|
נעמה בן-בסט
|
Ariel Lavi
|
אריאל לביא
|
Dafna Kahn Amster
|
דפנה קאהן אמסטר
|
Adi Shillo
|
עדי שילה
|
Anna Barkats
|
חנה ברכץ
|
Israel Shay Greenfeld
|
ישראל שי גרינפלד
|
*Also admitted to the New York Bar
|
בעל רשיון גם בניו יורק*
|
1.
|
Enforceability may be limited by applicable bankruptcy, insolvency, reorganization, receivership, preference, moratorium arrangement or winding up laws or other similar laws affecting the enforcement of creditors’ rights, including, without limitation, the Companies Law, 5759-1999, the Bankruptcy Ordinance [New Version], 5740-1980, the Pledge Law, 5727-1967, the Execution Law, 5727-1967 and laws regarding the limitation of actions.
|
2.
|
We express no opinion as to compliance with anti-fraud and/or minority oppression provisions of Applicable Laws.
|
3.
|
Enforceability of the Agreement or any part thereof or document or instrument referred to therein may be limited by equitable principles, including the principle that specific performance and injunction may only be granted in the discretion of the court of competent jurisdiction.
|
4.
|
The performance of contracts (as well as the negotiations leading up to the execution of any contract) must be conducted in good faith and in a reasonable manner. Lack of such good faith (by a contracting party or its agents) may be deemed a breach of contract. Notwithstanding any term or condition contained in any instrument, including, without limitation, the right of any party to exercise its sole discretion, a court of competent jurisdiction, may retain the discretion to determine when the actions of such party or its agents have been conducted in good faith and in a reasonable or “commercially reasonable” manner.
|
5.
|
The enforceability of any of the provisions of any instrument entitling a party to exercise rights and remedies, may be limited by Applicable Law requiring creditors and secured parties to afford debtors a reasonable time to rectify any default or to repay as demanded prior to taking any action to exercise such rights and remedies.
|
6.
|
We express no opinion as to the enforceability of any provision of any instrument which may be characterized in a court as an unenforceable penalty and not as a genuine pre-estimate of damages.
|
7.
|
The validity and enforceability of provisions inserted in any agreement or instrument, which purport to sever from the agreement or instrument any provision which is prohibited or unenforceable under Applicable Law without affecting the enforceability or validity of the remainder of the agreement or instrument may be limited by the operation of law.
|
8.
|
An agreement may be void or voidable if the agreement was entered into under certain circumstances such as, if (i) the will of one of the parties was flawed; (ii) fraud or willful misrepresentation by a party to the agreement; (iii) mistake by a party to the agreement; (iv) exploitation by one party of the other.
|
9.
|
Enforceability of an agreement or of any provisions thereof may be limited by frustration of contract.
|
10.
|
We are members of the Bar of the State of Israel, we express no opinion as to any matter relating to the laws of any jurisdiction other than the laws of the State of Israel as the same are in force on the date hereof and we have not, for the purpose of giving this opinion, made any investigation of the laws of any other jurisdiction. In addition, we express no opinion as to any documents, agreements or arrangements other than those subject to the laws of the State of Israel, if any. As used herein, the term “Applicable Law” means only those laws of the jurisdictions for which we express opinions hereunder.
|
a.
|
The Company is duly organized, validity existing and in good standing under the laws of the State of Israel and has the requisite corporate power and authority to own, operate and lease its assets and properties and carry on its business as now being conducted.
|
b.
|
The Company has the requisite corporate power and authority to execute, deliver and perform its obligations under the Agreement. The execution, delivery and performance by the Company of the Agreement has been duly authorized by all necessary corporate action of the Company, such Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms. Assuming the accuracy of the representations of the Purchasers set forth in Section 6.5 of the Agreement, no shareholder action on the part of the Company is necessary to authorize the execution, delivery or performance of the Agreement.
|
c.
|
None of the execution, delivery or performance of the Agreement will violate or contravene any provision of any applicable Israeli Law, or violate any provision of the Company’s Articles of Association, or to our knowledge conflict with or result in a material breach of the terms, conditions or provisions of, or constitute a material default under any material Contract under which the Company is now obligated.
|
d.
|
The execution, delivery or performance of the Agreement and the transactions contemplated thereunder by the Company do not require any prior approval or consent from any Governmental Authority in Israel, other than those disclosed to the Purchasers within the Agreement.
|
e.
|
The Securities have been duly authorized, and when issued and paid for in accordance with the Agreement at the Closing, or upon exercise of the Warrant (subject to its terms), will be validly issued and fully paid and nonassessable, free and clear of any Encumbrances and preemptive rights
and shall have the rights and obligations set forth in the Company's Articles of Association
.
|
f.
|
The Warrant Shares to be issued upon exercise of the Warrant have been duly authorized and reserved for issuance.
|
g.
|
Except for any consent, approvals, Order or authorization of, or registration, qualification, designation, declaration or filing with, any Israeli Governmental Authority that already has been made or obtained, the initial offer and sale of the Securities, the issuance of the Issued Shares, and the issuance of the Warrant Shares upon exercise of the Warrants, does not require any such consent, approvals, Order or authorization of, or registration, qualification, designation, declaration or filing with, any Israeli Governmental Authority on the part of the Company.
|
h.
|
There are no Actions pending or, to our knowledge, threatened in writing against the Company or involving its properties or assets. There are no pending or, to our knowledge, threatened, Actions filed or authorized by the Company. The Company has not received any written threat that questions the validity of the Agreement or the right of the Company to enter into the Agreement.
|
1.
|
The Company's Annual Report dated March 27, 2012 (Reference: 2012-01- 082137)
|
2.
|
An Immediate Report dated March 28, 2012 (Reference: 2012-01-082977) re: Appointment of VP Sales by Mazor USA.
|
3.
|
An Immediate Report dated April 1, 2012 (Reference: 2012-01-089157) re: Sale of Renaissance system in Florida.
|
4.
|
An Immediate Report dated April 15, 2012 (Reference: 2012-01-101202) re: Certain clarifications in respect of Company publications.
|
5.
|
The Company Quarterly Report for Q1 2012 dated May 16, 2012 (Reference: 2012-01-126456).
|
6.
|
An Immediate Report dated May 23, 2012 (Reference: 2012-01-133233) re: Launch of C-Onsite Application.
|
7.
|
An Immediate Report dated May 28, 2012 (Reference: 2012-01-136914) re: Intention to apply for a permit for publication of a prospectus.
|
8.
|
An Immediate Report dated June 11, 2012 (Reference: 2012-01-152679) re: Use of robot in brain procedures.
|
9.
|
An Immediate Report dated June 13, 2012 (Reference: 2012-01-154794) re: Receipt of KFDA approval for the Renaissance system.
|
10.
|
An Immediate Report dated June 26, 2012 (Reference: 2012-01-166542) re: Sale of Renaissance system in Virginia.
|
11.
|
An Immediate Report dated July 1, 2012 (Reference: 2012-01-171312) re: Sale of Renaissance system in Texas.
|
12.
|
An Immediate Report dated July 1, 2012 (Reference: 2012-01-171336) re: Sale of Renaissance system in Florida.
|
13.
|
An Immediate Report dated July 16, 2012 (Reference: 2012-01-185727) re: Appointment of VP Marketing by Mazor USA.
|
14.
|
An Immediate Report dated July 16, 2012 (Reference: 2012-01-185730) re: Appointment of VP Business Development by Company.
|
15.
|
An Immediate Report dated July 16, 2012 (Reference: 2012-01-185724) re: Receipt of FDA approval for Renaissance system in brain surgery.
|
1.
|
CONFIDENTIALITY
|
|
1.1
|
Confidential Information
.
During my service as an Observer, and at any time after the expiration or termination thereof, I will not disclose or make accessible to any other person, and will take all necessary precautions to prevent the disclosure of, any information of the Company, or information to which I was exposed to in the course of my engagement with the Company, or in connection therewith, including, without limitation, the Company’s Intellectual Property Rights (as defined hereunder), and other confidential and proprietary information (“
Confidential Information
”). Confidential Information shall not include, however information that: (i) reflects information and data generally known within the industries or trades in which the Company transacts business; (ii) I received from a third party exempt from confidentiality undertakings; (iii) was in my possession at the time of disclosure; or (iv)
I am compelled by court, government or regulatory action pursuant to applicable law or regulation to disclose, provided, however, that I will give the Company prompt notice thereof (where legally permissible and practicable to do so) so that the Company may seek a protective order or other appropriate remedy. It is agreed that, between the parties hereto, the Confidential Information is and will remain the sole property of the Company.
Notwithstanding the above, please note that: (i) I may have many other occupations and I am involved and will continue to be involved in a wide range of activities in numerous market segments, and therefore have other sources of information; and (ii) subject to the provisions of this letter, I will continue my engagement in such other occupations and activities and may continue using such information.
|
|
1.2
|
Use of Information; Duty of Care
. I shall not use any Confidential Information, directly or indirectly, except as required by the Company solely for the purpose of performing my duties as an Observer, whilst maintaining the Company’s best interest. I will exercise due care and diligence to prevent, and shall not take any action, which could result in conflict with, or be prejudicial to, the interests of the Company.
|
|
1.3
|
No License
. Disclosure of the Confidential Information to me shall in no way serve to create, on my part, a license to use, or any proprietary right in, the Company’s Confidential Information (as defined hereunder) and/or in the Company’s Intellectual Property Rights (as defined hereunder) including in any proprietary product, trademark, copyright or other right of the Company.
|
|
1.4
|
The terms of this Section 1 shall survive the termination or expiration of my position as Observer.
|
2.
|
MISCELLANEOUS
|
|
2.1
|
Term.
This letter, when signed by both parties, will enter into force as of _________, 201
2
(the "
Effective Date
"), and shall remain in full force and effect, unless it is terminated or otherwise expires due to the termination or expiration of my position as an Observer.
|
|
2.2
|
Effects of Termination
. Upon expiration and/or termination of this letter or my position as an Observer, for any reason whatsoever and/or at the Company’s request, I shall return to the Company or destroy (or, in the case of electronically stored information, delete and not attempt to recover) all documents and material in whatever media, and of any nature, and any copies thereof, containing, including and/or evidencing Confidential Information, whether in my possession or under my control, and shall deliver to the Company any such documents.
|
|
2.3
|
Equitable Relief
. I hereby acknowledge and agree that a breach of my obligations hereunder would cause the Company irreparable damage that could not be adequately remedied by an action at law. Accordingly, I agree that the Company shall have the right to seek specific performance of the provisions hereof, to enjoin a breach of the provision thereof, such right being in addition to all other rights and remedies that are available to the Company at law or in equity.
|
|
2.4
|
Entire Agreement
. This letter reflects the entire agreement of the parties with respect to its subject matter and supersedes all previous or contemporaneous written or oral negotiations, commitments and writings.
|
|
2.5
|
Governing Law
. This letter shall be governed and construed according to the laws of the state of Israel, without reference to conflict of laws principles. Any dispute under this letter shall be brought before the competent general courts of Tel-Aviv, Israel and the parties hereby agree to the sole and exclusive jurisdiction and venue of these courts.
|
|
2.6
|
Notices
. Any notice, request, demand or other communication required or permitted hereunder shall be in writing and shall be given or made by any delivery services requiring signature of receipt, first class registered mail (return receipt requested) addressed to the parties at their respective addresses provided in this Section, by e-mail (electronic confirmation required) or facsimile (electronic confirmation required):
If to the Company
:
Mazor Robotics Ltd
.
7
HaEshel St., Southern Caesarea Industrial Park
P.O.B 3104, Israel 38900
Fax: +972 (
_________________
)
Attention: Ori Hadomi, CEO
If to Observer:
___________________
___________________
___________________
Fax: ___________________
|
|
2.7
|
Amendments
. This letter shall not be modified except by a written instrument signed by both parties.
|
|
2.8
|
No Waiver
. No waiver of any rights arising under this letter shall be effective unless executed in writing and signed by the party against whom such waiver is sought to be enforced. The waiver of any breach of any provision herein contained, shall not be deemed to be a waiver of such breach, or of any subsequent breach of the same or other provision.
|
_____________
(the "Observer")
__________________________
_________________
Signature Date
|
Mazor Robotics Ltd.
By: ______________
Title: ____________
__________________________
_________________
Signature Date
|
Between:
|
Mazor Robotics, Ltd.
Company No. 51-300904-3
7 Haeshel St., Industrial Area, Caesaria
(hereinafter: The Company)
|
And Between:
|
[_________]
(hereinafter, together and separately: The Investor)
|
WHEREAS:
|
The Company is a public company registered in Israel, and its shares are traded on the Tel Aviv Stock Exchange (hereinafter: the Exchange).
|
AND WHEREAS:
|
the Investor is included in the detailed list of investors in the First Amendment of the Securities Law, 5728-1968, (hereinafter: Securities Law) and is interested in acquiring the Company's shares via a private allocation of shares and (non-negotiable) options in the Company;
|
AND WHEREAS:
|
the Company is interested in allocating shares for the Investor, all as detailed in this Agreement below:
|
1.
|
Preamble and Interpretation
|
|
1.1.
|
The Preamble to this Agreement shall constitute an integral part thereof and shall be read together with the other sections.
|
|
1.2
|
The headings in this Amendment are intended for purposes of convenience only and shall not be used for the interpretation of the provisions hereof.
|
|
1.3
|
No change, addition or deletion from this Agreement shall have any validity after it is signed, unless all the Parties agree to such change, addition or deletion, in writing.
|
|
1.4
|
No stipulation of the conditions and the overall stipulations in this Agreement derogate from any other condition or stipulation of this Agreement that shall be added, unless otherwise stipulated in this Agreement.
|
|
1.5
|
A stipulation and/or expression in the singular shall also include the plural, and vice versa. A stipulation and/or expression in the feminine shall also include the masculine, and vice versa; and reference to a person shall also include a corporation and vice versa.
|
2.
|
Company Statement
|
|
The Company hereby declares, certifies and undertakes that as of the date that this Agreement is signed, and as of the date of Closing, as follows:
|
|
2.1
|
The Company is a limited public company registered in Israel, with shares registered and traded on the Exchange.
|
|
2.2
|
The Company's Articles of Association published by the Company in the "Magna" [electronic data] System are correct, up-to-date and precise, and identical to the Company's valid and obligating Articles of Association, as of the date that this Agreement is signed, and that no decision by the Company's Shareholders General Meeting has been made that changes or amends the Company's Articles of Association.
|
|
2.3
|
The Company is registered pursuant to the law and is authorized to manage its business as it is managed today, and as is expected to be managed in the future, to sign this Agreement and implement all of the activities required of it.
|
|
2.4
|
As of the date that this Agreement is signed by the Company, it has all of the essential licenses and permits required by law to manage the essence of its business, and the Company is not in material violation of their material stipulations, and the Company does not know of any material obstacle to renewing or extending (if necessary) the aforementioned licenses and/or does not have any reason to make any changes in them that could materially, negatively affect the Company's activities, as they are on the date that this Agreement is signed.
|
|
2.5
|
Signature on this Agreement does not constitute breach of the Company's Articles of Incorporation, does not entail any deviation from the Company's Articles of Incorporation, and does not breach any legal stipulations or agreement or agreed-upon authorization.
|
|
2.6
|
There is nothing in the signature on this Agreement that is in breach and/or can cause breach in any way whatsoever of any agreement whatsoever of the Company and/or of any of its obligations and undertakings, of any type whatsoever, that the Company undertook with third parties.
|
|
2.7
|
The Company is registered pursuant to the stipulations of the Companies Law 5759-1999 (hereinafter: Companies Law). Registration of the Company is completely valid on the date that this Agreement is signed, and on the completion date, and to the best of its knowledge, no reason exists to remove the Company from the registration listed with the Companies Registrar. Nor has the Company received any notification from the Companies Registrar or any other agreed-upon authority, as of the date that this Agreement is signed, that the Company is to be removed from the registration. As of the date that this Agreement is signed, no dismantling of the Company is taking place, nor has such dismantling occurred in the past, nor have any receivership processes against the Company been taken, and/or appointments made (temporary or permanent) to dismantle it. No notification has been received of any intention to take such steps as aforementioned, and to the best of its knowledge, no reason exists or is expected, to open dismantling processes against the Company.
|
|
2.8
|
As of the day that this Agreement is signed, the Company's registered share capital is composed of fifty million (50,000,000) ordinary shares, each of 0.01 New Israeli Shekel [NIS] nominal value (hereinafter: Ordinary Shares).
|
|
2.9
|
As of the day that this Agreement is signed, (and before any allocation is made by force of this Agreement) the Company's issued share capital and is composed of [______] Ordinary Shares, each of 0.01 NIS nominal value. The Company's listing with the Companies Registrar is attached as
Appendix 2.9
to this Agreement.
|
|
All of the Company's issued and redeemed Ordinary Shares in the share capital are equal in status and rights, including everything related to voting rights, the right to share in the Company's profits, and the right to share in the division of the Company's assets in the case of dismantling it.
|
|
All of the Company's issued Ordinary Shares in the share capital were allocated pursuant to the law and redeemed in their entirety, and the Company has no rights of lien regarding the shares.
|
|
2.10
|
Since the Financial Statements of September 30, 2010, and up until the date that this Agreement was signed and the completion date, except for the Company's intention to sign a similar agreement with [_____] (hereinafter[_____]), pursuant to which the Company shall allocate to [_____][_____]Ordinary Shares, at a nominal value of 0.01 New Israeli Shekels each of the Company's shares, and [_____] non-negotiable options on the Company's Ordinary Shares, and except for the Company's undertaking to allocate a total of [_____] options on the Company's Ordinary Shares to its employees and consultants, the Company has not carried out any transactions or undertaken any obligations that is not part of its regular business, that have not been listed in the Immediate Statements issued by the Company, and there were/was not any:
|
|
2.10.1
|
material changes in the Company's assets, undertakings, status or transactions from what was reflected in the Financial Statements;
|
|
2.10.2
|
any damage, destruction or loss that materially affects or is likely to worsen the Company's assets, undertakings, status or outcomes of its transactions or business;
|
|
2.10.3
|
any relinquishment by the Company of any rights of value or material debt that is owed to it;
|
|
2.10.4
|
any change or amendment to an agreement or material arrangement by which the Company or any of its assets or other property is bound, or to which they are subject;
|
|
2.10.5
|
any loans that the Company gave to its Directors, employees, office-holders or consultants;
|
|
2.10.6
|
transactions with stakeholders.
|
|
2.11
|
That the Company's annual and quarterly Financial Statements are correct and complete, and accurately reflect the Company's status, its assets and undertakings on the dates set forth therein, and the outcomes of the Company's activities for the periods of the Statements. That the Financial Statements were prepared pursuant to the stipulations of the International Financial Reporting Standards (IFRS), which were applied without changes regarding prior years, except for anything otherwise stated in the Financial Statements.
|
|
2.12
|
That, aside from blocking rules pertaining to the shares allocated pursuant to this Agreement (as stated in Section 11 below), as far as the matter applies to the Company, the shares allocated shall be free of any attachment, mortgage, confiscation, lien, debt and/or debts and/or rights by any third party whatsoever. Subject to that set forth in Section 11 below, and the stipulations of all law, the Investor shall be entitled to sell its rights in shares and/or to transfer them and or assign its rights in them.
|
|
2.13
|
That the Company does its accounting and bookkeeping as required by law; the Company submitted Statements as required by law to the Income Tax Authority, the National Insurance Institute [Social Security], the Value Added Tax Authority, Customs and Purchase Tax Authority, and paid the amounts due to each pursuant to those Statements, on the dates stipulated by law; and that the Company does not know of any investigations undertaken against it (by contrast to audits) by any of the aforementioned authorities.
|
|
2.14
|
That as of the date that this Agreement is signed, the Company is not a party to any legal proceedings or any type of legal [action] in a court of law or any other tribunal (including arbitration, mediation, or conciliation), the results of which can materially, negatively affect the Company, with the exception of those set forth in the attached Financial Statements; the Company has not received notification of any legal proceedings or any type of legal [action] as aforementioned against it, with the exception of those set forth in Statements issued in Magna; and that the Company does not know of the existence, as of the date that this Agreement is signed, of any criminal investigation against it in matters wherein the results can materially and negatively affect the Company, with the exception of those set forth in the attached Financial Statements.
|
|
2.15
|
That there is nothing in the allocation of shares that are allocated pursuant to this Agreement, in itself, that gives rights to any third party to legally cancel material contracts or agreements to which the Company is a party, in a way that would be significantly deleterious to the Company's status, or give it a legal reason to worsen conditions of contracts or agreements as aforesaid.
|
|
2.16
|
Thatthe information that is provided to its investors, if any, by the Company, together with the Statements that the Company provided to Magna, is provided to the signatory on this Agreement, and constitutes all of the material information related to the Company, and that no information was provided to investors that is considered or that can be considered as internal information, as set forth in the Securities Law.
|
3.
|
Investor Statement
|
|
3.1
|
The Investor's engagement in this Agreement does not entail any breach of the law or rights of any third parties.
|
|
3.2
|
No agreement exists between the Investor and any other offerees, as part of the private allocation, and/or between the Investor and other shareholders of the Company, concerning acquisition and/or sales of the Company's shares or voting rights in the Company.
|
|
3.3
|
The Investor knows that the offered shares allocated to him are allocated without any statement or presentation or compensation, i.e. as is, except for that set forth in this Agreement and in the Company's regular reports to the Exchange and to the Securities Registrar, and are free of any debt, confiscation, lien, attachment and/or right of any third party.
|
|
3.4
|
With the exception of the Company's public disclosures and that set forth in Section 2 above, the Company and/or anyone acting on its behalf, did not give to the Investor any presentation, promise or prediction concerning the Company and its transactions, and that the Investor, in making its decision to acquire shares, did not rely on any information or document that is not set forth in this Agreement or public disclosures.
|
|
3.5
|
The Investor states that it has the financial ability to make the investment pursuant to this Agreement, and has sufficient economic and business ability and financial experience, to evaluate the appropriateness of the investment to its needs, and to evaluate the inherent business risks of the investment.
|
|
3.6
|
The Investor states that it has considered the aspect of the taxes that shall be levied on the investment, and the Company did not make any presentation to it concerning such matters.
|
|
3.7
|
The Investor states that it is a corporation, legally incorporated pursuant to the laws of the State of Israel, and has the legal competence to engage in this Agreement and act pursuant to it, and that the competent organs of the Investor made the decisions required for engaging in this Agreement. In everything pertaining to the Investor, its engagement in this Agreement does not breach any law, agreement or obligating decree, and does not require any additional approval or agreement.
|
|
3.8
|
As of February 21, 2011, the Investor and/or the companies related to it, holds [_____]% of the Company's issued and redeemed shares, and [_____]% of the Company's bonds (Series A) that can be converted to the Company's shares, but is not a
stakeholder
in the Company (as the term is defined in the Securities Law) but will become a stakeholder as a result of the share allocation.
|
4.
|
The Transaction
|
|
4.1
|
Subject to receipt of all the certifications set forth in Section 6 below, the Company shall allocate to the Investor, on the completion date, the following shares for the following remuneration:
|
|
4.1.1
|
[_____] of the Company's Ordinary Shares, at a nominal value of 0.01 NIS each, immediately after the allocation of shares and options allocated pursuant to this Agreement, and immediately after the allocation to Leader, which constitutes [_____]% of the capital issued and redeemed by the Company, without any dilution and [_____]% of the shares issued by the Company with full dilution, (hereinafter, The Shares or The Allocated Shares), at a rate of 9.5 NIS per share.
|
|
4.1.2
|
[_____] non-negotiable options, which shall not be listed for trade, for acquisition of [_____] of the Company's Ordinary Shares at a nominal value of 0.01 NIS each, which can be redeemed for a period of five (5) years from the completion date, at the price of 14 NIS for each option. The wording of the Options Document is attached as
Appendix 4.1.2
to this Agreement (hereinafter: The Options).
|
|
4.1.3
|
The Company shall allocate the shares and options allocated to the Investor's units, pursuant to the details set forth in
Appendix 4.1.3
to this Agreement.
The Investor shall pay the Company the sum of [_____] shekels ([_____]) in cash for the allocation of Shares and Options, upon the completion date (hereinafter: the Remuneration).
|
4.2
|
The Shares and Options are allocated free of any attachment, mortgage,lien, confiscation, demand, suit, debt or other rights of any third party.
|
|
4.3
|
The Shares (including Shares which the Investor shall receive as a result of realizing the Options or a portion thereof) shall be of equal status and rights, including everything concerning voting, the right to share in the Company's profits and the right to share in the distribution of the Company's assets in the event that the Company is dismantled, equal to the other Ordinary Shares of the Company.
|
|
Without derogating from the stipulations set forth, the Shares, including Shares which the Investor shall receive as a result of realizing the Options or a portion thereof) shall bestow on their holders every right deriving and/or concerning ownership of the Company, and in general, among other things, the right to participate and vote in the Company's General Meetings, both regular and special or extraordinary; the right to share in the division of dividends, bonus shares, rights and similar, and rights to shares in the Company's assets upon its dismantling, all as set forth in the Company's Articles of Incorporation and subject to all law.
|
5.
|
Designation of the Remuneration
|
6.
|
Conditions Precedent for Implementation of the
Transaction
|
|
6.1
|
Receipt of the authorization by the Company's Directors'. The Company's Articles of Association are attached to this Agreement, as
Appendix 6.1
.
|
|
6.2
|
Approval by the Tel Aviv Stock Exchange to list the allocated shares, and the shares that derive from exercising the options, for trade.
|
|
(The conditions set forth in Sections 6.1 and 6.2, hereinafter, together and separately: the Conditions Precedent.)
|
7.
|
Completion of the Transaction
|
|
7.1
|
The Company shall give to the Investor a copy of the authorizations, pursuant to Section 6 above.
|
|
7.2
|
The Company shall state, in an Immediate Statement, on the required forms, that the share allocation has been allocated to the Investor and the Company shall issue an Allocation Statement to its stakeholders, including to the Investor.
|
|
7.3
|
The Company shall allocate the shares to the Investor by depositing the Share Certificates in the Company's name for recording with the Bank Leumi Recording Company of Israel, Ltd. (hereinafter: the Recording Company), on the basis of the allocated shares, along with all attendant documents required by the Recording Company and the Exchange's clearinghouse, along with written instructions to deposit the allocated shares in the bank accounts in the name of the Investor's units pursuant to the details set forth in Appendix 4.1.3 and transfer to the Investor the Letter of Options for the allocated Options, in the wording set forth in Appendix 4.1.2.
|
|
7.4
|
In return for the Company's actions as set forth in Sections 7.2 and 7.3 above, and implementation of all the Company's undertakings pursuant to Sections 7.2 and 7.3 above, on the Completion Date, the Investor shall deposit the Remuneration in the Company's bank, the account number of which is[_____], in bank Leumi Le-Israel, Ltd. (hereinafter: the Account). Deposit of the monies in the Account by the Investor shall be considered as payment by the Investor pursuant to this Agreement and complete fulfillment of its undertakings pursuant to it.
|
|
7.5
|
The Parties shall implement all other actions that shall be necessary in order to complete the transaction.
|
|
7.6
|
Receipt of a notice from the lawyer that all authorizations and licenses required pursuant to all law, in order to implement the allocation and register the shares for trade on the Stock Exchange.
|
8.
|
The Investor's undertaking to complete the transaction and acquire the shares is subject to the stipulation that all of the Company's presentations in this Agreement shall be correct and precise on the Completion Date as if they had been issued on the Completion Date, and that the Company has implemented all of the undertakings that it undertook to implement pursuant to this Agreement on the Completion Date, and that until the Completion Date, no material change has occurred to worsen the Company's status or the transaction. (In order to remove all doubt, it is hereby clarified that changes in the rates of the Company's shares, at a rate not greater than 20% relative to the rate on the date on which this Agreement is signed, shall not be considered as a material change that worsens the Company's status.) It is hereby clarified that, in the event that the Investor does not transfer the remuneration to the Company and the Company does not allocate the shares and options and cancels this Agreement, pursuant to the circumstances as set forth in this Section, the Company shall not have any claims and/or demands on the Investor regarding cancellation of this Agreement.
|
|
The Company's undertakings to complete the transaction and acquire the shares are subject to the fact that all representations by the investor in this Agreement are correct and precise at the Completion Date, as if they had been given on the Completion Date. In the event that, until the Completion Date, a change shall take place in the value of the Company's securities, that constitutes a change of more than 20% relative to their value on the date that this Agreement was signed, the Company can cancel this Agreement, the Investor shall not transfer the remuneration to the Company, and the Company shall not allocate the shares and options to the Investor and other Parties, and there shall not be any claims by any Party on any other Party.
|
9.
|
The Company undertakes that, beginning on the date that this Agreement is signed and until the Completion Date, it shall not implement or announce any allocation of dividends and/or shall not allocate any bonus shares or any changes in the Company's structure.
|
10.
|
Taxes and Expenses
|
|
10.1
|
The Company shall pay all expenses associated with allocating the shares pursuant to this Agreement and their listing for trade with the Exchange, including requirements to report it to the Securities Authority and authorization from the Exchange for listing the shares for trade, and shall carry out all that is required of it to do so.
|
|
10.2
|
Each Party shall pay the consultants and taxes levied on it for implementing the allocation pursuant to this Agreement.
|
11.
|
Prohibition on Return Sale
|
12.
|
General
|
|
12.1
|
The Parties undertake to act in good faith and in mutual cooperationin order to carry out the stipulations of this Agreement, and in general, to take any action, to sign any document, and to present any authorization required to appropriately implement the stipulations of this Agreement.
|
|
12.2
|
The Investor knows that the Company is a public Company and that its shares are traded on the Securities Exchange, and accordingly, the Investor undertakes that, in order to become a shareholder in the Company, starting with the allocation of the shares pursuant to this Agreement, it shall transfer to the Company all of the Statements required, and/or that shall be demanded of it, pursuant to any valid law, that is incumbent on it as a shareholder in a public company. This shall be done in a time sufficient for the Company to meet the obligations to report, as is incumbent on it pursuant to all law.
|
|
12.3
|
No change in this Agreement or any of its stipulations shall be valid unless the change is made in writing and signed by the two Parties to this Agreement.
|
|
12.4
|
Behavior on the part of any of the Parties shall not be considered as relinquishing its rights pursuant to this Agreement or pursuant to any law and/or relinquishment or agreement on its part to any breach and/or non-implementation of any condition whatsoever of this Agreement, unless said relinquishment, agreement, change, cancellation and/or addition is done in detail and in writing.
|
|
12.5
|
Each of the Parties undertakes to sign any document, make any decision and implement any action that shall be required in order to implement and apply the stipulations of this Agreement.
|
|
12.6
|
This Agreement exclusively includes and exhausts that agreed to and the relationship between the Parties in all matters discussed in this Agreement, and no relevance exists or shall exist, and there is no usage and/or reliance on any document, negotiations, statement, presentation, undertaking or agreement that was made or shall be made, between the Parties, written and/or verbal or in any other manner, upon signing this Agreement.
|
|
12.7
|
Agreement on the part of any of the Parties in a specific case of deviation from the condition(s) and/or stipulation(s) of this Agreement, shall not constitute a precedent and/or agreement to the aforesaid deviation in other cases and that case shall not be relied upon or have ramifications for other cases.
|
|
12.8
|
The laws of the State of Israel shall apply to this Agreement. The exclusive legal competence in everything related to this Agreement shall be that of the competent Court of the Central District, in a manner that shall reject the legal competence of any other court.
|
|
12.9
|
Except for that set forth in this Agreement, a Party to this Agreement shall not be entitled to cancel, transfer, endorse over or attach, in any way or manner, its rights or obligations pursuant to this Agreement, in whole or in part, without the prior written agreement of the other Party to this Agreement, except for selling the shares that are held by the Investor, which can be done with no limitation, subject to the stipulations of all law, and that set forth in Section 11 above.
|
13.
|
Notices
|
|
13.1
|
Notices that shall be sent to the Parties' addresses as detailed at the beginning of this Agreement, by registered mail, shall be deemed to have been received within 72 hours of the date of dispatch thereof. If a notice is sent by hand, as set forth, the notice shall be deemed to have been received on the date of dispatch thereof.
|
|
13.2
|
Each Party shall be entitled to change its address to another in Israel, for the requirements of this Agreement, upon written notice that shall be sent to the other Party at the address set forth above.
|
|
[Signature page follows]
|
Mazor Robotics, Ltd.
|
||
__________________
|
||
__________________
|
||
__________________
|
||
The Investor
|
||
__________________
|
||
__________________
|
||
__________________
|
|
(hereinafter – the
“Employee”
or
“Chairman of the Company Board of Directors”
or
“Chairman”
)
|
Whereas
|
the Company wishes you to serve as Chairman of the Company’s Board of Directors, subject to receipt of the approvals required pursuant to the Companies Law, 5759-1999 (hereinafter – the
“Companies Law”
); and
|
Whereas
|
you have expressed your consent to serve as Chairman of the Company’s Board of Directors; and
|
Whereas
|
the parties wish to put your appointment as Chairman of the Company’s Board of Directors, including the terms of your service, in writing, all as provided below;
|
1.
|
Recitals and the position
|
|
1.1.
|
The recitals and annex to this Contract constitute an integral part thereof and shall be read as one with its other sections.
|
|
1.2.
|
The section headings herein are for convenience and location purposes only and shall not be used in the interpretation hereof.
|
|
1.3.
|
As Chairman of the Company’s Board of Directors, the Company expects you to participate in and conduct all the meetings of the Company’s board of directors and board of directors’ committees (on which you are appointed to serve), and to act for the advancement and implementation of the Company’s business strategy, as required of you from time to time, in accordance with the Company’s requirements. Acceptance of the appointment as Chairman of the Company’s Board of Directors is tantamount to your confirmation that you are prepared to devote your time and energy to meeting the Company’s expectations and the requirements of the law in connection with your service as director of a public company.
|
|
1.4.
|
In the scope of your service as aforesaid, you shall devote no less than one and a half days a week for the purpose of filling your position and advancing the Company’s interests and objects, as determined by the Company’s board of directors, including assistance with determining the Company’s strategy, current advice and assistance with overseeing the Company’s transactions.
|
|
1.5.
|
The parties hereby warrant that the Employee’s position is one requiring a special degree of personal trust within the meaning of such expression in section 30(a)(5) of the Hours of Work and Rest Law, 5711-1951, and that the provisions of this Law shall not apply to the Employee’s engagement by the Company.
|
|
1.6.
|
This Contract is personal and special and regulates the relationship between the Company and the Employee; accordingly, the Employee shall not be governed by any general and/or special collective agreement.
|
2.
|
The consideration
|
|
2.1.
|
Monthly salary
|
|
2.2.
|
Social terms
|
|
2.2.1.
|
Leave
. The Employee shall be entitled to leave as prescribed in the law. The Employee shall at no stage be entitled to the accrual or redemption of leave.
|
|
2.2.2.
|
Sick leave
. The Employee shall be entitled to sick leave as prescribed in the law. The sick leave may not be redeemed.
|
|
2.2.3.
|
Convalescence pay
. The Employee shall be entitled to convalescence pay in accordance with the provisions of the law.
|
|
2.3.
|
Options
|
|
2.4.
|
Overseas traveling expenses
|
|
2.5.
|
The consideration specified in this section 2 above is the full consideration to which you shall be entitled in connection with your service as Chairman of the Company’s Board of Directors, and is subject to receipt of the approvals required pursuant to the Companies Law.
|
3.
|
Confidentiality
|
|
3.1.
|
Without derogating from your duties pursuant to the law, you hereby undertake to keep the Company’s trade secrets absolutely confidential and to refrain from any use, conveyance, disclosure or transfer of all or some of the Company’s trade secrets to any third party, directly or indirectly, in Israel or overseas, save in the context of an engagement with the Company and in accordance with the Company’s approval. This undertaking shall apply to you during the period of your service as a director of the Company and at any time thereafter.
|
|
3.2.
|
On the termination of your service as a director, you shall give the Company any confidential information and/or other property of the Company that is in your possession, including all copies thereof.
|
4.
|
The period of the Contract
|
|
4.1.
|
Subject to the provisions of section 4.2 below, this Contract shall come to its end together with termination of the Chairman’s service as Chairman of the Company’s Board of Directors.
|
|
4.2.
|
It is hereby agreed that each party may notify the other party of the Contract’s termination on at least 30 days’ notice.
|
5.
|
Condition precedent
|
6.
|
Miscellaneous
|
|
6.1.
|
This Contract exhausts everything agreed between the parties, and any negotiations, warranty, representation, undertaking or consent made, if made, in writing or orally, expressly or impliedly, between the parties prior to the execution hereof shall not be of any effect.
|
|
6.2.
|
It is warranted that the Employee shall bear all the taxes and/or other compulsory payments applicable to him in respect of all the amounts paid to him pursuant hereto and in respect of all the benefits granted to him, and that the Company shall deduct from his salary any tax and/or other compulsory payment the deduction of which is required pursuant to any law, unless expressly provided otherwise in this Contract.
|
|
6.3.
|
No alteration of this Contract shall be valid, and none of its conditions may be altered, other than by a written document bearing the parties’ signature. For the avoidance of doubt, it is hereby expressed that none of the conditions of this Contract may be altered by way of conduct, practice and the like.
|
|
6.4.
|
Notices pursuant hereto shall be delivered in writing to the parties’ addresses as set forth in the recitals, unless any party gives notice of a change of address in accordance with this Contract’s provisions. Any notice sent by registered mail by one party to another, in accordance with the aforesaid address, shall be deemed to have been received by the addressee within 72 hours of being mailed in Israel, if delivered by hand – at the time of its delivery, and if sent by facsimile – after its successful transmission.
|
Mazor Surgical Technologies Ltd.
|
By:
/s/ Ori Hadomi
|
Name: Ori Hadomi
|
Title: Chief Executive Officer
|
Chairman of the Company Board of Directors
|
/s/ Jonathan Adereth
Jonathan Adereth
|
1.
|
Appointment; the Position
|
|
1.1.
|
Upon the terms and subject to the conditions set forth in this Agreement, the Company hereby agrees to employ the Employee, and the Employee hereby agrees to serve, commencing on the Effective Date, in the capacity of CEO.
|
|
1.2.
|
In such capacity, the Employee shall perform the duties, undertake the responsibilities and exercise the authority customarily performed, undertaken and exercised by persons situated in similar capacities, subject to the instructions and policies of the Board of Directors of the Company. The Employee shall report regularly to the Chairman of the Board of Directors (the “
Chairman
”) with respect to his activities
|
|
1.3.
|
The Employee is employed on a full time basis, and hereby undertakes to devote his full time, attention, skill, and effort exclusively to the performance of his duties in the Company and undertakes, during the term of this Agreement, not be engaged, directly or indirectly, in any other employment, render services to or engage actively in any other business activities, with or without compensation, for any other person, firm or company, without the prior written consent of the Chairman, which shall not be unreasonably withheld; provided however that such consent shall be subject to those approvals required under any applicable law, to the extent required. Without derogating to the above, the Company acknowledges that the CEO is acting as a director at a family company and provides consulting services to third parties in de minims scope. The Employee shall perform his duties and responsibilities to the best of his abilities in a diligent, trustworthy, businesslike and efficient manner.
|
|
1.4.
|
The parties hereto confirm that this is a personal services contract and that the relationship between the parties hereto shall not be subject to any general or special collective employment agreement or any custom or practice of the Company in respect of any of its other employees or contractors or consultants.
|
|
1.5.
|
The Employee's position, duties and responsibilities hereunder shall be in the nature of management duties that demand a special degree of personal loyalty and the terms of employment hereunder shall not permit application to this Agreement of the Law of Work Hours and Rest 5711 - 1951. Accordingly, the statutory limitations of such law shall not apply to this Agreement. The Employee shall not be entitled to additional compensation from the Company for working additional hours or working on holidays or Sabbaths, as required by the Company.
|
2.
|
Salary
|
|
2.1.
|
In consideration for the Employee's employment with the Company on a full time basis, as specified herein, the Company agrees to pay to the Employee, starting on the Effective Date, a gross salary of NIS 65,000 (Sixty Five thousand New Israeli Shekels) per month (the "
Salary
").
|
|
2.2.
|
The Salary shall be payable monthly in arrears no later than the ninth business day of each month, during the term of the Employee's engagement hereunder.
|
|
2.3.
|
It is hereby agreed that the Salary shall be reviewed on an annual basis and may be increased at the Company's sole discretion, subject to the approvals required under applicable law.
|
3.
|
Bonus
|
|
3.1.
|
No later than 45 days after the beginning of each calendar year, the Compensation Committee and Board of Directors, after receipt of the Chairman’s recommendations, shall set those certain goals the achievement of which shall entitle Employee to the Bonus, in whole or in part. Those goals shall be determined according to the Company's compensation policy at that time and may be subject to the approval of the general meeting of the shareholders. Determination whether those certain goals were achieved, in whole or in part, shall be made by the Board of Directors.
|
4.
|
Additional Benefits
|
|
4.1.
|
In addition to the Salary, and starting as of the Effective Date, the Employee shall receive the following benefits from the Company:
|
|
4.1.1.
|
Vacation
. The Employee shall be entitled to an annual vacation of 24 Working Days per year of continuous employment with the Company. A "Working Day" shall mean Sunday thru Thursday, inclusive. The Employee may be entitled, in accordance with the company vacation policy, to accumulate un-used vacation Working Days of up to 10% of the annual entitlement, in accordance with applicable law and the Company vacations days policy.
|
|
4.1.2.
|
Sick Leave
. The Employee shall be entitled to fully paid sick leave pursuant to the Sick Pay Law 5736-1976, from his first sickness day.
|
|
4.1.3.
|
Manager's Insurance.
The Company shall effect a Manager's Insurance Policy and/or a pension plan, as per the Employee’s request (the “
Insurance Policy
”) in the name of the Employee, and shall pay a sum equal to 13.33% of the Employee's Salary towards such Insurance Policy, of which 8.33% will be on account of severance pay and 5%in account the company's payments
(“Tagmuley Maasik”).
The Company shall deduct 5% from the Employee’s Salary to be paid on behalf of the Employee towards such Insurance Policy as pension fund payment
(“Tagmulim”)
. The Company shall also pay an amount equal to up to 2.5 % of the Salary for a long term disability insurance.
|
|
4.1.4.
|
Education Fund Contributions.
The Company shall pay a sum equal to 7.5% of the Salary, and shall deduct 2.5% from the Employee’s Salary to be paid on behalf of the Employee toward a further education fund
(
“Keren Hishtalmut”)
. Use of these funds shall be in accordance with the by-laws of such fund.
|
|
4.1.5.
|
Such payments to such further education fund shall be up to the maximum amount allowable under the tax regulations without causing any tax liability, and any amount exceeding such ceiling will be added to the monthly Salary.
|
|
4.1.6.
|
Indemnification.
The Company shall provide the Employee with an officer indemnification letter, as customary in the Company.
|
|
4.1.7.
|
Company Cellular Phone.
The Employee shall be entitled to full reimbursement of his cellular telephone expenses. The Company shall bear the maximal permitted tax deduction (“Gilum”) that may be imposed as a result of this benefit.
|
|
4.1.8.
|
Company ADSL line at the employee home office.
|
|
4.1.9.
|
Company Car.
The Employee shall be entitled to the use of a Company car, which belongs to the equivalent of Group 5 as was applicable until January 2010 and the Company shall pay expenses incurred resulting connection with the use of such car, including fixed and variable maintenance costs, licenses, insurance, gas and repairs; all according to the Company's policy at the time. The Company shall not pay any fines, reports or other traffic offenses incurred by Employee. The Employee shall execute a separate Company Car Agreement as a condition for the provision of the company car hereunder. The company shall bear the maximal permitted tax deduction
(“Gilum”)
that may be imposed as a result of this benefit.
|
|
4.1.10.
|
Re-Adjustment Payment.
in the event that the Employee shall resign from his position, the Employee shall be entitled to a re-adjustment payment in an amount equal to four (4) monthly Salaries, including the additional benefits set forth herein, payable at the end of the notice period. In the event that the Employee's employment shall be terminated by the Company (other than in case of breach of fiduciary duty), the Employee shall be entitled to a re-adjustment payment in a sum equal to six (6) monthly Salaries, including the additional benefits set forth herein payable at the end of the notice period.
|
|
4.1.11.
|
Employee shall bear all taxes that may be imposed as a result of any benefits granted hereunder, unless specified otherwise herein, and the Company may deduct any withholding tax, as required under any applicable law.
|
5.
|
Expenses
|
|
5.1.
|
The Employee shall be entitled to be reimbursed for all reasonable expenses incurred by CEO in fulfilling his duties in his position as Employee, including full reimbursement of cellular phone expenses, and travel expenses in Israel and abroad.
|
6.
|
Proprietary Information
|
|
6.1.
|
The Employee acknowledges and agrees that he will have access to confidential and proprietary information concerning the business and financial activities of the Company and information and technology regarding the Company's product research and development, including without limitation, the Company's banking, investments, investors, properties, employees, marketing plans, customers, trade secrets, and test results, processes, data and know-how, improvements, inventions, techniques and products (actual or planned). Such information, whether documentary, written, oral or computer generated, shall be deemed to be and referred to as "
Proprietary Information
".
|
|
6.2.
|
Proprietary Information shall be deemed to include any and all proprietary information disclosed in any manner by or on behalf of the Company and irrespective of form, but excluding information that (i) shall have appeared in any printed publication or patent or shall have become a part of the public knowledge except as a result of a breach of this Agreement by the Employee; (ii) as established by written records, shall have been received by the Employee from a third party having no obligation to the Company, (iii) reflects general skills and experience gained during the Employee's engagement by the Company, or (iii) reflects information and data generally known within the industries or trades in which the Company transacts business.
|
|
6.3.
|
The Employee agrees and declares that all Proprietary Information, patents and other rights in connection therewith shall be the sole property of the Company and its assigns. At all times, both during his engagement by the Company and after its termination, the Employee will keep in confidence and trust all Proprietary Information, and the Employee will not use or disclose any Proprietary Information or anything relating to it without the written consent of the Company, except as may be necessary to perform his duties as an employee of the Company.
|
|
6.4.
|
The Employee recognizes that the Company received and will receive confidential or proprietary information from third parties subject to a duty on the Company's part to maintain the confidentiality of such information and to use it only for certain limited purposes. At all times, both during his employment and after its termination, the Employee undertakes to keep and hold all such information in strict confidence and trust, and he will not use or disclose any of such information without the prior written consent of the Company, except as may be necessary to perform his duties as an employee of the Company and consistent with the Company's agreement with such third party. Upon termination of his employment with the Company, Employee shall act with respect to such information as set forth in Section 8.4,
mutatis
mutandis
.
|
|
6.5.
|
The Employee's undertakings in this Section 6 shall remain in full force and effect after termination of this Agreement or any renewal thereof.
|
7.
|
Disclosure and Assignment of Inventions
|
|
7.1.
|
The Employee understands that the Company is engaged in a continuous program of research, development, production and marketing in connection with its business and that, as an essential part of his employment with the Company, he is expected to make new contributions to and create inventions of value for the Company. Employee agrees to share with the Company all his knowledge and experience.
|
|
7.2.
|
From and after the date he first became associated with the Company, the Employee undertakes and covenants that he will promptly disclose in confidence to the Company all inventions, improvements, designs, original works of authorship, formulas, concepts, techniques, methods, systems, processes, compositions of matter, computer software programs, databases, mask works, and trade secrets, related to the Company’s business or current or anticipated research and development, whether or not patentable, copyrightable or protectable as trade secrets, that are made or conceived or first reduced to practice or created by his, either alone or jointly with others, during the period of his employment, whether or not in the course of his employment ("
Inventions
").
|
|
7.3.
|
The Employee agrees that all Inventions, as defined above, that are developed during the term hereof will be the sole and exclusive property of the Company ("
Company Inventions
").
|
|
7.4.
|
The Employee hereby irrevocably transfers and assigns to the Company: (a) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Company Invention; and (b) any and all "Moral Rights" (as defined below) that he may have in or with respect to any Company Invention. He also hereby forever waives and agrees never to assert any and all Moral Rights he may have in or with respect to any Company Invention, even after termination of his work on behalf of the Company. "Moral Rights" mean any rights of paternity or integrity, any right to claim authorship of an invention, to object to any distortion, mutilation or other modification of, or other derogatory action in relation to, any invention, whether or not such would be prejudicial to his honor or reputation, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a "moral right".
|
|
7.5.
|
The Employee agrees to assist the Company in every proper way to obtain for the Company and enforce patents, copyrights, mask work rights, and other legal protections for the Company's Inventions in any and all countries. He will execute any documents that the Company may reasonably request for use in obtaining or enforcing such patents, copyrights, mask work rights, trade secrets and other legal protections. His obligations under this Section 7.5 will continue beyond the termination of his employment with the Company, provided that the Company will compensate his at a reasonable rate for time or expenses actually spent by his at the Company's request on such assistance after such termination. The Employee hereby irrevocably appoints the Chairman of the Board of Directors of the Company or any officer in the Company in his place as his attorney-in-fact to execute documents on his behalf for this purpose.
|
8.
|
Termination
|
|
8.1.
|
This Agreement shall enter into effect subject to the approvals required under applicable law including the general shareholders meeting, upon the Effective Date and shall remain in effect until terminated by either party hereto by prior written notice of no less than 90 (ninety) days.
|
|
8.2.
|
Notwithstanding the aforesaid, in case the Employee elects to terminate the agreement, the board of directors, at its discretion, will have the right to shorten the notice period, in addition. The Company shall be entitled to terminate this Agreement with immediate effect, without prior notice, in case of termination for Cause (as defined below).
|
|
8.3.
|
During the period following notice of termination by any party for any reason, the Employee shall cooperate with the Company and use his best efforts to assist the integration into the Company’s organization of the person or persons who will assume the Employee’s responsibilities. At the option of the Company, the Employee shall during such period either continue with his duties or remain absent from the premises of the Company.
|
|
8.4.
|
The Employee agrees that upon termination of his employment with the Company, for any reason, he shall (i) promptly deliver and/or return to the Company all the documents, diskettes or other magnetic media, letters, notes, reports and other papers in his possession and relating to his employment with the Company, as well as any equipment and/or other property belonging to the Company which was placed at his disposal, including the Employee’s badge or other equipment; and (iii) coordinate the orderly handing over of his position according to the timetable determined by the Company's board of directors, and hand over in an orderly fashion and in accordance with Company procedures his position, the documents and all the other matters dealt with by his to such person as the Company instructs, all to the satisfaction of the Company.
|
9.
|
Mutual Representations
|
|
9.1.
|
The Employee represents and warrants to the Company that there is no limitation or restriction under any law, agreement or otherwise preventing his from entering into this Agreement or preventing or limiting him from performing all of his undertakings hereunder and that the execution and delivery of this Agreement and the fulfillment of the terms hereof (i) will not constitute a default under or conflict with any agreement or other instrument to which he is a party or by which he is bound, and (ii) do not require the consent of any person or entity.
|
|
9.2.
|
The Company represents and warrants to the Employee that this Agreement has been duly authorized, executed and delivered by the Company and that the fulfillment of the terms hereof (i) will not constitute a default under or conflict with any agreement of other instrument to which it is a party or by which it is bound, and (ii) do not require the consent of any person of entity, other than those consents obtained prior to the execution hereof.
|
|
9.3.
|
Each Party hereto warrants and represents to the other that this Agreement constitutes the valid and binding obligation of such party enforceable against such party in accordance with its terms subject to applicable bankruptcy, insolvency, moratorium and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless if enforcement is sought in proceeding in equity or at law).
|
10.
|
Notice; Addresses
|
|
10.1.
|
The addresses of the parties for purposes of this Agreement shall be the addresses set forth above, or any other address which shall be provided by due notice.
|
|
10.2.
|
All notices in connection with this Agreement shall be sent by registered mail or delivered by hand to the addresses set forth above, and shall be deemed to have been delivered to the other party at the earlier of the following two dates: if sent by registered mail, as aforesaid, five business days from the date of mailing; if delivered by hand - upon actual delivery or proffer of delivery (in the event of a refusal to accept it) at the address of the addressee. Delivery by cable, telex, facsimile or other electronic communication shall be sufficient and be deemed to have occurred upon electronic confirmation of receipt.
|
11.
|
Miscellaneous
|
|
11.1.
|
The preamble to this Agreement constitutes an integral part hereof.
|
|
11.2.
|
Headings are included for reference purposes only and are not to be used in interpreting this Agreement.
|
|
11.3.
|
The provisions of this Agreement are in lieu of the provisions of any collective bargaining agreement, and therefore, no collective bargaining agreement shall apply with respect to the relationship between the parties hereto (subject to the applicable provisions of law).
|
|
11.4.
|
No failure, delay or forbearance of either party in exercising any power or right hereunder shall in any way restrict or diminish such party's rights and powers under this Agreement, or operate as a waiver of any breach or nonperformance by either party of any terms or conditions hereof.
|
|
11.5.
|
Any determination of the invalidity or unenforceability of any provision of the Agreement shall not affect the remaining provisions hereof unless the business purpose of this Agreement is substantially frustrated thereby.
|
|
11.6.
|
This Agreement is personal and non-assignable by the Employee. It shall inure to the benefit of any corporation or other entity with which the Company shall merge or consolidate or to which the Company shall lease or sell all or substantially all of its assets. ,
|
|
11.7.
|
This Agreement is the only agreement between the parties on the subject matter of the Agreement and supersedes and replaces all other agreements, whether written or oral, between the parties, concerning the subject matter of this Agreement.
|
|
11.8.
|
It is hereby agreed between the parties that the laws of the State of Israel shall apply to this Agreement and that the sole and exclusive place of jurisdiction in any matter arising out of or in connection with this Agreement shall be the applicable Tel-Aviv court.
|
Between:
|
Sharon Levita
|
(the "Employee") of the first part
|
and:
|
Mazor Surgical Technologies Ltd.
|
(the "Company") of the second part
|
Whereas
|
the Company wishes to employ the Employee, in the position of CFO; and
|
Whereas
|
the employee expressed her consent to work in the Company; and
|
Whereas
|
the Company wishes to regulate the terms of her employment with the Company and her retirement therefrom, all pursuant to the provisions of this agreement and in accordance therewith;
|
|
a.
|
The preamble to this agreement constitutes an integral part hereof and its provisions are equally binding on the parties with regard to the terms and conditions of this agreement.
|
|
b.
|
The parties hereby represent that the Employee's position is a position which requires a special degree of personal trust as per the meaning thereof in Section 30 (a) (5) of the Hours
of Work and Rest Law, 5711-1951, and that the provisions of the aforesaid law will not apply to the Employee's employment with the Company.
|
|
c.
|
The Company's working days are Sundays – Thursdays.
|
|
d.
|
The working hours for the purpose of calculation of a full-time position percentage is 9 full working hours per day.
|
|
e.
|
In connection with her work at the Company, the Employee will not receive any and all consideration or benefits from anyone, including the Company's customers or suppliers or investors, and all neither directly nor indirectly.
|
2.
|
This agreement is effective from February 1, 2008.
|
3.
|
In consideration for all her work in the Company's service, the Company shall pay the Employee, the following:
|
|
a.
|
A gross monthly salary in the amount of NIS 34,000 for a full-time position (the "
Salary
"). Such Salary constitutes complete and final consideration for all of her work during the entire week and she will have no claim for additional remuneration or compensation including for overtime work.
|
|
b.
|
The Employee is entitled to a quota of 20 days of leave per year (for a full-time position).
|
|
c.
|
The Employee is entitled to a quota of sick leave as set forth in the law.
|
|
d.
|
Beginning from the date of commencement of her work for the Company, and subject to directives which will be set forth from time to time by the Income Tax Commission, and according to the maximum permissible deduction, the Company shall contribute, to an insurance company according to the Company's choice, in the context of managers' insurance and/or a pension fund, the amount which is equal to 13.33% - of the monthly base Salary, to be divided as follows: 8.33% on account of severance pay, and 5% on account of provident payments.
|
|
e.
|
The Company will deduct 5% from the Employee's Salary and transfer the same to the insurance company, as the Employee's participation in the provident payments, and the Employee declares her consent to such deduction.
|
|
f.
|
The Employee will be entitled to a loss of working capacity insurance, according to the Company's policy. The cost of the insurance coverage will be at the employer's expense up to the maximum permissible deduction pursuant to the income tax regulations.
|
|
g.
|
The payments which are specified in this section above will be in lieu of severance pay, pursuant to the Severance Pay Law, 5723-1963, and as provided in Section 14 of the aforesaid Severance Pay Law. The Employee declares her consent to join the arrangement of conversion of the severance pay into payments to the insurance company pursuant to Section 14 of the law, which is attached to this agreement as
Annex A
. If and insofar as will be required, the Employee will sign any and all documents which will be required by the Ministry of Labor to obtain the approval of the Minister of Labor for the performance of the arrangement.
|
|
h.
|
The Employee will be entitled to participate in a study fund program, in which the Company will contribute 7.5% of the Employee's Salary against a contribution of 2.5% by the Employee.
|
|
i.
|
The Employee will be entitled to lease a Group 4 car pursuant to the Company's agreements and procedures between the Company and the leasing companies. The cost of the lease will be covered by the Company while the Employee will bear the tax payments deriving from the value of the benefit, in accordance with the prevailing law at the relevant time.
|
|
j.
|
The Company will finance reasonable gas costs of the Employee.
|
|
k.
|
The Employee will be entitled to participate in the option plan of the Company's employees, in accordance with the agreements between the Company and the Israel tax authorities, as will be decided by the Company's board of directors, from time to time.
|
|
l.
|
The Company undertakes to include the Employee in the frame of the Company's officers insurance policy.
|
4.
|
This personal contract is in lieu of any kind of collective bargaining agreements however, collective bargaining agreements which apply by law to all of the employees in Israel, including the cost-of-living adjustment, will apply to the Employee also, without derogating from the generality of the aforesaid. It is explicitly clarified that despite the physical location of the conduct of the Company's business, no terms of salary or related benefits or any other term and condition which are not explicitly stated in this personal agreement will apply to the Employee's employment. During the period of her employment with the Company, the Employee will not be entitled to engage in any other work nor fill another position, without the receipt of a written approval from the CEO of the Company.
|
5.
|
During her work in the Company, the Company will act fairly vis-à-vis the Employee, as customary. The Employee will discharge her duties with loyalty and dedication, as customary, and devote her time and the best of her professional knowledge and experience to the Company pursuant to the guidelines of her supervisors.
|
|
a.
|
The Employee is required to maintain the secrets of the Company and the bodies with which it engages in confidence, and to maintain the confidentiality of any and all commercial or professional information, or patent or idea or development etc. which will reach her during the course of her work and/or be developed by her, not to make any use thereof nor allow others who are not the Company's employees access to such information. Any and all such confidential information which will reach the Employee in the course of, or pursuant to, her work in the Company, will be deemed as the Company's secret and property, and the aforesaid prohibition applies thereto as well.
|
|
b.
|
This agreement is not intended to prejudice the Employee's basic right to work, after the expiration of her work with the Company, in the professional field of her education and experience. However, the Employee agrees in advance that upon the exercise of her aforesaid right, and at all times after the expiration of her work with the Company, she will not make any use of the knowledge and information which either reached her or that she acquired pursuant to her work with the Company (if the same are related to the Company's business and are not in the public domain).
|
7.
|
The Employee is required to not remove any and all documents or equipment belonging to the Company from the place where they are situated during the ordinary course of the work, unless an approval from her supervisors shall have been received therefor.
|
8.
|
If the Company will seek to terminate this agreement for any reason or, it may do so with an advance notice of 30 days
during the first year of the employment or 60 days commencing from the expiration of the first year of employment during each of the Employee's years following.
|
|
a.
|
For the avoidance of doubt and without derogating from the provisions of Section 8 above, the Company is entitled to terminate the Employee's employment immediately and without advance notice in the event of a severe breach of trust or if she is suspected of a work-related offense involving moral turpitude.
|
|
b.
|
If the Company shall have terminated the Employee's work due to circumstances as provided in Subsection (a) above, the Company's management may decide that the Employee will not be entitled to receive any payment on account of severance pay and/or consideration which is due to her during the early notice period, and the options which were granted to her will immediately expire.
|
|
c.
|
In the event of the termination of work pursuant to a suspected commission of an offense as provided in Subsection (a) above, following which the Employee is found innocent, the Company will pay the Employee such amounts to which she would have been entitled upon the termination of her work, had it been terminated other than pursuant to this section.
|
10.
|
The terms and conditions specified in this personal agreement are personal. The Employee is required to maintain the full confidentiality thereof.
|
11.
|
The parties' addresses for the purpose of this contract are:
|
|
a.
|
Mazor Surgical Technologies Ltd.
|
|
b.
|
Sharon Levita
|
Mazor Surgical Technologies Ltd.
|
By:
/s/ Ori Hadomi
|
Name: Ori Hadomi
|
Title: Chief Executive Officer
|
The Employee
|
/s/ Sharon Levita
Sharon Levita
|
(1)
|
Employer payments
|
|
(a)
|
to a Pension Fund are no less than 14 1/3% of the Exempt Salary or 12% of the Exempt Salary if in addition thereto the employer is also making, for his employee, payments to supplement severance pay to a severance pay provident fund or to an Insurance Fund in the employee's name at the rate of 2 1/3% of the Exempt Salary. If the employer shall not have paid in addition to the 12% also 2 1/3% as aforesaid, his payments will be in lieu of 72% of the employee's severance pay, only;
|
|
(b)
|
to an Insurance Fund are no less than one of the following:
|
|
(1)
|
13 1/3% of the Exempt Salary, if in addition thereto the Employer is also making, for his employee, payments to ensure a monthly income in the event of loss of working capacity, in a plan which was approved by the Capital Market Insurance and Savings Commissioner at the Ministry of Finance, at the rate which is required to secure at least 75% of the Exempt Salary or at the rate of 2 1/2% of the Exempt Salary, whichever is lower (the "
Payment for Loss of Working Capacity Insurance
");
|
|
(2)
|
11% of the Exempt Salary, if in addition the employer also made a Payment for Loss of Working Capacity Insurance, in which case the employer's payments will be in lieu of 72% of the severance pay of the employee, only; If in addition thereto the employer shall have also made payments to supplement severance pay to a severance pay provident fund or an Insurance Fund in the employee's name at the rate of 2 1/3% of the Exempt Salary, the employer's payments will be in lieu of 100% of the employee's severance pay.
|
(2)
|
No later than three months from the commencement of making of the employer's payments, a written contract shall have been drawn up between the employer and an employee which includes-
|
|
(a)
|
The employee's consent to an arrangement pursuant to this approval in the language specifying the employer's payments and the Pension Fund and the Insurance Fund, as the case may be: The aforesaid contract shall also include the language of this approval;
|
|
(b)
|
The employer's advance waiver of any and all rights which he may have to any refunding of his payments, unless the employee's right to severance pay shall have been revoked in a judgment by virtue of Sections 16 or 17 of the law and to the extent that the same was revoked, or that the employee withdrew funds from the Pension Fund or the Insurance Fund other than due to an Entitling Event; In this regard, an "Entitling Event" – death, disability or retirement at the age of sixty or above.
|
(3)
|
Nothing in this approval derogates from an employee's right to severance pay under the law, a collective bargaining agreement, an extension order, or an employment contract, due to a salary over and above the Exempt Salary.
|
1.
|
General
|
2.
|
Manufacturing, Pricing, etc.
|
2.1
|
Initial Purchase Order
.
Upon signing of this Agreement, Mazor shall pay MPS an
advanced payment of $[****] and shall place with MPS a purchase order for 60 Actuators and 10 LVDT7, all subject to all terms and conditions set forth herein (the “
Initial
Purchase
Order
”).
|
2.2
|
By its signature to this Agreement MPS agrees and accepts the Initial Purchase
Order and agrees to accept and fulfill any additional Purchase Orders for Robots, parts, and/or services, as will be placed by Mazor from time to time, at prices, quantities etc. as set forth in MPS’ quote attached hereto as
Annex I
, and pursuant to all other terms and conditions set forth in this Agreement.
|
2.3
|
Immediately after the receipt of the Initial Purchase Order by MPS (“
ARO
”) as per
Section 2.1 above, and per MPS request, Mazor will provide MPS with an document and information, not yet provided by Mazor, and that is required for the preparation of the infrastructure for the production, manufacturing, assembly and testing of the Robots, including tooling and human resources, and MPS shall continue with the preparation for production, all as set out in this Agreement. Upon receipt of the documents and information, MPS shall conduct a design study in order to finalize the manufacturability and the design of the Robot.
|
2.4
|
Three (3) weeks ARO, MPS shall deliver to Mazor production drawings based on the
design study. Subject to Mazor's approval of the design study (“
Design Freeze
”), the Design Freeze milestone will be deemed completed.
|
2.5
|
Immediately following the approval of the Design Freeze drawings by Mazor, Mazor
shall deliver to MPS 70 LVDT and 70 Flex Print parts, at Mazor’s sole expense, and MPS shall begin the production of all parts of the Robot which are to be supplied by MPS (the “
MPS
Parts
”). Within twelve (12) weeks following the approval of the Design Freeze drawings by Mazor, MPS shall complete the manufacturing of the MPS Parts in accordance with quality assurance and specification compliance laboratory analysis pursuant to protocols to be agreed upon by the Parties (the “
Parts Production Phase
”).
|
2.6
|
Within two (2) weeks following the completion of the Parts Production Phase, MPS
shall complete its validation/rejection tests, and inform Mazor of the results (the “
Parts Validation Phase
”).
|
2.7
|
Subject to Mazor's approval of the results of the Parts Validation Phase, MPS shall
immediately proceed to assemble, calibrate, and test the Actuators and LVDT7 (the "
Assembly
Test
Validation
Phase
").
|
2.8
|
Upon completion of the Assembly Test Validation Phase but in no event later 18
weeks after the Design Freeze Milestone, MPS will deliver the 60 Actuators and 10 LVDT7 to Mazor (the “
Initial
Delivery
”)
|
2.9
|
The reference exchange rate is 1.2 CHF for 1 USD. If the exchange rate varies
more than between 1.1 CHF for 1 USD and 1.3 CHF for 1 USD, we must re-negotiate the pricing.
|
3.
|
Orders, Shipment, and Payment
|
|
(a)
|
Upon completion of the Initial Delivery, Mazor shall, from time to time, place with MPS additional purchase orders for the manufacturing no less than 10 Robots per purchase order at least 100 days in advance of the delivery date (the "
Lead
Time
") specified in the
purchase order (the
"Purchase
Order
").
|
|
(b)
|
If Mazor submits any additional Purchase Orders with less Lead Time than is required under Subsection 3.1(a) (or if Mazor places a new Purchase Order within the 100 days Lead Time period of a previous Purchase Order), then MPS shall use commercially reasonable efforts to fulfill that Purchase Order but will not be liable to Mazor if despite those best efforts they fail to do so, unless such new Purchase Order was shown in a 6 month forecast previously accepted by MPS.
|
|
(c)
|
In order to manufacture the Robot, MPS shall manufacture the additional parts as set forth in compliance with the Design Freeze, and purchase the LVDT Assembly and Flex Print directly from a third party designated by Mazor (a "
Vendor
"). Mazor shall however accommodate MPS’s request to procure such LVDT Assembly and Flex Print from the Vendor on behalf of MPS’ in which case the accounting between MPS and Mazor shall be adjusted accordingly.
|
|
3.2
|
Each shipment of Robots will be delivered by MPS FOB (i.e. "Free on Board" as that term is defined in INCOTERMS 2000) Biel, Switzerland. MPS shall deliver by the delivery date specified in a Purchase Order all of the Robots specified in that Purchase Order. Mazor is only required to pay for Robots actually delivered. MPS shall make shipping arrangements with carriers designated in writing by Mazor from the FOB point to points specified by Mazor, under the Agreements that Mazor has with those carriers.
|
|
3.3
|
Freight, Insurance, and Taxes. Mazor shall pay all freight, insurance, duties, and other fees (except tax on income to MPS) incurred in connection with sale and shipment of Robots under this Agreement.
|
|
3.4
|
Payment should be remitted within 30 days following shipment has left Biel, Switzerland, and subject to sending by MPS to Mazor an invoice through fax and ordinary mail.
|
4.
|
Target Pricing and Spare Parts Pricing
|
|
4.1
|
All cost directly related to the manufacturing of the Robot, and the prices charged by MPS are detailed in
Annex I
of this Agreement.
|
|
4.2
|
MPS acknowledges that Mazor’s target price is US$ [****] per Robot. In order to reach this target, Mazor and MPS will act as follows to reduce the price to the defined target price:
|
|
(a)
|
After manufacture of the first 10 Robots MPS will provide part list price for all Robot parts, including assembly and testing.
|
|
(b)
|
Mazor and MPS will work on price reduction based on an initial price of US$ [****].
|
|
(c)
|
MPS will provide to Mazor a parts list price and update the total after manufacture of every batch of 10 Robots, according to the target price per each batch.
|
|
(d)
|
MPS will act to reduce the cost of the Robot in one or more of the following ways: (1) Engineering changes; (2) Component changes; and (3) Use of alternative suppliers.
|
|
4.3
|
MPS will furnish Mazor with a detailed spare parts price list for each of the Robot components as well as few sub assemblies including full actuator. In no event will the aggregate price for all the components exceed the Robot price set forth in
Annex 1
by more than 10%.
|
5.
|
Quality System
|
|
5.1
|
All Robots manufactured by MPS must (1) conform to the Specifications and (2) be manufactured, labeled, packaged, stored, and tested (while in the possession of, stored by, or under the control of MPS) in accordance with cGMPs. "
cGMPs
" means current Good Manufacturing Practices (as provided for, respectively, in the Rules Governing Medicinal Products in the European Community Volume 4 (Guide to Good Manufacturing Practice for Medicinal Products) and by the U.S. Food and Drug Administration (“
FDA
”) as set out in 21 C.F.R. 210 and 21 C.F.R. 211, as amended from time to time).
|
|
5.2
|
The Robot shall be manufactured, assembled and tested in compliance with MPS's internal quality system, the Specifications, Acceptance Criteria and to relevant ISO, EN and FDA standards, guidelines, and regulations.
|
6.
|
Inspections; Records
|
7.
|
Engineering
|
|
7.1
|
In the event that the Manufacturer requires changes or modifications to specifications or drawings, they must first be approved in writing by Mazor's Engineering Change Order process ("
ECO
"). The ECO will be approved following extensive analysis of the cost, performance and ROI implications, as will be provided by MPS based on the Engineering Change Request ("
ECR
") that may be initiated by both parties. A standard ECR format is enclosed as
Annex II
to this document.
|
|
7.2
|
With exception to revision change and documentation changes which means instructions comments, MPS will provide Mazor with engineering services at the following prices (to take effect after the first 10 Robots):
|
|
·
|
Up to 10 ECO's per year, up to 10 rows per ECO – no charge;
|
|
·
|
For ECO's over 10, up to 10 rows per ECO - $[****] per ECO;
|
|
·
|
For each row over 10 rows - $[****] per row.
|
|
8.1
|
Warranties.
|
8.1.1
|
Compliance
Warranty
.
|
|
MPS warrants that Robot purchased hereunder will be in accordance with the Specifications Package and will be free from defects in materials, workmanship and design (except to the extent such defective design is attributable to MAZOR). This warranty will commence on the date of delivery of the Robot and expires (a) one hundred and eighty (180) days after the delivery or (b) upon acceptance by MAZOR. MAZOR shall give MPS prompt written notification of any defects, and agrees, if practicable, to allow MPS to examine the Robot claimed to be defective and furnish MPS any reasonably available information concerning the circumstance of failure. MAZOR agrees to maintain reasonable records of tests and failures of Robots purchased and delivered under this Agreement for a period of five (5) years after the expiration or termination of this Agreement.
|
|
8.1.2
|
End User Warranty
.
|
|
8.2
|
MAZOR shall not be liable for, and MPS assumes responsibility for and agrees to
Indemnify and save harmless MAZOR, from all personal injury and property damages that occur during MPS's Robot formulation or manufacturing process, or for claims based on violations of federal, state or local laws or regulations applicable to employee or environmental protection, in connection with such manufacturing process (e.g., a claim based on MPS's violations of environmental standards or standards dealing with providing a safe place to work or the maintenance of hazardous products).
|
|
8.3
|
MPS represents and warrants to MAZOR that it has not entered into any agreement
which conflicts with the terms of the Agreement and that it will not do so during the pendency of this Agreement.
|
|
8.4
|
In the event claims arise against MPS for personal injuries resulting from Robot purchased by MAZOR, under this Agreement, unless such claims result from MPS’ negligence, MAZOR, shall indemnify and hold MPS harmless from any and all liability, damage, loss, cost and expense (including legal fees and other legal expenses) arising from any such claim and, if MPS so requests and to the extent permitted by law, MAZOR, shall, at its cost, defend all such claims against MPS provided, however, MPS agrees to provide requested documents and assistance reasonably necessary to defend any such claim. MPS agrees to provide MAZOR timely notice of all claims or complaints received by MPS against products manufactured and/or sold under this Agreement. If MAZOR, is requested but is not permitted by law to defend such claims, MAZOR, shall reimburse MPS for the costs and attorneys fees reasonably spent by MPS in defense. MPS shall permit MAZOR to take over the defense of any such defense if so requested by MAZOR. This indemnification does not extend to any personal injuries resulting from any Robot, which has failed as a result of improper use, misuse, alteration, or accident caused by MPS.
|
|
8.5
|
Insurance.
|
|
8.6
|
MAZOR shall have the right to reject, within 180 days after the actual delivery, any
Robots that do not meet the applicable specifications. Any such rejection shall be accomplished by a written notice from MAZOR identifying and specifying, in reasonable detail, the Robot rejected and the reasons for rejection. Any Robot rejected by MAZOR shall be made available, by MAZOR to MPS at MPS's site, for inspection by MPS or its representatives. In the event that any Robot does not meet applicable specifications and provided further that MAZOR notified MPS in accordance with the above, MPS shall replace any of the rejected Robots with Robots meeting the, applicable specifications. Such Robots shall be delivered to MAZOR by MPS in due time and at MPS’s costs.
|
9.
|
Confidentiality and Non-Competition
|
|
9.1
|
The Parties hereby agree to abide by the terms and conditions of
Annex
III
regarding the safe-keep of all confidential information as defined in said Annex III.
|
|
9.2
|
So long as this Agreement is in effect, and 12 months thereafter; so long as MPS is delivering 90% of the robots purchased by Mazor, MPS shall not engage in the development, production, or marketing of a device which directly competes with the Robot.
|
10.
|
Intellectual Property
|
|
10.1
|
Pre-existing and Independently Developed Intellectual Property. Nothing in this Agreement affects the ownership by either party of any intellectual property owned or in the possession of that Party on the date of this Agreement.
|
|
10.2
|
All Intellectual Property related to MPS’s production lines and manufacturing methods shall be owned by MPS and shall be treated by Mazor as confidential information received from MPS.
|
|
10.3
|
All intellectual property of any kind including hardware, software, source and object codes, data confidential information, test and research results, materials, concepts, ideas inventions, patents, patent applications, continuations, continuations in part, corresponding patent related licenses (or other IP rights) received by Mazor from third parties to the Robot and to Mazor’s other products or systems, including, but not limited to the manufacturing and assembly drawings, and assembly and testing instructions developed or created by MPS with respect to the Robot, including without limitation the Specifications, and any design of the Robot, and any new idea, concept, data and inventions developed or owned by Mazor prior to the signing of this Agreement or arrived at by Mazor at any time thereafter and including any such intellectual property resulting from MPS’ works on or with the Robot or its assembly, (“
Mazor IP
”) is or shall become the sole property of Mazor and shall at all times be owned by it and shall,
inter alia
, be treated by MPS as confidential information received from Mazor.
|
|
10.4
|
MPS will provide Mazor with the entire Robot documentation, drawings, engineering, manufacturing and tests protocols and records and will allow a Mazor representative to be present throughout the entire production preparation, manufacturing, assembly, calibration, testing and packing processes. Mazor shall be entitled to file, prosecute and maintain patent applications and resulting patents, if any, on any of its intellectual property rights that shall arise as a result of this Agreement.
|
|
10.5
|
MPS shall promptly disclose to Mazor in writing any invention and discovery conceived or reduced to practice in connection with this Agreement.
|
|
10.6
|
At Mazor’s request, MPS shall procure the signatures of any of its employees, the signature of whom might be required in order to protect Mazor’s IP, file, and assign any patents and/or patents applications to the name of Mazor solely.
|
|
10.7
|
It is further agreed that Mazor shall own any tangible and hardware items produced by MPS for Mazor under this Agreement, including but not limited to any samples prototypes, and Robots.
|
|
10.8
|
Labeling. Mazor shall provide content and graphics of the label to be attached by MPS to the Robot. The label shall mention MPS's name in addition to Mazor in a form to be decided by Mazor.
|
|
10.9
|
Limited License
. Mazor grants MPS a limited license to its intellectual property to the extent necessary to permit MPS to carry out its obligations under this Agreement. Any such license will expire upon termination of this Agreement and will not be transferable or sub-licensable. Providing that Mazor orders from MPS at least 50 Robots, Mazor is and shall be at liberty to manufacture the Robots by itself or through other parties nevertheless, and assuming satisfactory performance of MPS, Mazor intents, but is not obligated, to increase the purchase volume from MPS.
|
|
10.10
|
Reservation of Rights. Nothing contained herein may be construed as giving MPS any rights to any of Mazor IP, whether pre-existing Intellectual Property or Intellectual Property arising in connection with this Agreement.
|
11.
|
Term and Termination
|
|
11.1
|
The term of this Agreement is 48 months from the date of this Agreement (the “
Initial Term
”), with automatic renewal for an additional successive one-year term unless, no later than 90 days prior to the end of the Initial Term, either party notifies the other in writing that it wishes to terminate this Agreement effective the end of the Initial Term. Subsequent extensions of the term of this Agreement will require the mutual agreement of the Parties evidenced by a written instrument executed and delivered by the Parties.
|
|
11.2
|
Each Party can terminate this Agreement in case of a substantial breach or misconduct that was not cured by the breaching Party within 30 days from receipt of a written notice from the other Party.
|
|
11.3
|
MPS may terminate this Agreement if during any calendar year the total quantity of Robots ordered by Mazor is less than 20, starting from year 2006.
|
|
11.4
|
In case of termination of the agreement for any reason by any of the parties, MPS will be obliged to supply its services, including manufacturing, assembly, calibration and tests, for additional 18 months for the same price and other terms stipulated in this Agreement. In addition, MPS shall be obligated to provide Mazor with spare parts for Robots sold by Mazor prior to the termination, for a period for which Mazor is obligated to supply spare parts and maintenance under any prevailing law in the jurisdiction in which any of such Robots have been sold.
|
|
11.5
|
All rights and obligations of either party that may have accrued prior to the date of termination or any obligation contained in Sections 9 and 10 and in Annex II shall survive the termination or expiration of this Agreement, for any reason whatsoever; MPS shall return to Mazor all documents and other tangible items it or its employees or agents have received or created pursuant to this Agreement.
|
|
12.1
|
This agreement is governed by the laws of the State of Israel without giving effect to
principles of conflict of laws. The Parties hereto submit any dispute arising herefrom to the exclusive jurisdiction to the Courts of Tel Aviv, Israel
|
|
12.2
|
This agreement constitutes the entire agreement of the parties pertaining to the subject matter of this Agreement. It supersedes all prior agreements of the parties, whether oral or written, pertaining to the subject matter of this Agreement.
|
|
12.3
|
This agreement may be amended in writing only.
|
|
12.4
|
Nothing in this Agreement creates, or will be deemed to create, a partnership or the relationship of principal and agent between the parties. Each party agrees to perform under this Agreement solely as an independent contractor.
|
|
12.5
|
Except as required by law, neither party may make any official press release, announcement, or other formal publicity relating to the transactions that are the subject of this Agreement without first obtaining in each case the prior written consent of the other party (which consent may not be unreasonably withheld). Except as required by law, neither party may use the name of the other party, or any director, officer or employee thereof, without the prior written approval of the other party.
|
Mazor Surgical Technologies Ltd.
|
MPS Micro Precision Systems AG
|
By:
/s/ Ori Hadomi
|
By:
/s/ Francois Huguelet
|
Name: Ori Hadomi
|
Name: Francois Huguelet
|
Title: CEO
|
Title: Business Development Manager
|
By:
/s/ Eli Zehavi
|
|
Name: Eli Zehavi
|
|
Title: COO
|
|
Date: September 28, 2005
|
Drawing Number
|
Part Name
|
Price / Item
|
Tooling (one time)
|
|
SWD-00019 Rev.:B
|
ACTUATOR ASSY
|
[****] CHF
|
[****] CHF
|
|
SWD-00632 Rev.:C
|
LVDT7 ASSY
|
[****] CHF
|
[****] CHF
|
|
TOTAL
TOOLING
:
|
[****] CHF
|
Process engineering and Design effort
|
[****] CHF
|
Project Management
|
[**
**] CHF
TOTAL NRE: [****] CHF
|
Components + Assy
|
NRE
|
Tooling
|
[****] CHF
|
[****] CHF
|
[****] CHF
|
|
·
|
After completion of this Phase, Mazor can order the next phase, which is the future step to build all parts at MPS and to take on the complete assembly.
|
|
·
|
Our goal with the engineering in the previous phase was to guarantee a perfect function of the robot assembly, and to have a complete robot price of under [****] CHF for orders of 10 Robots. We offer the below noted price for the 5
th
lot of 10 for [****] CHF.
|
|
·
|
The pricing indicated below includes one complete assembled and tested Robot including all components, based on an orders 10 assembled Robots in five separate orders where we offer a price reduction over the five lots. The final price will be the [****] CHF. The price is our best estimation of the costs at this time. There are some open positions as LVDT assembly that must be recalculated after every Phase. We now assume the LVDT to be [****] CHF(price shall be adapted after confirmation of the LVDT price). This pricing includes the Upper and Lower Bases.
|
1
st
10 Robots
|
2
nd
10 Robots
|
3
rd
10 Robots
|
4
th
10 Robots
|
5
th
10 Robots
|
[****] CHF
|
[****] CHF
|
[****] CHF
|
[****] CHF
|
[****] CHF
|
2.2
|
Payment Terms:
|
|
·
|
The remaining [****] CHF of the Tooling and NRE will be divided over the next 5 orders of 10 during the next 24 months. The [****] CHF will be billed ARO for each of the next 5 orders.
|
|
·
|
If the 50 robots are not ordered within 24 months of this order, MPS will invoice the remaining Tooling and NRE.
|
|
·
|
After the 5
th
10 Robots we will offer Robots at the price of [****] CHF.
|
(I)
|
It is contemplated that each party (the “
Disclosing Party
”) may from time to time disclose Confidential Information to the other (the “
Receiving Party
”).
|
(II)
|
"
Confidential Information
" means all data, specifications, drawings, training, and any other know-how related to the design, development, manufacture, or performance of the Robot, as well as all other information and data provided by either party to the other party pursuant to this Agreement, except that the term "Confidential Information" does not include the following:
|
|
a.
|
information that is or becomes generally available to the public other than as a result of a breach of this Agreement by the receiving party or its representatives.
|
|
b.
|
information that was within the receiving party's possession or knowledge prior to its being furnished to the receiving party by or on behalf of the disclosing party, on condition that the source of that information was not bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to the disclosing party or any other person with respect to that information;
|
|
c.
|
information that is or becomes available to the receiving party on a non-confidential basis from a source other than the disclosing party or any of its Representatives, on condition that that source was not bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to the disclosing party or any other person with respect to that information; or
|
(III)
|
The Receiving Party shall take all reasonable steps to prevent disclosure of the Disclosing Party’s Confidential Information and not to use any such Confidential Information except for the limited purposes set forth in this Agreement.
|
(IV)
|
A party receiving Confidential Information may disclose it to those of its employees, directors or consultants who need to review that Confidential Information in connection with that party's performance of its obligations and evaluation of its rights under this Agreement. Any party who so discloses any Confidential Information pursuant to this Subsection shall (1) inform those persons of the confidential nature of that Confidential Information, and (2) direct those persons to keep that Confidential Information confidential.
|
(V)
|
The provisions of this Annex III will survive termination or expiration of this Agreement and will continue indefinitely.
|
To:
|
Mazor Robotics Ltd. 7
HaEshel St.
|
5.1
|
All Robots manufactured by MPS must (1) conform with the Specifications and (2) be manufactured, labeled, packaged, stored and tested (while in possession of, stored by, or under the control of MPS) in accordance with ISO 13485.
|
5.2
|
The Robot shall be manufactured, assembled and tested in compliance with the MPS's internal quality system, the Specifications, the Acceptance Criteria and to ISO 13485.
|
|
1.
|
General
|
|
2.
|
Terms of Agreement
|
|
3.
|
System Specifications
|
|
4.
|
Pricing
|
|
5.
|
Price Linking, Payment Terms and Guarantee
|
|
6.
|
Current Component Stock
|
|
7.
|
Win/Win Cost Reduction Mechanism
|
|
·
|
Engineering changes
|
|
·
|
Component changes
|
|
·
|
Use of alternative suppliers
|
|
8.
|
Engineering Change Orders
|
|
·
|
Up to 10 ECO's per year, up to 10 rows per ECO – no charge
|
|
·
|
For ECO's over 10, up to 10 rows per ECO - $[****] per ECO
|
|
·
|
For each row over 10 rows - $[****] per row
|
|
9.
|
Orders and Delivery
|
|
10.
|
Liability
|
|
11.
|
Termination
|
|
·
|
Essential breach of contract by either side
|
|
·
|
Cease of business activity by either side
|
|
·
|
In the event that Tamuz does not meet the price of the delivery schedule as committed.
|
|
·
|
In case of significant deterioration in the System manufacturing and assembly quality, as will be defined by the Mazor QA Manager and after being presented to the Tamuz team and a fair opportunity for improvement takes place.
|
|
·
|
Tamuz may terminate this Agreement if during any year the total quantity of Systems ordered by Mazor is less than 20, starting from year 2006.
|
Mazor Surgical Technologies, Ltd
|
Yizrael Tamuz Ltd.
|
__________________
|
_____________
|
By:
/s/ Eli Zehavi
Name: Eli Zehavi
Title:COO
|
By:
/s/ Ilan Alfia
Name: Ilan Alfia
Title: CEO
|
Address:
7 HaEshel St.
Caesarea Park, 38900
P.O.Box 3104
Israel
|
Address:
Kibbutz Yizrael
19350
Israel
|
Tel: +972-4-6270171
Fax: +972-4-6377234
|
Tel: +972-4-6598333
Fax: +972-4-6492406
|
Date: February 15, 2005
|
T
o:
|
Mazor Robotics Ltd. 7
HaEshel St.
|
Whereas
|
Mazor Robotics Ltd. (hereinafter – the
“Company”
) has adopted the resolutions required pursuant to the law for the indemnification and grant of an advance undertaking for the indemnification of officers and past officers of the Company, as provided in this Letter of Indemnification; and
|
Whereas
|
you are serving and/or have served and/or might serve as an officer in the Company and/or have served and/or are serving and/or might serve and/or be engaged on behalf of the Company in subsidiaries and/or related companies of the Company;
|
1.
|
Indemnification undertaking
|
|
a.
|
your acts and/or any derivative thereof in your past or present capacity as an officer and/or person engaged in the Company and/or as an officer and/or person engaged on behalf of the Company in subsidiaries and/or related companies of the Company;
|
|
b.
|
your acts and/or any derivative thereof in your capacity as an officer, employee or agent of the Company in any other corporation in which the Company directly and/or indirectly holds securities (hereinafter –
“Other Corporation”
);
|
2.
|
The indemnification causes
|
|
2.1.
|
monetary liability imposed on you in favor of another person pursuant to a judgment, including a judgment given in settlement or a court-approved arbitrator’s award (hereinafter –
“Final Liability”
), provided that the Final Liability that was imposed on you is directly or indirectly related to one or more of the determining events detailed in the schedule to this Letter of Indemnification, which the Company’s board of directors has decided are foreseeable in light of the Company’s actual activity at the time of giving this Letter of Indemnification (the
“Schedule”
and the
“Determining Events”
), respectively); and/or
|
|
2.2.
|
reasonable litigation expenses, including lawyers’ fees, that you incur or are ordered to pay in consequence of an investigation or proceedings conducted against you by the authority competent to conduct such investigation or proceedings, which reached a conclusion without an indictment being filed against you and without monetary liability being imposed on you as an alternative to criminal proceedings, or which reached a conclusion without an indictment being filed against you but with the imposition of monetary liability as an alternative to criminal proceedings in respect of an offence not requiring proof of general intent or in connection with monetary sanctions;
|
|
2.3.
|
reasonable litigation expenses, including lawyers’ fees, that you incur or are ordered to pay by a court in proceedings filed against you by the Company or in its name or by another person, or in a criminal indictment in which you are acquitted, or in a criminal indictment in which you are convicted of an offence not requiring proof of general intent (hereinafter –
“Litigation Expenses”
);
|
|
2.4.
|
expenses incurred by you in connection with administrative enforcement proceedings conducted against you, including reasonable Litigation Expenses, and
inter alia
lawyers’ fees:
|
|
2.5.
|
payment to a party injured by a breach, in accordance with section 52BBB(a)(1)(a) of the Securities Law;
|
|
2.6.
|
the Company’s indemnification undertaking in respect of the causes detailed in this section 2 shall apply in connection with any event, including the determining events detailed in the Schedule.
|
3.
|
The indemnification amount
|
|
3.1.
|
The aggregate indemnification amount
|
4.
|
Interim payments
|
5.
|
The indemnification terms and conditions
|
|
5.1.
|
The indemnification notice
|
5.2.
|
The handling of the defense
|
|
5.3.
|
Cooperation with the Company
|
|
5.4.
|
Cover of the liabilities
|
|
5.5.
|
The indemnification’s non-applicability in cases of settlement or admission
|
|
5.6.
|
The indemnification’s non-applicability in cases of indemnification or insurance from a third party
|
|
(a)
|
The Company shall not be required to pay amounts pursuant to this Letter of Indemnification that you are entitled to receive and actually receive from the Liable Corporation in the scope of an insurance policy taken out by the Liable Corporation and/or pursuant to an advance indemnification undertaking or pursuant to an indemnification permit given by the Liable Corporation.
|
|
(b)
|
If your demand for indemnification and/or insurance cover in respect of an act done by you in the scope of your position in the Liable Corporation, which might be indemnifiable pursuant to this Letter of Indemnification, is rejected by the Liable Corporation or the insurance company of the Liable Corporation, as the case may be, the Company shall pay you the amounts to which you are entitled pursuant to this Letter of Indemnification, if you are entitled to these amounts and you assign to the Company your rights to receive amounts from the Liable Corporation and/or pursuant to the insurance policy of the Liable Corporation and authorize the Company to collect these amounts in your name, insofar as such authorization is necessary for performance of the provisions of this section. In such regard, you undertake to sign any document required by the Company for the purpose of assignment of your said rights and authorization of the Company to collect the said amounts in your name.
|
|
(c)
|
For the avoidance of doubt, it is expressed that this Letter of Indemnification does not grant the Liable Corporation and/or any other third party any rights vis-à-vis the Company, including, but without derogating from the generality of the aforesaid, a right to claim and/or demand any payment from the Company as a contribution towards the indemnification and/or insurance cover provided to you by the Liable Corporation in respect of an act done in the scope of your position in the Liable Corporation.
|
|
5.7.
|
Payment of the indemnification
|
|
5.8.
|
Refund of paid indemnification amounts
|
6.
|
The indemnification period
|
7.
|
Miscellaneous
|
|
7.1.
|
The Company’s indemnification obligations pursuant hereto shall not apply in any of the following cases: (a) a breach of the duty of loyalty (unless you acted in good faith and had reasonable basis to believe that the act would not harm the Company’s interests); (b) a breach of the duty of care committed intentionally or recklessly, unless committed with mere negligence; (c) an act done with the intention of unlawfully producing a personal profit; (d) a fine, civil fine or penalty imposed on you, provided that the aforesaid fine or penalty was not imposed in respect of conviction of an offence that does not require proof of general intent or by reason of monetary sanctions imposed on you.
|
|
7.2.
|
The Company’s obligations pursuant to this Letter of Indemnification shall be interpreted widely and in a manner aimed at their performance, insofar as permitted pursuant to the law, in order to achieve their designated purpose. In the event of any contradiction between any provision of this Letter of Indemnification and any legal provision that may not be qualified, altered or added to, the said legal provision shall prevail, but such shall not prejudice or derogate from the validity of the other provisions of this Letter of Indemnification.
|
|
7.3.
|
This Letter of Indemnification does not derogate from the Company’s right to decide on retroactive indemnification pursuant to the provisions of any law.
|
|
7.4.
|
This Letter of Indemnification shall take effect on your signature of a copy thereof in the designated place and delivery of the signed copy to the Company.
|
|
7.5.
|
The provisions of this Letter of Indemnification do not derogate from the provisions of any letter of exemption given to you by the Company, if given.
|
|
7.6.
|
The language of this Letter of Indemnification cannot be modified unless signed by the Company and by you.
|
|
7.7.
|
For the avoidance of doubt, it is hereby expressed that this letter of Indemnification does not constitute a contract in favor of a third party and may not be assigned.
|
|
7.8.
|
No waiver, delay, failure to take action or grant of an extension by the Company or by you shall in any circumstances be interpreted as a waiver of such party’s rights pursuant to this Letter of Indemnification and pursuant to any law, and shall not prevent such party from taking all the legal and other steps required for the sake of exercising its rights as aforesaid.
|
|
7.9.
|
The Schedule to this Letter of Indemnification constitutes an integral part hereof.
|
|
7.10.
|
The law governing this Letter of Indemnification is the Israeli law and the competent court in Tel Aviv is vested with exclusive jurisdiction to hear any disputes in connection with this Letter.
|
Date:________________
|
Mazor Robotics Ltd.
By:___________
Name:_________
Title:__________
|
The determining events
|
|
1
|
Any claim or demand submitted by a customer, supplier, contractor or other third party who or which carries on any type of business with the Company, its subsidiaries, its related companies or Other Corporation as defined above (hereinafter jointly and severally in this Schedule – the
“Company”
), including by virtue of the Consumer’s Protection Law, 5741-1981, and/or orders and/or regulations by virtue thereof.
|
2
|
Any claim or demand submitted in connection with an act and/or transaction (as defined in section 1 of the Companies Law), whether they are exceptional transactions and acts or transactions and acts that are not exceptional (as the expression exceptional transaction is defined in section 1 of the Companies Law), including in respect of the receipt of credit, sale, rental, transfer or purchase of assets or liabilities, and the receipt and/or grant of an option for the sale, rental, transfer or purchase of assets or liabilities as aforesaid.
|
3
|
Any claim or demand in connection with the employer-employee relations in the Company, including claims and demands submitted by employees, consultants, agents, manpower contractors, freelancers or other individuals or an entity engaged by or providing services to the Company in connection with compensation owed to them or damages or liabilities occasioned to them in connection with their engagement by the Company or contracts with the Company, including also events relating to the terms and conditions of employees’ engagement and employer-employee relations, including the promotion of employees, handling of pension, provident fund and savings arrangements, grant of securities and other benefits and including in relation to safety at work.
|
4
|
Any claim or demand in relation to the non-disclosure of or failure to provide any type of information at the required time in accordance with the law, or in connection with the misleading or defective disclosure of information as aforesaid, to third parties, including to holders of the Company’s securities, or potential holders of securities, including in relation to the issue, allotment, distribution, purchase, holding or connection to the Company’s securities or any other investment activity involving or influenced by the Company’s securities. Without derogating from the generality of the aforesaid, this event shall also apply in relation to an offer of securities to the public pursuant to a prospectus, private offer, exchange tender offer or any other offer of securities.
Any claim or demand in relation to the non-disclosure of or failure to provide any type of information at the required time in accordance with the law, or in connection with the misleading disclosure or defective disclosure of information as aforesaid, to third parties, including the income tax authorities, the value added tax authorities, the National Insurance Institute, the Investment Center, local authorities, the Ministry of the Environment and any government or institutional entity or professional or other association.
|
5
|
Any claim or demand submitted in relation to a cause performed or alleged to have been performed or abuse in relation to an intellectual property right of a third party by the Company or anyone on its behalf.
|
6
|
Any claim or demand submitted by a lender or creditor or in relation to monies lent by them, or debts of the Company to them.
|
7
|
Any claim or demand submitted by a third party suffering from bodily harm or damage to his business or personal property, including loss of the use thereof in the course of any act or omission attributed to the Company, or respectively to its employees, agents or other persons acting or claiming to act on behalf of the Company.
|
8
|
Any claim or demand submitted directly or indirectly in connection with a full or partial omission by the Company, or by the officers, managers or employees of the Company, in connection with payment, reporting or documentation, of one of the State’s authorities, foreign authority, municipal authority or any other payment required pursuant to the laws of the State of Israel, including payments of income tax, sales tax, appreciation tax, transfer tax, excise, value added tax, stamps tax, customs, national insurance, salaries or wage delays to employees or other delays, including any type of interest and supplements in respect of linkage.
|
9
|
Any claim or demand submitted by purchasers, owners, lessors or other occupants of properties of the Company for damages or losses relating to the said properties’ use.
|
10
|
Any administrative, public or judicial act, orders, judgments, claims, demands, claim letters, instructions, pleas, charges, attachments, investigation proceedings, or notices of lack of compliance or breaches on behalf of a government authority or other entities claiming potential responsibility or liability (including for expenses in respect of enforcement, investigations, responses of government authorities, cleaning, removal or repair, for damages to natural resources, land damages, bodily damages or fines or donations, indemnification, recovery payments, compensation) as a result thereof, in Israel or overseas, based on or related to:
(a)
the appearance of a liquid release, emission, leak, flood, spill, elimination, release, filtering or migration on and/or under and/or above the ground (jointly –
“Contamination”
) or risk of Contamination or exposure to any type of hazardous, toxic, explosive or radioactive substance, waste or other substances that there is a duty to regulate in accordance with the environmental laws of the State of Israel, in any place belonging to or operated, rented or managed by the Company;
(b)
circumstances creating any type of breach of the environmental laws, environmental licenses, permits, or other approvals required pursuant to the environmental laws of the State of Israel.
|
11
|
Any administrative, public, judicial act, orders, judgments, claims, demands, letters of demand, instructions, pleas, investigations, proceedings or notices of lack of compliance or breach of an act of a government authority or other entity claiming non-compliance with a legal provision, regulation, order, command, rule, custom, directive, licensing, exemption, permit (including approvals, permits and exemptions with regard to restrictive trade practices) or a judgment by the Company or the Company’s officers in the scope of their position in the Company.
|
12
|
Any claim or demand relating to a change in the Company’s structure or its reorganization or any decision with regard thereto, including – but without derogating from the generality of the aforesaid – a merger, split, arrangement between the Company and its shareholders and/or creditors pursuant to the Companies Law, a change in the Company’s capital, the foundation of subsidiaries, their liquidation or sale to third parties, allotment and/or distribution.
|
13
|
Any claim or demand relating to a decision or activity of the Company or the officer in the scope of his position in the Company, after the carrying out of the examinations and consultations befitting such type of decision or activity, including resolutions adopted by the Company’s board of directors or one of its committees.
|
14
|
Any claim or demand relating to any utterance or statement, including the expression of a stand or opinion or vote at general meetings of corporations and/or other organs of corporations made by the officer in the scope of his position with the Company.
|
15
|
Adoption of the findings of external opinions for the purpose of issuing an immediate report, prospectus, financial statements or any other disclosure document, including any claim or demand in relation to opinions of the Company’s board of directors to offerees in a tender offer, regarding the feasibility of a special tender offer in accordance with section 329 of the Companies Law, 5759-1999, or failure to give opinions as aforesaid.
|
16
|
Any claim or demand relating to the events detailed above, in connection with the officer’s service in subsidiaries and/or related companies of the Company and/or in the Other Corporation, and all if done in the scope of his position as an officer and/or person engaged in one of the said companies.
|
17
|
Any act resulting in the failure to make proper insurance arrangements and/or in a risk management failure and/or relating to negotiation towards, contracting in and operation of insurance policies.
|
18
|
Any act relating to distribution, including the purchase of shares of the Company, provided that the indemnification in respect of such act does not constitute a breach of any law.
|
19
|
Acts deriving from the fact that the Company is a public company and/or that its securities have been offered to the public and/or are traded on any stock exchange, including the giving of notices and/or reports and/or failure to file notices or reports as aforesaid.
|
20
|
Any utterance or statement, including the expression of a stand or opinion, made in good faith by the officer in the scope of his position and by virtue of his position, including at meetings of the board of directors or any of its committees.
|
21
|
Events relating to the drawing up and/or approval of financial statements and/or any act contrary to the Company’s articles or memorandum of association.
|
22
|
Any act of the Company within the realm of its transactions, holdings, investments, trade, finances, money management and other activities of the Company and the affiliated corporations that are permitted pursuant to the law, including acts relating to management, consultancy or other services provided by the Company to the group’s companies or to any third party, acts in connection with investments that the Company looks into and/or makes, which are done in stages prior to and/or after the making of the investment for the purpose of entering into, executing, developing, monitoring and supervising the transaction, including in the scope of participation in tenders (hereinafter –
“Investment Acts”
), including Investment Acts done by the officer in the name of the Company or as an officer of the corporation the subject of the investment, acts of sale, purchase or holding of negotiable securities for or in the name of the Company, acts relating to the purchase or sale of companies, legal entities or assets, and splits or mergers.
|
23
|
Any event and/or act that may be indemnified pursuant to the Streamlining of Enforcement Processes at the ISA (Legislative Amendments) Law, 5771-2011.
|
To:
|
Date: _______ _, 20__
|
Whereas:
|
Mazor Robotics Ltd. (the "
Company
") has taken all required decisions by law, in order to exempt you from the duty of care, as shall be further detailed in this letter of exemption;
|
|
Whereas:
|
you currently serve and/or served and/or will serve as an office holder in the Company, and/or served and/or currently serving and/or might serve and/or be employed on behalf of the Company in any subsidiaries and/or affiliates of the Company;
|
Date:________________
|
Mazor Robotics Ltd.
By:___________
Name:_________
Title:__________
|
|
Exhibit 4.14
|
|
(Unofficial English translation from Hebrew original)
|
|
PERSONAL / SPECIAL EMPLOYMENT CONTRACT
|
|
Made and signed in Nesher on November 28, 2000
|
Between:
|
Mr Eliyahu Zehavi
|
|
of 3 Kariv Street, Haifa 34761
|
|
(hereinafter – the
“Employee”
)
|
|
of the one part
|
And:
|
Mazor Robotics Ltd.
|
|
of Nesher Technion Science Park, POB 212, Nesher 36601
|
|
(hereinafter – the
“Company”
)
|
|
of the other part
|
Whereas
|
the Company wishes to employ the Employee as CTO responsible for the Company’s R&D and engineering on the technological incubator track;
|
Whereas
|
the Employee has expressed his consent to work for the Company as CTO; and
|
Whereas
|
the Company wishes to regulate the terms and conditions of the Employee’s employment with and retirement from the Company, in accordance with and as provided below in this contract;
|
1.
|
(a)
|
The recitals to this contract constitute an integral part thereof and the provisions thereof bind the parties equally in respect of the terms and conditions of this contract.
|
|
(b)
|
The parties warrant that the Employee’s position is one requiring a special degree of personal trust within the meaning thereof in section 30(a)(5) of the Hours of Work and Rest Law, 5711-1951, and that the provisions of this Law shall not apply to the Employee’s employment by the Company.
|
|
(c)
|
The Company’s working days are Sundays to Thursdays; insofar as necessary, the Employee shall also work on Fridays.
|
2.
|
This contract shall commence on January 1, 2001.
|
3.
|
In consideration for his overall employment in the Company’s service, the Company shall pay the Employee as follows:
|
|
(a)
|
A gross monthly salary of NIS 19,000 for a full-time position (hereinafter – the
“salary”
).
|
|
On the date on which the Company raises an amount exceeding US$ 800,000 (hereinafter –
“the first milestone”
), the salary shall rise to NIS 26,000 gross. On the date on which the Company raises an amount exceeding US$ 2,000,000, the salary shall rise to NIS 33,000 gross.
|
|
This salary constitutes the full and final consideration for all the Employee’s work during the week and he shall not have any claim for additional compensation or additional recompense, including in respect of overtime.
|
|
The salary and the salary scales detailed above shall be linked to the consumer price index and shall be revised once a quarter.
|
|
(b)
|
The Employee is entitled to a leave quota of 18 days a year (for a full-time position).
|
|
The Employee is not entitled to accrue leave days in excess of 36 days.
|
|
(c)
|
The Employee is entitled to a sick day quota days as provided in the law.
|
|
(d)
|
The Employee shall join an insurance plan immediately upon the employment’s commencement.
|
|
The Company shall deduct 5% from the salary mentioned in section (a) for this plan and is making a provision for him at a rate of 13.
1
/
3
%, such being each and every month. The employer’s provision includes 5% for provident payments and 8.
1
/
3
% for severance pay.
|
|
It is hereby agreed that the Company’s insurance provisions in respect of severance – 8.
1
/
3
% - shall be in lieu of / shall constitute part of severance pay.
|
|
In addition, the Company shall provide up to 2.5% of the Employee’s salary for the purpose of loss of working capacity insurance.
|
|
On the date of termination of the Employee’s employment with the Company, the executive insurance policy shall be transferred in full to the Employee’s title.
|
|
(e)
|
On attainment of the first milestone, the Employee shall join a vocational studies fund, and the Company shall provide 7.5% of the salary and the Employee shall provide 2.5% to the vocational studies fund.
|
|
(f)
|
The Employee shall be entitled to a car on the level of a Renault Megane from the date of commencement of his employment with the Company. The Company shall pay all the expenses relating to the car and the Employee shall pay the tax attribution. On attainment of the first milestone, the car shall be replaced by one on the level of a Mazda Lantis.
|
|
(g)
|
From the date of commencement of his employment with the Company until the date of termination of his employment with the Company, the Employee shall receive a cellular telephone, the expenses of which shall be paid by the Company.
|
4.
|
This personal contract is in lieu of the various collective agreements; however, collective agreements applicable at law to all employees in Israel, including cost-of-living adjustments (which shall also apply to the salary scales detailed in section 3(a) above), shall also apply to the Employee. Without prejudice to the generality of the aforesaid, it is expressed that notwithstanding the physical location of the Company’s activity, the Employee’s employment shall not be governed by any wage terms or ancillary terms or any other terms that are not expressly mentioned in this personal contract.
|
|
For the avoidance of doubt, it is expressed that the Employee shall not be governed by the employment contracts applicable at the Technion in general to the administrative and technical employees and to the academic staff. During the term of his employment with the Company, the Employee may not engage in any other work or fill any other position without obtaining the written approval of the Company’s board of directors.
|
5.
|
During the term of his employment with the Company, the Company shall treat the Employee with customary fairness. The Employee shall perform his position loyally and conscientiously as customary, and shall devote his time and the best of his professional knowledge and experience to the Company in accordance with the instructions of his superiors.
|
6.
|
(a)
|
The Employee is required to keep the secrets of the Company and entities with which he deals, and to maintain the confidentiality of any commercial or professional information or patent or idea or development and the like reaching him in the course of his employment and/or developed by him, not to make any use thereof and not to allow others who are not employees of the Company. Any confidential information as aforesaid reaching him in the course of his employment, or in consequence of his employment with the Company, shall be deemed a secret of the Company, and the above prohibition also applies to it.
|
|
Without prejudice to the generality of the aforesaid, the Employee may not publish information relating to or deriving from his employment with the Company in any journal or at any conference, without prior written and express approval. All the aforesaid also applies to information of any person or entity whom or with which the Company has ties. The Employee’s obligations pursuant to this section shall remain valid after the termination of his employment with the Company, without limitation as to time or place.
|
|
The Employee must notify the Company of any idea, invention or development made by him in the scope of his employment with the Company and of any idea, invention or development made by him that is relevant to the Company’s spheres of engagement.
|
|
Ideas, inventions, developments, changes and improvements therein and any invention step as aforesaid, whether or not they are patentable in Israel and/or overseas, which are attained by the Employee during the term of his employment with the Company, shall belong to the Company, shall be submitted for registration by the Company and shall form part of its assets. Copyright in the Employee’s work on developments and ideas steered by him during the term of his employment with the Company shall also belong to the Company.
|
|
(b)
|
This contract is not intended to prejudice the Employee’s basic right to work after the termination of his employment with the Company, in the professional sphere of his education and experience. However, the Employee agrees in advance that at the time of exercising the aforesaid right and for three years after the termination of his employment with the Company, he shall not use any information and know-how reaching him or acquired by him in consequence of his employment with the Company (if they are related to the Company’s business and are not in the public domain) for the purpose of competition or assisting competition with the Company’s business or the business of affiliates, subsidiaries or related companies of the Company.
|
7.
|
If the Company wishes to terminate this contract, it may do so on prior notice of 30 days, or earlier notice, if such is necessary in light of the Employee’s functioning in the Company and the need to replace him in an orderly manner.
|
|
The Company may terminate the contract immediately, provided that it pays the Employee an amount in the equivalent of one month’s salary.
|
|
If the Employee wishes to terminate his employment, he must notify the Company thereof in writing 30 days in advance.
|
8.
|
(a)
|
For the avoidance of doubt and without derogating from the provisions of section 7 above, the Company may terminate the Employee’s employment forthwith and without prior notice in the event of a grave breach of trust or if he is suspected, in connection with his work, of an offence involving moral turpitude.
|
|
(b)
|
If the Company terminates the Employee’s employment in the circumstances mentioned in sub-section (a) above, the Company’s management may decide that the Employee shall not be entitled to receive any payment on account of severance pay and/or consideration due to him in the prior notice period.
|
|
(c)
|
If the employment is terminated because of the suspected commission of an offence as mentioned in sub-section (a) above, and the
Employee
is subsequently acquitted, the Company shall pay the Employee those amounts to which he would have been entitled on his employment’s termination had it been terminated other than in accordance with this section.
|
9.
|
The terms and conditions of this personal contract are personal. The Employee is required to maintain full confidentiality in respect thereof. The Employee’s signature on the annexed copy constitutes his consent to these terms and conditions.
|
The Company
By:
/s/ Moshe Shoam
Name: Moshe Shoam
By:
/s/ Zohar Gendler
Name: Zohar Gendler
|
The
Employee
/s/ Eliyahu Zehavi
Name: Eliyahu Zehavi
|
Between:
|
Mr Eliyahu Zehavi
|
|
of 3 Kariv Street, Haifa 34761
|
|
(hereinafter – the
“Employee”
)
|
|
of the one part
|
And:
|
Mazor Robotics Ltd.
|
|
of Nesher Technion Science Park, POB 212, Nesher 36601
|
|
(hereinafter – the
“Company”
)
|
|
of the other part
|
Whereas
|
on November 28, 2000 an employment contract (hereinafter – the
“contract”
) was executed between the Company and the Employee, in the scope of which it was determined that the Employee would serve as the Company’s CTO; and
|
Whereas
|
the parties wished to add to and alter the contract in accordance with the terms and conditions of an investment agreement that was conditional,
inter alia
, on alteration of the terms and conditions of the Employee’s employment as provided below;
|
1.
|
It is agreed that the Employee shall continue working for the Company in the position of COO.
|
2.
|
Notwithstanding the contract’s provisions, if the Company decides to terminate the Employee’s employment, it may do so on prior written notice of 60 days, or earlier notice, if such is necessary in light of the Employee’s functioning in the Company and the need to replace him in an orderly manner.
|
3.
|
In the event of termination of the Employee’s employment by the Company in circumstances in which the Employee is entitled to severance pay, the Employee shall be entitled, at the end of the period of the employer-employee relations, to additional payment in the equivalent of two months’ salary, computed on the basis of his last salary.
|
4.
|
The Employee undertakes to sign, at the time of signing this annex to the employment contract, a confidentiality and non-competition undertaking to the Company, in the manner and form of wording prevailing at the Company at the time of signature.
|
5.
|
Subject to the provisions of the employee option plan approved by the Company’s board of directors (hereinafter – the
“plan”
), the Company shall allot the Employee additional options to purchase ordinary shares of the Company at an exercise price of NIS 0.01 per share, as follows:
|
|
(a)
|
immediately upon the plan’s approval, the Company shall allot the Employee an option to purchase 6,907 ordinary shares, which shall be exercisable immediately;
|
|
(b)
|
on attainment of the second milestone (as such expression is defined in the investment agreement of January ___, 2003 (hereinafter – the
“investment”
) or receipt of FDA approval for the Company’s application to this authority – whichever is earlier – the Company shall allot the Employee an option to purchase 2,337 ordinary shares, of which 1,169 options shall be exercisable immediately and the balance shall be exercisable 12 months after the option allotment date;
|
|
(c)
|
at the end of three years from the initial closing date of the investment, the Company shall allot the Employee an option to purchase 2,337 ordinary shares, which shall be exercisable immediately.
|
|
For the avoidance of doubt, it is expressed that after the options’ allotment as aforesaid, the Employee shall have options to purchase 15,581 ordinary shares of the Company (including an option to purchase 4,000 ordinary shares that was allotted to it in the past).
|
6.
|
Subject and in addition to the following provisions, the contract shall continue to regulate the relationship between the Employee and the Company.
|
The Company
By:
/s/ Zeev Zehavi
Name:
Zeev Zehavi
|
The
Employee
/s/ Eliyahu Zehavi
Name: Eliyahu Zehavi
|
Between:
|
Avi Posen
|
(hereinafter – the
“Employee”
)
|
|
|
of the one part
|
And:
|
Mazor Robotics Ltd.
|
(hereinafter – the
“Company”
)
|
|
of the other part
|
Whereas
|
the Company wishes to employ the Employee as a member of the Company’s product marketing team; and
|
Whereas
|
the Employee has expressed his consent to work for the Company; and
|
Whereas
|
the Company wishes to regulate the terms and conditions of the Employee’s employment with and retirement from the Company, in accordance with and as provided below in this contract;
|
1.
|
(a)
|
The recitals to this contract constitute an integral part thereof and the provisions thereof bind the parties equally in respect of the terms and conditions of this contract.
|
|
(b)
|
The parties warrant that the Employee’s position is one requiring a special degree of personal trust within the meaning thereof in section 30(a)(5) of the Hours of Work and Rest Law, 5711-1951, and that the provisions of this Law shall not apply to the Employee’s employment by the Company.
|
|
(c)
|
The Company’s working days are Sundays to Thursdays; insofar as necessary, the Employee shall also work on Fridays.
|
2.
|
This contract shall commence on August 1, 2003.
|
3.
|
In consideration for his overall employment in the Company’s service, the Company shall pay the Employee as follows:
|
|
(a)
|
A gross monthly salary of NIS 12,000 for a full-time position (hereinafter – the
“salary”
).
|
|
The salary constitutes the full and final consideration for all the Employee’s work throughout the week and he shall not have any claim for additional compensation or additional recompense, including in respect of overtime.
|
|
(b)
|
The Employee is entitled to a leave quota of 20 days a year (for a full-time position).
|
|
At no stage shall the Employee be entitled to the accrual of leave days or to the redemption thereof in consideration for money.
|
|
(c)
|
The Employee is entitled to a sick day quota as provided in the law.
|
(e)
|
The Employee is entitled to convalescence pay in accordance with the law.
|
(f)
|
From the date of commencement of his employment with the Company, and subject to the guidelines prescribed from time to time by the Income Tax Commission, and in accordance with the permitted deduction ceiling, the Company shall provide to an insurance company chosen by the Employee (subject to signature of a letter of appointment of agent, and agent who shall be chosen by the Company – for the purpose of the monthly payment administration), in the scope of executive insurance, an amount equal to 13.33% of the monthly base salary, broken down as follows: 8.33% on account of severance pay and 5% on account of provident payments.
|
(g)
|
The Company shall deduct 5% from the Employee’s salary, which it shall transfer to the insurance company, as the Employee’s contribution towards the provident payments, and the Employee warrants that he agrees to this deduction.
|
(h)
|
The payments detailed above in this section shall be in lieu of severance pay, in accordance with the Severance Pay Law, 5723-1963, and as provided in section 14 of the aforesaid Severance Pay Law. The Employee warrants that he agrees to join the arrangement of conversion of severance pay into payments to the insurance company. Insofar as necessary, the Employee shall sign the documents required by the Ministry of Labor for the purpose of obtaining the Minister of Labor’s approval of the arrangement’s implementation.
|
(i)
|
During the term of the contract, and subject to the guidelines and ceiling prescribed from time to time by the Income Tax Commission, the Company shall provide 7.55 of the monthly base salary to a vocational studies fund. The Company shall also deduct 2.5% from the Employee’s base salary, which it shall transfer to the vocational studies fund, and the Employee warrants that he agrees to this deduction.
|
(j)
|
The Employee shall be entitled to participate in the Company’s employee option plan as approved by the Company’s board of directors and the income tax authorities. A decision regarding the options’ allotment shall be made at the end of the first six months of employment.
|
(k)
|
The Company shall lease a Group “B” car for the Employee for a period of about four years. The full lease cost shall be deducted from the Employee’s gross salary together with the payment obliged by law of benefit value tax in accordance with the type of car that is leased.
|
(l)
|
The Company shall pay the Employee, in addition to his salary as described in section 3(a), recompense for and subject to compliance with goals. The Company is not undertaking to pay the full bonus defined or part thereof – the decision is within the authority of the Company’s CEO, subject to the satisfaction of the Company and the Employee’s direct manager with the Employee’s functioning and his compliance with the defined goals. A detailed description of the goals and their definition shall be defined and agreed with the Employee by no later than the end of three months from the date of his employment’s commencement.
|
|
(m)
|
The Employee agrees and undertakes that from and by no later than the end of three months from the date of commencement of his employment with the Company, he shall live in the vicinity of the Company’s offices and for the avoidance of doubt, his new place of residence shall be within a range of not more than 50 kilometers from the Company’s offices (north of Ramat Hasharon and south of Tirat Ha’Carmel). Subject to the approval of and by arrangement with the Company’s CEO, a change (of up to no more than one more month) in the relocation date will be allowed.
|
|
(n)
|
During the first three months of employment and subject to the presentation of invoices, the Company shall finance the Employee’s daily traveling costs from his current place of residence to the Company’s site. This financing shall be limited to a ceiling of NIS 850 a month and shall be subject to the presentation of corresponding invoices.
|
(n)
|
Subject to the presentation of invoices in the Company’s name, the Company shall finance up to 50% of the direct relocation cost (transportation of belongings), provided that this cost to the Company shall not exceed NIS 2,000.
|
4.
|
This personal contract is in lieu of the various collective agreements; however, collective agreements applicable at law to all employees in Israel including cost-of-living adjustments, shall also apply to the
Employee
. Without prejudice to the generality of the aforesaid, it is expressed that notwithstanding the physical location of the Company’s activity, the
Employee
’s employment shall not be governed by any wage terms or ancillary terms or any other terms that are not expressly mentioned in this personal contract.
|
5.
|
During the term of his employment with the Company, the Company shall treat the
Employee
with customary fairness. The
Employee
shall perform his position loyally and conscientiously as customary, and shall devote his time and the best of his professional knowledge and experience to the Company in accordance with the instructions of his superiors.
|
6.
|
(a)
|
The
Employee
is required to keep the secrets of the Company and entities with which he deals, and to maintain the confidentiality of any commercial or professional information or patent or idea or development and the like reaching him in the course of his employment and/or developed by him, not to make any use thereof and not to allow others who are not employees of the Company. Any confidential information as aforesaid reaching him in the course of his employment, or in consequence of his employment with the Company, shall be deemed a secret of the Company, and the above prohibition also applies to it.
|
|
Without prejudice to the generality of the aforesaid, the
Employee
may not publish information relating to or deriving from his employment with the Company in any journal or at any conference, without prior written and express approval. All the aforesaid also applies to information of any person or entity whom or with which the Company has ties. The
Employee
’s obligations pursuant to this section shall remain valid after the termination of his employment with the Company, without limitation as to time or place.
|
|
The
Employee
must notify the Company of any idea, invention or development made by him in the scope of his employment with the Company and of any idea, invention or development made by him that is relevant to the Company’s spheres of engagement.
|
|
Ideas, inventions, developments, changes and improvements therein and any invention step as aforesaid, whether or not they are patentable in Israel and/or overseas, which are attained by the
Employee
in the term of his employment with the Company, shall belong to the Company, shall be submitted for registration by the Company and shall form part of its assets. Copyright in the
Employee
’s work on developments and ideas steered by him during the term of his employment with the Company shall also belong to the Company.
|
|
(b)
|
This contract is not intended to prejudice the
Employee
’s basic right to work after the termination of his employment with the Company, in the professional sphere of his education and experience. However, the
Employee
agrees in advance that at the time of exercising the aforesaid right and for three years after the termination of his employment with the Company, he shall not use any information and know-how reaching him or acquired by him in consequence of his employment with the Company (if they are related to the Company’s business and are not in the public domain) for the purpose of competition or assisting competition with the Company’s business or the business of its controlling shareholders or affiliates of the Company or its controlling shareholders.
|
7.
|
The
Employee
may not remove any equipment or documents belonging to the Company from the place where they are kept in the ordinary course of work, unless he has received his superiors’ approval to do so.
|
8.
|
Save in the event of termination of the
Employee
’s employment as a direct result of the Company’s acquisition, merger with another company or issue, in which case the Company must give two months’ warning before terminating the
Employee
’s employment, if the Company wishes to terminate this contract for any reason or at another time, it may do so on prior notice of 30 days.
|
9.
|
(a)
|
For the avoidance of doubt and without derogating from the provisions of section 8 above, the Company may terminate the
Employee
’s employment forthwith and without prior notice in the event of a grave breach of trust or if he is suspected, in connection with his work, of an offence involving moral turpitude.
|
|
(b)
|
If the Company terminates the
Employee
’s employment in the circumstances mentioned in sub-section (a) above, the Company’s management may decide that the
Employee
shall not be entitled to receive any payment on account of severance pay and/or consideration due to him in the prior notice period.
|
|
(c)
|
If the employment is terminated because of the suspected commission of an offence as mentioned in sub-section (a) above, and the
Employee
is subsequently acquitted, the Company shall pay the
Employee
those amounts to which he would have been entitled on his employment’s termination had it been terminated other than in accordance with this section.
|
10.
|
The terms and conditions of this personal contract are personal. The
Employee
is required to maintain full confidentiality in respect thereof.
|
11.
|
The parties’ addresses for the purposes of this contract are:
|
|
(a)
|
Mazor Surgical Technologies Ltd., 7 Ha’Eshel Street, Caesarea Industrial Park, Israel 38900;
|
|
(b)
|
Avi Posen, 15 Ha’Nassi Street, Jerusalem 92188.
|
The Company
By:
/s/ Ori Hadomi
Name: Ori Hadomi
Title: CEO
|
The
Employee
/s/ Avi Posen
Name: Avi Posen
|
To:
|
Mazor Robotics Ltd.
|
1.
|
All information reaching me orally, in writing or in any other way at the time and/or in the scope and/or in consequence of and/or in connection with the employment’s performance (hereinafter –
“information”
) is confidential information that is exclusively owned by the Company, in the acquisition and development of which financing and efforts were invested.
|
2.
|
Not to disclose the information and/or pass it on and/or make any use thereof, myself or through or with the assistance of others, directly or indirectly, for consideration or without consideration, other than for the purpose of the employment’s performance and in accordance with the express instructions that I receive from you.
|
3.
|
The expression “information” above and below includes: data about the Company, know-how, ideas or any other information and knowledge relating to the Company’s products, processes, designs, development works or research, including information in registers, documents, specifications, memoranda, reports, records, offers, notes, files, correspondence, lists, plans, examples, facilities, materials, equipment, software, codes, databases, computer programs, computer printouts, electronic or magnetic storage means, graphic or other written records, original creative work, technical discoveries, drafts of patent applications or patent applications. In addition, the names, purchase arrangements or habits of any one of the Company’s customers from the Company, names of the Company’s suppliers and markets, the cost of materials, the Company’s production and sales costs, lists or any other written record used by the Company in the course of its business, payments made to the Company’s employees or independent contractors in its service and other employment terms, information in the personal files of employees, lists of the Company’s customers, its business plans or any other matter relating to any business of the Company or any of its customers, consultants, suppliers, agents and representatives, past, present or future.
|
4.
|
To keep the information strictly confidential, to adopt all the cautionary measures required in order to prevent it being lost, damaged or reaching the hands of others, and I undertake not to copy or allow anyone else to copy, in any form or way, the information or part thereof, save for the purposes of the employment’s performance and in accordance with the Company’s express written instructions.
|
5.
|
All the rights (proprietary and otherwise) in any fruits of my employment and/or works developed by me in the course of my employment with the Company and/or in the development of which I take part and/or am involved, including any development and/or invention and/or idea and/or software and/or products and/or work methods and/or discovery and/or information (hereinafter – the
“works”
) are and shall be the exclusively property of the Company and I shall not have any rights therein and may not make any use thereof during the period of my employment or thereafter and they shall be delivered to the Company by me immediately and/or on the employment’s termination and/or at any other time on the Company’s demand. For the avoidance of doubt, I hereby irrevocably assign all my rights (insofar as existing) in the aforesaid works to the Company.
|
6.
|
Because of the nature of my position with the Company, I shall unavoidably be exposed to a great deal of proprietary information of the Company, including its intellectual property, trade secrets, business plans and methods, lists of customers and suppliers, and other information and data that the Company considers secret and vital to its growth and development (hereinafter –
“proprietary information”
). I am aware that my ongoing exposure to the proprietary information and my employment by a competitor of the Company will almost certainly cause me to make use of the Company’s proprietary information. In addition, there is no doubt that the proprietary information’s disclosure, directly or indirectly, to third parties, including competitors of the Company, will occasion the Company real and potential damages and losses.
|
7.
|
In light of the above warranty, I hereby recognize the Company’s need to protect its legitimate interests and rights in the intellectual property, and I therefore undertake not to engage and not to participate, not to accept a position and not to put myself in the position of interested party, directly or indirectly, for consideration or without consideration, as an independent contractor or as a manager, in any form or way, including as a partner, consultant or service provider, in any work or business or for any employer or customer, whether such is a corporate entity or not, whose sphere of engagement and activity or part of whose sphere of engagement or activity competes with the sphere of engagement and/or activity of the Company or which manufactures products identical or similar to those manufactured by the Company, during the term of my employment and for 18 months from the end of the actual term of my employment with the Company – and regardless of the circumstances of the employment’s termination, including because the term of the contract has come to an end.
|
8.
|
Further and in addition, I undertake not to approach or create any business relationship with customers, suppliers or agents of the Company, and not to accept from them any positions, offers, business or work orders in the spheres in which the Company engages, during the actual term of my employment with the Company and for 18 months from the end of the actual term of my employment with the Company – and regardless of the circumstances of the employment’s termination, including because the term of the contract has come to an end or because of my dismissal.
|
9.
|
I warrant and confirm that the salary for my employment with the Company during the term of the contract, including options to purchase shares, if given to me, constitutes adequate and reasonable consideration not only for the time, energy and qualifications invested by me in my employment with the Company, but also for the obligations and restrictions that I have assumed in this undertaking and in the employment contract.
|
10.
|
I hereby undertake not to put myself in a situation that will lead to any conflict of interest between the Company and I, and to notify the Company immediately and without delay of any matter or subject in which I have a personal interest and/or in respect of there is concern of a conflict of interest arising between the Company and I.
|
11.
|
Unless otherwise agreed in advance and in writing between the Company and I, during the term of the employment contract I shall not take on any other or additional employment, and shall not engage in any other business, and shall not fill any position in any company or other entity, for payment or without payment, and shall not accept any payment or benefit from any third party, whether or not related to the Company.
|
12.
|
For the avoidance of doubt, it is expressed that my above obligations shall apply to and bind me within the State of Israel and outside it.
|
13.
|
I am aware that my above obligations are at the basis of the contract between you and me and are a condition of my employment with you and/or in your service.
|
14.
|
All the provisions of this undertaking are in addition to, and do not derogate from, the provisions of any contract drawn up and signed between us as aforesaid. It is agreed and warranted that my undertakings herein shall constitute fundamental obligations of the employment contract, a breach of which shall constitute a fundamental breach of the contract.
|
Date: August 8, 2003
|
/s/ Avi Posen
Name: Avi Posen
|
|
1.1
|
Leased Premises
|
1
|
|
1.2
|
Commencement Date
|
1
|
|
1.3
|
Rent Commercial Rate
|
1
|
|
1.4
|
Lease Term
|
1
|
|
1.5
|
Base Rent
|
2
|
|
1.6
|
Security Deposit
|
2
|
|
1.7
|
Due at Signing
|
2
|
|
1.8
|
Building:
|
2
|
|
1.9
|
Condominium
|
2
|
|
1.10
|
Addresses
|
3
|
|
1.11
|
Tenant Improvements
|
3
|
|
2.1
|
Abandon
|
3
|
|
2.2
|
Act of God or Force Majeure
|
3
|
|
2.3
|
Common Elements
|
3
|
|
2.4
|
Developer
|
4
|
|
2.5
|
Guarantor
|
4
|
|
2.6
|
Lease Year
|
4
|
|
2.7
|
Permitted Use
|
4
|
|
2.8
|
Rules and Regulations
|
4
|
|
2.9
|
Tenant’s Share Per Unit
|
4
|
|
2.10
|
Base Year
|
4
|
|
3.1
|
Grant of Leased Premises
|
4
|
|
3.2
|
Delivery of Leased Premises
|
4
|
|
4.1
|
Base Rent
|
4
|
|
4.2
|
Additional Rent
|
5
|
|
4.3
|
Late Payment Charge
|
7
|
|
4.4
|
Security Deposits
|
7
|
|
4.5
|
Reserved
|
8
|
|
4.6
|
Holding Over
|
8
|
|
5.1
|
Use and Operation of Tenant's Business
|
8
|
|
5.2
|
Use of the Common Elements
|
9
|
|
5.3
|
Signs
|
9
|
|
5.4
|
Compliance with Laws, Rules and Regulations
|
10
|
|
5.5
|
Right of Entry; Inspection
|
10
|
|
5.6
|
Personal Property and Rent Taxes
|
10
|
|
5.7
|
Parking.
|
10
|
|
5.8
|
Tenant’s Requests to the Association
|
10
|
|
6.1
|
Utilities
|
11
|
|
6.2
|
Telecommunications Services
|
11
|
|
7.1
|
By Landlord
|
12
|
|
7.2
|
By Developer and/or the Association
|
13
|
|
7.3
|
Right of Entry
|
13
|
|
7.4
|
By Tenant
|
13
|
|
8.1
|
Construction
|
14
|
|
8.2
|
Tenant Improvements
|
14
|
|
8.3
|
Improvements to premises
|
14
|
|
8.4
|
Ownership of Improvements
|
14
|
|
9.1
|
Casualty
|
15
|
|
9.2
|
Condemnation
|
16
|
|
10.1
|
Property Insurance
|
16
|
|
10.2
|
Waiver of Subrogation
|
17
|
|
10.3
|
Hold Harmless
|
17
|
|
10.4
|
Liability Insurance
|
18
|
|
10.5
|
Insurance Requirements
|
18
|
|
10.6
|
Hazardous Material
|
18
|
|
11.1
|
Assignment/Sublease by Tenant
|
19
|
|
11.2
|
Assignment by Landlord
|
19
|
|
11.3
|
Default and Collection
|
19
|
|
11.4
|
Rights of Mortgagee, Estoppel Letters
|
20
|
|
12.1
|
Default by Tenant
|
21
|
|
12.2
|
Remedies for Tenant's Default
|
22
|
|
12.3
|
Default by Landlord
|
24
|
|
12.4
|
Remedies for Landlord's Default
|
24
|
|
12.5
|
Reserved
|
24
|
|
13.1
|
Waiver
|
25
|
|
13.2
|
Attorneys' Fees
|
25
|
|
13.3
|
Successors
|
25
|
|
13.4
|
Interpretations: Severability
|
25
|
|
13.5
|
Notices
|
25
|
|
13.6
|
Multiple Tenants
|
26
|
|
13.7
|
Landlord's Liability
|
26
|
|
13.8
|
Time is of the Essence
|
26
|
|
13.9
|
Entire Agreement
|
26
|
|
13.10
|
Amendment
|
26
|
|
13.11
|
Limitation of Warranties
|
26
|
|
13.12
|
Waiver and Releases
|
26
|
|
13.13
|
Radon Gas Disclosure
|
26
|
|
13.14
|
Exhibits, Riders and Addenda
|
27
|
|
13.15
|
Real Estate Broker
|
27
|
|
13.16
|
Waiver of Jury Trial
|
27
|
|
13.17
|
Legal Authority
|
27
|
1.1
|
Leased Premises
. The “
Leased Premises
” described in this Lease are owned in the form of condominium ownership pursuant to Florida law and are comprised of the floor space and interior wall and ceiling space of those portions of the Condominium (defined below) known, or to be known as Unit 1830 S & 1850 S (the “Unit”), and as described or shown on
Exhibit "B"
, attached hereto and incorporated herein by reference, and containing approximately 6445 rentable square feet, together with the nonexclusive right to use the Common Elements (as defined herein).
|
1.2
|
1.2a Commencement Date
. The “
Commencement Date
” of the Lease Term shall be March 11th, 2013.
|
1.3
|
1
.2b Rent Commencement Date. Beginning April 1, Tenant shall pay 25% of full monthly rent until the entire Premises is clear of executive suite tenants, (Tenants other than Mazor employees). Tenant shall be provided use of the entire Premises by May 1, 2013.
|
1.4
|
Lease Term
. The “
Lease Term
” shall commence on the Commencement Date and continue for Thirty eight-
eight
(38
8
) months after the Commencement Date.
|
1.5
|
Base Rent
. The initial monthly “
Base Rent
” beginning May 1, 2013 for the Leased Premises is Eleven Thousand Eight hundred Fifteen and 83/100 Dollars ($11,815.83) based on a per rentable square foot rate of Twenty-Two and 00/100 Dollars ($22.00), escalating by Three Percent (3%) on the first day of the second, and third Lease Year, as set forth on the Rent Schedule provided on
Exhibit "C"
, attached hereto and incorporated herein by reference, plus any applicable Florida and Local Sales Tax.
|
1.6
|
Security Deposit
. Twelve Thousand Five Hundred and Thirty-Five and 42/100 Dollars ($12,535.42).
|
1.7
|
Due at Signing.
A sum equal to First Month’s full Rent amount and Security Deposit, plus any applicable Florida and Local Sales Tax.
|
1.8
|
Buildings
. The “
Buildings
”, including the Leased Premises, is part of The Plaza South Tower Commercial Condominium, as set forth in that certain Declaration of Condominium of The Plaza South Tower Commercial Condominium, recorded August 22, 2006, in Official Records Book 8820, Page 4096, of the Public Records of Orange County, Florida, as the same may be further amended from time to time (the "
Declaration
"), and part of The Plaza South Tower Commercial Condominium, as set forth in that certain Declaration of Condominium of The Plaza South Tower Commercial Condominium, recorded August 22, 2006, in Official Records Book 8820, Page 4096, of the Public Records of Orange County, Florida, as the same may be further amended from time to time (the "
Declaration
"), located on that certain tract of real property (the "
Land
") located in Orlando, Orange County, Florida and more particularly described on
Exhibit "A"
attached hereto and incorporated herein by reference. The Building, the Land and all other improvements and appurtenances developed by Landlord in connection with the development of the Building shall be collectively referred to as the "
Property
".
|
1.9
|
Condominiums
. The “
Condominiums
" are The Plaza South Tower Commercial Condominium and is comprised of the Building, units, common elements and other property described in the Declaration. The Condominiums are subject to the control and regulation of The Plaza South Tower Commercial Condominium Association, Inc., a Florida not for profit corporation (the "
Association
"), whose membership is comprised of the owners of units in The Plaza South Tower Condominium and The Plaza South Tower Commercial Condominium and is comprised of the Building, units, common elements and other property described in the Declaration, this Condominium is subject to the control and regulation of The Plaza South Tower Commercial Condominium Association, Inc., a Florida not for profit corporation (the "
Association
"), whose membership is comprised of the owners of units in The Plaza South Tower Condominium . The Condominiums are subject to: (i) the Declaration, and (ii) that certain Master Declaration of Covenants, Conditions and Restrictions of The Plaza Project recorded October 15, 2004 in Official Records Book 7660, Page 1940 in the Public Records of Orange County, Florida, as the same may be amended from time to time (the "
Master Declaration
"). The Association owns or will own a condominium unit in the Plaza Land Condominium pursuant to that certain Declaration of Condominium of The Plaza Land Condominium recorded October 15, 2004 in Official Records Book 7660, Page 2084 in the Public Records of Orange County, Florida, as the same may be amended from time to time (the "
Land Declaration
"), and, as such, the Association will be a member of the Plaza Land Condominium Association, Inc., a Florida not for profit corporation (the "
Land Condominium Association
").
|
1.10
|
Addresses
:
|
1.11
|
Tenant Improvements.
TO BE ADDED AT A LATER DATE
|
2.1
|
Abandon
. "
Abandon
" means the vacating of all or a substantial portion of the Leased Premises by Tenant for a period greater than fifteen (15) consecutive days, and during which Tenant is in default for failure to pay Rent or other payments due under this Lease.
|
2.2
|
Act of God or Force Majeure
. An "
Act of God
" or "
Force Majeure
" is defined for purposes of this Lease as strikes, lockouts, sitdowns, material or labor restrictions by any governmental authority, unusual transportation delays, riots, floods, washouts, explosions, earthquakes, fire storms, weather (including wet grounds or inclement weather which prevents construction), acts of the public enemy, wars, insurrections, terrorism and/or any other cause not reasonably within the control of Landlord or which by the exercise of due diligence Landlord is unable wholly or in part to prevent or overcome. Landlord shall not be required to perform any covenant or obligation in this Lease, or be liable in damages to Tenant, so long as the performance or nonperformance of the covenant or obligation is delayed or prevented by an Act of God, Force Majeure or by Tenant. Except as provided hereinbelow, Tenant shall not be required to perform any covenant or obligation in this Lease, except for the fulfillment of accrued monetary obligations, or be liable to Landlord, so long as the performance or nonperformance of the covenant or obligation is delayed or prevented by an Act of God or Force Majeure.
|
2.3
|
Common Elements
. The Common Elements shall include for all purposes of this Lease those parts of the Property intended for the common use of all owners and tenants of portions of the Property, including among other facilities (as such may be applicable to the Property), parking area, private streets and alleys, landscaping, curbs, loading area, sidewalks, malls and promenades (enclosed or otherwise), lighting facilities, drinking fountains, meeting rooms, public toilets, and the like, and any such additional areas which may be included under the term "
Common Elements
" as defined in the Declaration or Master Declaration.
|
2.4
|
Developer
. “
Developer
” shall mean the Developer under the Declaration and its successors and assigns. Developer currently is The Plaza LLC, a Florida limited liability company.
|
2.5
|
Guarantor
. Intentionally Deleted.
|
2.6
|
Lease Year
. Each succeeding 12-month period commencing with the first day of the first full calendar month of the Lease Term shall be a “Lease Year”.
|
2.7
|
Permitted Use
. general office, administrative or other use as may be permitted hereunder and any permitted use set forth in the Declaration upon the prior written approval of Landlord. Any permitted use must be in accordance with the Declaration and in the event the use is not a permitted use under the Declaration, Landlord may terminate this Lease upon ten (10) days notice to Tenant.
|
2.8
|
Rules and Regulations
. Tenant shall be subject to (i) the Rules and Regulations of the Association, as the same may be modified or amended from time to time, an initial copy of which is attached hereto as
Exhibit "E"
and incorporated herein by reference (the "
Condominium Rules and Regulations
"), and (ii) the terms and conditions of the Master Declaration (the Condominium Rules and Regulations and the terms and conditions of the Master Declaration are collectively, the "
Rules and Regulations
").
|
2.9
|
Tenant’s Share Per Unit
. “Tenant’s Share Per Unit” shall mean 100% with respect to each designated Unit listed in Exhibit B.
|
2.10
|
Base Year
. The Base Year will be 2013 as described in Section 4.2(d)
|
3.1
|
Grant of Leased Premises
. In consideration of the obligation of Tenant to pay the Rent (as hereinafter defined) and other charges as provided in this Lease and in consideration of the performance by Tenant of the other terms and provisions of this Lease, Landlord hereby demises and leases to Tenant, and Tenant hereby takes from Landlord, the Leased Premises during the Lease Term, subject to the terms and conditions set forth in this Lease.
|
3.2
|
Delivery of Leased Premises
. Landlord shall deliver possession of the Leased Premises to Tenant upon the Commencement Date (the “
Turnover Date
”).
|
4.1
|
Base Rent
. Tenant agrees to pay monthly as Base Rent during the Lease Term the sums of money set forth in
Section 1.4
hereof, plus applicable State of Florida and local sales tax, which amounts shall be payable to Landlord at the address set forth in
Section 13.5
or at such other address that Landlord in writing shall notify Tenant. Upon the Commencement Date the following shall be due and payable: the monthly installment of Base Rent for the first month's Base Rent payable under this Lease. Commencing on the first day of the second month of the Lease Term, monthly installment payments of Base Rent shall be due and payable on or before the first day of each calendar month thereafter during the Lease Term, in the amounts set forth on
Exhibit “C”
, without demand, offset or deduction. If the Commencement Date should be a date other than the first day of a calendar month, the monthly Rent set forth above shall be prorated to the end of that calendar month, and all succeeding installments of Rent shall be payable on or before the first day of each succeeding calendar month during the Lease Term. In addition to Tenant's requirement to pay Base Rent hereunder, Tenant shall pay, as Additional Rent (hereinafter defined), all other sums as required under this Lease.
|
4.2
|
Additional Rent
. In addition to Base Rent and applicable taxes due thereon, all other payments to be made by Tenant to Landlord as set forth herein, shall be deemed to be and shall become "
Additional Rent
" hereunder, and shall be due and payable at the specific time set forth in this Lease, including, but not limited to, as required by
Section 4.2(e)
, or, if no specific time is set forth in this Lease, then within thirty (30) days following written demand by Landlord, together with all applicable sales or use tax, or any other tax (excluding any federal income or estate taxes to Landlord arising from Rent paid by Tenant), which may be imposed upon rents now or hereafter by any governing authority. All references in this Lease to the term "
Rent
", including, but not limited to references in the provisions concerning Landlord's remedies for Tenant's failure to pay Rent, shall be deemed to refer to Base Rent, Additional Rent, and applicable taxes due thereon.
|
|
(a)
|
Utilities
. Landlord shall be responsible for providing electricity and chilled water (air conditioning) to the Leased Premises during normal business hours and after hours..
|
|
(b)
|
Telephone, to the Leased Premises shall be separately measured or metered (telephone, electric power, HVAC, and any other utilities to the Leased Premises that are separately measured or metered at the Leased Premises are collectively, the “
Tenant Utility Services
”). Tenant shall hold Tenant Utility Services in Tenant’s name, pay for all deposits required for Tenant Utility Services, and pay any and all charges for Tenant Utility Services as they become due. If Tenant fails to pay all charges for Tenant Utility Services as they become due, such failure shall constitute an Event of Default under this Lease.
|
|
(c)
|
Taxes and Assessments
. Commencing in calendar year 2014, Tenant shall pay to Landlord, as Additional Rent, Tenant’s Share Per Unit of the real estate taxes and assessments applicable to the Unit, and other charges shown on the annual ad valorem tax bills (the "
Real Estate Taxes
") levied or charged each year against the Unit within the Leased Premises to the extent such Real Estate Taxes for each such Unit exceed the amount so levied or charged against each such Unit in calendar year 2013 (the “
Base Year Tax Amount
”). Real Estate Taxes for any Lease Year which is not a full calendar year, shall be paid directly by Landlord and Landlord shall invoice Tenant, as Additional Rent, Tenant’s Share Per Unit of such Real Estate Taxes less the prorated Base Year Tax Amount prorated for that portion of the year (based on a 365-day year) that Tenant leased the Leased Premises pursuant to this Lease. Payment of such invoices for Real Estate Taxes shall be made in accordance with the requirements for the payment of Additional Rent.
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(d)
|
Condominium Association Fees.
Commencing in calendar year 2014, Landlord shall bill Tenant, as Additional Rent, in accordance with Tenant’s Share Per Unit, those portions of all assessments, excluding “Special Assessments” (as defined in the Declaration), and fees charged by the Association against the Unit of the Leased Premises for the costs and expenses related to ordinary maintenance (but not capital expenditures) by the Association pursuant to the Declaration and Master Declaration (collectively, the “Condo Assessments”) to the extent such Condo Assessments for the Unit of the Leased Premises exceed the amount assessed or levied against such Unit of the Leased Premises in calendar year 2013 (the “Base Year Condo Assessment Amount”); provided, however, that Tenant shall not be charged for or responsible for paying any fines or penalties charged against any Unit of the Leased Premises by reason of an action or inaction on the part of Landlord, and not charged as the result of any action or inaction on the part of Tenant, that results in the levy of such fine or penalty. Payment of such invoices for the Tenant’s Share Per Unit of the Condo Assessments exceeding the Base Year Condo Assessment Amount shall be made in accordance with the requirements for the payment of Additional Rent. Unless otherwise expressly provided in this Lease, it is the intent of the parties that Special Assessments of the Association, other than Condo Assessments as provided above, shall not be billed to Tenant but shall be the obligation of and paid by Landlord.
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(e)
|
Estimated Payment; Monthly Installments
. Notwithstanding anything herein to the contrary, commencing with January 2014, being the first month following calendar year 2013 (the “
Base Year
”), if requested by Landlord, Tenant shall pay, in equal monthly installments, one-twelfth (1/12th) of Landlord’s estimate of the Real Estate Taxes over the Base Year Tax Amount, Condo Assessments over the Base Year Condo Assessments Amount (collectively, “
Estimated Additional Rent
”) for the then current calendar year (prorated for any partial calendar year or month at the beginning or end of the Lease Term). Landlord shall give Tenant written notice of such estimated amounts, and Tenant shall pay such amounts monthly to Landlord at the same time as monthly Base Rent. Within ninety (90) days following the end of each calendar year subsequent to the Base Year, Landlord will submit to Tenant a statement showing Estimated Additional Rent for the preceding calendar year along with a reconciliation of Tenant’s estimated payments as compared to the actual amounts for Real Estate Taxes over the Base Year Tax Amount, Condo Assessments over the Base Year Condo Assessments Amount and other amounts of Additional Rent for such calendar year (each, an “
Additional Rent Statement
”). Within thirty (30) days after receipt of an Additional Rent Statement, Tenant shall pay Landlord any additional amounts owed as shown on the Additional Rent Statement. Tenant’s obligation to pay any amounts due under this Section shall survive the expiration or earlier termination of this Lease. Tenant shall have thirty (30) days to notify Landlord in writing of any objections to the Additional Rent Statement.
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(f)
|
Overpayment
. In the event of overpayment by Tenant, Landlord shall apply the excess to the next payment of Rent when due, until such excess is exhausted or until no further payments of Rent are due, in which case, Landlord shall pay to Tenant the balance of such excess within thirty (30) days thereafter with interest at a rate of one and one-half percent (1.5%) per month. Any failure or delay on the part of Landlord in furnishing any statement with respect to Estimated Additional Rent shall not constitute a waiver by Landlord of Tenant’s obligation to pay such amounts to the extent required of Tenant under this Lease, provided that Landlord shall use reasonable efforts to deliver an Additional Rent Statement for each calendar year or portion thereof occurring during the Lease Term hereof occurring subsequent to the Base Year to Tenant within ninety (90) days after the last day of the calendar year to which such statement is applicable.
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4.3
|
Late Payment Charge
. Other remedies for nonpayment of Rent notwithstanding, if any monthly Rent payment is not received by Landlord on or before the fifth (5
th
) day of the month for which the Rent is due, or if any other payment hereunder due Landlord by Tenant is not received by Landlord on or before the fifth (5
th
) day of the month next following the month in which Tenant was invoiced, a late payment charge of one and one half percent (1.5%) of such past due amount shall become due and payable, in addition to such amounts owed under this Lease. Tenant shall not be liable for a late payment charge in the event of delays in bona fide carrier services, including the United States Postal Service, or delays as a result of force majeure. If during the Lease Term, Landlord receives two (2) or more checks from Tenant which are returned by Tenant's bank for insufficient funds, Landlord may require that all checks thereafter be bank certified or cashier's checks (without limiting Landlord's other remedies). All bank service charges resulting from any bad checks shall be borne by Tenant.
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4.4
|
Security Deposits
. The Security Deposit set forth in
Section 1.5
hereof shall be held by Landlord for the performance of Tenant's covenants and obligations under this Lease, it being expressly understood that the Security Deposit shall not be considered an advance payment of Rent or a measure of Landlord's damage in case of default hereunder by Tenant, and shall be held by Landlord without payment of any interest thereon. If the sum deposited by Tenant with Landlord is insufficient to discharge all of Tenant's liability, Tenant shall remain liable for any amounts that the Security Deposit is insufficient to pay and agrees to pay those amounts immediately upon demand. In the event Tenant fails to faithfully perform the terms and conditions of this Lease, Landlord, at Landlord's option, may at any time apply the Security Deposit or any part thereof toward the payment of the Rent and toward the performance of Tenant's obligations under this Lease. In such event, within five (5) days after receipt of written notice of such application by Landlord, Tenant shall deposit with Landlord cash sufficient to restore the Security Deposit to its original amount. The Security Deposit may be assigned and transferred by Landlord to the successor in interest of Landlord and, upon acknowledgment by such successor of receipt of the Security Deposit and its assumption of the obligation to account to Tenant for the Security Deposit in accordance with the terms of this Lease, Landlord shall thereby be discharged of any further obligation relating thereto. In addition, if Tenant assigns this Lease with the consent of Landlord, the Security Deposit will remain with Landlord for the benefit of the new tenant and shall be returned to such new tenant upon the same conditions as would have entitled Tenant to its return.
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4.5
|
Reserved
.
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4.6
|
Holding Over
. If Tenant does not vacate the Leased Premises upon the expiration or earlier termination of this Lease, Tenant shall be a tenant at sufferance for the holdover period and all of the terms and provisions of this Lease shall be applicable during such period, except that, if such holdover is without the express consent of Landlord, Tenant shall pay Landlord on demand (in addition to Additional Rent and any other sums payable under this Lease) as Base Rent for the period of such holdover an amount equal to one hundred
fifty
twenty five percent (125
0
%) of the Base Rent which would have been payable by Tenant had the holdover period been a part of the original Lease Term (without waiver of Landlord's right to recover damages as permitted by law). If such holdover is with the express consent of Landlord, such Base Rent during the holding period shall be an amount equal to 110% of the Base Rent which would have been otherwise payable. Tenant shall indemnify and hold harmless Landlord and the Association against all claims made by any tenant or prospective tenant against Landlord resulting from delay by Landlord in delivering possession of the Leased Premises to such other tenant or prospective tenant as a result of any nonconsensual holdover by Tenant, except that Tenant shall not be liable for consequential damages arising from a holdover by Tenant for a period of thirty (30) days or less. Notwithstanding anything to the contrary in this Lease, Tenant shall not be liable for any consequential, special or punitive damages.
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5.1
|
Use and Operation of Tenant's Business
. Tenant warrants and represents to Landlord that the Leased Premises shall be used and occupied only for the purposes set forth in
Section 2.7
hereof. Tenant acknowledges that its type of business, as specified herein, is a material consideration for Landlord's execution of this Lease. Tenant may, however, change the nature of its business without the approval of Landlord, provided said change is not otherwise in conflict with applicable governmental and condominium restrictions. Furthermore, Tenant shall not use the Leased Premises for any purpose prohibited by the Rules and Regulations. Tenant shall occupy the Leased Premises in good faith, conduct its business and control its agents, employees, licensees, invitees and visitors in such a manner as is lawful, reputable and will not create a nuisance to other owners or tenants of the Condominium or the Property. Tenant and its agents, employees, licensees, invitees and visitors shall have the nonexclusive right to use the Common Elements subject to the Rules and Regulations. Tenant shall not solicit business, distribute handbills or display merchandise within the Common Elements, or take any action which would interfere with the rights of other persons to use the Common Elements. Tenant shall not permit any operation which emits any odor or matter which intrudes into other portions of the Condominium or Property, use any apparatus or machine which makes undue noise or causes vibration in any portion of the Condominium or Property, or otherwise interfere with, annoy or disturb any other tenant or owner in its normal business operations or the Association, Land Condominium Association or Developer (or their respective designated representative) in their respective management of the Condominium, or other portions of the Property. Tenant shall not permit any waste on the Leased Premises nor allow the Leased Premises to be used in any way which would, in the reasonable opinion of Landlord, be extra hazardous on account of fire or which would in any way increase or render void Landlord’s insurance of the Leased Premises or any insurance coverages on the Condominium or other portions of the Property.
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5.2
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Use of the Common Elements
. The Master Declaration and the Declaration provide for Tenant a nonexclusive easement for pedestrian traffic and customer use over, through and across the corridors, lobbies, sidewalks, paths, walks and other portions of the Common Elements for the use and benefit of Landlord, Tenant, other tenants and owners of portions of the Property, and those persons claiming by, through or under such persons including agents, employees, licensees, invitees and visitors, subject to compliance with the Rules and Regulations. In addition to Landlord's authority under this Lease, Tenant acknowledges that the Association and the Land Condominium Association shall also operate and control Common Elements pursuant to the Condominium Rules and Regulations and the Master Declaration, and Tenant acknowledges such control and accepts such regulation by the Association and Land Condominium Association, their respective successors and managers. Tenant acknowledges that the Association or Land Condominium Association may close any part of the Common Elements to make repairs or alterations, but shall provide Tenant and Tenant's agents, employees, licensees, invitees and visitors with reasonable access to the Leased Premises. With regard to the Common Elements, Tenant agrees to be bound by all provisions of the Rules and Regulations and other governing documents of the Condominium, as they may be amended and modified from time to time. A copy of the Rules and Regulations and the Declaration have been provided to Tenant at the time of execution of this Lease and, by execution hereof, Tenant acknowledges the receipt of same and agrees to hereby be bound by such Rules and Regulations and by the Declaration. Notwithstanding anything herein to the contrary, any fines, charges or assessments imposed on Landlord or the Leased Premises as a result of a violation of any of the Rules and Regulations for any action or inaction by Tenant or any of its employees, guests, occupants, customers, agents, licensees or invitees that resulted in any fine, charge or assessment being imposed by the Association on Landlord or the Leased Premises, shall be charged by Landlord to Tenant, and any such charges shall be paid to Landlord by Tenant within thirty (30) days of Tenant’s receipt of written notice of any such fine, charge or assessment.
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5.3
|
Signs
. Tenant shall not erect, place or paint in or about the Leased Premises or the Property any sign except as permitted pursuant to and in accordance with the Rules and Regulations and Declaration. Subject to Tenant first obtaining the necessary approvals and otherwise complying with the applicable guidelines set forth in the Declaration and the Rules and Regulations, Landlord shall provide, at Landlord’s expense, Tenant’s standard graphical signage at the entrance to the Leased Premises. Tenant shall, at its own expense, maintain all such permitted signs and shall, on or before the expiration of the Lease Term, at its own expense, remove all such permitted signs and repair any damage or destruction caused by such removal. Tenant acknowledges that the Association shall have the right to remove all non-permitted signs without notice to Tenant and at the expense of Tenant. Landlord shall cooperate with Tenant’s request to the Association and/or Land Condominium Association to provide, at Landlord’s expense, a listing for Tenant on the lobby directory. The design, form and location of Tenant's space on the lobby directory shall be in accordance with the guidelines set forth in the Declaration.
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5.4
|
Compliance with Laws, Rules and Regulations.
Tenant, at Tenant's sole cost and expense, shall comply with all laws, ordinances, orders, rules and regulations of state, federal, municipal or other agencies or bodies having jurisdiction over the use, condition or occupancy of the Leased Premises, including, but not limited to, the requirements of the Americans With Disabilities Act of 1990, as amended from time to time (the "
ADA
"), in connection with its business operation on the Leased Premises, that become effective after the Commencement Date of this Lease. Except for Tenant’s obligations as set forth above and in the event Tenant does not commence any alterations of the Leased Premises subsequent to the Commencement Date, Landlord, at Landlord's sole cost and expense, shall comply with all laws, ordinances, orders, rules and regulations of state, federal, municipal or other agencies or bodies having jurisdiction over the use, condition or occupancy of the Leased Premises that are in effect as of the Commencement Date or that become effective after the Commencement Date, including, but not limited to, the requirements of the ADA. Tenant further agrees to indemnify and hold harmless Landlord and the Association and Land Condominium Association from and against any and all claims, liability, injury, damages, causes of action, costs or expenses of any nature whatsoever (including attorneys' fees) which Landlord and/or the Association or Land Condominium Association suffer as a result of Tenant's failure to comply with such laws. Tenant shall procure at its own expense all permits and licenses required for the transaction of its business in the Leased Premises.
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5.5
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Right of Entry; Inspection
. Landlord or its authorized agents shall at any and all reasonable times upon reasonable notice to Tenant have the right to enter the Leased Premises to inspect the same, to show the Leased Premises to prospective mortgagees, purchasers or prospective tenants, and to alter, improve or repair the Leased Premises if such alterations, improvements or repair are reasonably required by any governmental entity or deemed reasonably necessary by Landlord. . Tenant shall not change Landlord's lock system or in any other manner prohibit Landlord from entering the Leased Premises.
Landlord shall have the right at all times to enter the Leased Premises by any means in the event of an emergency without liability therefor. Tenant acknowledges that the Association or its designees thereof shall have such rights of access as are provided in the Rules and Regulations and the Declaration.
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5.6
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Personal Property and Rent Taxes
. Tenant shall be liable for all tangible personal property taxes levied against leasehold improvements, merchandise, personal property, and trade fixtures of Tenant located within the Leased Premises. If any such taxes for which Tenant is liable are levied against Landlord or Landlord's property, Tenant shall pay to Landlord, upon demand, that part of such taxes for which Tenant is liable. Tenant shall pay when due any and all applicable sales or use tax, or any other tax, which may be imposed now or hereafter by any governmental authority, related to Tenant's use and operation of its business in the Leased Premises.
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5.7
|
Parking
. Tenant will provided up to 12 reserve parking spaces. Additionally, Tenant shall also be able to lease an additional 20 reserved parking spaces on or before June 1, 2013. If Tenant doesn’t take additional 20 spots on or before June 1, 2013, Tenant shall be offered any available spots owned by Landlord. The costs per month for parking spaces is $150 per space.
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5.8
|
Tenant’s Requests to the Association
. Provided that Tenant is not in default, Landlord agrees to take commercially reasonable action (at no cost, expense or undue burden to Landlord) to support Tenant in Tenant’s reasonable requests to the Association from time to time for the action, consent or approval of the Association on matters within the Association’s jurisdiction, as reasonably necessary. Landlord further agrees that it will not cast its votes (as a member of the Association) in Association matters in a manner that would materially, substantially and unreasonably impair Tenant’s use and quiet enjoyment of the Common Elements or the Leased Premises.
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6.1
|
Utilities
. Tenant acknowledges that Landlord is not in control of, nor responsible for, the delivery of electricity, water or elevator service to, or for, the Leased Premises, but that subject to the Rules and Regulations and the Declaration, such services are to be made available to the Leased Premises on a twenty-four (24) hour basis, seven (7) days per week. Landlord shall not be liable for any interruption whatsoever (except if such interruption is the direct result of Landlord’s gross negligence or willful misconduct) in Tenant Utility Services, Utility Services or other utility services, other than where Landlord has failed to pay charges for such services as and when they become due. Tenant acknowledges and agrees that neither Developer, the Association, nor the Land Condominium Association shall be liable for: (i) any interruption whatsoever in Tenant Utility Services, Utility Services or other utility services which are due to Acts of God or Force Majeure, or any other reasons outside the reasonable control of Developer, the Association, or the Land Condominium Association, or (ii) any interruption of Tenant Utility Services, Utility Services or other utility services which continues during any reasonable period necessary to restore such service upon the occurrence of any of the foregoing conditions. Failure to any extent to provide Tenant Utility Services, Utility Services, other utility services or any other services not specified, or any cessation thereof, shall not: (A) render Developer, the Association, the Land Condominium Association, or Landlord liable in any respect for damages to either person or property (other than if caused by the gross negligence or willful misconduct of such entity, their respective agents or employees), (B) be construed as an eviction of Tenant, (C) provide an abatement of Rent, or (D) relieve Tenant from fulfillment of any covenant or obligation set forth in this Lease. Tenant shall have no claim for abatement or rebate of Rent or damages on account of any interruption in service if any of the equipment or machinery necessary or useful for provision of any Tenant Utility Services, Utility Services or other utility services, and for which the Association or the Land Condominium Association is responsible, breaks-down, or for any cause ceases to function properly. Tenant has the right to terminate the lease without penalty of there is no electricity, water or elevator service, or Tenant is not able to conduct its customary business operations at the Leased Premises due to interruption of any Tenant Utility Services, Utility Services or other utility services, continuously for more than (i) three days other than in the case of a natural disaster or (ii) thirty days in the case of a natural disaster.
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6.2
|
Telecommunications Services
.
|
|
(a)
|
Developer's Right
. Tenant acknowledges that pursuant to the Master Declaration, Developer has reserved the exclusive right to enter into a telecommunications agreement (the "
Telecommunications Agreement
") with a third party provider (the "
Telecommunications Provider
") of certain internet and telecommunications services, including, but not limited to, audio, video and data communication and transmission services (the "
Telecommunication Services
") to and for the benefit of the Property, including the Leased Premises. In recognition of the nature of Tenant’s business, Landlord has obtained the written consent of Developer (“Developer’s Consent”) for Tenant to (i) directly contract for Tenant’s Telecommunications Services with a provider or providers of such services as Tenant may from time to time select during the Lease Term, and (ii) have the right to install, at Tenant’s sole cost and expense, telecommunications infrastructure, including, copper, fiber or the equivalent to serve the Leased Premises. A copy of Developer’s Consent is attached hereto as Exhibit “H” and in the event of conflict between this Lease and the Developer’s Consent the terms and conditions of the Developer’s Consent shall control. Tenant acknowledges and agrees that, except as permitted by Developer’s Consent and to the extent not in conflict with or violative of applicable law or any existing contract or agreement, Developer has, and shall continue to have, the sole and exclusive right to enter into Telecommunications Agreements providing Telecommunication Services to other owners, tenants, and users of the Property.
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(b)
|
Tenant's Right
. Unless Developer has elected pursuant to the foregoing to provide Telecommunication Services to the Leased Premises, Tenant may, subject to the prior written approval of Developer as set forth in the Declaration, select the telecommunications and internet service provider(s) required to provide such services to the Leased Premises and Tenant shall work with Developer on access issues with respect to any such services, including the use of conduits for wiring outside of the Leased Premises. Subject to the foregoing, Tenant shall have the right to install, and once installed to operate, maintain, repair, replace, modify and remove, wireless systems for audio, video and data communication and transmission (the "
Wireless Systems
") in the Leased Premises for its own use only and not for use by third parties (other than permitted subtenants). Tenant shall ensure that any Wireless Systems do not interfere with the use and enjoyment by other tenants of their premises in the Condominium or Property and the operation of their businesses, or their Telecommunication Services. Tenant acknowledges and understands that Developer shall have the right to grant similar rights to owners or other tenants in or of the Condominium or Property, and Landlord and Developer shall have no liability for any interference with the performance of Tenant's Wireless Systems due to any other owner or tenant's use of a common radio transmission spectrum.
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7.1
|
By Landlord
. Landlord shall not be required to make any improvements, replacements or repairs of any kind or character to the Leased Premises during the Lease Term except as set forth in this Lease. Landlord shall not be liable to Tenant, except as expressly provided in this Lease, for any damage, destruction or inconvenience, and Tenant shall not be entitled to any damages nor to any abatement or reduction of Rent by reason of any repairs, alterations or additions made by Landlord under this Lease, other than if caused by the negligence or misconduct of Landlord, its agents or employees. Landlord shall have no responsibility for the repair or maintenance of any improvement, system, fixture or item installed by Tenant. Upon termination of this Lease, by lapse of time or otherwise, Tenant shall deliver the Leased Premises to Landlord in as good condition as existed at the Commencement Date, ordinary wear and tear excepted. The cost and expense of any repairs necessary to restore the condition of the Leased Premises shall be borne by Tenant. Landlord shall exercise diligence to avoid disruptions to Tenant's business.
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7.2
|
By Developer and/or the Association
. Tenant acknowledges and understands that except for any damage or destruction caused by the acts of negligence or willful misconduct by Tenant or any of its employees, guests, occupants, customers, agents, licensees or invitees, Developer and/or the Association or Land Condominium Association, as applicable under the Declaration, Master Declaration or other documents, have the responsibility to maintain the roof, foundation and Common Elements, including, without limitation, elevators and bathroom areas, and the structural soundness of the exterior walls. In the event Tenant or any of its employees, guests, occupants, customers, agents, licensees or invitees cause any damage or destruction to the Property or Common Elements, or any part thereof, either Developer, the Association, or Land Condominium Association (or their designees), as applicable, may assume responsibility for repairs of certain components that may otherwise be the responsibility of Tenant. Particularly, Developer, the Association, or Land Condominium Association may assume the responsibility to repair utility components such as conduit, ducts, plumbing and wiring. Tenant agrees to cooperate in good faith to determine whether Developer, the Association, or Land Condominium Association will repair components that will otherwise be the responsibility of Tenant and in such case Tenant shall allow Developer, the Association, or Land Condominium Association, as the case may be, to make such repairs. Before Tenant commences any such work necessary to repair or replace any damage or destruction caused by Tenant or any of its employees, guests, occupants, customers, agents, licensees or invitees (or at any time thereafter), either Developer, the Association, or Land Condominium Association, as applicable, may require Tenant to furnish to it such security, in form (including, without limitation, a bond issued by a corporate surety licensed to do business in the state in which the Property is situated) and in such amount as either Developer, the Association, or Land Condominium Association, as applicable, shall deem necessary to assure the payment for such work by Tenant. Tenant shall be liable for the special assessment or charges for such work, and if Developer, the Association, or Land Condominium Association bills or charges Landlord for such work, Tenant agrees to pay Landlord, as Additional Rent, within thirty (30) days of Landlord’s delivery of written demand therefore to Tenant. If Developer, the Association, or Land Condominium Association declines responsibility for a repair, and in all cases in which the repair is the responsibility of Tenant, then such maintenance and repair work must be performed by Tenant in conformity with the applicable Condominium or Property standards or Rules and Regulations. Tenant shall seek and obtain the prior approval of Landlord, and if required by the Declaration, Master Declaration, or Rules or Regulations, or any rules or requirements of the Architectural Review Committee of the Association (the "
ARC
"), the ARC, for the repair, maintenance or replacement work, except that Landlord’s consent shall not be required if the work does not require a building permit and it is minor or routine work that will be accomplished by Tenant for a charge of $10,000.00 or less.
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7.3
|
Right of Entry
. Tenant acknowledges that Developer, the Association, and Land Condominium Association have, pursuant to, and as provided in, the Declaration, Master Declaration, and Rules and Regulations, reserved easements for the benefit of the Developer and/or the Association, the Land Condominium Association, or their designees, to have access to the Leased Premises to perform their repair, maintenance and other obligations. The rights of Developer, the Association, and Land Condominium Association set forth in this
Section 7.3
are in addition to and do no supplant or in any way diminish the rights of Landlord set forth in
Section 5.5
, and the rights of Landlord are in addition to and do no supplant or in any way diminish the rights of Developer, the Association, and Land Condominium Association set forth in this
Section 7.3
.
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7.4
|
By Tenant
. Tenant shall be responsible, at Tenant’s sole cost and expense, for (i) contracting for and providing any and all janitorial services to the Leased Premises, and (ii) making any improvements, replacements or repairs of any kind or character to the Leased Premises during the Lease Term, including but limited to maintaining and repairing the improvements, other than any systems or equipment for providing services or utilities to the Lease Premises, made to the Leased Premises by Tenant or on Tenant’s behalf.
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8.1
|
Construction
. Except as expressly provided in this Lease, or in the Leasehold Improvements Agreement (if any), Tenant acknowledges and agrees that Landlord has not undertaken to perform any modification, alteration or improvement to the Leased Premises, and Tenant further waives any defect in the Leased Premises and acknowledges and accepts, as of thirty (30) days after Tenant’s execution of the Acceptance of Leased Premises referred to herein below, (i) the Leased Premises as suitable for the purpose for which they are leased in its "AS-IS, WHERE-IS" condition and (ii) the Condominium and the Property, and every part and appurtenance thereof, as being in good and satisfactory condition. In addition, Tenant shall be subject to any disclaimers with regard to adequacy, quality and fitness of the construction of the Condominium, the Leased Premises, and other improvements to or on the Property by Developer as set forth in the Declaration or Master Declaration (the “
Construction Warranties
”). Any such disclaimer of warranties flows through and is binding upon Tenant and Tenant does hereby waive all claims against Landlord, Developer, the Association, and the Land Condominium Association that Tenant may at any time have with respect to the Construction Warranties. Upon the request of Landlord, Tenant shall deliver to Landlord a completed Acceptance of Leased Premises in Landlord's prescribed form as set forth in
Exhibit "G"
attached hereto and incorporated herein by reference. Tenant has the right to inspect prior to acceptance of the leased premises.
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8.2
|
A. Tenant Improvements
. Tenant shall not make or allow to be made any alterations, physical additions or improvements in or to the Leased Premises without obtaining the prior written consent of Landlord and such other parties as may be required by the Declaration or Master Declaration, which consents may be withheld in the sole and absolute discretion of Landlord and such other parties as may be required by the Declaration or Master Declaration. To the extent Tenant proposes to undertake any alterations, additions or improvements to the Leased Premises following Tenant's acceptance of the Leased Premises, Tenant shall furnish complete plans and specifications for any proposed alteration, addition or improvement for review and approval by Landlord and Developer. All improvements by Tenant must be pursuant to final architectural plans that are approved by the ARC. Until such time as the ARC is in effect, the improvements by Tenant must be approved by Developer. Tenant is responsible to employ and pay a qualified architect or engineer to design improvements, including any graphic package and signage, to the requirements of the ARC.
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8.3
|
8
.2 B Improvements to Premises. Landlord shall provide turn-key improvements to Premises according to Exhibit D. Tenant Improvements shall be completed on or before May 1, 2013.
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8.4
|
Ownership of Improvements
. Any alterations, physical additions or improvements to the Leased Premises made by or installed by Landlord or Tenant shall remain upon, and be surrendered with, the Leased Premises and become the property of Landlord upon the expiration or earlier termination of this Lease without credit to Tenant;
provided, however
, Landlord, at its option, may require Tenant to remove any physical improvements or additions and/or repair any alterations in order to restore the Leased Premises to substantially the same condition existing at the time Tenant took possession, reasonable wear and tear excepted, all costs of removal and/or alterations to be borne by Tenant. Notwithstanding the foregoing, Tenant shall not be required to remove from the Premises any improvements made pursuant to the Leasehold Improvement Plan. This clause shall not apply to moveable equipment, furniture or moveable trade fixtures owned by Tenant, which may be removed by Tenant at the end of the Lease Term if Tenant is not then in default and if such equipment and furniture are not then subject to any other rights, liens and interests of Landlord. Tenant shall have no authority or power, express or implied, to create or cause any mechanic's or materialmen's lien, charge or encumbrance of any kind against the Leased Premises, the Property or any portion thereof and the interest of Landlord shall not be subject to liens for improvements made by Tenant. Tenant shall promptly cause any such liens that have arisen by reason or any work claimed to have been undertaken by or through Tenant to be released by payment, bonding or otherwise within thirty (30) days after Tenant’s receipt of notice regarding such lien (failing which Tenant will automatically be in default under this Lease), and Tenant shall indemnify Landlord and the Association against losses arising out of any such claim (including, without limitation, legal fees and court costs). Without waiving Tenant’s default, Landlord, in addition to all other available rights and remedies, without further notice or opportunity for Tenant to cure, may discharge the same of record by payment, bonding or otherwise, as Landlord may elect, and upon request Tenant will reimburse Landlord for all costs and expenses so incurred by Landlord plus interest thereon at the highest rate allowed by law from the date of such expenditure through the date such amounts are paid in full.
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9.1
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Casualty
. Tenant shall give Landlord immediate notice of any change or destruction to the Leased Premises by fire or other casualty. Following such damage or destruction to the Leased Premises, at Landlord's sole option, either (i) this Lease shall terminate, and, in such case, the Rent shall be abated for the unexpired portion of the Lease, effective as of the date of the written notification, or (ii) this Lease shall not terminate, and Landlord shall proceed with reasonable diligence to rebuild or repair the Leased Premises to substantially the same condition in which they existed prior to the damage or destruction. Landlord agrees to provide Tenant written notice of its decision within sixty (60) days of Tenant's notice. If the Leased Premises are to be rebuilt or repaired and are untenantable in whole or in part following the damage or destruction, and the damage or destruction was not caused or contributed to by act or negligence of Tenant, its agents, employees, licensees or invitees or those for whom Tenant is responsible, the Base Rent payable under this Lease during the period for which the Leased Premises are untenantable shall be reduced to an amount determined by multiplying the sum of the Base Rent and the Additional Rent that would otherwise be payable but for this provision, by the ratio that the portion of the Leased Premises not rendered untenantable bears to the total net rentable area of the Leased Premises prior to the casualty. Landlord's obligation to rebuild or restore under this
Section 9.1
shall be limited to restoring the Leased Premises to substantially the condition in which the same existed prior to the casualty, exclusive of improvements for which Tenant is responsible under the terms of the Leasehold Improvements Agreement, if any, and Tenant shall, promptly, after the completion of such work by Landlord, proceed with reasonable diligence and at Tenant's sole cost and expense to restore those improvements for which Tenant is responsible under the terms of such Leasehold Improvements Agreement to substantially the condition in which the same existed prior to the casualty and to otherwise make the Leased Premises suitable for Tenant's use. If Landlord fails to substantially complete the necessary repairs or rebuilding within ninety (90) working days from the date that Landlord receives all necessary approvals and permits to repair and restore (subject to extension due to an Act of God or Force Majeure), Tenant may at its option, terminate this Lease by delivering written notice of termination to Landlord, whereupon all rights and obligations under this Lease shall cease to exist. For purposes of this Lease, a "working" day means every week day, except for federal holidays. Tenant agrees that in the event Landlord is obligated to repair pursuant to this
Section 9.1
, the Association may undertake a part of or all of the necessary repairs for which Landlord might otherwise be obligated. Nothing herein requires Landlord or the Association to make repairs in the event of damage, destruction or loss if any other provision of this
Section 9.1
gives to Landlord the right or option in its discretion to either decline to make the repairs or the right to decline responsibility for the cost of the repairs.
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9.2
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Condemnation
. If all or a portion of the Leased Premises shall be taken for any public or quasi-public use under any governmental law, ordinance or regulation, or by right of eminent domain or by purchase in lieu thereof, this Lease shall at Landlord’s sole option either (i) terminate and the Rent shall be abated during the unexpired portion of this Lease effective on the date physical possession is taken by the condemnation authority, or (ii) this Lease shall not terminate and Landlord shall restore and reconstruct, to the extent of condemnation proceeds (excluding any proceeds for land) actually received after the exercise by any mortgagee of the Property of an option to apply such proceeds against Landlord's debt to such mortgagee, the Property and other improvements on the Leased Premises to the extent necessary to make it reasonably tenantable. The Base Rent payable under this Lease during the unexpired portion of the term shall be reduced to an amount determined by multiplying the Base Rent that would otherwise be payable for this provision by the ratio that the portion of the Leased Premises not rendered untenantable bears to the total net rentable area of the Leased Premises prior to the casualty. If Landlord fails to substantially complete such restoration and reconstruction within one hundred and twenty (120) working days of the date of physical possession by the condemning authority work (subject to extension due to Act of God or Force Majeure), Tenant may at its option terminate this Lease by delivering written notice of termination to Landlord, whereupon all rights and obligations of this Lease shall cease to exist. All compensation awarded for any taking (or the proceeds of private sale in lieu thereof), whether for the whole or a part of the Leased Premises, shall be the property of Landlord (whether such award is compensation for damaged to Landlord's or Tenant's interest in the Leased Premises), and Tenant hereby assigns all of its interest in any such award to Landlord; provided, however, Landlord shall have no interest in any award made to Tenant for loss of business or for taking of Tenant's fixtures and other property within the Leased Premises if a separate award for such items is made to Tenant.
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10.1
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Property Insurance
.
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(a)
|
By Landlord
. Landlord may maintain such insurance covering the Leased Premises as Landlord shall desire from time to time in its sole and absolute discretion. Insurance for the structure is covered by the Association. If Association fails to maintain insurance on Leased Premises, Landlord will be responsible for maintaining such insurance on Leased Premises. Tenant shall have no right in or claim to the proceeds of any policy of insurance maintained by Landlord. Landlord shall not be obligated in any way or manner to insure any personal property (including, but not limited to, any furniture, machinery, goods or supplies) of Tenant upon or within the Leased Premises, any fixtures installed or paid for by Tenant upon or within the Leased Premises, or any improvements which Tenant may construct on the Leased Premises.
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(b)
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By Tenant
. Tenant at all times during the Lease Term shall, at its own expense, keep in full force and effect insurance against fire and such other risks as are from time to time included in standard all-risk insurance (including coverage against vandalism and malicious mischief) for the full insurable value of (i) all improvements made to the Leased Premises from time to time, including, but not limited to the improvements made pursuant to the Leasehold Improvements Agreement or by Tenant or on Tenant’s behalf, and (ii) Tenant's trade fixtures, furniture, supplies and all items of personal property of Tenant located on or within the Leased Premises. In the event that Tenant fails to maintain insurance coverage as required herein or if Landlord reasonably believes that failure to maintain required coverage is imminent, Landlord shall have the right, but not the obligation, to obtain such coverage without notice to Tenant and charge Tenant for all expenses related thereto. Tenant shall not do or permit to be done any act or thing as a result of which either (i) any policy of insurance of any kind covering any or all of the Leased Premises or any liability of Landlord in connection therewith, may become void or suspended, or (ii) the insurance risk under any such policy would (in the opinion of the insurer thereunder) be made greater than that which exists on the Commencement Date. If an increase in any insurance premiums paid by Landlord for the Leased Premises or by the Association or Land Condominium Association for the Common Elements, as applicable, is caused by Tenant's use of the Leased Premises in a manner other than as set forth in
Section 2.7
, or if Tenant vacates the Leased Premises and causes an increase in such premiums (and said vacating is deemed a default hereunder), or Landlord incurs any expenses on behalf of Tenant in regard to providing insurance coverage as set forth herein, Tenant shall immediately cease such use of the Leased Premises and pay to Landlord within ten (10) days after receipt of Landlord's invoice therefor, an amount equal to the increase caused by such action, which shall be deemed Additional Rent hereunder.
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10.2
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Waiver of Subrogation
. Notwithstanding anything to the contrary contained herein, Landlord and Tenant hereby waive and release each other from any and all right of recovery, claim, action or cause of action, against each other, their agents, officers and employees, for any loss, damage or destruction that may occur to the Leased Premises, improvements to the Leased Premises, or personal property within the Leased Premises, by reason of fire or the elements, regardless of cause or origin, including negligence of Landlord or Tenant and their agents, officers and employees, but only to the extent that such loss, damage or destruction is actually covered by insurance and only to the extent that the insured party has received insurance proceeds therefor. Landlord and Tenant agree immediately to give their respective insurance companies which have issued policies of insurance covering all risk of direct physical loss, written notice of the terms of the mutual waivers contained in this
Section 10.2
, and to have the insurance policies properly endorsed, if necessary, to prevent the invalidation of the insurance coverages by reason of the mutual waivers.
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10.3
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Hold Harmless
. Other than death or injury to persons or damage or destruction to property resulting from the negligence or willful misconduct of Landlord or its agents and employees, Landlord shall not be liable to Tenant or to any of Tenant's agents, employees, licensees, invitees and visitors, or to any other person whomsoever, for any claims, losses, demands, causes of action, liability, judgments. damages, costs or expenses arising out of or connected with the death or injury to person or damage or destruction to property on or about the Leased Premises, the Common Elements, or the Property, including but not limited to, consequential damages, (i) caused by any act or omission of Tenant, its employees, subtenants, licensees and concessionaires or of any other person entering the Leased Premises, the Common Elements, or the Property by express or implied invitation of Tenant, or (ii) arising out of the use of the Leased Premises, the Common Elements, or the Property by Tenant, its employees, subtenants, licensees, concessionaires or invitees, or (iii) arising out of any default by Tenant in the performance of its obligations hereunder, or (iv) caused by the improvements located in the Leased Premises becoming out of repair or by defect in or failure of equipment, pipes, or wiring, or by broken glass, or by the backing up of drains, or by gas, water, steam, electricity or oil leaking, escaping or flowing into the Leased Premises, the Common Elements, or the Property, or (v) arising out of the failure or cessation of any service provided by Landlord (including security service and devices), and Tenant hereby agrees to hold harmless Landlord from any liability, loss, expense or claim (including, but not limited to reasonable attorneys' fees) arising out of such damage or destruction to property or death or injury to persons. Landlord shall not be liable to Tenant for any loss, damage or destruction that may be occasioned by or through the acts or omissions of owners or other tenants of the Property or of any other persons whomsoever, excepting only duly authorized employees and agents of Landlord acting within the scope of their authority. Further, Tenant specifically agrees to be responsible for and hold harmless Landlord from any and all damages or expenses of whatever kind arising out of or caused by a burglary, theft, vandalism, malicious mischief or other illegal acts performed in, at, or from the Leased Premises, except if such damage or expense is caused by Landlord or is a result of a failure by Landlord to perform its duties under this Lease.
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10.4
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Liability Insurance
. Tenant shall at its expense obtain and keep in force during the Lease Term comprehensive general liability insurance with a combined single limit of not less than $1,000,000.00 per occurrence for death and bodily injury and property damage or destruction, insuring both Landlord and Tenant against liability arising out of Tenant's use or occupancy of the Leased Premises or the Property, including without limitation the Common Elements and any other areas appurtenant thereto. Such insurance shall contain endorsements for the following coverages: (i) contractual liability (other than Rent) insurance relating to all obligations of Tenant pursuant to this Lease, including Tenant’s indemnification of Landlord; and (ii) employee liability.
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10.5
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Insurance Requirements
. All insurance policies or duly executed certificates for the same required to be carried by Tenant under this Lease, together with satisfactory evidence of the payment of the premium thereof, shall be deposited with Landlord on the date Tenant first occupies the Leased premises and upon renewals of such policies not less than fifteen (15) days prior to the expiration of the term of such coverage. Notwithstanding the foregoing, in the event Tenant delivers certificates of insurance to Landlord, Tenant shall be required to provide Landlord with copies of insurance policies within ten (10) days of a written request therefore by Landlord. All insurance required to be carried by Tenant under this Lease shall be in form and content, and written by insurers acceptable to Landlord, in its reasonable discretion, with an A.M. Best Rating of at least A-VII and both Landlord and the Association shall be named as additional insured or loss payee, as applicable. All policies shall provide that they may not be terminated without thirty (30) days' prior written notice to Landlord. If Tenant shall fail to comply with any of the requirements contained relating to insurance, Landlord may obtain such insurance and Tenant shall pay to Landlord, on demand as Additional Rent hereunder, the premium cost thereof.
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10.6
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Hazardous Material
. Throughout the Lease Term, Tenant shall prevent the presence, use, generation, release, discharge, storage, disposal or transportation of any Hazardous Materials (as hereinafter defined) on, under, in, above, to or from the Leased Premises other than in strict compliance with all applicable federal, state, and local laws, rules, regulations, and orders For purposes hereunder, the term "
Hazardous Materials
" shall mean and refer to any wastes, materials, or other substances of any kind or character that are or become regulated as hazardous or toxic waste or substances, or which require special handling or treatment, under any applicable local, state, or federal law, rule, regulation, or order. Tenant shall indemnify, defend and hold harmless Landlord, Developer, the Association, and the Land Condominium Association from and against (i) any loss, cost, expense, claim or liability arising out of any investigation, monitoring, clean-up, containment, removal, storage or restoration work of the Leased Premises ("
Remedial Work
") required by, or incurred by Landlord, the Association, the Land Condominium Association, or any other person or party in a reasonable belief that such Remedial Work is required by any applicable federal, state or local law, rule, regulation or order, or by an governmental agency, authority, political subdivision having jurisdiction over the Leased Premises, and (ii) any claims of third parties for loss, injury, expense or damage arising out of the presence, release or discharge of any Hazardous Materials on, under, in, above, to or from the Leased Premises and which arise out of the activities of Tenant. In the event any Remedial Work is so required under any applicable federal, state or local law, rule, regulation or order, Tenant shall promptly perform or cause to be performed such Remedial Work in compliance with such law, rule, regulation or order. In the event Tenant shall fail to commence the Remedial Work in a timely fashion, or shall fail to prosecute diligently the Remedial Work to completion, such failure shall constitute an Event of Default on the part of Tenant under the terms of this Lease, and Landlord or the Association, in addition to any other rights or remedies afforded it hereunder, may, but shall not be obligated to, cause Remedial Work to be performed, and Tenant shall promptly reimburse Landlord, the Association, or Land Condominium Association, as applicable, for the cost and expense thereof upon demand.
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11.1
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Assignment/Sublease by Tenant
. Tenant shall not assign, in whole or in part, this Lease, or allow it to be assigned, in whole or in part, by operation of law or otherwise or mortgage or pledge the same, or sublet the Leased Premises, in whole or in part, without the prior written consent of Landlord, which consent may not unreasonably withheld, conditioned or delayed, and in no event shall any such assignment or sublease ever release Tenant or any Guarantor from any obligation or liability hereunder. No assignee or sublessee of the Leased Premises or any portion thereof may assign or sublet the Leased Premises or any portion thereof. Notwithstanding the foregoing, Tenant may, without Landlord's approval but with written notice to Landlord, assign or sublet the Lease Premises or any part thereof, to any successor of Tenant resulting from a merger, consolidation, sale or acquisition of Tenant, or to any entity that owns Tenant or is under common ownership with Tenant. Consent by Landlord to one or more assignments or sublettings shall not operate as a waiver of Landlord's rights as to any subsequent assignments and subletting.
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11.2
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Assignment by Landlord
. Landlord shall have the right to sell, transfer or assign, in whole or in part, its rights and obligations under this Lease. Any such sale, transfer or assignment shall operate to release Landlord from any and all liabilities under this Lease arising after the date of such sale, assignment or transfer, and Landlord’s successor in interest shall become the new Landlord hereunder and responsible to Tenant for all obligations of Landlord, and Tenant shall attorn to such successor in interest and recognize such successor in interest as the Landlord under this Lease
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11.3
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Default and Collection
. If any Event of Default should occur while the Leased Premises or any part thereof are then assigned or sublet, and said Event of Default remains uncured following ten (10) business days, for monetary defaults, or fifteen (15) business days, for non-monetary defaults, written notice to cure from Landlord to Tenant, Landlord, in addition to any other remedies herein provided or provided by law, may at its option collect directly from such assignee or subtenant all rents becoming due to Tenant under such assignment or sublease, and apply such Rent against any sums due to Landlord by Tenant hereunder, and Tenant hereby directs any such assignee or subtenant to make such payments of Rent directly to Landlord upon receipt of notice from Landlord. No direct collection by Landlord from any such assignee or subtenant shall be construed to constitute a novation or a release of Tenant or any guarantor of Tenant from the further performance of its obligations hereunder. Receipt by Landlord of Rent from any assignee, subtenant or occupant of the Leased Premises shall not be deemed a waiver of the covenant contained in this Lease against assignment and subletting or a release of Tenant from any obligation under this Lease. The receipt by Landlord to any such assignee or subtenant obligated to make payments of Rent shall be a full and complete release, discharge and acquittance to such assignee or subtenant to the extent of any such amount of Rent so paid to Landlord. Landlord is authorized and empowered, on behalf of Tenant, to endorse the name of Tenant upon any check, draft or other instrument payable to Tenant evidencing payment of Rent, or any part thereof, and to apply the proceeds therefrom in accordance with the terms hereof. Tenant shall not mortgage, pledge, or otherwise encumber its interest in this Lease or in the Leased Premises. Any attempted assignment or sublease or encumbrance by Tenant in violation of the terms and covenants of this
Section 11.3
shall be void and constitute an Event of Default under this Lease.
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11.4
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Rights of Mortgagee, Estoppel Letters
. Tenant accepts this Lease subject and subordinate to any recorded lease, mortgage or deed of trust lien presently existing, if any, or hereafter encumbering the Property and to all existing ordinances and recorded restrictions, covenants, easements and agreements with respect to the Property. So long as any requested documentation to confirm the subordination of Tenant’s interest under this Lease to any mortgage or deed of trust lien hereafter placed on the Property is delivered to Tenant and Tenant has not executed or provided reasonable written objection to same within ten (10) days of Tenant’s receipt of same, Landlord hereby is irrevocably vested with full power and authority to subordinate Tenant's interest under this Lease to any mortgage or deed of trust lien hereafter placed on the Property. Upon any foreclosure of any such mortgage, or the sale or conveyance of the Property in lieu of foreclosure, or any other transfer of Landlord's interest in the Property, whether or not in connection with a mortgage, Tenant hereby does and hereafter agrees to attorn to the purchaser at such foreclosure sale or to the grantee under any deed in lieu of foreclosure or to any other transferee of Landlord's interest, and shall recognize the purchaser, grantee, or other transferee as Landlord under this Lease, and no further attornment or other agreement shall be required to effect or evidence Tenant's attornment to and recognition of such purchaser or grantee as Landlord hereunder. Such agreement of Tenant to attorn shall survive any such foreclosure sale, trustee's sale, conveyance in lieu thereof, or any other transfer of Landlord's interest in the Property. Tenant, upon written request, and provided the same shall be in form reasonably satisfactory to Tenant at any time, before or after any such foreclosure sale, trustee's sale, conveyance in lieu thereof, or other transfer shall execute, acknowledge and deliver to prospective transferee or mortgagee a Subordination, Nondisturbance and Attornment Agreement and any additional written instruments and certificates evidencing such attornment as mortgagee or other prospective transferee may reasonably require. So long as any such instruments and certificates are delivered to Tenant and Tenant has not executed or provided reasonable written objection to the same within ten (10) days of Tenant’s receipt of the same, Tenant hereby appoints Landlord as Tenant's agent and attorney-in-fact for the purpose of executing, acknowledging and delivering any such instruments and certificates. Notwithstanding anything to the contrary contained in this
Section 11.4
, any mortgagee under any mortgage shall have the right at any time to subordinate any such mortgage to this Lease on such terms and subject to such conditions as mortgagee in its discretion may consider appropriate. Tenant agrees to furnish, from time to time, within twenty (20) days after receipt of a written request from Landlord or Landlord's mortgagee, (i) a statement certifying, if applicable and true, all or some of the following: Tenant is in possession of Leased Premises; this Lease is in full force and effect; this Lease is unmodified (except as disclosed in such statement); Tenant claims no present charge, lien or claim of offset against Rent (except as disclosed in such statement); the Rent is paid for the current month, but is not prepaid for more than one (1) month and will not be prepaid for more than one (1) month in advance; there is no existing Landlord default by reason of some act or omission by Landlord (except as disclosed in such statement); Landlord has performed all inducements required of Landlord in connection with this Lease, including construction obligations, and Tenant accepts the Leased Premises as constructed (except as disclosed in such statement); and (ii) an acknowledgment of the assignment of Rent and other sums due hereunder to the mortgagee and agreement to be bound thereby, (iii) an agreement requiring Tenant to advise the mortgagee of damage to or destruction of the Leased Premises by fire or other casualty requiring reconstruction, (iv) an agreement by Tenant to give the mortgagee written notice of Landlord's Default hereunder and to permit the mortgagee to cure such default within a reasonable time after such notice before exercising any remedy Tenant might possess as result of such default, and (v) such other matters as may be reasonably required by Landlord or Landlord's mortgagee. Tenant's failure to deliver such statement, in addition to being a default under this Lease shall be deemed to establish conclusively that this Lease is in full force and effect except as declared by Landlord, that Landlord is not in default of any of its obligations under this Lease, and that Landlord has not received more than one (1) month's Rent in advance.
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12.1
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Default by Tenant
. The following shall be deemed to be events of default by Tenant under this Lease (an “
Event of Default
”):
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(a)
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Tenant shall fail to pay when due any installment of Rent or any other payment required pursuant to this Lease and fails to cure such failure after 5-days written notice;
provided, however
, that for each calendar year during which Landlord has already given Tenant two (2) written notices of the failure to pay an installment of Rent or other required payment under this Lease, no further notice shall be required (i.e., the Event of Default shall automatically occur on the fifth (5
th
) day after the day upon which the Rent or other payment was due);
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(b)
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Tenant shall abandon the Leased Premises;
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(c)
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Tenant or any guarantor of Tenant's obligations hereunder shall file a petition or be adjudged bankrupt or insolvent under any applicable federal or state bankruptcy or insolvency law or admit that it cannot meet its financial obligations as they become due, or a receiver or trustee shall be appointed for all or substantially all of the assets of Tenant or any guarantor of Tenant's obligations hereunder and the same shall not be discharged or dismissed within sixty (60) days;
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(d)
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Tenant or any guarantor of Tenant's obligations hereunder shall make a transfer in fraud of creditors or shall make an assignment for the benefit of creditors;
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(e)
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Tenant shall do or permit to be done any act which results in a lien being filed against the Leased Premises or the property, and such lien is not released or bonded within thirty (30) days of Tenant’s receipt of notice of such lien;
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(f)
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the liquidation, termination, dissolution or (if Tenant is a natural person) the death of Tenant or any guarantor of Tenant's obligations hereunder; or
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(g)
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Tenant shall be in default of any other term, provision or covenant of this Lease, and, other than specified in clause (i) above, such default is not cured within thirty (30) days after written notice thereof to Tenant.
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12.2
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Remedies for Tenant's Default.
Upon the occurrence of any Event of Default set forth in this Lease, Landlord shall, in addition to any other rights or remedies available to Landlord under this Lease and under the laws of the State of Florida, have the option to pursue any one or more of the remedies set forth in this
Section 13.2
without any additional notice or demand:
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(a)
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With respect to an Event of Default based on failure to pay Rent, Landlord may elect to declare the entire Rent for the balance of the Lease Term, or any part thereof, due and payable immediately, which if paid shall be discounted to then present value using a discount rate of eight percent (8%).
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(b)
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Landlord may elect, at any time subsequent to such Event of Default, by written notice to Tenant, to terminate this Lease on the date specified in such notice of termination, provided Tenant has not cured the Event of Default, and Tenant shall surrender the Leased Premises to Landlord as if the Lease Term ended by the expiration of the time fixed herein, but Tenant shall remain liable as hereinafter provided;
provided
,
however
, whether or not Landlord shall elect to terminate this Lease, Landlord shall have the immediate right to re-enter the Leased Premises and may remove all persons and property from the Leased Premises and such property may be removed and stored in a public warehouse or elsewhere at the cost of, and for the account of Tenant, and Landlord shall not be deemed guilty of trespass, or become liable for any loss or damage which may be occasioned thereby.
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(c)
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Landlord may retake possession of the Leased Premises for the account of Tenant and may re-enter the Leased Premises, by summary proceedings or otherwise, and, using its best efforts, attempt to relet the Leased Premises, or any part thereof, as Tenant's agent, in the name of Landlord, or otherwise to any tenant and upon such terms and conditions and for any use or purpose and for a term shorter or longer than the balance of the Lease Term, all as Landlord may deem appropriate. Should Landlord elect to re-enter or should it take possession pursuant to legal proceedings or pursuant to any notice provided for by law, it may make such alterations and repairs as may be necessary in order to relet the Leased Premises or any part thereof. Upon each such reletting, all rent received by Landlord from such reletting shall be applied, first, to the payment of any indebtedness, other than Rent due hereunder, from Tenant to Landlord; second to the payment of any reasonable costs and expenses of such reletting including brokerage fees and to costs of such alterations and repairs; third, to the payment of Rent due and unpaid hereunder, the residue, if any, shall be held by Landlord and applied in payment of future Rent as the same may become due and payable hereunder. If such rent received from such reletting during any month be less than that to be paid during that month by Tenant as set forth herein, Tenant shall pay any such deficiency to Landlord. Such deficiency shall be calculated and paid monthly, but to the extent permitted by law, Tenant shall not be entitled to any surpluses from such reletting. Landlord shall recover from Tenant all damages it may incur by reason of Tenant's default, including the reasonable cost of recovering the Leased Premises and, including charges equivalent to Rent reserved in this Lease for the remainder of the Lease Term, all of which amounts shall be immediately due and payable from Tenant to Landlord. In computing the net amount of rents collected through such reletting, Landlord may deduct all reasonable expenses incurred in obtaining possession of and reletting the Leased Premises, including legal expenses, attorneys' fees through the appellate level, brokerage fees, the cost of restoring the Leased Premises to good order, and the cost of all alterations and decorations deemed necessary by Landlord to effect reletting.
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(d)
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Landlord may retake possession of the Leased Premises, or any part thereof, on its own behalf, without thereby relieving Tenant from any liability for damages accruing prior to such retaking. Alternatively, Landlord may elect not to seek to re-enter any portion of the Leased Premises, without waiving its right to do so at any future time or its right to collect the Rent due hereunder as and when the same shall become due and to continue to hold Tenant fully liable for all if its obligations hereunder.
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(e)
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If Tenant is in default, Landlord, in addition to retaking possession, may bring an action immediately for all damages resulting therefrom.
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(f)
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In the event of a breach or threatened breach of any of the covenants or provisions hereof, Landlord shall have the further right to seek an injunction.
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(g)
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Landlord may enforce the provisions of this Lease and may enforce and protect the rights of Landlord hereunder by a suit or suits in equity or at law for specific performance of any covenant or agreement contained herein, or for the enforcement of any other legal or equitable remedy, including recovery of all monies due or to become due from Tenant under any of the provisions of this Lease.
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(h)
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If Landlord exercises any of the remedies provided for in subparagraphs (a) through (f) above, Tenant shall surrender possession and vacate the Leased Premises immediately and deliver possession thereof to Landlord, and Landlord may then or at any time thereafter re-enter and take complete and peaceful possession of the Leased Premises, with or without process of law, full or complete license to do so being hereby granted by Tenant to Landlord, and Landlord may remove all occupants and property therefrom, using such force as may be necessary, without being deemed in any manner guilty of trespass, eviction or forcible entry and detainer and without relinquishing Landlord's right to Rent or any other right given to Landlord hereunder or by operation of law.
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(i)
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Upon an Event of Default resulting from Tenant's failure to pay Base Rent, Additional Rent or any other amount due hereunder, all sums past due shall bear interest at the lesser of twelve percent (12%) per annum or the highest legal rate of interest permitted under the laws of the State of Florida. Neither the accrual nor the payment of such interest shall be deemed to excuse or cure any breach, default or Event of Default hereunder. In the event that any interest paid or charged hereunder shall exceed the maximum legal rate then applicable, such rate so charged by Landlord shall be automatically reduced to the current maximum legal rate of interest, and Landlord shall promptly refund to Tenant the excess amount of interest paid over such maximum legal rate of interest.
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(j)
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The rights, privileges, elections and remedies of Landlord under this Lease shall be cumulative, and Landlord shall have the right to exercise such remedies at any time and from time to time singularly or in combination. No termination of this Lease (whether upon an Event of Default or otherwise) shall be deemed to limit or negate Landlord's rights hereunder to indemnification from Tenant (or Tenant's insurance carriers) for any claim or liability asserted against or imposed upon Landlord, whether before or after the termination of this Lease, which is directly or indirectly based upon death, personal injury, property damage or destruction, or other matters occurring prior to the termination hereof.
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(k)
|
The pursuit by Landlord of any particular remedy, whether specified herein or otherwise, shall, to the extent permitted by law, not preclude Landlord from pursuing any other remedy or remedies available to it at law in equity, all of which shall be deemed to be cumulative. If Landlord's re-entry is the result of Tenant's bankruptcy, insolvency or reorganization, Landlord shall recover as its full and only damage award and as liquidated damages, in addition to accrued Rent and other charges, the full Rent for the maximum period allowed by any act relating to bankruptcy, insolvency or reorganization. If Tenant abandons or vacates the Leased Premises, or if Landlord re-enters the Leased Premises pursuant to court order, any property left in the Leased Premises by Tenant shall be deemed to have been abandoned by Tenant, and Landlord shall have the right to retain or dispose of such property in any manner without any obligation to account therefor to Tenant. Tenant, for itself and for all persons claiming through or under it, hereby waives any and all rights which are or may be conferred upon Tenant by any present or future law to redeem the Leased Premises after a warrant to dispossess shall have been issued or after judgment in an action for ejectment shall have been made and entered. The parties hereby waive trial by jury in an action, proceeding or counterclaim brought by either of the parties hereto against the other or any matters whatsoever arising out of or in any way connected with this Lease, the relationship of Landlord and Tenant, Tenant's use or occupancy of the Leased Premises, and/or claim of injury, death, damage or destruction. In the event of a breach by Tenant of any of the covenants or provisions hereof, Landlord shall have, in addition to any other remedies which it may have, the right to invoke any remedy allowed at law or in equity, including injunctive relief, to enforce Landlord's rights or any of them, as if re-entry and other remedies were not herein provided for.
|
12.3
|
Default by Landlord
. If Landlord defaults in the performance of any term, covenant or condition required to be performed by Landlord under this Lease (a “
Landlord Default
”), Landlord shall have thirty (30) days following the receipt of written notice from Tenant specifying such Landlord Default to cure such Landlord Default;
provided
, if Landlord has commenced actions to cure such Landlord Default within said 30-day period, Landlord shall have all reasonable and necessary additional time to complete such cure. Tenant shall have the right to terminate the Lease in the event Landlord’s default continues beyond 45 days and Tenant is not able to continue customary business operations
|
12.4
|
Remedies for Landlord's Default
. Upon the occurrence of any Landlord Default set forth in this Lease and subsequent failure by Landlord to cure or commence actions to cure as provided in
Section 13.3
, Tenant shall have all rights available to it under applicable Florida law.
|
12.5
|
Reserved
.
|
13.1
|
Waiver
. Failure of Landlord to declare an Event of Default immediately upon its occurrence, or delay in taking any action in connection with an Event of Default, shall not constitute a waiver of the default, but Landlord shall have the right to declare the default at any time and take such action as is lawful or authorized under this Lease. Failure by Landlord to enforce one or more of the remedies provided hereunder or at law upon any Event of Default shall not be deemed or construed to constitute a waiver of the default or of any other violation or breach of any of the terms, provisions and covenants contained in this Lease. Landlord may collect and receive Rent due from tenant without waiving or affecting any rights or remedies that Landlord may have at law or in equity or by virtue of this Lease at the time of such payment. Following Landlord’s declaration to the Tenant in writing of an Event of Default, institution of any action to re-enter the Leased Premises shall not be construed to be an election by Landlord to terminate this Lease.
|
13.2
|
Attorneys' Fees
. If a party hereto defaults in the performance of any of the terms, covenants, agreements or conditions contained in this Lease and places in the hands of an attorney the enforcement of all or any part of this Lease, the collection of any Rent or other sums due or to become due or recovery of the possession of the Leased Premises, the prevailing party agrees to pay the other party's costs of collection, including reasonable attorneys' and paralegals’ fees, whether suit is actually filed or not, and if suit is filed then at all trial and appellate levels, and in bankruptcy.
|
13.3
|
Successors
. This Lease shall be binding upon and inure to the benefit of Landlord and Tenant and their respective heirs, personal representatives, successors and permitted assigns.
|
13.4
|
Interpretations: Severability
. The captions appearing in this Lease are for convenience only and in no way define, limit, construe or describe the scope or intent of any Article, Section, subsection or paragraph. Grammatical changes required to make the provisions of this Lease apply (i) in the plural sense where there is more than one tenant and (ii) to either corporations, associations, partnerships or individuals, males or females, shall in all instances be assumed as though in each case fully expressed. The Laws of the State of Florida shall govern the validity, performance and enforcement of this Lease. This Lease shall not be construed more or less favorably with respect to either party as a consequence of the Lease or various provisions hereof having been drafted by one of the parties hereto. If any provision of this Lease or the application thereof to any person or circumstances shall be invalid or unenforceable to any extent, the remainder of this Lease and the application of such provisions to other persons or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by law. Each covenant and agreement contained in this Lease shall be construed to be a separate and independent covenant and agreement, and the breach of any such covenant or agreement by Landlord shall not discharge or relieve Tenant from Tenant's obligation to perform each and every covenant and agreement of this Lease to be performed by Tenant.
|
13.5
|
Notices
. All Rent and other payments required to be made by Tenant shall be payable to Landlord at the following address: 407 Wekiva Springs Rd., Suite 241, Longwood, Fl 32779, Attn: N C Murthy. All payments required to be made by Landlord to Tenant shall be payable to Tenant at Tenant's address set forth in
Section 1.9
. Any notice or document (other than Rent) required or permitted to be delivered by the terms of this Lease shall be deemed to be delivered (whether or not actually received) when deposited in the United States Mail, postage prepaid, certified mail, return receipt requested, addressed to the parties at the respective addresses set forth in
Section 1.9
(or, in the case of Tenant, at the Leased Premises).
|
13.6
|
Multiple Tenants.
If this Lease is executed by more than one person or entity as "Tenant", each such person or entity shall be jointly and severally liable hereunder. It is expressly understood that (i) any one of the named Tenants shall be empowered to execute any modification, amendment, exhibit, floor plan, or other document referenced herein and bind all of the named signatories thereto and (ii) Landlord shall be entitled to rely on same to the extent as if all of the named signatories had executed same.
|
13.7
|
Landlord's Liability
. If Landlord shall be in default under this Lease and, if as a consequence of such default, Tenant shall recover a money judgment against Landlord, such judgment shall be satisfied only out of the right, title, and interest of Landlord in the Leased Premises, including, without limitation, any income generated thereby, as the same may then be encumbered and neither Landlord nor any person or entity comprising Landlord shall be liable for any deficiency. In no event shall Tenant have the right to levy execution against any property of Landlord nor any person or entity comprising Landlord other than its interest in the Leased Premises as herein expressly provided. In no event shall Landlord have any liability for consequential damages such as, but not limited to, lost profits.
|
13.8
|
Time is of the Essence
. The time of the performance of all of the covenants, conditions and agreements of this Lease is of the essence.
|
13.9
|
Entire Agreement
. It is expressly agreed by Tenant, as a material consideration for the execution of this Lease, that this Lease, with the specific references to extrinsic documents, is the entire agreement of the parties, that there are, and were, no verbal representations, warranties, understandings, stipulations, agreement or promises pertaining to the subject matter of this Lease or of any expressly mentioned extrinsic documents that are not incorporated in writing in this Lease or in such documents.
|
13.10
|
Amendment
. This Lease may not be altered, waived, amended or extended except by an instrument in writing signed by Landlord and Tenant.
|
13.11
|
Limitation of Warranties
. Landlord and Tenant expressly agree that there are and shall be no implied warranties of merchantability, habitability, suitability, fitness for a particular purpose of or of any other kind arising out of this Lease, and there are no warranties which extend beyond those expressly set forth in this Lease. Without limiting the generality of the foregoing, Tenant expressly acknowledges that neither Landlord, Developer, the Association, nor the Land Condominium Association has made any warranties or representations concerning any hazardous substances or other environmental matters affecting any part of the Property, and Landlord hereby expressly disclaims and Tenant waives any express or implied warranties with respect to any such matters.
|
13.12
|
Waiver and Releases
. Tenant shall not have the right to withhold or to offset Rent or to terminate this Lease except as expressly provided herein. Tenant waives and releases any and all statutory liens and offset rights, except as specifically contained herein.
|
13.13
|
Radon Gas Disclosure
. Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from the Orange County, Florida, public health unit.
|
13.14
|
Exhibits, Riders and Addenda
. All exhibits, riders and addenda attached hereto are incorporated herein by reference. Tenant acknowledges that the terms of the agreements set forth in all exhibits, riders and addenda are acceptable to Tenant.
|
13.15
|
Real Estate Broker
. Tenant and Landlord each represent and warrant that neither party nor any of their representatives, employees or agents have dealt with or consulted any real estate broker in connection with the negotiations of or transactions contemplated by this Lease Other than Signature Commercial and CBRE, Inc. Without limiting the effect of the foregoing, Tenant and Landlord agree to indemnify and hold harmless the other against any claim or demand made by any other real estate broker or agents claiming to have dealt or consulted with them or any of their representatives, employees or agents contrary to the foregoing representations and warranty. Any brokerage commissions to Broker are to be paid by Landlord under separate brokerage agreement.
|
13.16
|
Waiver of Jury Trial
. LANDLORD AND TENANT HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LEASE OR ANY DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF EITHER PARTY ARISING OUT OF OR RELATED IN ANY MANNER WITH THE LEASED PREMISES (INCLUDING WITHOUT LIMITATION, ANY ACTION TO RESCIND OR CANCEL THIS LEASE OR ANY CLAIMS OR DEFENSES ASSERTING THAT THIS LEASE WAS FRAUDULENTLY INDUCED OR IS OTHERWISE VOID OR VOIDABLE). THIS WAIVER IS A MATERIAL INDUCEMENT FOR LANDLORD AND TENANT TO ENTER AND ACCEPT THIS LEASE.
|
13.17
|
Legal Authority.
If Tenant is a corporation (including any form of professional association), then each individual executing or attesting this Lease on behalf of such corporation covenants, warrants and represents that he is duly authorized to execute or attest and deliver this Lease on behalf of such corporation. If Tenant is a partnership (general or limited) or limited liability company, then each individual executing this Lease on behalf of the partnership or company hereby covenants, warrants and represents that he is duly authorized to execute and deliver this Lease on behalf of the partnership or company in accordance with the partnership agreement or membership agreement, as the case may be, or an amendment thereto, now in effect.
|
|
LANDLORD
:
|
WITNESSES:
|
ACM DT PROPERTIES, LLC.
a Florida limited liability company
|
/s/ Joel Borchadt
Name: Joel Borchadt
/s/ Erik Poole
Name: Erik Poole
|
By:
/s/
Nalluru C. Murthy
Name: Nalluru C. Murthy
Title: Manager
|
WITNESSES: |
TENANT
:
MAZOR ROBOTICS INC.
a
Foreign Profit Corporation
|
/s/ Erik Poole
Name: Erik Poole
|
By:
/s/ Ori Hadomi
Name: Ori Hadomi
Title: CEO
|
/s/ Kelli LaPointe
Name:
Kelli LaPointe
|
1.
|
Base Rent for Initial Lease Term
.
|
Lease Year
|
Rent/ft
|
Square Feet
|
Annually
|
Monthly
|
1
|
$22.00
|
6445
|
$141,790.00
|
$11,815.83
|
2
|
$22.66
|
6445
|
$146,043.70
|
$12,170.31
|
3
|
$23.34
|
6445
|
$150,425.01
|
$12,535.42
|
2.
|
Sales and Use Tax
|
1.
|
Create a VTC tiled storage area by combining four private offices into one larger space as drawn below. One double interior door will be added creating a minimum of four feet across the door threshold at the corner of the renovated space as shown.
|
2.
|
One connecting door will be added between the two offices indicated with stars.
|
1.
|
Each Owner is governed by and is required to comply with the tams of the Condominium Documents and these Condominium Rules and Regulations adopted pursuant to those documents. All terms used in these Condominium Rules and Regulations have the same meaning as the identical terms used in the Declaration of Condominium of The Plaza Noth Tower Commercial Condominium. Failure of an Owner to comply with the provisions of the Condominium Documents and these Condominium Rules and Regulations will entitle the Association or other Owners 'to pursue any and BB legal and equitable remedies for the enforcement of such provisions, including but not limited to an action for damages, an action for injunctive relief or an action for declaratory judgment.
|
2.
|
Use Restrictions. No portion of the Condominium shall be used for any of the purposes listed below:
|
|
a.
|
Flea market;
|
|
b.
|
Swap shop, pawn shop, second hand store, or surplus store;
|
|
c.
|
Massage parlor;
|
|
d.
|
Adult bookstore;
|
|
e.
|
Facility for the sale of paraphernalia for use with illicit drugs;
|
|
f.
|
Funeral parlor or mortuary;
|
|
g.
|
Gambling for money facility or operation;
|
|
h.
|
Dry cleaning plant or laundry plant;
|
|
i.
|
Tattoo parlor; or
|
|
j.
|
Any use that will increase the cost of insurance to the Association on the Condominium Property or Master Property.
|
3.
|
The Parking Unit shall only be used for parking purposes and operation of it commercial parking operation. The Owner of the Parking Unit is entitled, in its sole, absolute and unfettered discretion, to enter into easements for parking spaces within a portion of the Parking Unit with Owners of Units or owners of condominium units within a Unit that has been declared into the condominium form of ownership. The Owner of the Parking Unit is also entitled to subdivide the Parking Unit in accordance with the Declaration. The Owner of the Parking Unit is entitled to enter into leases for parking spaces within the Parking Unit and such leases shall not be subject to the approval of the Association.
|
4.
|
Common elements and Limited Common Elements. The Common Elements and Limited Common Elements may be used only for the purposes for which they are intended in the furnishing of services and facilities for the enjoyment of and use by the Owners or certain Owners with respect to Limited Common Elements, and their occupants, tenants, guests, invitees or lessees.
|
5.
|
Nuisances. No nuisance will be, allowed on the Condominium Property, which interferes with the peaceful possession and proper use of the Condominium Property by the Owners. All parts of the Condominium will be kept in a clean and sanitary condition, and no rubbish, refuse, or garbage will be allowed to accumulate except in the areas of the trash rooms and only for a period of time necessary for trash removal as scheduled by companies engaged for such removal; nor any fire hazard allowed to exist. No clothing, towels, bedding, or other similar items may be dried or aired in any outdoor area or hung over or on balconies.
|
6.
|
No Owner or occupant may make or cause to be made any noises, or use musical instruments, radios, televisions, amplifiers or other such equipment in a manner that may tend to disturb other Owners. Each Owner shall operate, utilize, repair, maintain, and/or replace, or cause to be operated, utilized, repaired, maintained, and/or replaced, all utility and ventilation equipment, machinery, systems, and other related devices, including exhaust systems, fans, and equipment owned by it and serving and related to its respective Unit, whether or not located on or within its Unit, in such a manner that the aforementioned equipment, machinery, systems, and other devices (i) shall not create noise and other disturbance levels that exceed the threshold noise design standards to the Unit was originally acoustically designed and constructed; and (ii) shall not create noise and other disturbance levels that would offend a reasonable person of ordinary sensibilities, taking into account the mixed-use, urban nature of the Master Property. It is expressly contemplated that Commercial Units may be operated as commercial spaces containing stores, theatres, parking facilities, grocery stores, offices, banks, restaurants, entertainment areas, and other public establishments which may have nighttime hours of operation and which may result in noise or light levels in excess of levels typically occurring in areas consisting solely of residential accommodations; nothing in these Condominium Rules and Regulations shall be deemed to prohibit such commercial activity.
|
7.
|
Lawful Use. No immoral, improper, offensive use, or use unlawful under Applicable Law may be made of the Condominium Property.
|
8.
|
Signs. The Developer has reserved the exclusive right to place signs, notices, other displays, or advertising on the exterior of any Improvements constructed on the Common Elements
or within any Unit other than the Nested Parking Spaces Unit or Limited Common Elements appurtenant to the Nested Parking Spaces Unit. This right includes the ability to place, alter, and maintain such signage as desired by the Developer. Except as otherwise provided in herein, no other sign, notice, other display, or advertising may be posted, displayed, maintained, inscribed, painted, or affixed on any part of the Condominium Property or placed on or within any part of a Unit where it is visible from the Common Elements, other Units, or other properties, unless such signs, notices, other displays, or advertising is in compliance with Applicable Law, has been approved in writing by the ARC, and is in conformance with the building standards graphic package and signage guidelines approved by the ARC from time to time. Pursuant to the Master Declaration, Developer has reserved an easement for itself and Tavistock Corporation, during the term of such lease, to place publicly visible naming signage with the name "Tavistock Court" on the signage area described in the Master Declaration.
|
9.
|
Solicitation. No solicitation of any kind, whether commercial, religious, educational, or otherwise, may be conducted anywhere on Common Elements except for the activity permitted to be performed by the Developer or its designees in accordance with its rights under the Declaration and Master Declaration.
|
10.
|
Parking and Storage. Commercial trucks, oversized vehicles, trailers, motorcycles, and bicycles may not be parked on the Condominium Property except (i) in those areas located on the Common Elements, if any, designated by the Board for such purposes, (ii) in those areas within the Parking Unit that are designated by the Parking Unit Owner or its designees in accordance with its rights under the Declaration and Master Declaration, or (iiiy in those areas within the Nested Parking Spaces Unit that are designated by the Owner of the Nested Parking Spaces Unit for such purposes. Except as provided in the first sentence of this paragraph, Owners will only have the right to use, for automobile parking only, parking spaces within the Condominium in accordance with the Declaration and Master Declaration. No boats, jet skis, wave runners, or other watercraft of any kind whatsoever may be used, stored, or brought onto the Condominium Property except within the Parking Unit or Nested Parking Spaces Unit with the prior written consent of the Owner of such Unit. Storage of any items must be on the interior of a Unit. Except as designated by the Board, no items whatsoever may be stored on balconies, patios, or terraces, including bicycles and motor bikes, except customary balcony and patio furniture.
|
11.
|
During the sixty (60) day period after receipt of a certificate of occupancy for the Unit, each Owner shall be permitted to "move in" Owner's personal property into the Owner's Parcel at any time during the day except that such activities shall be prohibited between 5:00 p.m. and 1:00 a.m. Eastern Time. Subsequent to the initial sixty (60) day period, Owners shall be prohibited from such "move in" activities between 7:00 a.m. and 9:00 a.m.; and between 4:00 p.m. and 1:00 a.m. Commercial deliveries shall also be prohibited between 7:00 a.m. and 9:00 a.m.; and between 4:00 p.m. and 1:00 a.m. The "staging" of commercial or moving trucks on "Court Street" is prohibited.
|
12.
|
Pets. Except as permitted under the Master Declaration or required under Applicable Law, no pet may be kept, raised, bred, or maintained on the Condominium Property.
|
13.
|
Antennas and Satellite Dishes. Except as otherwise provided by Applicable Law, no exterior antennas, aerials, satellite dishes, or other apparatus for the transmission or reception of television, radio, satellite, or other signals of any kind may be allowed on the Condominium Property, except (i) as may be provided by the Developer or the Board for the benefit and use of the Condominium; (ii) if such apparatus is completely contained within the Unit so as not to be visible from outside the Unit; or (iii) if such apparatus is otherwise approved by the ARC. No exterior antennas, aerials, satellite dishes, or other apparatus for the transmission or reception of television, radio, satellite, or other signals of any kind may be allowed on balconies. No electrical or electromagnetic signals, machinery, devices, or apparatus of any sort shall be used or maintained which causes interference with any television or radio reception received or broadcast on any other portion of the Condominium Property without the prior written approval of the ARC.
|
14.
|
Barbeque Grills. Barbecue grills are prohibited on the Condominium Property.
|
15.
|
Alteration or Damage. No Owner or guest, invitee, or lessee of such Owner may alter the Common Elements or the exterior of the Units except for permitted alterations made in accordance with the Declaration and Master Declaration. No Owner or guest, invitee, or lessee of such Owner may deface, mar, or otherwise damage any part of the Condominium Property. In the event of non-permitted alteration or damage, the Owner for itself or on behalf of any guests, invitee or licensee of such Owner will be liable for the cost of restoration or repair.
|
16.
|
Evacuation Orders. In the event an emergency evacuation order is made by the appropriate state, county or other governmental authorities, whether voluntary or mandatory, the Association may implement an emergency plan in order to protect all Owners, the Condominium Property and the Association Property. The emergency plan will be communicated to Owners staying at the condominium when implemented and may require that Owners vacate the Condominium Property and find safer alternate accommodations at Owners' sole expense. All Owners, tenants, guests, invitees, and employees must adhere to the Association's emergency plan when implemented.
|
17.
|
Establishment of Unit Declaration and subdivision of Condominium Property. No Owner, other than the Developer, shall create, declare, or establish a Unit Declaration without the prior written consent of the Developer, which consent shall be recorded with the Unit Declaration in the public records of Orange County, Florida. Except as provided in the Declaration, no Owner, or person or entity claiming an interest in the Condominium Property, shall be permitted to subdivide, plat, or subject to the condominium or cooperative form of ownership, any portion of the Condominium' Property, without the prior written approval of the ARC and Developer. Except as otherwise provided herein, the ARC and Developer has the right in their sole, absolute, and unfettered discretion to cause or permit the subdivision, platting, or division of all or any part of the Condominium Property. The Developer is permitted to subdivide, plat or subject any Unit to the condominium or cooperative form of ownership, at any time, in its sole, absolute, and unfettered' discretion, without the approval of any Owner, the Association or the ARC.
|
18.
|
Exterior Improvements. No Owner may cause anything to be affixed or attached to, hung, displayed or placed on the exterior walls, exterior doors, balconies or exterior of any windows of any Unit within the Condominium (including awnings, signs, storm shutters, screens, window tinting, furniture, fixtures and equipment), without the prior written consent of the ARC or except as set forth in Approved Final Plans. Notwithstanding the foregoing, any Owner may display one portable, removable United States flag in a respectful manner.
|
19.
|
Sound and Weight Restrictions. Bard or heavy surface floor coverings, such as tile, marble, wood, and the like will be permitted only in foyers, kitchens and bathrooms or as otherwise installed by the Developer pursuant to the Declaration and Master Declaration. Installations of hard surfaced floor coverings (other than by the Developer) in any other areas (i.e., areas other than foyers, kitchens, and bathrooms) are to receive sound absorbent, less dense floor coverings, such as carpeting, or otherwise must be first approved by the ARC and meet all sound insulation requirements and structural requirements established by the ARC. Further, the installation of any improvement or heavy object must be submitted to and approved by the ARC, and be compatible with the overall structural design of the Condominium. The Board may require a structural engineer to review certain of the proposed improvements, with such review to be at the Owner's sole expense. Additionally, the ARC will have the right to specify the exact material to be used on balconies. The structural integrity of balconies is adversely affected by water intrusion and the water retention qualities of indoor-outdoor carpet, river rock and unglazed ceramic tile and its grout. Therefore, these materials may not be utilized on balconies. Any use guidelines set forth by the Association shall be consistent with good design practices for the waterproofing and overall structural design of the Condominium, Owners will be held strictly liable for violations of these restrictions and for all damages resulting therefrom and the Association has the right to require immediate removal of violations. Applicable warranties of the Developer, if any, shall be voided by violations of these restrictions and requirements. Each Owner, by acceptance of a deed or other conveyance of their Unit, hereby acknowledges and agrees that sound transmission in a mixed unit development such as the Condominium is very difficult to control, and that noises from adjoining or nearby Units and or mechanical equipment can often be heard in another Unit. The Developer does not make any representation or warranty as to the level of sound transmission between and among Units and the other portions of the Condominium Property or Master Property, and each Owner hereby waives and expressly releases any such warranty and claim for loss or damages resulting from sound transmission and understands and agrees that there shall be no required sound insulation under hard surface floor coverings in foyers, kitchens and bathrooms,
|
20.
|
Association Access to Units. In order to facilitate access to Units by the Association for the purposes enumerated in sections 4.1, 7.3, and 12.7 of the Declaration, it will be the responsibility of all Owners to deliver a set of keys (or access card or code, as may be applicable) to their respective Units to the Association to use in the performance of its functions. No Owner may change the locks to his Unit without so notifying the Association and delivering to the Association a new set of keys (or access card or code, as may be applicable) to such Unit.
|
21.
|
Plumbing. Plumbing may not be used for any other purpose than those for which it was constructed, and no sweepings, rubbish, rags or other foreign substances may be deposited into plumbing. The cost of any damage resulting from misuse will be borne by the Owner.
|
22.
|
Roof. With the exception of those areas specifically designated for use by Owners (e.g. Commercial Units), Owners, their invitees, lessees, and guests are not permitted on the roof of any building within the Condominium Property for any purpose (including repairs to air conditioning equipment) without the express approval of the Board or Management Company.
|
23.
|
Complaints. Complaints regarding the service of the Condominium may be made in writing to the Management Company, as long as the Management Contract remains in effect, and if the Management Contract is no longer in effect, to the Board.
|
24.
|
Windows. Doors. Shades, Drapes and Shutters. No change shall be made in the initial color of any exterior window, exterior door, storm or hurricane shutter, glass or screen shutters, or other such covering of the exterior doors and windows shall be made without the approval of the ARC. The exterior face of all window shades, drapes, and shutters shall be white, or such other colors as may be approved by the ARC from time to time.
|
25.
|
Leases. Units may be leased or rented in whole or in part pursuant to the following terms and conditions:
|
|
a.
|
Prior to the rental or lease of any Unit, the Owner shall notify the Board in writing of the name and address of the person to whom the proposed rental or lease is to be made, the terms and conditions thereof, and a fully completed tenant information sheet, as promulgated by the Board from time to time, which tenant information sheet shall include a statement of the tenant's obligation to comply with the Condominium Documents signed by the proposed Tenant, together with a copy of the fully executed rental or lease agreement. Failure to comply with any of these requisites shall be deemed a breach hereof, and any rental or lease in contravention of this section shall be null and void and confer no right, title, or interest to the intended lessee.
|
|
b.
|
Any and all rental and lease agreements must contain a provision stating that the lessee agrees to be bound by the terms and provisions of the Condominium Documents. In the event of any violation of the Condominium Documents by the lessee, the Association shall have the right to fine and the right to evict the lessee and to pursue such other rights and remedies as it may have under the Condominium Documents directly against the lessee. The Owner will be jointly and severally liable with the tenant to the Association for any amount which is required by the Association to repair any damage to the Common Elements resulting from acts or omissions of tenants (as determined in the sole discretion of the Board) and to pay any claim for injury or damage to property caused by the negligence of the tenant and special charge may be levied against the Owner's Unit for such injury or damage. All rentals and leases are made subordinate to any lien riled by the Association, whether, prior or subsequent to such rental or lease.
|
|
c.
|
Leases of shorter duration than one (1) year shall not be permitted.
|
26.
|
Compliance with Rules and Regulations: Disciplinary Actions. Every Owner and occupant shall comply with these Rules and Regulations as set forth herein, any and all rules and regulations which from time to time may be adopted, and the provisions of the Declaration, Bylaws, and Articles of Incorporation, as amended from time to time. Failure of an Owner or occupant to so comply shall be grounds for action which may include, without limitation, an action to recover sums due for damages, injunctive relief, or any combination thereof. In addition to all other remedies, in the sole discretion of the Board, a fine or fines may be imposed upon an Owner for failure of.an Owner, his family, guests, invitees, lessees or employees, to comply with any covenant, restriction, rule or regulation herein or in the Declaration, Articles of Incorporation, or Bylaws, provided the following procedures are adhered to:
|
|
a)
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Notice:. The party against whom the fine is sought to be levied shall be afforded an opportunity for hearing after reasonable notice of not less than fourteen (14) days and said notice shall include (i) a statement of the date, time and place of the hearing; (ii) a statement of the provisions of the Condominium Documents which have allegedly been violated; and (iii) a short and plain statement of the matters asserted by the Association.
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b)
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Hearing: The non-compliance shall be presented to a committee of other Unit Owners, who shall hear reasons why penalties should not be imposed. The party against whom the fine may be levied shall have a reasonable opportunity to respond, to present evidence, and to provide written and oral argument on all issues involved and shall have an opportunity at the hearing to review, challenge, and respond to any material considered by the committee, all in a reasonable manner. A written decision of the committee shall be submitted to the Owner or occupant by not later than twenty-one (21) days after the meeting.
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c)
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Fines: The Board may impose fines against the applicable Unit up to the maximum amount permitted by law from time to time.
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d)
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Violations: Each separate incident which is grounds for a fine shall be the basis of one separate fine. In the case of continuing violations, each continuation of same after a notice thereof is given shall be deemed a separate incident.
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e)
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Payment of Fines: Fines shall be paid not later than thirty (30) days after notice of the imposition thereof.
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f)
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Application of Fines: All monies received from fines shall be allocated as directed by the Board.
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g)
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Non-exclusive Remedy: These fines shall not be construed to be exclusive and shall exist in addition to all other rights and remedies to which the Association may be otherwise legally entitled, however, any penalty paid by the offending Owner or occupant shall be deducted from or offset against any damages which the Association may otherwise be entitled to recover by law from such Owner or occupant.
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LIST OF SUBSIDIARIES
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Company Name
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Jurisdiction of Incorporation
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Mazor Robotics Inc.
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Delaware, United States
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CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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The Board of Directors
Mazor Robotics Ltd.:
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We consent to the use of our report included herein and to the reference to our firm under the heading “Auditors” included herein in Item 1C.
As discussed in Note 2B to the financial statements, the Company determined that in September 2012 its functional currency had changed from New Israel Shekel to the U.S. dollar.
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