As filed with the Securities and Exchange Commission on August 4, 2017

Registration No. 333-            

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM S-8

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

Symantec Corporation

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Delaware   77-0181864

(State or Other Jurisdiction of

Incorporation or Organization)

 

(I.R.S. Employer

Identification No.)

350 Ellis Street

Mountain View, CA 94043

(Address of Principal Executive Offices)

Options to purchase common stock, restricted stock units and performance stock units granted under the

Skycure Ltd. Share Incentive Plan, Skycure Ltd. 2017 Equity Incentive Plan, and Fireglass Inc. 2015 Share Incentive Plan

(Full Title of the Plans)

Scott C. Taylor

Executive Vice President, General Counsel and Secretary

350 Ellis Street

Mountain View, CA 94043

(Name and Address of Agent For Service)

(650) 527-8000

(Telephone Number, Including Area Code, of Agent For Service)

Copy to:

William L. Hughes, Esq.

Douglas N. Cogen, Esq.

Fenwick & West LLP

Silicon Valley Center

801 California Street

Mountain View, California 94041

Telephone: (650) 988-8500

 

 

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer   ☐  (Do not check if a smaller reporting company)    Smaller reporting company  
     Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the e3xtended transition period for complying with any new or revised financing accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of Securities

to be Registered

 

Amount

to be

Registered(1)

 

Proposed

Maximum

Offering Price

per Share(5)

 

Proposed

Maximum

Aggregate

Offering Price

 

Amount of

Registration Fee

Common Stock, par value $0.01 per share

               
To be issued under assumed stock options under Skycure Ltd. Share Incentive Plan   329,775 (2)   $2.21 (5)   $728,802.75   $84.47 (6)
To be issued under assumed restricted stock units and performance stock units under the Skycure Ltd. 2017 Equity Incentive Plan   1,393,234 (3)   $30.88 (7)   $43,023,065.92   $4,986.38 (8)
To be issued under assumed stock options under the Fireglass Ltd. 2015 Share Incentive Plan   392,611 (4)   $2.25 (5)   $883,374.75   $102.39 (6)
To be issued under assumed restricted stock units and performance stock units under the Fireglass Ltd. 2015 Share Incentive Plan   1,736,615 (4)   $30.88 (7)   $53,626,671.20   $6,215.34 (8)

Total

  3,852,235       $98,261,914.62   $11,389.00

 

 

(1)    Pursuant to Rule 416(a), this Registration Statement shall also cover any additional shares of the Registrant’s Common Stock that become issuable in respect of the securities identified in the above table by reason of any stock dividend, stock split, recapitalization or other similar transaction effected without the Registrant’s receipt of consideration which results in an increase in the number of the outstanding shares of the Registrant’s Common Stock.

(2)    Represents Registrant’s shares issuable under stock options granted under the Skycure Ltd. Share Incentive Plan assumed by the Registrant on July 24, 2017 pursuant to a Share Purchase Agreement dated July 10, 2017 among the Registrant, FS Acquisitions Ltd., Skycure Ltd., the executing shareholders and Shareholder Representative Services LLC, as representative (the “ Skycure Purchase Agreement ”).

(3)    Represents Registrant’s shares issuable under restricted stock units and performance stock units granted under the Skycure Ltd. 2017 Equity Incentive Plan and assumed by the Registrant on July 24, 2017 pursuant to the Skycure Purchase Agreement.

(4)    Represents Registrant’s shares issuable under awards granted under the Fireglass Ltd. 2015 Share Incentive Plan assumed by the Registrant on July 24, 2017 pursuant to a Share Purchase Agreement dated June 30, 2017 by and among the Registrant, Fireglass Ltd., FS Acquisitions Ltd., the executing shareholders and Shareholder Representative Services LLC, as representative.

(5)    Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(h) under the Securities Act of 1933 (the “ Act ”), as amended, on the basis of the weighted average exercise price of the assumed options.

(6)    Calculated solely for the purposes of computing the amount of the registration fee pursuant to Rule 457(h) under the Act on the basis of the weighted average exercise price of the outstanding options.

(7)    Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) under the Act on the basis of the average of the high and low prices of the Registrant’s Common Stock reported on the Nasdaq Global Select Market on July 31, 2017.

(8)    Calculated solely for the purposes of computing the amount of the registration fee pursuant to Rule 457(c) under the Act on the basis of the average of the high and low prices of the Registrant’s Common Stock reported on the NASDAQ Global Select Market on July 31, 2017.

 

 

 


PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

 

Item 3. Incorporation of Documents by Reference.

The following documents, which have been filed by Symantec Corporation (the “Registrant”) with the Securities and Exchange Commission (the “Commission”), are hereby incorporated by reference in this Registration Statement:

 

  (a) Registrant’s Annual Report on Form 10-K for the fiscal year ended March 31, 2017, filed with the Commission on May 19, 2017;

 

  (b) All other reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (“Exchange Act”) since the end of the fiscal year covered by the Registrant’s Annual Report referred to in (a) above; and

 

  (c) The description of the Registrant’s Common Stock contained in the Registrant’s Registration Statement on Form 8-A filed with the Commission on May 24, 1989 (including any amendment or report filed for the purpose of updating such description).

All documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the filing of a post-effective amendment to this registration statement which indicates that all securities offered hereby have been sold or which deregisters all securities remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents.

Unless expressly incorporated into this Registration Statement, a report furnished on Form 8-K prior or subsequent to the date hereof shall not be incorporated by reference into this Registration Statement, except as to specific sections of such statements as set forth therein. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained in any subsequently filed document which also is deemed to be incorporated by reference herein modifies or supersedes such statement.

 

Item 4. Description of Securities.

Not applicable.

 

Item 5. Interests of Named Experts and Counsel.

As of the date of this Registration Statement, attorneys of Fenwick & West LLP and family members thereof beneficially own an aggregate of approximately 10,000 shares of the Registrant’s Common Stock.

 

Item 6. Indemnification of Directors and Officers.

Section 145 of the Delaware General Corporation Law (“DGCL”) authorizes a court to award, or a corporation’s board of directors to grant, indemnity to directors and officers in terms sufficiently broad to permit such indemnification under certain circumstances for liabilities (including reimbursement for expenses incurred) arising under the Securities Act of 1933, as amended (the “Securities Act”).

As permitted by Sections 102(b)(7) and 145 of the DGCL, the Registrant’s Amended and Restated Certificate of Incorporation includes a provision that eliminates the personal liability of its directors for monetary damages for breach of fiduciary duty as a director, except for liability:

 

    for any breach of the director’s duty of loyalty to Registrant or its stockholders;

 

    for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of the law;

 

    under Section 174 of the DGCL regarding unlawful dividends and stock purchases; and


    for any transaction from which the director derived an improper personal benefit.

Article 7 of the Registrant’s Amended and Restated Certificate of Incorporation, as amended, limits the liability of directors to the fullest extent permitted by Section 102(b)(7).

As permitted by the DGCL, Registrant’s Bylaws provide that:

 

    the Registrant is required to indemnify its directors and officers to the fullest extent permitted by the DGCL, subject to limited exceptions;

 

    the Registrant is required to advance expenses, as incurred, to its directors and officers in connection with a legal proceeding to the fullest extent permitted by the DGCL, subject to limited exceptions; and

 

    the rights conferred in the Bylaws are not exclusive.

Registrant has entered into indemnity agreements with each of its current directors and officers to give such directors and officers additional contractual assurances regarding the scope of the indemnification set forth in Registrant’s Restated Certificate of Incorporation and Bylaws and to provide additional procedural protections.

Registrant maintains directors’ and officers’ liability insurance and has extended that coverage for public securities matters.

See also the undertakings set out in response to Item 9.

In addition, the Registrant has entered into various merger agreements and registration rights agreements in connection with its acquisitions of and mergers with various companies and its financing activities under which the parties to those agreements have agreed to indemnify the Registrant and its directors, officers, employees and controlling persons against specified liabilities.

 

Item 7. Exemption from Registration Claimed.

Not applicable.

 

Item 8. Exhibits.

 

          Incorporated by Reference     

Exhibit

Number

  

Exhibit Description

   Form    File No.    Exhibit    Filing Date    Filed
Herewith
4.01    Amended and Restated Certificate of Incorporation of Symantec Corporation    S-8    333-119872    4.01    10/21/2004   
4.02    Certificate of Amendment of Amended and Restated Certificate of Incorporation of Symantec Corporation    S-8    333-126403    4.03    07/06/2005   
4.03    Certificate of Amendment of Amended and Restated Certificate of Incorporation of Symantec Corporation    10-Q    000-17781    3.01    08/05/2009   
4.04    Certificate of Designations of Series A Junior Preferred Stock of Symantec Corporation    8-K    000-17781    3.01    06/26/2015   
4.05    Bylaws, as amended, of Symantec Corporation    10-K    000-17781    3.05    05/19/2017   
5.01    Opinion of Fenwick & West LLP                X
23.01    Consent of KPMG LLP, Independent Registered Public Accounting Firm                X
23.02    Consent of Fenwick & West LLP (filed as part of Exhibit 5.01)                X
24.01    Power of Attorney (incorporated by reference to the signature page hereto)                X
99.01    Skycure Ltd. Share Incentive Plan, including forms of awards thereunder                X
99.02    Skycure Ltd. 2017 Equity Incentive Plan, including forms of awards thereunder                X
99.03    Fireglass Ltd. 2015 Share Incentive Plan                X


Item 9. Undertakings.

A. The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement;

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement—notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set for the in the “Calculation of Registration Fee” table in this Registration Statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; provided, however, that paragraphs A(1)(i) and A(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated by reference in this Registration Statement.

(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

B. The undersigned Registrant hereby undertakes that, for purposes of determining liability under the Securities Act, each filing of the Registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is incorporated by reference in this Registration Statement shall be deemed a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

C. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

To effect the above, each of the undersigned has executed this Power of Attorney as of the date indicated beside each name.


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Mountain View, State of California, on August 4, 2017.

 

SYMANTEC CORPORATION
By:  

/s/ Gregory S. Clark

  Gregory S. Clark, Chief Executive Officer and Director

POWER OF ATTORNEY TO SIGN AMENDMENTS

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below (each being an officer and/or director of the Registrant) does hereby constitute and appoint Gregory S. Clark, Nicholas R. Noviello and Scott C. Taylor, and each of them, with full power of substitution, such person’s true and lawful attorneys-in-fact and agents for such person in such person’s name, place and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this Registration Statement on Form S-8 and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises in order to effectuate the same as fully, to all intents and purposes, as such person might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents may lawfully do or cause to be done by virtue hereof. This Power of Attorney may be signed in one or more counterparts.


Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement on Form S-8 has been signed by the following persons in the capacities and on the dates indicated.

 

Signature

  

Capacity

 

Date

/s/ Gregory S. Clark

Gregory S. Clark

   Chief Executive Officer and Director (Principal Executive Officer)   August 4, 2017

/s/ Nicholas R. Noviello

Nicholas R. Noviello

   Executive Vice President and Chief Financial Officer (Principal Financial Officer)   August 4, 2017

/s/ Mark S. Garfield

Mark S. Garfield

   Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)   August 4, 2017

/s/ Daniel H. Schulman

Daniel H. Schulman

   Chairman of the Board   August 4, 2017

/s/ Frank E. Dangeard

Frank E. Dangeard

   Director   August 4, 2017

/s/ Kenneth Y. Hao

Kenneth Y. Hao

   Director   August 4, 2017

/s/ David W. Humphrey

David W. Humphrey

   Director   August 4, 2017

/s/ Geraldine B. Laybourne

Geraldine B. Laybourne

   Director   August 4, 2017

/s/ David L. Mahoney

David L. Mahoney

   Director   August 4, 2017

/s/ Robert S. Miller

Robert S. Miller

   Director   August 4, 2017

/s/ Anita M. Sands

Anita M. Sands

   Director   August 4, 2017

/s/ V. Paul Unruh

V. Paul Unruh

   Director   August 4, 2017

/s/ Suzanne M. Vautrinot

Suzanne M. Vautrinot

   Director   August 4, 2017


Index to Exhibits

 

          Incorporated by Reference     

Exhibit

Number

  

Exhibit Description

   Form    File No.    Exhibit    Filing Date    Filed
Herewith
4.01    Amended and Restated Certificate of Incorporation of Symantec Corporation    S-8    333-119872    4.01    10/21/2004   
4.02    Certificate of Amendment of Amended and Restated Certificate of Incorporation of Symantec Corporation    S-8    333-126403    4.03    07/06/2005   
4.03    Certificate of Amendment of Amended and Restated Certificate of Incorporation of Symantec Corporation    10-Q    000-17781    3.01    08/05/2009   
4.04    Certificate of Designations of Series A Junior Preferred Stock of Symantec Corporation    8-K    000-17781    3.01    06/26/2015   
4.05    Bylaws, as amended, of Symantec Corporation    10-K    000-17781    3.05    05/19/2017   
5.01    Opinion of Fenwick & West LLP                X
23.01    Consent of KPMG LLP, Independent Registered Public Accounting Firm                X
23.04    Consent of Fenwick & West LLP (filed as part of Exhibit 5.01)                X
24.01    Power of Attorney (incorporated by reference to the signature page hereto)                X
99.01    Skycure Ltd. Share Incentive Plan, including forms of awards thereunder                X
99.02    Skycure Ltd. 2017 Equity Incentive Plan, including forms of awards thereunder                X
99.03    Fireglass Ltd. 2015 Share Incentive Plan, including forms of awards thereunder                X

EXHIBIT 5.01

 

LOGO

August 4, 2017

Symantec Corporation

350 Ellis Street

Mountain View, CA 94043

Ladies and Gentlemen:

As counsel to Symantec Corporation, a Delaware corporation (the “ Company ”), we have examined the Registration Statement on Form S-8 to be filed by the Company with the Securities and Exchange Commission (the “ Commission ”) on or about August 4, 2017 (the “ Registration Statement ”) in connection with the registration under the Securities Act of 1933, as amended (the “ Securities Act ”), of an aggregate of 3,852,235 shares (the “ Shares ”) of the Company’s Common Stock, $0.01 par value per share (the “ Common Stock ”), subject to issuance by the Company: (1) upon the exercise of stock options granted under the Skycure Ltd. Share Incentive Plan (the “ Skycure Option Plan ”) and the settlement of restricted stock units and performance stock units granted under the Skycure Ltd. 2017 Equity Incentive Plan (the “ Skycure 2017 Equity Incentive Plan ”) and assumed by the Company on July 24, 2017 in accordance with the terms of a Share Purchase Agreement dated July 10, 2017 by and among the Company, FS Acquisitions Ltd., Skycure Ltd., the executing shareholders and Shareholder Representative Services LLC, as representative (the “ Skycure Purchase Agreement ”) and (2) upon the exercise of stock options and the settlement of restricted stock units and performance stock units granted under the Fireglass Ltd. 2015 Share Incentive Plan (the “ Fireglass 2015 Share Incentive Plan ” and together with the Skycure Option Plan and the Skycure 2017 Equity Incentive Plan, the “ Plans ) and assumed by the Company on July 24, 2017 in accordance with the terms of a Share Purchase Agreement dated June 30, 2017 by and among the Company, FS Acquisitions Ltd., Fireglass Ltd., the executing shareholders and Shareholder Representative Services LLC, as representative (the “ Fireglass Purchase Agreement ”).

At your request we are providing this letter to express our opinion on the matters set forth below in this letter (“ our opinion ”).

In connection with our opinion, we have examined such matters of fact as we have deemed necessary, which included examination of originals or copies of: the Company’s current certificate of incorporation and bylaws, as amended, the Plans, the Skycure Purchase Agreement, the Fireglass Purchase Agreement, certain corporate proceedings of the Company’s board of directors and stockholders relating to the Registration Statement, the prospectuses prepared in


Symantec Corporation

August 4, 2017

 

connection with the Registration Statement, the prospectuses prepared in connection with the Registration Statement, the Plans and related forms, the Skycure Purchase Agreement, the Fireglass Purchase Agreement, the Company’s current certificate of incorporation and bylaws and such other agreements, documents, certificates and statements of the Company, its transfer agent and public or government officials as we have deemed advisable, and we have examined such questions of law as we have considered necessary.

In our examination of documents for purposes of this opinion, we have assumed, and express no opinion as to, the authenticity and completeness of all documents submitted to us as originals, the genuineness of all signatures on documents reviewed by us, the conformity to originals and the completeness of all documents submitted to us as copies, the legal capacity of all parties executing any documents, the lack of any undisclosed termination or modification or waiver of any document, the absence of any extrinsic agreements or documents that might change or affect the interpretation or terms of documents, and the due authorization, execution and delivery of all documents by each party thereto other than the Company. We have also assumed that any certificates or instruments representing the Shares, when issued, will be executed by the Company by officers of the Company duly authorized to do so. In rendering our opinion, we have also relied upon a Certificate of Good Standing dated August 4, 2017 issued by the Delaware Secretary of State with respect to the Company and representations and certifications made to us by the Company, including without limitation representations in an Opinion Certificate addressed to us of even date herewith that the Company has available a sufficient number of authorized shares of Common Stock that are not currently outstanding or reserved for issuance under other outstanding securities or plans of the Company, to enable the Company to issue and deliver all of the Shares as of the date of this letter. We render this opinion only with respect to, and we express no opinion herein concerning the application or effect of the laws of any jurisdiction other than, the existing Delaware General Corporation Law.

Based upon, and subject to, the foregoing, it is our opinion that:

(1) when the 329,775 shares of Common Stock that may be issued and sold by the Company upon the exercise of stock options granted under the Skycure Option Plan and assumed by the Company in accordance with the terms of the Skycure Purchase Agreement, have been issued and sold by the Company against the Company’s receipt of payment therefor (in an amount and type of consideration not less than the par value per share) in accordance with the terms (including without limitation payment and authorization provisions) of the Skycure Option Plan and form of award agreement entered into thereunder and have been duly registered on the books of the transfer agent and registrar for the Shares in the name or on behalf of the holders thereof, such Shares will be validly issued, fully paid and non-assessable;

(2) when the 1,393,234 shares of Common Stock that may be issued by the Company upon the settlement of restricted stock units and performance stock units granted under the Skycure 2017 Equity Incentive Plan and assumed by the Company in accordance with the terms of the Skycure Purchase Agreement, have been issued by the Company in accordance with the terms (including without limitation settlement and authorization provisions) of the Skycure 2017 Equity Incentive Plan and forms of award agreement entered into thereunder and have been duly registered on the books of the transfer agent and registrar for the Shares in the name or on behalf of the holders thereof, such Shares will be validly issued, fully paid and non-assessable; and


Symantec Corporation

August 4, 2017

 

(3) when the 2,129,226 shares of Common Stock that may be issued and sold by the Company upon the exercise of stock options and the settlement of restricted stock units and performance stock units granted under the Fireglass 2015 Share Incentive Plan and assumed by the Company in accordance with the terms of the Fireglass Purchase Agreement, have been issued and sold by the Company against the Company’s receipt of payment therefor (in an amount and type of consideration not less than the par value per share) in accordance with the terms (including without limitation payment and authorization provisions) of the Fireglass 2015 Share Incentive Plan and forms of award agreement entered into thereunder and have been duly registered on the books of the transfer agent and registrar for the Shares in the name or on behalf of the holders thereof, such Shares will be validly issued, fully paid and non-assessable.

We consent to the use of this opinion as an exhibit to the Registration Statement and further consent to all references to us, if any, in the Registration Statement, the prospectuses constituting a part thereof and any amendments thereto. We do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder. This opinion is intended solely for use in connection with issuance and sale of the Shares subject to the Registration Statement and is not to be relied upon for any other purpose. In providing this letter, we are opining only as to the specific legal issues expressly set forth above, and no opinion shall be inferred as to any other matter or matters. This opinion is rendered on, and speaks only as of, the date of this letter first written above, and does not address any potential change in facts or law that may occur after the date of this opinion letter. We assume no obligation to advise you of any fact, circumstance, event or change in the law or the facts that may hereafter be brought to our attention, whether or not such occurrence would affect or modify any of the opinions expressed herein.

 

Very truly yours,
/s/ Fenwick & West LLP

 

Exhibit 23.01

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Symantec Corporation:

We consent to the use of our report dated May 19, 2017, with respect to the consolidated financial statements and effectiveness of internal control over financial reporting, incorporated by reference herein.

Our report dated May 19, 2017, on the effectiveness of internal control over financial reporting as of March 31, 2017, contains an explanatory paragraph that states that Symantec Corporation acquired Blue Coat, Inc. (Blue Coat) and LifeLock, Inc. (LifeLock) in August 2016 and February 2017, respectively, as discussed in Note 6 to the Consolidated Financial Statements. Management excluded from its assessment of the effectiveness of Symantec Corporation’s internal control over financial reporting as of March 31, 2017 Blue Coat’s internal control over financial reporting associated with consolidated total assets of approximately 4% and total consolidated revenues of approximately 11% and LifeLock’s internal control over financial reporting associated with consolidated total assets of approximately 2% and consolidated revenues of approximately 2%, included in the consolidated financial statements of Symantec Corporation and subsidiaries as of and for the year ended March 31, 2017. Our audit of internal control over financial reporting of Symantec Corporation also excluded an evaluation of the internal control over financial reporting of Blue Coat and LifeLock.

(signed) KPMG LLP

Santa Clara, California

August 4, 2017

Exhibit 99.01

SKYCURE LTD.

SHARE INCENTIVE PLAN

This plan, as amended from time to time, shall be known as the “Skycure Ltd. Share Incentive Plan” (the “ Plan ”).

 

1. PURPOSE OF THE PLAN

The purpose of this Plan is to provide a method whereby Employees and Non-Employees of the Company or any of its Affiliates may be offered an opportunity to purchase Shares in order to increase their proprietary interests in the Company and their incentive to remain and advance in their employment or other engagement with the Company or any of its Affiliates.

 

2. DEFINITIONS

For purposes of this Plan and related documents, the following definitions shall apply:

 

  2.1. Administrator ” means the Board or, if and to the extent empowered, the Committee.

 

  2.2. Affiliate ” means (i) any subsidiary of the Company and any other entity that is affiliated with the Company through stock or equity ownership or otherwise and is designated as an Affiliate for purposes of the Plan by the Administrator, and (ii) with respect to Awards granted under Section 102 of the Ordinance, any “employing company” within the meaning of Section 102(a) of the Ordinance.

 

  2.3. Approved 102 Award ” means an Award granted to an Israeli Grantee pursuant to Section 102(b) of the Ordinance and held in trust by the Trustee for the benefit of the Grantee.

 

  2.4. Articles of Association ” means the Articles of Association of the Company, as shall be in effect from time to time.

 

  2.5. Award ” means a grant under the Plan of Options or Shares.

 

  2.6. Award Agreement ” means either: (a) a written agreement entered into by the Company and a Grantee setting forth the terms and provisions applicable to an Award granted under the Plan, or (b) a written or electronic statement issued by the Company to a Grantee describing the terms and provisions of such Award, in each case including any amendment or modification thereof. The Administrator may provide for the use of electronic, internet or other non-paper Award Agreements, and the use of electronic, internet or other non-paper means for the acceptance thereof and actions thereunder by a Grantee.

 

  2.7. Board ” means the Board of Directors of the Company.

 

  2.8. Capital Gain Award ” or “ CGA ” means Approved 102 Award designed and intended by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) of the Ordinance.

 

  2.9. Cause ” means, with respect to a Grantee, any one of the following: (a) conviction of any felony involving moral turpitude or affecting the Company or any of its Affiliates; (b) embezzlement or theft of funds of the Company or any of its Affiliates; (c) any breach of the Grantee’s fiduciary duties or duties of care towards the Company or any of its Affiliates, including, without limitation, self-dealing and prohibited disclosure of confidential information of, or relating to, the Company or any of its Affiliates; (d) any conduct reasonably determined by the Administrator to be detrimental to the Company or any of its Affiliates; (e) any other breach of the terms of engagement or any undertaking of the Grantee with the Company or any of its Affiliates, or (f) any other event determined by the Administrator to be “Cause”.


  2.10. Code ” means the U.S. Internal Revenue Code of 1986, as it may be amended from time to time, including rules and regulations promulgated thereunder and successor provisions and rules and regulations thereto.

 

  2.11. Committee ” means a committee of the Board, which is empowered by the Board to administer this Plan.

 

  2.12. Company ” means Skycure Ltd., a company incorporated under the laws of the State of Israel.

 

  2.13. Controlling Shareholder ” means a person who holds or will hold as a result of a grant of Award under this Plan, directly or indirectly, together with a “relative” (as defined in the Ordinance): (i) at least 10% of the outstanding shares of the Company, (ii) at least 10% of the voting power of the Company, (iii) the right to hold or purchase at least 10% of the outstanding equity or voting power in the Company, (iv) the right to obtain at least 10% of the profits of the Company, or (v) the right to appoint a director, all as defined in Section 32(9) of the Ordinance, and as such definition may be changed from time to time.

 

  2.14. Date of Grant ” means the date of grant of an Award, as determined by the Administrator and set forth in the Grantee’s Award Agreement and, with respect to CGAs, not earlier than the first date on which the Company is permitted to grant Awards under the provisions of the Ordinance in order to qualify as a CGA.

 

  2.15. Disability ” means as defined in the engagement agreement between the Grantee and the Company or any of its Affiliates, as applicable, and if no such definition exists, then ‘Disability’ shall mean Grantee’s inability to perform the Grantee’s duties towards the Company or any of its Affiliates, for a consecutive period of at least 180 days, by reason of any medically determinable physical or mental impairment, and (ii) with respect to a U.S. Grantee, means a permanent and total disability, within the meaning of Section 22(e)(3) of the Code.

 

  2.16. Employee ” means (i) a person who is engaged by the Company or any of its Affiliates as an employee, and (ii) for purposes of Awards granted under Section 102 of the Ordinance, also a person who is not an employee but is serving as a director or an office holder (within the meaning of the Israeli Companies Law, 5759-1999), but excluding an Israeli Grantee who a Controlling Shareholder.

 

  2.17. Expiration Date ” means the date upon which an Option shall expire or terminate, as set forth in Section 11.3 of the Plan.

 

  2.18. Fair Market Value ” means, as of any date, the value of a Share determined as follows:

 

  2.18.1. If the Company’s shares are listed on any established stock exchange or a national market system, the Fair Market Value shall be the closing sales price, as applicable to class of the Shares (or the closing bid, if no sales were reported), as quoted on such exchange or system for the last market trading day prior to time of determination, as reported in the Wall Street Journal, or such other source as the Administrator deems reliable;

 

  2.18.2. If the Company’s shares are regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value shall be the mean between the high bid and low asked prices for the shares, as applicable to class of the Shares, on the last market trading day prior to the day of determination;

 

  2.18.3. In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Administrator; or

 

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  2.18.4. Without derogating from the above, solely for the purpose of determining the tax liability pursuant to Section 102(b)(3) of the Ordinance, or any successor of such section, the Fair Market Value shall be determined in accordance with the provisions of such section or successor section.

Notwithstanding the above, with respect to ISOs, fair market value shall be determined subject to Section 422(c)(7) of the Code; provided, however, that if the Shares are readily tradable on an established securities market, Fair Market Value on any date shall be the last sale price reported for the Shares on such market on such date or, if no sale is reported on such date, on the last date preceding such date on which a sale was reported.

 

  2.19. Grantee ” means a recipient of an Award under the Plan.

 

  2.20. Incentive Stock Option ” or “ ISO ” means an Option granted to a U.S. Grantee which is designated as an Incentive Stock Option and which is intended to meet the requirements of Section 422 of the Code.

 

  2.21. IPO ” means the initial public offering of the Company’s shares.

 

  2.22. Israeli Grantee ” means a Grantee who is subject to income tax under the Ordinance.

 

  2.23. ITA ” means the Israeli Tax Authority or any successor body that assumes its power in connection with Israeli income tax on grant of share options.

 

  2.24. NIS ” means New Israeli Shekels.

 

  2.25. Non-Employee ” means any person or entity who is not an Employee and who provides services to the Company or to any of its Affiliates, including for the avoidance of doubt, directors.

 

  2.26. Nonqualified Award ” or “ NQA ” means an Award that is granted to a Grantee who is neither a US Grantee nor an Israeli Grantee.

 

  2.27. Nonqualified Stock Option ” or “ NQSO ” means an Option which is granted to a U.S. Grantee and is not intended to meet the requirements of Section 422 of the Code or otherwise does not meet such requirements.

 

  2.28. 3(i) Award ” means an Award granted to an Israeli Grantee and to which Section 102 of the Ordinance does not apply.

 

  2.29. Ordinary Income Award ” or “ OIA ” means an Approved 102 Award designated and intended by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1).

 

  2.30. Option ” means an option to purchase one or more Shares pursuant to this Plan.

 

  2.31. 102 Award ” means an Award granted to an Israeli Grantee under the terms of Section 102 of the Ordinance.

 

  2.32. Ordinance ” means the Israeli Income Tax Ordinance [New Version] 1961, including any and all rules and regulations promulgated thereunder, all as now in effect or as hereafter amended.

 

  2.33. Purchase Price ” means the price to be paid by a Grantee to the Company in order to purchase one Share pursuant to an Award, whether in exercise of an Option or otherwise.

 

  2.34. Restricted Stock ” means an Award granted to a Grantee pursuant to Section 7.

 

  2.35. Section   102 ” means Section 102 of the Ordinance, including any and all rules, regulations, orders and procedures promulgated thereunder, as now in effect or as hereafter amended.

 

  2.36. Share ” means an Ordinary Share of the Company, of no par value, as may be adjusted in accordance with the terms of this Plan.

 

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  2.37. Transaction ” means: (i) a merger or consolidation of the Company as a result of which the shareholders of the Company prior to such event do not own, by virtue of their shareholdings in the Company prior to such event, a majority of the voting power of the acquiring or surviving entity in the same relative proportions; (ii) a sale of all or substantially all of the Company’s assets (on a consolidated basis with its subsidiaries) or a transfer, in one transaction or a series of related transactions of at least 50% of the Company’s shares, other than to a wholly owned subsidiary of the Company or for a change of domicile. Notwithstanding the aforesaid, the Board may determine, at its sole discretion and without liability to any Grantee, that a transaction that would otherwise fall within the aforesaid definition will not be considered a Transaction for purposes of the Plan and any Award granted hereunder.

 

  2.38. Trustee ” means a person appointed by the Company to serve as a trustee for purposes of grants of Approved 102 Awards and approved by the ITA as such, all in accordance with the provisions of Section 102.

 

  2.39. U.S. Grantee ” means a Grantee who is subject to U.S.A. federal income tax.

 

  2.40. US$ ” means United States of America dollars.

 

  2.41. Vested ” means (i) with respect to an Option, the portion that has already become vested and exercisable according to its Vesting Schedule or otherwise, and (ii) with respect to Restricted Stock, the portion that become vested in accordance with its Vesting Schedule or otherwise.

 

  2.42. Vesting Schedule ” means, with respect to an Award, the date(s) or event(s) as of which the Award shall become Vested, as set forth in the Grantee’s individual Award Agreement.

 

  2.43. Unapproved 102 Award ” means an Award granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee.

 

3. ADMINISTRATION OF THE PLAN

 

  3.1. The Administrator shall have the authority to administer this Plan and to exercise all the powers and authorities specifically granted to it under this Plan as it deems necessary or advisable, in its sole discretion, for the administration of this Plan. Without derogating from the aforesaid, the Administrator shall have the authority, in its sole discretion, from time to time and at any time: (i)  to construe and interpret the terms of this Plan and any granted Award; (ii)  to designate the Grantees to whom Awards are granted; (iii)  to determine the terms of each granted Award, including without limitation, the Vesting Schedule, Purchase Price, number of underlying Shares and expiration terms, based in each case on such factors as the Administrator, in its sole discretion, shall determine; (iv)  to approve forms of Award Agreements; (v)  to approve amendments to Award Agreements or waiver of terms thereof, either prospectively or retroactively; (vi)  to determine the Fair Market Value of Shares; (vii)  to determine the effects on the vesting, termination or expiration of any Option in the case of: (a) any Grantee who is employed by an entity that ceases to be an Affiliate (whether due to a spin-off or otherwise), (b) any transfer of an Grantee between locations of employment with the Company or an Affiliate, (c) any leave of absence of an Grantee, (d) any change in an Grantee’s status from an Employee to a Non-Employee, or vice versa, (e) any increase or decrease in the scope of engagement of an Grantee; and (f) any Grantee who ceases his/her engagement with the Company or an Affiliate but becomes engaged by a partnership, joint venture, corporation or other entity related to the Company, which is not an Affiliate, and (viii)  to take all other actions and make all other determinations necessary or desirable for or incidental to the administration of this Plan.

 

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  3.2. Any decision or action taken or to be taken by the Administrator, arising out of or in connection with the construction, administration, interpretation and effect of this Plan and of its rules and regulations, shall be within its absolute discretion (except as otherwise specifically provided herein) and shall be conclusive and binding upon all Grantees and any person claiming under or through any Grantee. The Administrator may take any action or decision with respect to a specific Grantee without necessarily applying it to other Grantees and no Grantee shall have a claim or cause of action in that respect.

 

  3.3. The interpretation, construction or determination of any provisions of the Plan by the Administrator shall be final and conclusive. No member of the Board or the Committee shall be liable for any action taken or determination made in good faith with respect to this Plan or any Award granted hereunder.

 

4. DESIGNATION OF GRANTEES

 

  4.1. The persons and entities eligible for participation in this Plan as Grantees shall include any Employees and Non-Employees, provided that (i) Employees who are Israeli Grantees may only be granted 102 Awards; and (ii) Non-Employees who are Israeli Grantees may only be granted 3(i) Awards.

 

  4.2. Each Award granted pursuant to this Plan shall be evidenced by an Award Agreement. Each Award Agreement shall state, among other matters, the maximum number of Shares underlying the Award, the type of Award granted thereunder (whether CGA, OIA, Unapproved 102 Award, 3(i) Award, ISO, NQSO or a Restricted Stock, or NQA), the Vesting Schedule, the Purchase Price, the Expiration Date and such other terms and conditions as the Administrator in its discretion may prescribe, provided in all cases that they are not conflicting with this Plan. Award Agreements may differ among recipients and grants.

 

  4.3. The grant of an Award hereunder shall neither entitle the Grantee to participate nor disqualify the Grantee from participating in, any other grant of Award pursuant to this Plan or any other incentive plan of the Company or any of its Affiliates.

 

5. AWARDS TO ISRAELI GRANTEES PURSUANT TO SECTION 102

 

  5.1. The Company may designate Awards granted to Employees who are Israeli Grantees as Approved 102 Awards or Unapproved 102 Awards. Such designation shall be subject to the terms and conditions set forth in Section 102. The grant of Approved 102 Awards under this Plan shall be made in accordance with the provisions herein, and shall be conditioned upon the approval of this Plan by the ITA. With regards to Approved 102 Awards, the provisions of this Plan and the Award Agreement shall be subject to the provisions of Section 102 and the ITA Commissioner’s permit, and the said provisions and permit shall be deemed an integral part of this Plan and of the individual Award Agreement with each Grantee. Any provision of Section 102 or the said permit which is necessary in order to receive and to keep any tax benefit pursuant to Section 102, which is not expressly specified in this Plan or the individual Award Agreement with an Grantee, shall be considered binding upon the Company and such Grantee.

 

  5.2.

The Company’s election of the type of Approved 102 Awards as CGA or OIA granted to Employees who are Israeli Grantees (the “ Election ”) shall be appropriately filed with the ITA before the first Date of Grant of an Approved 102 Award under such Election. Such Election shall become effective beginning on the first Date of Grant of an Approved 102 Award under such Election and shall remain in effect for at least such period of time as specified in Section 102. The Election shall obligate the Company to grant only the type

 

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  of Approved 102 Award it has elected, and shall apply to all Grantees who were granted Approved 102 Awards during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Ordinance. Such Election shall not prevent the Company from granting Unapproved 102 Awards during such period.

 

  5.3. Approved 102 Awards granted under this Plan and any Shares issued thereunder, including without limitation Shares received subsequently following any realization of rights, such as bonus shares, shall be allocated or issued to the Trustee (and registered in the Trustee’s name in the Company’s shareholders register) and held by the Trustee for the benefit of the Grantees to whom such Approved 102 Awards were granted for such period of time as required by Section 102 (the “ Restriction Period ”). All certificates representing Shares issued to the Trustee shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Shares are released from the aforesaid trust as herein provided.

 

  5.4. The Trustee shall not release any Approved 102 Awards (including Shares allocated or issued upon exercise of Approved 102 Awards which are Options) prior to the full payment of the Grantee’s tax liabilities arising from Approved 102 Awards, which were granted to such Grantee and any Shares issued upon exercise of such Options.

 

  5.5. Subject to the provisions of Section 102, a Grantee shall not sell or release from trust any Approved 102 Awards (including Shares allocated or issued upon exercise of Approved 102 Awards which are Options) or any Shares received subsequently following any realization of rights, including without limitation, bonus shares, until the lapse of the Restriction Period required under Section 102. Notwithstanding the above, if any such sale or release occurs during the Restriction Period, the sanctions under Section 102 shall apply to and shall be borne by such Grantee.

 

  5.6. Upon receipt of an Approved 102 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 this Plan, or any Approved 102 Award or Shares issued to the Grantee hereunder. Such release may be incorporated into the Award Agreement.

 

  5.7. With respect to Unapproved 102 Awards, if the Grantee ceases to be employed by the Company or any Affiliate, the Grantee shall extend to the Company or to such Affiliate a security or guarantee in a form determined by the Administrator for the payment of tax due at the time of sale of Shares.

 

6. GRANT OF OPTION S TO U.S. GRANTEES

 

  6.1. Each Award Agreement with respect to any Option granted to a U.S. Grantee shall specify whether an Option is intended to be ISO or an NQSO. To the extent that any Option granted to a U.S. Grantee does not qualify as an ISO (whether because of its provisions or the time or manner of its exercise or otherwise), such Option, or the portion thereof which does not so qualify, shall constitute a separate NQSO.

 

  6.2. No ISO shall be granted to any individual who is not an Employee of the Company or a Subsidiary on the date of granting of such Option. Any ISO granted under the Plan shall contain such terms and conditions, consistent with the Plan, as the Administrator may determine to be necessary to qualify such Option as an “incentive stock option” under Section 422 of the Code.

 

  6.3.

Notwithstanding any intent to grant ISOs, an Option granted under the Plan will not be considered an ISO to the extent that it, together with any other “incentive stock options” (within the meaning of Section 422 of the Code, but without regard to subsection (d) of such Section) under the Plan and any other “incentive stock option” plans of the Company, any subsidiary and any “parent corporation” of the Company within the

 

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  meaning of Section 424(e) of the Code, are exercisable for the first time by any Grantee during any calendar year with respect to Shares having an aggregate Fair Market Value in excess of $100,000 (or such other limit as may be required by the Code) as of the time the Option with respect to such Shares is granted. The rule set forth in the preceding sentence shall be applied by taking Options into account in the order in which they were granted.

 

  6.4. No ISO shall be granted to an individual who owns (within the meaning of Section 424(d) of the Code), at the time the Option is granted, more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or a subsidiary or any “parent corporation” of the Company within the meaning of Section 424(e) of the Code (a “ Ten-Percent Holder ”). This restriction does not apply if at the time such ISO is granted the Purchase Price of the ISO is at least 110% of the Fair Market Value of a Share on the date such ISO is granted, and the ISO by its terms is not exercisable after the expiration of five years from such date of grant.

 

  6.5. The Administrator may require a Grantee to give prompt written notice to the Company concerning any disposition of Shares received upon the exercise of an ISO within: (i) two (2) years from the date of granting such ISO to such Grantee or (ii) one (1) year from the transfer of such Shares to such Grantee, or (iii) such other period as the Administrator may from time to time determine. The Administrator may direct that a Grantee with respect to an ISO undertake in the applicable Award Agreement to give such written notice described in the preceding sentence, at such time and containing such information as the Administrator may prescribe, and/or that the certificates evidencing Shares acquired by exercise of an ISO refer to such requirement to give such notice.

 

7. RESTRICTED STOCK AWARDS

Subject to the terms and provisions of the Plan, the Administrator may grant Shares of Restricted Stock to Grantees in such amounts as the Administrator shall determine. Each Restricted Stock shall be evidenced by an Award Agreement that shall specify the Vesting Schedule, the number of Shares of Restricted Stock, the Purchase Price and such other provisions as the Administrator shall determine.

 

8. SHARES RESERVED FOR THE PLAN

Subject to adjustment as provided in Section 13 below, the total number of Shares that may be delivered pursuant to Awards under the Plan, including without limitation with respect to Incentive Stock Options, shall be 16,512,152 (the “ Pool ”). Any Shares so reserved which remain un-issued and which are not subject to then outstanding Awards at the termination or expiration of this Plan shall cease to be reserved for the purpose of this Plan, but may continue to be reserved for other share incentive plans then in effect, and in any event, until termination of this Plan the Company shall at all times reserve sufficient number of Shares out of its authorized share capital to meet the requirements of any then outstanding Awards. Should any Award for any reason expire or be canceled prior to its exercise or relinquishment in full, the Shares subject to such Award shall return to the Pool.

 

9. PURCHASE PRICE

 

  9.1. The Purchase Price, if any, of each Share underlying an Award shall be determined by the Administrator in its sole discretion.

 

  9.2. The form of consideration to be paid for the Shares to be issued to a Grantee, including the method of payment, shall be determined by the Administrator in its sole discretion and may consist entirely of (1) cash, (2) check, or (3) any combination of the foregoing or any other methods of payment. The Administrator shall have the authority to postpone the date of payment on such terms as it may determine. The Administrator shall have the authority to agree to a cashless exercise of a net exercise of Options.

 

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  9.3. The Purchase Price shall be denominated in NIS or US$ or otherwise as determined by the Administrator.

 

  9.4. The Purchase Price of an ISO granted to any U.S. Grantee who is not a Ten-Percent Holder shall be no less than 100% of the Fair Market Value on the Date of Grant. In the case of a NQSO, the Purchase Price shall be the price as is determined by the Administrator.

 

10. VESTING AND EXERCISABILITY

 

  10.1. Subject to the provisions of this Plan, each Option shall Vest and become exercisable and each Restricted Stock shall Vest in accordance with the Vesting Schedule, as determined by the Administrator and set forth in the individual Award Agreement, for the number of Shares as shall be provided in the Award Agreement. However, no Option shall be exercisable after the Expiration Date. Unless otherwise determined by the Administrator, the vesting of an Option shall be automatically suspended during an unpaid for leave of absence of the Grantee.

 

  10.2. An Option may be subject to such other terms and conditions on the time or times when it may be exercised, as the Administrator may deem appropriate.

 

11. TERM AND EXERCISE OF OPTIONS

 

  11.1. Vested Options shall be exercisable by the Grantee by giving written notice to the Company in such form and method as may be determined by the Administrator (with respect to Options held by the Trustee, a notice shall also be given to the Trustee in accordance with the requirements of Section 102 and the applicable trust agreement), which exercise shall be effective upon receipt of such notice by the Company, the payment of the Purchase Price and the compliance with such other terms as may be set forth in the Award Agreement or determined by the Administrator.

 

  11.2. Vested Options may be exercised by the Grantee in whole at any time or in part from time to time, prior to the Expiration Date, and provided that, unless otherwise determined by the Administrator and subject to the provisions of Section 12.2 below, the Grantee is employed by or rendering services to the Company or any of its Affiliates, at all times during the period beginning with the granting of the Option and ending upon the date of exercise.

 

  11.3. Unexercised Options (whether or not vested) shall terminate forthwith upon the earlier of: (i) ten (10) years from the Date of Grant, unless otherwise determined in the Award Agreement; (ii) the expiration of any period in any of the events set forth in Section 12 below; or (iii) in accordance with Section 13.2 below. An Award Agreement may include additional events upon which an Award shall expire.

 

  11.4. The Company shall not be obligated to issue any Shares upon the exercise of an Option if such issuance, in the opinion of the Company, might constitute a violation of any provision of applicable law.

 

  11.5. No fractional Shares shall be issued upon the exercise or payment of an Option and any such fractions shall be rounded down to the nearest whole number.

 

  11.6. The Company may have repurchase rights with respect to Shares issued pursuant to an Option, as may be set forth in an Award Agreement.

 

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12. EFFECT OF CESSATION OF SERVICE

 

  12.1. In the event of cessation of Grantee’s engagement with the Company or any of its Affiliates, whether due to expiration or termination by either party, and unless otherwise determined in the Grantee’s Award Agreement or by the Administrator, (i) all Options granted to such Grantee that are at the time of cessation not Vested will expire and the Shares underlying such non-Vested Options shall revert to the Pool, and (ii) all Shares of Restricted Stock that are at the time of cessation not Vested shall be deemed to be resold to the Company (or a designee of the Company) and shall revert to the Pool (or held by the designee for the benefit of the Pool), without any need for further act or signing of any document by the Company or the Grantee and the sole obligation of the Company (or such designee) thereafter shall be to pay to the Grantee the Purchase Price (if any) paid by the Grantee to the Company for the original issuance by the Company of such resold Shares of Restricted Stock which are not Vested; such expiration or resale shall occur automatically upon the actual date of cessation of relationship of employment or provision of services (i.e. following the end of any applicable notice period). Unless otherwise determined by the Administrator, engagement shall not be deemed to be ceased because a Grantee is transferred from the Company or from an Affiliate to another Affiliate or from any Affiliate to the Company.

 

  12.2. Unless otherwise determined in the Grantee’s Award Agreement or by the Administrator, a Vested Option may be exercised after the date of cessation of Grantee’s engagement with the Company or any of its Affiliates during an additional period of time, as follows:

 

  12.2.1. If the cessation is due to termination of the engagement by the Company or by any such Affiliate without Cause or due to resignation or termination by the Grantee and the Administrator does not determine that a termination for Cause would have been justified under the circumstances, then any Vested Option may be exercised within a period of two (2) months after the date of such cessation; or

 

  12.2.2. If cessation is the result of death or Disability of the Grantee, then any Vested Option may be exercised within a period of six (6) months after the date of such cessation, by the Grantee’s heirs or by the Grantee, as applicable.

 

  12.3. Notwithstanding Sections 12.1 and 12.2 above, if cessation of the engagement is due to termination for Cause or resignation under circumstances determined by the Administrator to justify termination for Cause in the absence of such resignation then: (a) any outstanding unexercised Option (whether vested or non-vested), will immediately expire and terminate upon the date of notice of such termination or resignation, and the Grantee shall not have any right in connection with such Options; and (b) all Shares issued upon exercise of Options or otherwise pursuant to an Award prior to the date of termination for Cause shall be subject to a right of repurchase by the Company (or any designee of the Company) at the Purchase Price actually paid to the Company for the original issuance of such Shares, if any (such repurchase to be effected by way of a written notice by the Company (or such designee) to the Grantee within 30 days from the date of actual cessation of engagement, together with cash, check or wire transfer for such payment, with no need for any further instrument or action).

 

13. ADJUSTMENTS

 

  13.1. Recapitalizations and Related Transactions

 

     In the event of the occurrence of any reclassification, recapitalization, stock split, reverse stock split, stock dividend, reorganization, repurchase, or exchange of shares or other securities of the Company, or other like change in the corporate structure of the Company (other than a Transaction) that proportionally applies to and results in a proportional adjustment with respect to all outstanding shares of the Company of the same class as the Shares, a similar adjustment shall be made with respect to the number and class of Shares that are reserved for the purposes of this Plan and with respect to the number, class, and Purchase Price of Shares covered by each outstanding Award, all as the Administrator shall deem equitable.

 

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  13.2. Transaction

Upon the occurrence of a Transaction, the Administrator may take any one or more of the following actions with respect to the then outstanding Awards: (i) provide that such Awards shall be assumed, or substituted with equivalent awards, by the acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written notice to the Grantees, provide that all or part of the then Awards which are not Vested will become Vested in full or in part as of a specified time (the “ Acceleration Time ”) prior to the estimated date of closing of the Transaction and that any Vested Options will terminate immediately prior to the date of closing of such Transaction, except to the extent exercised by the Grantees between the Acceleration Time and the date of closing of such Transaction (provided that any exercise of an accelerated portion must be conditional on the closing of the Transaction), (iii) in the event of a Transaction under the terms of which holders of outstanding Ordinary Shares will be entitled to receive upon the closing thereof a payment (whether in cash or in any other form of consideration) for each Share surrendered in the Transaction (the “ Transaction Price ”), make or provide for a payment (whether in cash or in any other form of consideration), to the Grantees equal to the difference between (A) the Transaction Price times the number of Shares subject to such outstanding Vested Options and (B) the aggregate Purchase Price of all such outstanding Vested Options, in exchange for the termination of Vested (and if so decided by the Administrator, also unvested) Options. In the absence of an assumption or substitution of an unexercised Option or a non-Vested Restricted Stock under paragraph (i) above, and unless otherwise decided by the Administrator, such Option shall expire immediately prior to the closing of a Transaction (for the avoidance of doubt, without any consideration due to the Grantee in respect of such expiration) and such non-Vested Restricted Stock shall be deemed automatically resold to the Company (or a designee of the Company) as if the Grantee’s engagement has ceased immediately prior to the closing of the Transaction and the provisions of Section 12.1 would have applied.

For the purpose of this Section 13.2, an Award shall be considered assumed or substituted if, following the Transaction, the Award confers the right to purchase or receive, for each Share underlying such Award immediately prior to the Transaction, the consideration (whether shares, options, cash, or other securities or property) received in the Transaction by holders of the same class of shares as the Shares held on the effective date of the Transaction (and if such holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of such outstanding Shares); provided, however, that if such consideration received in the Transaction is not solely ordinary shares (or their equivalent) of the successor company or its affiliates, the Administrator may, with the consent of the successor company, provide for the consideration to be received under the Award to be solely ordinary shares (or their equivalent) of the successor company or its affiliates equal in fair market value (as determined by the Administrator) to the per Share consideration received by holders of a majority of the shares of the same class of shares as the Shares outstanding in the Transaction; and provided further that the Administrator may determine, in its discretion, that in lieu of such assumption or substitution of Awards for awards of the successor company or its affiliates, such Awards will be substituted for any other type of asset or property including cash which it determined as fair under the circumstances.

 

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14. RIGHTS OF GRANTEES AS SHAREHOLDERS

 

  14.1. A Grantee shall not be deemed an owner of the Shares underlying an Option and shall not have any of the rights or privileges of shareholders of the Company in respect of any Shares purchasable upon the exercise of any Option, until registration of such Grantee as holder of such Shares in the Company’s register of shareholders upon exercise of the Option in accordance with the provisions of this Plan, but in case of Options and Shares held by the Trustee, subject to the provisions of Section 5 of this Plan.

 

  14.2. With respect to any Shares that are held by the Trustee, only the Trustee shall be entitled (to the exclusion of the applicable Grantees) to receive any and all notices delivered to the shareholders of the Company in respect of the Shares and to vote such Shares. The Shares shall be voted as instructed by the Administrator. The Administrator may also determine that Shares that are held by the Trustee will be voted by way of a proxy in the form decided on by the Administrator which shall be granted to a person designated by the Administrator.

 

  14.3. Any Shares that are not issued to the Trustee or that are released from the Trustee, shall be voted by an irrevocable proxy in the form decided on by the Administrator (as such form may change from time to time) (the “ Proxy ”). The Proxy shall be granted to the person or entity designated by the Administrator (the “ Proxy Holder ”) and shall entitle the Proxy Holder to receive any and all notices delivered to the shareholders of the Company in respect of the Shares (to the exclusion of the applicable Grantees) and the Proxy Holder shall vote such Shares as stated in the Proxy. The Proxy shall expire upon the closing of an IPO. A Grantee shall be obligated to sign the Proxy in the form provided to it by the Company when requested by the Company, whether prior to or after the issuance of Shares underlying the applicable Award. Without derogating from any other remedy available to the Company, the failure by an Grantee to so sign the Proxy within 7 days from demand by the Company shall entitle the Company to cancel the Award issued for the benefit of such Grantee without any liability to the Grantee and to repurchase from such Grantee all Shares issued in respect of any Award in consideration for the payment of the Purchase Price paid by the Grantee for the issuance of such Shares, such repurchase to be effected by way of a written notice by the Company to the Grantee, together with cash, check or wire transfer for such payment, with no need for any further instrument or action. The provisions of this Section 14.3 shall apply to the fullest extent permissible under applicable law.

 

  14.4. With respect to all Shares (excluding, for avoidance of any doubt, any unexercised Options) held by a Grantee or by the Trustee, as the case may be, the Grantee shall be entitled to receive cash dividends in accordance with the provisions of the Certificate of Incorporation, subject to any applicable taxation on distribution of dividends, and, when applicable, subject to the provisions of Section 102. The Administrator may apply any restrictions to such dividends on Shares that are not then Vested as it shall deem appropriate in its sole discretion.

 

15. RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS AND SHARES

 

  15.1. All Shares issued under the Plan shall be subject to the restrictions and limitations contained in the Articles of Association.                

 

  15.2. Notwithstanding anything to the contrary in the Articles of Association or in any agreement between shareholders of the Company, none of the Grantees shall be entitled to a right of first refusal, co-sale rights, preemptive rights or the like in relation with the Shares issued under the Plan. However, any sale, transfer, assignment or other disposal of Shares issued under the Plan shall be subject to such restrictions on transfer that apply to Ordinary Shares of the Company, as may be stated in the Articles of Association, or as may be determined by the Administrator, including without limitation right of first refusal, co-sale and bring along rights. Further, if requested by the Company, as a condition to the exercise of Option, a Grantee shall agree to be bound by any restrictions on transferability that are stated in any shareholders agreements in the Company.

 

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  15.3. No Option or any right with respect thereto purchasable hereunder, whether fully paid or not, and no portion of a Restricted Stock Award which is not yet Vested, shall be assignable, transferable, pledged or given as collateral or any right with respect to it given to any third party whatsoever, other than by will or pursuant to the laws of descant and distribution and except as specifically allowed under this Plan, and during the lifetime of the Grantee each and any of such Grantee’s rights to purchase Shares hereunder shall be exercisable only by the Grantee. Any such action made directly or indirectly, for an immediate validation or for a future one, shall be void.

 

  15.4. For as long as Options or Shares are held by the Trustee on behalf of the Grantee, all rights of the Grantee over the Shares are personal, cannot be transferred, assigned, pledged or mortgaged, other than by will or pursuant to the laws of descent and distribution.

 

  15.5. In the event that Company’s shares shall be registered for trading on any public market, the Grantee’s right to sell or make any other disposition with respect to the Shares may be subject to certain limitations (including a lock-up period), as will be determined by the Company or its underwriters and such determination shall bind the Grantee upon receipt of a written notice by the Company informing the Grantee of the same. If requested by the Company, the Grantee shall sign any lock-up agreement or undertaking requested by the Company.

 

16. EFFECTIVE DATE AND DURATION OF THE PLAN; AMENDMENT

This Plan shall be effective as of the date it was adopted by the Board and shall terminate at the end of Ten (10) years from such date of adoption, unless terminated earlier by the Board. The termination of this Plan shall not affect Awards granted prior to such termination.

The Board may, at any time, amend, alter, suspend or terminate the Plan or any of its terms; provided, however, that any such action shall not adversely affect any Awards granted under the Plan prior to such action by the Board. An early 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. To the extent required under the Code, in order for the adoption of this Plan and any amendment thereto to be effective in respect of grant of Incentive Stock Options, such adoption or amendment should be approved by the holders of a majority of the outstanding shares of the Company within twelve (12) months after the date of adoption or amendment by the Board. The effectiveness of any Incentive Stock Option granted pursuant to this Plan prior to such stockholder approval shall be specifically subject to and conditioned upon, and no such Option shall be vested or exercisable until, such stockholder approval.

 

17. GOVERNMENT REGULATIONS

This Plan, the grant and exercise of Options and other Awards hereunder, and the obligation of the Company to sell and deliver Shares under such Options and Awards, shall be subject to all applicable laws, rules, and regulations, whether of the State of Israel or of the United States or any other State having jurisdiction over the Company and the Grantee, including the registration of the Shares under the United States Securities Act of 1933 and the Ordinance, and to such approvals by any governmental agencies or national securities exchanges as may be required. Nothing herein shall be deemed to require the Company to register the Shares under the securities laws of any jurisdiction.

The inability of the Company to obtain authority from any regulatory body, which authority is deemed by the Company’s counsel to be necessary for the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

 

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18. CONTINUANCE OF ENGAGEMENT

Neither this Plan nor any Award Agreement with the Grantee shall impose any obligation on the Company or an Affiliate thereof, to continue any Grantee in its employ or service, and nothing in this Plan or in any Award granted pursuant thereto shall confer upon any Grantee any right to continue in the employ or service of the Company or an Affiliate thereof, or conflict with the right of the Company or an Affiliate thereof, or the Grantee, to terminate such employment or service at any time.

 

19. GOVERNING LAW  & JURISDICTION

This Plan and the Award Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts in the District of Tel Aviv, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this Plan and any Award Agreements effected hereunder.

 

20. TAX CONSEQUENCES

Any tax consequences arising from the grant of any Award or the exercise of any Option, from the payment for Shares covered by an Award or from any other event or act (of the Company or its Affiliates, the Trustee or the Grantee), hereunder, shall be borne solely by the Grantee. The Company, its Affiliates and the Trustee may withhold taxes according to the requirements of any applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Grantee shall indemnify the Company, its Affiliates and the Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to or by the Grantee. The Company and, when applicable, the Trustee shall not be required to release any Share or share certificate representing such Shares to an Grantee until all required tax payments have been fully made.

The Company does not warrant that any Award under the Plan will qualify for favorable tax treatment under any provision of U.S. federal (including Section 409A of the Code), state, local, or non-United States law. The Company shall not be liable to any Grantee for any tax, interest, or penalties the Grantee might owe as a result of the grant, holding, vesting, exercise, or payment of any Award under the Plan.

 

21. NON-EXCLUSIVITY OF THIS PLAN

The adoption of this Plan by the Board shall not be construed as amending, modifying or rescinding any previously approved incentive arrangements or as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of options to purchase shares of the Company otherwise than under this Plan, and such arrangements may be either applicable generally or only in specific cases.

 

22. RULES PARTICULAR TO SPECIFIC JURISDICTIONS

The terms and conditions of the Plan may be adjusted with respect to a particular jurisdiction by means of an addendum to the Plan in the form of an appendix (the “ Appendix ”), and to the extent that the terms and conditions set forth in the Appendix conflict with any provisions of the Plan, the provisions of the Appendix shall govern. Terms and conditions set forth in the Appendix shall apply only to Awards issued to Grantees under the specific jurisdiction that is the subject of the Appendix and shall not apply to Awards issued to any other Grantees. The adoption of any such Appendix shall be subject to the approval of the Board and if required the approval of the shareholders of the Company.

 

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SKYCURE LTD.

OPTION GRANT AGREEMENT

APPROVED 102 OPTION

I. Summary Terms of the Option Grant (the “Summary Terms”)

The following is the summary terms of the grant made by Skycure Ltd., a company organized under the laws of the State of Israel (the “ Company ”) to the optionee whose name is set forth below (the “ Optionee ”) of an option to purchase Shares of the Company (the “ Option ”), subject to the terms and conditions set forth in this Grant Agreement (including Part II hereunder) and the Skycure Ltd Share Incentive Plan (the “ Plan ”), a copy of which is attached as Exhibit A hereto, forming an integral part hereof.

 

Name of Optionee:

   [___________________]

Date of Grant:

   [___________________]

Designation:

  

Capital Gain Option

Number of Shares Underlying Option:

   [___________________]

Exercise Price per Share:

   US$[_____]

Vesting Schedule:

  

25% of the Option shall vest on [________] and

[__]% of the Option shall vest at the end of every

[__]-month period thereafter.

                                                                                                                                  
Skycure Ltd.    Optionee’s Signature
By: _______________   

By signing above, the Optionee acknowledges receipt of a copy of the Plan and accepts the Option subject to all of the terms and provisions thereof and of this Grant Agreement. The Optionee further acknowledges that he or she has reviewed the Plan and this Grant Agreement in its entirety (including Part II hereunder), has had an opportunity to obtain the advice of counsel prior to executing this Grant Agreement, and fully understands all provisions of this Grant Agreement.

Exhibits to this Grant Agreement:

Exhibit A – Skycure Ltd. Share Incentive Plan

Exhibit B – Trust Agreement

 

LOGO


II. Terms of the Option Grant Agreement

 

1. Preamble and Definitions . Part I, the Summary Terms, constitutes an integral part of this Grant Agreement. Unless otherwise defined herein, capitalized terms used herein shall have the meaning ascribed to them in the Plan.

 

2. Grant of Option . Subject to the provisions of this Grant Agreement and the Plan, the Company hereby grants to the Optionee, pursuant to the Plan, the right and option (the “ Option ”) to purchase up to the number of Shares, as set forth in the Summary Terms at a price per share equal to the Exercise Price. The Option is issued to the Trustee, on behalf of the Optionee, in accordance with the terms of the Plan and Section 102, as a Capital Gain Option.

 

3. Vesting and Exercisability

 

  3.1. The term of this Grant Agreement shall commence on the Date of Grant (the “ Date of Grant ”) set forth in the Summary Terms and terminate on the Expiration Date, at which time the Option shall expire, to the extent not exercised earlier.

 

  3.2. Subject to the provisions of the Plan, portions of the Option shall vest and become exercisable according to the Vesting Schedule set forth in the Summary Terms, provided that the Optionee continues to be an Employee of or to provide services to the Company or to an Affiliate from the Date of Grant and until the applicable Vesting Date.

 

  3.3. The Administrator may determine additional conditions for the exercise of Options, as it deems advisable. The Optionee further agrees that in the event that the Company, upon advise of counsel, deems it necessary or advisable, in its sole discretion, the issuance of Shares may be conditioned upon certain representations, warranties, and acknowledgments by the Optionee.

 

4. Restrictions on Transfer of Shares. The transfer or sale of Shares issued upon the exercise of the Options shall be subject to the limitations and restrictions set forth in the Plan, and in the Company’s governing documents as shall be in effect from time to time, and in any agreement to which Optionee is bound. As a condition for the recognition of the Company of any such sale or transfer, any transferee or purchaser of Shares issued upon the exercise of the Options, shall, prior to such transfer assume and become bound by all obligations of the Optionee under any instrument and agreement involving the Optionee and the Company and applicable to such exercised shares, including but not limited to the execution and delivery to the Company of an irrevocable voting proxy in the form provided by the Company.

 

5. Taxes; Indemnification

 

  5.1. The receipt of the Option and the acquisition of the Shares to be issued upon the exercise of the Option may result in tax consequences. THE OPTIONEE IS ADVISED TO CONSULT A TAX ADVISER WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING THIS OPTION OR DISPOSING OF THE SHARES UNDERLYING THIS OPTION.

 

  5.2. Any tax consequences arising from the grant or exercise of the Option, from the payment for Shares covered thereby or from any other event or act (of the Company, its Affiliates, the Trustee or the Optionee), hereunder, shall be borne solely by the Optionee. The Company, its Affiliates and the Trustee shall withhold taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source, as they deem necessary at their discretion. Furthermore, the Optionee hereby agrees to indemnify the Company, its Affiliates and the Trustee and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee.

 

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  5.3. The Optionee will not be entitled to receive from the Company or the Trustee any Shares issued upon the exercise of the Option prior to the full payments of the Optionee’s tax liabilities arising from the Option which were granted to the Optionee or Shares issued upon the exercise of the Option. Neither the Company nor the Trustee shall be required to release any Options or Shares to the Optionee until all payments required to be made by the Optionee have been fully satisfied.

 

  5.4. The Optionee acknowledges that he or she is familiar with the provisions of Section 102, including without limitations the type of Option granted hereunder and the tax implications applicable to such grant. The Optionee accepts the provisions of the trust agreement signed between the Company and the Trustee, and the related forms, attached as Exhibit B hereto, and agrees to be bound by its terms as such terms relate to the Optionee. The Optionee acknowledges that if for whatever reason the Company shall not be granted an approval by the ITA under Section 102, the Optionee shall bear and pay any and all taxes and any other compulsory payments applicable to the Option, exercise, sale or other disposition of the Option or the Shares.

 

  5.5. The Optionee acknowledges that in the event that he or she will cease to be either an Employee or an Israeli resident, the Option and the Shares may still remain subject to the provisions of Section 102, in accordance with applicable law.

 

6. Miscellaneous

This Grant Agreement and its exhibits constitute the entire agreement between the Optionee and the Company with respect to Options granted hereunder and supersedes all prior agreements, understandings and arrangements, oral or written, between the Optionee and the Company in that respect. This Grant Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts in the District of Tel Aviv, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this Grant Agreement. The Optionee shall regard the information in this Grant Agreement and its exhibits attached hereto as confidential information and the Optionee shall not reveal its contents to anyone except when required by law or for the purpose of gaining legal or tax advice. Neither the Plan nor this Grant Agreement shall impose any obligation on the Company or an Affiliate to continue the Optionee’s employment or service and nothing in the Plan or this Grant Agreement shall confer upon the Optionee any right to continue in the employ or service of the Company or an Affiliate or restrict the right of the Company or an Affiliate to terminate such employment or service at any time. The failure of any party to enforce at any time any provisions of this Grant Agreement or the Plan shall in no way be construed to be a waiver of such provision or of any other provision hereof. The Options provided for herein are granted pursuant to the Plan, and said Option and this Grant Agreement are in all respects governed by the Plan and subject to all of the terms and provisions of the Plan. Any interpretation of this Grant Agreement will be made in accordance with the Plan but in the event there is any contradiction between the provisions of this Grant Agreement and the Plan, the provisions of the Plan will prevail. This Grant Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereof.

 

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SKYCURE LTD.

OPTION GRANT AGREEMENT

3(i) AWARD

I. Summary Terms of the Option Grant (the “Summary Terms”)

The following is the summary terms of the grant made by Skycure Ltd., a company organized under the laws of the State of Israel (the “ Company ”) to the optionee whose name is set forth below (the “ Optionee ”) of an option to purchase Shares of the Company (the “ Option ”), subject to the terms and conditions set forth in this Grant Agreement (including Part II hereunder) and the Skycure Ltd. Share Incentive Plan (the “ Plan ”), a copy of which is attached as Exhibit A hereto, forming an integral part hereof.

 

Name of Optionee:    [___________________]
Date of Grant:    [___________________]
Designation:    3(i) Option
Number of Shares Underlying Option:    [___________________]
Exercise Price per Share:    NIS [_____]
Vesting Schedule:    25% of the Option shall vest on [________] and [__]% of the Option shall vest at the end of every [__]-month period thereafter.
                                                                                                                              
Skycure Ltd.    Optionee’s Signature
By: _______________   

By signing above, the Optionee acknowledges receipt of a copy of the Plan and accepts the Option subject to all of the terms and provisions thereof and of this Grant Agreement. The Optionee further acknowledges that he or she has reviewed the Plan and this Grant Agreement in its entirety (including Part II hereunder), has had an opportunity to obtain the advice of counsel prior to executing this Grant Agreement, and fully understands all provisions of this Grant Agreement.

Exhibits to this Grant Agreement:

Exhibit A – Skycure Ltd. Share Incentive Plan

 

LOGO


II. Terms of the Option Grant Agreement

 

1. Preamble and Definitions . Part I, the Summary Terms, constitutes an integral part of this Grant Agreement. Unless otherwise defined herein, capitalized terms used herein shall have the meaning ascribed to them in the Plan.

 

2. Grant of Option . Subject to the provisions of this Grant Agreement and the Plan, the Company hereby grants to the Optionee, pursuant to the Plan, the right and option (the “ Option ”) to purchase up to the number of Shares, as set forth in the Summary Terms at a price per share equal to the Exercise Price.

 

3. Vesting and Exercisability

 

  3.1. The term of this Grant Agreement shall commence on the Date of Grant (the “ Date of Grant ”) set forth in the Summary Terms and terminate on the Expiration Date, at which time the Option shall expire, to the extent not exercised earlier.

 

  3.2. Subject to the provisions of the Plan, portions of the Option shall vest and become exercisable according to the Vesting Schedule set forth in the Summary Terms, provided that the Optionee continues to be an Employee of or to provide services to the Company or to an Affiliate from the Date of Grant and until the applicable Vesting Date.

 

  3.3. The Administrator may determine additional conditions for the exercise of Options, as it deems advisable. The Optionee further agrees that in the event that the Company, upon advice of counsel, deems it necessary or advisable, in its sole discretion, the issuance of Shares may be conditioned upon certain representations, warranties, and acknowledgments by the Optionee.

 

4. Restrictions on Transfer of Shares. The transfer or sale of Shares issued upon the exercise of the Options shall be subject to the limitations and restrictions set forth in the Plan, and in the Company’s governing documents as shall be in effect from time to time, and in any agreement to which Optionee is bound. As a condition for the recognition of the Company of any such sale or transfer, any transferee or purchaser of Shares issued upon the exercise of the Options, shall, prior to such transfer assume and become bound by all obligations of the Optionee under any instrument and agreement involving the Optionee and the Company and applicable to such exercised shares, including but not limited to the execution and delivery to the Company of an irrevocable voting proxy in the form provided by the Company.

 

5. Taxes; Indemnification

 

  5.1. The receipt of the Option and the acquisition of the Shares to be issued upon the exercise of the Option may result in tax consequences. THE OPTIONEE IS ADVISED TO CONSULT A TAX ADVISER WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING THIS OPTION OR DISPOSING OF THE SHARES UNDERLYING THIS OPTION.

 

  5.2. Any tax consequences arising from the grant or exercise of the Option, from the payment for Shares covered thereby or from any other event or act (of the Company, its Affiliates or the Optionee), hereunder, shall be borne solely by the Optionee. The Company or its Affiliates shall withhold taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source, as they deem necessary at their discretion. Furthermore, the Optionee hereby agrees to indemnify the Company and its Affiliates and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee.

 

- 2 -


  5.3. The Optionee will not be entitled to receive from the Company any Shares issued upon the exercise of the Option prior to the full payments of the Optionee’s tax liabilities arising from the Option which were granted to the Optionee or Shares issued upon the exercise of the Option. The Company shall not be required to release any Options or Shares to the Optionee until all payments required to be made by the Optionee have been fully satisfied.

 

6. Miscellaneous

This Grant Agreement and its exhibits constitute the entire agreement between the Optionee and the Company with respect to Options granted hereunder and supersedes all prior agreements, understandings and arrangements, oral or written, between the Optionee and the Company in that respect. This Grant Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts in the District of Tel Aviv, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this Grant Agreement. The Optionee shall regard the information in this Grant Agreement and its exhibits attached hereto as confidential information and the Optionee shall not reveal its contents to anyone except when required by law or for the purpose of gaining legal or tax advice. Neither the Plan nor this Grant Agreement shall impose any obligation on the Company or an Affiliate to continue the Optionee’s employment or service and nothing in the Plan or this Grant Agreement shall confer upon the Optionee any right to continue in the employ or service of the Company or an Affiliate or restrict the right of the Company or an Affiliate to terminate such employment or service at any time. The failure of any party to enforce at any time any provisions of this Grant Agreement or the Plan shall in no way be construed to be a waiver of such provision or of any other provision hereof. The Options provided for herein are granted pursuant to the Plan, and said Option and this Grant Agreement are in all respects governed by the Plan and subject to all of the terms and provisions of the Plan. Any interpretation of this Grant Agreement will be made in accordance with the Plan but in the event there is any contradiction between the provisions of this Grant Agreement and the Plan, the provisions of the Plan will prevail. This Grant Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereof.

 

- 3 -


SKYCURE LTD.

OPTION GRANT AGREEMENT

INCENTIVE STOCK OPTION

I. Summary Terms of the Option Grant (the “Summary Terms”)

The following is the summary terms of the grant made by Skycure Ltd., a company organized under the laws of the State of Israel (the “ Company ”) to the optionee whose name is set forth below (the “ Optionee ”) of an option to purchase Shares of the Company (the “ Option ”), subject to the terms and conditions set forth in this Grant Agreement (including Part II hereunder) and the Skycure Ltd. Share Incentive Plan (the “ Plan ”), a copy of which is attached as Exhibit A hereto, forming an integral part hereof.

 

Name of Optionee:    [___________________]
Date of Grant:    [___________________]
Designation:    Incentive Stock Option
Number of Shares Underlying Option:    [___________________]
Exercise Price per Share:    US$[_____]
Vesting Schedule:    25% of the Option shall vest on [________] and [__]% of the Option shall vest at the end of every [__]-month period thereafter.
                                                                                                                              
Skycure Ltd.    Optionee’s Signature
By: _______________   

By signing above, the Optionee acknowledges receipt of a copy of the Plan and accepts the Option subject to all of the terms and provisions thereof and of this Grant Agreement. The Optionee further acknowledges that he or she has reviewed the Plan and this Grant Agreement in its entirety (including Part II hereunder), has had an opportunity to obtain the advice of counsel prior to executing this Grant Agreement, and fully understands all provisions of this Grant Agreement.

Exhibits to this Grant Agreement:

Exhibit A – Skycure Ltd. Share Incentive Plan

 

LOGO


II. Terms of the Option Grant Agreement

 

1. Preamble and Definitions . Part I, the Summary Terms, constitutes an integral part of this Grant Agreement. Unless otherwise defined herein, capitalized terms used herein shall have the meaning ascribed to them in the Plan.

 

2. Grant of Option . Subject to the provisions of this Grant Agreement and the Plan, the Company hereby grants to the Optionee, pursuant to the Plan, the right and option (the “ Option ”) to purchase up to the number of Shares, as set forth in the Summary Terms at a price per share equal to the Exercise Price.

 

3. Vesting and Exercisability

 

  3.1. The term of this Grant Agreement shall commence on the Date of Grant (the “ Date of Grant ”) set forth in the Summary Terms and terminate on the Expiration Date, at which time the Option shall expire, to the extent not exercised earlier.

 

  3.2. Subject to the provisions of the Plan, portions of the Option shall vest and become exercisable according to the Vesting Schedule set forth in the Summary Terms, provided that the Optionee continues to be an Employee of or to provide services to the Company or to an Affiliate from the Date of Grant and until the applicable Vesting Date.

 

  3.3. The Administrator may determine additional conditions for the exercise of Options, as it deems advisable. The Optionee further agrees that in the event that the Company, upon advice of counsel, deems it necessary or advisable, in its sole discretion, the issuance of Shares may be conditioned upon certain representations, warranties, and acknowledgments by the Optionee.

 

4. Restrictions on Transfer of Shares. The transfer or sale of Shares issued upon the exercise of the Options shall be subject to the limitations and restrictions set forth in the Plan, and in the Company’s governing documents as shall be in effect from time to time, and in any agreement to which Optionee is bound. As a condition for the recognition of the Company of any such sale or transfer, any transferee or purchaser of Shares issued upon the exercise of the Options, shall, prior to such transfer assume and become bound by all obligations of the Optionee under any instrument and agreement involving the Optionee and the Company and applicable to such exercised shares, including but not limited to the execution and delivery to the Company of an irrevocable voting proxy in the form provided by the Company.

 

5. Taxes; Indemnification

 

  5.1. The receipt of the Option and the acquisition of the Shares to be issued upon the exercise of the Option may result in tax consequences. THE OPTIONEE IS ADVISED TO CONSULT A TAX ADVISER WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING THIS OPTION OR DISPOSING OF THE SHARES UNDERLYING THIS OPTION.

 

  5.2. Any tax consequences arising from the grant or exercise of the Option, from the payment for Shares covered thereby or from any other event or act (of the Company, its Affiliates or the Optionee), hereunder, shall be borne solely by the Optionee. The Company or its Affiliates shall withhold taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source, as they deem necessary at their discretion. Furthermore, the Optionee hereby agrees to indemnify the Company and its Affiliates and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee.


  5.3. The Optionee will not be entitled to receive from the Company any Shares issued upon the exercise of the Option prior to the full payments of the Optionee’s tax liabilities arising from the Option which were granted to the Optionee or Shares issued upon the exercise of the Option. The Company shall not be required to release any Options or Shares to the Optionee until all payments required to be made by the Optionee have been fully satisfied.

 

6. Miscellaneous

This Grant Agreement and its exhibits constitute the entire agreement between the Optionee and the Company with respect to Options granted hereunder and supersedes all prior agreements, understandings and arrangements, oral or written, between the Optionee and the Company in that respect. This Grant Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts in the District of Tel Aviv, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this Grant Agreement. The Optionee shall regard the information in this Grant Agreement and its exhibits attached hereto as confidential information and the Optionee shall not reveal its contents to anyone except when required by law or for the purpose of gaining legal or tax advice. Neither the Plan nor this Grant Agreement shall impose any obligation on the Company or an Affiliate to continue the Optionee’s employment or service and nothing in the Plan or this Grant Agreement shall confer upon the Optionee any right to continue in the employ or service of the Company or an Affiliate or restrict the right of the Company or an Affiliate to terminate such employment or service at any time. The failure of any party to enforce at any time any provisions of this Grant Agreement or the Plan shall in no way be construed to be a waiver of such provision or of any other provision hereof. The Options provided for herein are granted pursuant to the Plan, and said Option and this Grant Agreement are in all respects governed by the Plan and subject to all of the terms and provisions of the Plan. Any interpretation of this Grant Agreement will be made in accordance with the Plan but in the event there is any contradiction between the provisions of this Grant Agreement and the Plan, the provisions of the Plan will prevail. This Grant Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereof.


SKYCURE LTD.

OPTION GRANT AGREEMENT

NON-QUALIFIED AWARD

I. Summary Terms of the Option Grant (the “Summary Terms”)

The following is the summary terms of the grant made by Skycure Ltd., a company organized under the laws of the State of Israel (the “ Company ”) to the optionee whose name is set forth below (the “ Optionee ”) of an option to purchase Shares of the Company (the “ Option ”), subject to the terms and conditions set forth in this Grant Agreement (including Part II hereunder) and the Skycure Ltd. Share Incentive Plan (the “ Plan ”), a copy of which is attached as Exhibit A hereto, forming an integral part hereof.

 

Name of Optionee:    [___________________]
Date of Grant:    [___________________]
Designation:    Non-Qualified Award
Number of Shares Underlying Option:    [___________________]
Exercise Price per Share:    US$[_____]
Vesting Schedule:    25% of the Option shall vest on [________] and [__]% of the Option shall vest at the end of every [__]-month period thereafter.
                                                                                                                              
Skycure Ltd.    Optionee’s Signature
By: _______________   

By signing above, the Optionee acknowledges receipt of a copy of the Plan and accepts the Option subject to all of the terms and provisions thereof and of this Grant Agreement. The Optionee further acknowledges that he or she has reviewed the Plan and this Grant Agreement in its entirety (including Part II hereunder), has had an opportunity to obtain the advice of counsel prior to executing this Grant Agreement, and fully understands all provisions of this Grant Agreement.

Exhibits to this Grant Agreement:

Exhibit A – Skycure Ltd. Share Incentive Plan

 

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II. Terms of the Option Grant Agreement

 

1. Preamble and Definitions . Part I, the Summary Terms, constitutes an integral part of this Grant Agreement. Unless otherwise defined herein, capitalized terms used herein shall have the meaning ascribed to them in the Plan.

 

2. Grant of Option . Subject to the provisions of this Grant Agreement and the Plan, the Company hereby grants to the Optionee, pursuant to the Plan, the right and option (the “ Option ”) to purchase up to the number of Shares, as set forth in the Summary Terms at a price per share equal to the Exercise Price.

 

3. Vesting and Exercisability

 

  3.1. The term of this Grant Agreement shall commence on the Date of Grant (the “ Date of Grant ”) set forth in the Summary Terms and terminate on the Expiration Date, at which time the Option shall expire, to the extent not exercised earlier.

 

  3.2. Subject to the provisions of the Plan, portions of the Option shall vest and become exercisable according to the Vesting Schedule set forth in the Summary Terms, provided that the Optionee continues to be an Employee of or to provide services to the Company or to an Affiliate from the Date of Grant and until the applicable Vesting Date.

 

  3.3. The Administrator may determine additional conditions for the exercise of Options, as it deems advisable. The Optionee further agrees that in the event that the Company, upon advice of counsel, deems it necessary or advisable, in its sole discretion, the issuance of Shares may be conditioned upon certain representations, warranties, and acknowledgments by the Optionee.

 

4. Restrictions on Transfer of Shares. The transfer or sale of Shares issued upon the exercise of the Options shall be subject to the limitations and restrictions set forth in the Plan, and in the Company’s governing documents as shall be in effect from time to time, and in any agreement to which Optionee is bound. As a condition for the recognition of the Company of any such sale or transfer, any transferee or purchaser of Shares issued upon the exercise of the Options, shall, prior to such transfer assume and become bound by all obligations of the Optionee under any instrument and agreement involving the Optionee and the Company and applicable to such exercised shares, including but not limited to the execution and delivery to the Company of an irrevocable voting proxy in the form provided by the Company.

 

5. Taxes; Indemnification

 

  5.1. The receipt of the Option and the acquisition of the Shares to be issued upon the exercise of the Option may result in tax consequences. THE OPTIONEE IS ADVISED TO CONSULT A TAX ADVISER WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING THIS OPTION OR DISPOSING OF THE SHARES UNDERLYING THIS OPTION.

 

  5.2. Any tax consequences arising from the grant or exercise of the Option, from the payment for Shares covered thereby or from any other event or act (of the Company, its Affiliates or the Optionee), hereunder, shall be borne solely by the Optionee. The Company or its Affiliates shall withhold taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source, as they deem necessary at their discretion. Furthermore, the Optionee hereby agrees to indemnify the Company and its Affiliates and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Optionee.


  5.3. The Optionee will not be entitled to receive from the Company any Shares issued upon the exercise of the Option prior to the full payments of the Optionee’s tax liabilities arising from the Option which were granted to the Optionee or Shares issued upon the exercise of the Option. The Company shall not be required to release any Options or Shares to the Optionee until all payments required to be made by the Optionee have been fully satisfied.

 

6. Miscellaneous

This Grant Agreement and its exhibits constitute the entire agreement between the Optionee and the Company with respect to Options granted hereunder and supersedes all prior agreements, understandings and arrangements, oral or written, between the Optionee and the Company in that respect. This Grant Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Israel applicable to contracts made and to be performed therein, without giving effect to the principles of conflict of laws. The competent courts in the District of Tel Aviv, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this Grant Agreement. The Optionee shall regard the information in this Grant Agreement and its exhibits attached hereto as confidential information and the Optionee shall not reveal its contents to anyone except when required by law or for the purpose of gaining legal or tax advice. Neither the Plan nor this Grant Agreement shall impose any obligation on the Company or an Affiliate to continue the Optionee’s employment or service and nothing in the Plan or this Grant Agreement shall confer upon the Optionee any right to continue in the employ or service of the Company or an Affiliate or restrict the right of the Company or an Affiliate to terminate such employment or service at any time. The failure of any party to enforce at any time any provisions of this Grant Agreement or the Plan shall in no way be construed to be a waiver of such provision or of any other provision hereof. The Options provided for herein are granted pursuant to the Plan, and said Option and this Grant Agreement are in all respects governed by the Plan and subject to all of the terms and provisions of the Plan. Any interpretation of this Grant Agreement will be made in accordance with the Plan but in the event there is any contradiction between the provisions of this Grant Agreement and the Plan, the provisions of the Plan will prevail. This Grant Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereof.

Exhibit 99.02

 

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SKYCURE LTD.

2017 Equity Incentive Plan

1. Purpose. The purpose of this Plan is to provide incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of the Company, its Parent, Subsidiaries and Affiliates, by offering them an opportunity to participate in the Company’s future performance through awards of Restricted Stock Units. Capitalized terms not defined in the text are defined in Section 22.

2. Shares Subject to the Plan.

2.1 Number of Shares Available. Subject to Sections 2.2 and 14, the total number of Shares reserved and available for grant and issuance pursuant to this Plan will be 22,000,000 Shares.

Subject to Sections 2.2 and 14, Shares that: (a) are subject to an Award granted hereunder but are forfeited or (b) are subject to an Award that otherwise terminates without Shares being issued will again be available for grant and issuance in connection with future Awards under this Plan. At all times the Company shall reserve and keep available a sufficient number of Shares as shall be required to satisfy the requirements of all outstanding Awards granted under this Plan.

2.2 Adjustment of Shares. In the event that the number of outstanding Shares is changed by a stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration or there is a change in the corporate structure (including, without limitation, a spin-off), then the number of Shares reserved for issuance and future grant under the Plan set forth in Section 2.1 shall be adjusted proportionally. Note that fractions of a Share will not be issued but will be rounded down to the nearest whole Share, and may be replaced by a cash payment equal to the Fair Market Value of such fraction of a Share, as determined by the Committee.

3. Eligibility. All Awards may be granted to employees, officers, directors, consultants, independent contractors and advisors (each an “Eligible Individual”) of the Company or any Parent, Subsidiary or Affiliate of the Company; provided such consultants, contractors and advisors render bona fide services not in connection with the offer and sale of securities in a capital-raising transaction.

4. Administration.

4.1 Committee Authority. This Plan will be administered by the Committee or by the Board acting as the Committee. Subject to the general purposes, terms and conditions of this Plan, and to the direction of the Board, the Committee will have full power to implement and carry out this Plan. Without limitation, the Committee will have the authority to:

(a) construe and interpret this Plan, any sub-plan, Award Agreement and any other agreement or document executed pursuant to this Plan;

(b) prescribe, amend and rescind rules and regulations relating to this Plan or any Award;

(c) select Eligible Individuals to receive Awards;

(d) determine the form and terms of Awards;

(e) grant Awards and determine the number of Shares or other consideration subject to Awards;

(f) determine whether Awards will be granted singly, in combination with, in tandem with, in replacement of, or as alternatives to, other Awards under this Plan or any other incentive or compensation plan of the Company or any Parent, Subsidiary or Affiliate of the Company;


(g) grant waivers of Plan or Award conditions;

(h) determine the vesting, exercisability and payment of Awards; provided that no Award may vest at or prior to the Closing;

(i) correct any defect, supply any omission or reconcile any inconsistency in this Plan, any Award or any Award Agreement;

(j) amend any Award Agreements executed in connection with this Plan;

(k) determine whether the performance goals under any performance-based Award have been met and whether a performance-based Award has been earned;

(1) determine whether, to what extent an Award may be canceled, forfeited, or surrendered;

(n) adopt terms and conditions, rules and/or procedures (including the adoption of any subplan under this Plan) relating to the operation and administration of the Plan to accommodate requirements of local law and procedures outside of the United States;

(o) make all other determinations necessary or advisable for the administration of this Plan, any sub-plan or Award Agreement;

(p) delegate any of the foregoing to the extent permitted by applicable law to one or more executive officers pursuant to a specific delegation, in which case references to “Committee” in this Section 4.1 will refer to such delegate(s), except with respect to Insiders.

4.2 Committee Discretion. Any determination made by the Committee with respect to any Award will be made in its sole discretion at the time of grant of the Award or, unless in contravention of any express term of this Plan or Award, at any later time, and such determination will be final and binding on the Company and on all persons having an interest in any Award under this Plan. To the extent permitted by applicable laws, the Committee may delegate to one or more officers of the Company the authority to grant an Award under this Plan to Participants who are not Insiders of the Company.

5. Restricted Stock Units and Performance Stock Units. A Restricted Stock Unit (or RSU) is an award covering a number of Shares that may be settled by issuance of those Shares. A Performance Stock Unit (or PSU) is an RSU that vests in whole or in part based on certain performance metrics as determined by the Committee. The Committee will determine to whom an RSU or PSU grant will be made, the number of Shares subject to the RSU or PSU, the restrictions to which the Shares subject to the RSU or PSU will be subject, and all other terms and conditions of the RSU or PSU, subject to the following:

5.1 Terms of RSUs and PSUs. RSUs and PSUs may vary from Participant to Participant and between groups of Participants, and may be based upon the achievement of the Company, Affiliate, Parent or Subsidiary and/or individual performance goals or upon such other criteria as the Committee may determine.

5.2 RSU Agreement. All RSUs will be evidenced by an Award Agreement (the “RSU Agreement ”), which will be in such form and contain such provisions (which need not be the same for each Participant) as the Committee may from time to time approve, and which will comply with and be subject to the terms and conditions of this Plan.

5.3 PSU Agreement. PSUs may be subject to performance metrics as set out in an Award Agreement (the “ Performance Stock Unit Agreement ”), which need not be the same for each Participant. If the PSU is being earned upon the satisfaction of performance goals pursuant to a Performance Stock Unit Agreement, then the Committee will: (a) determine the nature, length and starting date of any Performance Period for each PSU and (b) determine the number of Shares subject to the PSU. Prior to settlement of any PSU earned upon the satisfaction

 

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of performance goals pursuant to a Performance Stock Unit Agreement, the Committee shall determine the extent to which such PSU has been earned. Performance Periods may overlap and Participants may participate simultaneously with respect to PSUs that are subject to different Performance Periods and different performance goals and other criteria. The number of Shares may be fixed or may vary in accordance with such performance goals and criteria as may be determined by the Committee. The Committee may adjust the performance goals applicable to the PSUs to take into account changes in law and accounting or tax rules and to make any other adjustments as the Committee deems necessary or appropriate.

5.4 Settlement. The portion of an RSU or PSU being settled may be paid currently or on a deferred basis with such interest or dividend equivalent, if any, as the Committee may determine. Payment may be made in the form of cash or whole Shares or a combination thereof, either in a lump sum payment or in installments, all as the Committee will determine. Notwithstanding anything to the contrary in this Plan, any Award Agreement or otherwise, no RSU or PSU (or portion thereof) may be settled until following the Closing.

5.5 Termination of Participant. Except as may be set forth in the Participant’s Award Agreement, vesting ceases on such Participant’s Termination Date (unless determined otherwise by the Committee).

6. Withholding Taxes.

6.1 Withholding Generally. The Company, its Parent, Subsidiaries and Affiliates, as appropriate, shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, its Parent, Subsidiaries and Affiliates, an amount sufficient to satisfy any Tax-Related Items with respect to any taxable event concerning a Participant arising as a result of this Plan or to take such other action as may be necessary in the opinion of the Company or its Parent, Subsidiaries or Affiliates, as appropriate, to satisfy withholding obligations for the payment of Tax-Related Items, including but not limited to (i) withholding from the Participant’s wages or other cash compensation; (ii) withholding from the proceeds for the sale of Shares underlying the Award either through a voluntary sale or a mandatory sale arranged by the Company on the Participant’s behalf; (iii) through withholding in Shares as set forth in Section 6.2 below; (iv) where payments in satisfaction of the Awards are to be made in cash, through withholding all or part of the cash payment in an amount sufficient to satisfy the Tax-Related Items; or (v) any other method of withholding deemed acceptable by the Committee. No Shares (or their cash equivalent) shall be delivered hereunder to any Participant or other person until the Participant or such other person has made arrangements acceptable to the Committee for the satisfaction of these tax obligations with respect to any taxable event concerning the Participant or such other person arising as a result of Awards made under this Plan.

6.2 Stock Withholding. When, under applicable tax laws, a Participant incurs tax liability in connection with the grant, vesting or settlement of any Award that is subject to tax withholding and the Participant is obligated to pay the Company the amount required to be withheld, the Committee may allow the Participant to satisfy the minimum withholding tax obligation by electing to have the Company withhold from the Shares to be issued that number of Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined on the date that the amount of tax to be withheld is to be determined. All elections by a Participant to have Shares withheld for this purpose will be made in writing in a form and during a period acceptable to the Committee.

7. Privileges of Stock Ownership; Voting and Dividends. Except to the extent that the Committee grants an RSU that entitles the Participant to credit for dividends paid on Award Shares prior to the date such Shares are issued to the Participant (as reflected in the RSU Agreement), no Participant will have any of the rights of a stockholder with respect to any Shares until the Shares are issued to the Participant. For the avoidance of doubt, in the event the Committee grants an RSU that entitles a Participant to credit for dividends on Award Shares prior to the date such Shares are issued, dividends shall not be paid to a Participant until Shares are issued with respect to such RSU. After Shares are issued to the Participant, the Participant will be a stockholder and have all the rights of a stockholder with respect to such Shares, including the right to vote and receive all dividends or other distributions made or paid with respect to such Shares.

8. Transferability. Unless determined otherwise by the Committee or its delegate(s) or pursuant to this Section 8, an Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner, other than by (i) a will or (ii) by the laws of descent or distribution. If the Committee makes an Award

 

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transferable, including, without limitation, by instrument to an inter vivos or testamentary trust in which the Awards are to be passed to beneficiaries upon the death of the trustor (settlor) or by gift or domestic relations order to a Permitted Transferee, such Award may contain such additional terms and conditions as the Committee or its delegate(s) deems appropriate.

9. Restrictions on Shares. All certificates for Shares or other securities delivered under this Plan will be subject to such stock transfer orders, legends and other restrictions as the Committee may deem necessary or advisable, including restrictions under any applicable federal, state or foreign securities law, or any rules, regulations and other requirements of the SEC or any stock exchange or automated quotation system upon which the Shares may be listed or quoted.

10. Escrow; Pledge of Shares. To enforce any restrictions on a Participant’s Shares, the Committee may require the Participant to deposit all certificates representing Shares, together with stock powers or other instruments of transfer approved by the Committee, appropriately endorsed in blank, with the Company or an agent designated by the Company to hold in escrow until such restrictions have lapsed or terminated, and the Committee may cause a legend or legends referencing such restrictions to be placed on the certificates.

11. Exchange and Buyout of Awards. The Committee may, at any time or from time to time, authorize the Company, with the consent of the respective Participants, to issue new Awards in exchange for the surrender and cancellation of any or all outstanding Awards, subject to any applicable law, including any tax ruling, if so required.

12. Securities Law and Other Regulatory Compliance. An Award will not be effective unless such Award is in compliance with all applicable federal, state, and foreign securities laws, rules and regulations of any governmental body, and the requirements of any stock exchange or automated quotation system upon which the Shares may then be listed or quoted, as they are in effect on the date of grant of the Award and also on the date of exercise or other issuance. Notwithstanding any other provision in this Plan, the Company will have no obligation, and no liability for failure, to issue Shares or deliver certificates for Shares under this Plan prior to: (a) obtaining any approvals from governmental agencies, including governmental agencies outside the United States, that the Company determines are necessary or advisable; and/or (b) completion of any registration or other qualification of such Shares under any local, state, federal, or foreign law or ruling of any governmental body that the Company determines to be necessary or advisable. Furthermore, the inability or impracticability of the Company to obtain or maintain approval from any governmental agencies or to complete any registration or other qualification of the Shares under any applicable law or ruling as set forth herein shall relieve the Company of any liability with respect to the failure to issue or sell such Shares and shall constitute circumstances in which the Committee may determine to amend or cancel Awards pertaining to such Shares, with or without consideration to the affected Participants. Finally, the Company will be under no obligation to register the Shares with the SEC or to effect compliance with the registration, qualification or listing requirements of any state, local or foreign securities laws, stock exchange or automated quotation system, and the Company will have no liability for any inability or failure to do so.

13. Foreign Awards and Rights. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in countries in which the Company operates or has Eligible Individuals, the Committee, in its sole discretion, shall have the power and authority to (i) modify the terms and conditions of any Award granted to Eligible Individuals to comply with applicable laws of jurisdictions where Eligible Individuals reside; (ii) establish sub-plans and determine the exercise or purchase price, methods of exercise and other terms and procedures and rules, to the extent such actions may be necessary or advisable, including adoption of rules, procedures or sub-plans applicable to its Parent, Subsidiaries, Affiliates or Participants residing in particular locations; provided, however , that no such sub-plans and/or modifications shall increase the share limitations contained in Section 2 hereof or otherwise require shareholder approval; and (iii) take any action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local governmental regulatory exemptions or approvals. Without limiting the generality of the foregoing, the Committee is specifically authorized to adopt rules, procedures and sub-plans with provisions that limit or modify rights on eligibility to receive an Award under the Plan or on Termination, available methods of exercise or settlement of an Award, payment of Tax-Related Items, the shifting of employer tax liability to the Participant, the withholding procedures and handling of any Share certificates or other indicia of ownership which may vary with local requirements. The Committee may also adopt sub-plans to the Plan intended to allow the Company to grant tax-qualified Awards in a particular jurisdiction. Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate the Securities Act, Exchange Act, the Code, or any federal, state, local or foreign securities law.

 

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14. Corporate Transactions.

14.1 Assumption or Replacement of Awards by Successor. In the event of (a) a dissolution or liquidation of the Company, (b) the consummation of a merger or consolidation in which the Company is not the surviving corporation ( other than (i) a merger or consolidation with a wholly-owned subsidiary, (ii) a reincorporation of the Company in a different jurisdiction, or (iii) other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the Awards granted under this Plan are assumed, converted or replaced by the successor corporation, which assumption will be binding on all Participants), (c) the consummation of a merger in which the Company is the surviving corporation but after which the stockholders of the Company (other than any stockholder which merges (or which owns or controls another corporation which merges) with the Company in such merger) cease to own their shares or other equity interests in the Company, (d) the sale of substantially all of the assets of the Company, or (e) the consummation of any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code wherein the stockholders of the Company give up all of their equity interest in the Company ( except for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the Company from or by the stockholders of the Company)(each provision herein (a) through (e) a “ Corporate Transaction”), any or all outstanding Awards may be assumed, converted or replaced by the successor corporation (if any), which assumption, conversion or replacement will be binding on all Participants, or the successor corporation may substitute equivalent awards or provide substantially similar consideration to Participants as was provided to stockholders (after taking into account the existing provisions of the Awards). In the event such successor corporation (if any) fails to assume or substitute Awards pursuant to a transaction described in this Subsection 14.1, all such Awards will expire on such transaction at such time and on such conditions as the Board shall determine. Notwithstanding the foregoing, a transaction described in (a) through (e) above must also qualify as a change in the ownership or effective control of a corporation or a change in the ownership of a substantial portion of a corporation’s assets, as the case may be, within the meaning of Code Section 409A and the regulations thereunder.

14.2 Other Treatment of Awards. Subject to any greater rights granted to Participants under the foregoing provisions of this Section 14, in the event of the occurrence of any transaction described in Section 14.1, any outstanding Awards will be treated as provided in the applicable agreement or plan of merger, consolidation, dissolution, liquidation, sale of assets or other “corporate transaction.”

15. No Obligation to Employ; Accelerated Expiration of Award for Harmful Act. Nothing in this Plan or any Award granted under this Plan will confer or be deemed to confer on any Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Parent, Subsidiary or Affiliate of the Company or limit in any way the right of the Company or any Parent, Subsidiary or Affiliate of the Company to terminate Participant’s employment or other relationship at any time, with or without cause. Notwithstanding anything to the contrary herein, if a Participant is Terminated because of such Participant’s actual or alleged commitment of a criminal act or an intentional tort and the Company (or an employee of the Company) is the victim or object of such Criminal act or intentional tort or such criminal act or intentional tort results, in the reasonable opinion of the Committee, in liability, loss, damage or injury to the Company, then, at the Committee’s election, Participant’s Awards shall not be issuable or settleable and shall terminate and expire upon the Participant’s Termination Date. Termination by the Company based on a Participant’s alleged commitment of a criminal act or an intentional tort shall be based on a reasonable investigation of the facts and a determination by the Company that a preponderance of the evidence discovered in such investigation indicates that such Participant is guilty of such criminal act or intentional tort.

16. Certain Stockholder Approval Matters.

16.1 Plan Effectiveness; Increasing Plan Shares. This Plan became effective on June 27, 2017 (the “Effective Date”). Any amendment to this Plan increasing the number of Shares available for issuance hereunder shall be approved by the stockholders of the Company, consistent with applicable laws, within twelve (12) months before or after the effective date of such amendment (“Amendment Effective Date”). Upon the Amendment Effective Date, the Board may grant Awards covering such additional Shares pursuant to this Plan;

 

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provided, however, that: in the event that stockholder approval of any such amendment increasing the number of Shares subject to this Plan is not obtained, all Awards covering such additional Shares granted hereunder will be canceled, any Shares issued pursuant to any Award will be canceled, and any purchase of Shares hereunder will be rescinded.

17. Term of Plan. Unless earlier terminated as provided herein, this Plan will terminate on June 27, 2027. Notwithstanding anything to the contrary in this Plan, any Award Agreement or otherwise, upon the termination of the Purchase Agreement, this Plan and all Awards granted hereunder will automatically terminate with no consideration due to any Participant.

18. Amendment or Termination of Plan. The Board may at any time terminate or amend this Plan in any respect, provided, however, that the Board will not, without the approval of the stockholders of the Company, amend this Plan to increase the number of shares that may be issued under this Plan, change the designation of employees or class of employees eligible for participation in this Plan, or otherwise materially modify a provision of the Plan if such modification requires stockholder approval under the applicable rules and regulations of the Nasdaq Market.

19. Nonexclusivity of the Plan. Neither the adoption of this Plan by the Board, the submission of this Plan to the stockholders of the Company for approval, nor any provision of this Plan will be construed as creating any limitations on the power of the Board to adopt such additional compensation arrangements as it may deem desirable, including, without limitation, the granting of stock options and bonuses otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases.

20. Governing Law. The Plan shall be governed by the laws of the state of Israel, without regard to its conflict of laws.

21. No Guarantee of Tax Consequences. Although the Company may endeavor to qualify an Award for favorable tax treatment under the laws of the United States or jurisdictions outside of the United States or to avoid adverse tax treatment, the Company makes no representation to that effect and expressly disavows any covenant to maintain favorable or avoid unfavorable tax treatment, notwithstanding anything to the contrary in this Plan, and the Company will have no liability to a Participant or any other party if an Award that is intended to benefit from favorable tax treatment or avoid adverse tax treatment does not receive or maintain such favorable treatment or does not avoid such unfavorable treatment or for any action taken by the Committee with respect to the Award. The Company shall be unconstrained in its corporate activities without regard to the potential negative tax impact on holders of Awards under the Plan.

22. Definitions. As used in this Plan, the following terms will have the following meanings:

“Affiliate” means any corporation that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, another corporation, where “control” (including the terms “controlled by” and “under common control with”) means the possession, direct or indirect, of the power to cause the direction of the management and policies of the corporation, whether through the ownership of voting securities, by contract or otherwise.

“Award” means any award under this Plan, including any Restricted Stock Unit or Performance Stock Unit.

“Award Agreement” means, with each Award, the signed written agreement between the Company and the Participant setting forth the terms and conditions of the Award.

“Board” means the Board of Directors of the Company.

“Closing ” is defined in the Purchase Agreement.

“Code” means the Internal Revenue Code of 1986, as amended.

 

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“Ordinary Shares” means Ordinary Shares of the Company.

“Committee ” means the committee appointed by the Board to administer this Plan, or if no such committee is appointed, the Board.

“Company” means Skycure Ltd., a company organized under the laws of Israel, or any successor corporation.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

Fair Market Value means, as of any date, the value of an Ordinary Share of the Company determined as follows:

(a) if such Ordinary Shares is then quoted on the Nasdaq Global Select Market, the Nasdaq Global Market or the Nasdaq Capital Market (collectively, the “ Nasdaq Market”), its closing price on the Nasdaq Market on the date of determination as reported in The Wall Street Journal or such other source as the Board or the Committee deems reliable;

(b) if such Ordinary Shares is publicly traded and is then listed on a national securities exchange, its closing price on the date of determination on the principal national securities exchange on which the Ordinary Shares is listed or admitted to trading as reported in The Wall Street Journal or such other source as the Board or the Committee deems reliable;

(c) if such Ordinary Shares is publicly traded but is not quoted on the Nasdaq Market nor listed or admitted to trading on a national securities exchange, the average of the closing bid and asked prices on the date of determination as reported in The Wall Street Journal or such other source as the Board or the Committee deems reliable; or

(d) if none of the foregoing is applicable, by the Board or the Committee in good faith.

Insider ” means an officer or director of the Company or any other person whose transactions in the Company’s Ordinary Shares are subject to Section 16 of the Exchange Act.

Purchase Agreement” means the Share Purchase Agreement to be entered into by and among Symantec Corporation, a Delaware corporation, a wholly owned subsidiary of Symantec Corporation, and the Company.

“Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if at the time of the granting of an Award under this Plan, each of such corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

Participant ” means a person who receives an Award under this Plan.

“Performance Period” means the period of service determined by the Committee during which years of service or performance is to be measured for an Award.

“Performance Stock Unit” or “PSU” means an award of Shares pursuant to Section 5.

“Plan ” means this Skycure Ltd. 2017 Equity Incentive Plan, as amended from time to time.

“Restricted Stock Unit” or “RSU” means an award of Shares pursuant to Section 5.

“Securities Act” means the Securities Act of 1933, as amended.

 

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“Shares” means Ordinary Shares of the Company reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and 14, and any successor security.

“Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the time of granting of the Award, each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

“Tax-Related Items” means federal, state, or local taxes and any taxes imposed by jurisdictions outside of the United States (including but not limited to income tax, social insurance contributions, fringe benefits tax, payment on account, employment tax obligations, and stamp taxes) required by law to be withheld and any employer liability shifted to a Participant.

“Termination” or “ Terminated ’’ means, for purposes of this Plan with respect to a Participant, that the Participant has for any reason ceased to provide services as an Eligible Individual to the Company or a Parent, Subsidiary or Affiliate of the Company. A Participant will not be deemed to have ceased to provide services in the case of (i) sick leave, (ii) vacation leave (iii) military leave, (iv) transfers of employment between the Company and its Parent, Subsidiaries or Affiliates; or (v) any other leave of absence approved by the Committee, provided, that such leave is for a period of not more than three months, unless reemployment upon the expiration of such leave is guaranteed by contract or statute or unless provided otherwise pursuant to formal policy adopted from time to time by the Company. In the case of any Participant on an approved leave of absence, the Committee may make such provisions respecting suspension of vesting of the Award while on leave from the employ of the Company or its Parent, Subsidiaries or Affiliates as it may deem appropriate, except that in no event may an Award be exercised after the expiration of the term, if any, set forth in the applicable Award Agreement. The Committee will have sole discretion to determine whether a Participant has ceased to provide services and the effective date on which the Participant ceased to provide services (the “Termination Date ”).

 

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SKYCURE LTD.

APPENDIX A—ISRAEL

TO THE 2017 EQUITY INCENTIVE PLAN

 

1. GENERAL

 

  1.1 This appendix (the “Appendix”) shall apply only to persons who are residents of the State of Israel for tax purposes or those who are otherwise subject to tax in Israel with respect to the Awards (the “Israeli Participants”). The provisions specified hereunder shall form an integral part of the Skycure Ltd. 2017 Equity Incentive Plan (the “Plan”), which applies to the issuance of Awards to purchase or acquire Ordinary Shares (“Shares”) of Skycure Ltd., a company organized under the laws of Israel, or any successor corporation, (the “Company”). The term “Company” shall include any successor to Skycure Ltd., as well as its Subsidiaries and Affiliates.

 

  1.2 This Appendix is effective with respect to Awards granted on or after June 27, 2017 and shall comply with Amendment no. 132 of the Israeli Tax Ordinance.

 

  1.3 This Appendix is to be read as a continuation of the Plan and only modifies the terms of Awards granted to Israeli Participants so that they comply with the requirements set by the Israeli tax, securities and applicable law in general, and in particular with the provisions of Section 102 (as specified herein), as may be amended or replaced from time to time. For the avoidance of doubt, this Appendix does not add to or modify the Plan in any other respect.

 

  1.4 The Plan and this Appendix are complimentary to each other and shall be deemed as one. In any case of contradiction with respect to Awards granted to Israeli Participants, whether explicit or implied, between the provisions of this Appendix and the Plan, the provisions set out in the Appendix shall prevail. This Appendix complies with, and is subject to, the provisions of the Ordinance and Section 102 (as defined below).

 

  1.5 Any capitalized terms not specifically defined in this Appendix shall be construed according to the interpretation given to it in the Plan.

 

2. DEFINITIONS

 

  2.1 “3(i) Award” means an Award granted pursuant to Section 3(i) of the Ordinance to any person who is a Non- Employee.

 

  2.2 “102 Award” means any Award granted to Employees pursuant to Section 102 of the Ordinance.

 


  2.3 “Approved 102 Award” means an Award granted pursuant to Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of the Israeli Participant.

 

  2.4 “Award” solely for purposes of this Appendix means an award of a stock-based award, including RSUs or PRUs, granted pursuant to the terms and conditions of the Plan and this Appendix.

 

  2.5 “Award Agreement” means the agreement and other documents evidencing the terms and conditions of an Award.

 

  2.6 “Capital Gain Award or CGA” means an Approved 102 Award elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) and Section 102(b)(3) of the Ordinance.

 

  2.7 “Controlling Shareholder” shall have the meaning ascribed to it in Section 32(9) of the Ordinance.

 

  2.8 “Employee” means a person who is employed by the Company or an Israeli resident Subsidiary of the Company, including an individual who is serving as a director or an office holder, but excluding any Controlling Shareholder, all as determined in Section 102 of the Ordinance.

 

  2.9 “ITA” means the Israeli Tax Authorities.

 

  2.10 “Non-Employee” means a consultant, adviser, service provider, Controlling Shareholder or any other person who is not an Employee.

 

  2.11 “Ordinance” means the Israeli Income Tax Ordinance [New Version], 1961 as now in effect or as hereafter amended.

 

  2.12 “Ordinary Income Award or OIA” means an Approved 102 Award elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the Ordinance.

 

  2.13 “Section  102” means section 102 of the Ordinance and any regulations, rules, orders, procedures, or administrative guidelines promulgated thereunder as now in effect or as hereafter amended, and any tax rulings issued by the ITA to the Company or any Subsidiary.

 

  2.14 “Subsidiary” means any “employer” within the meaning of article (1) of “employer company” under Section 102(a) of the Ordinance that also meets the definition of Subsidiary under the Plan.

 

  2.15 “Trustee” means any individual or entity appointed by the Company to serve as a trustee and approved by the ITA, all in accordance with the provisions of Section 102(a) of the Ordinance.


  2.16 “Unapproved 102 Award” means an Award granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee.

 

3. ISSUANCE OF AWARDS

 

  3.1 The persons eligible for participation in the Plan and this Appendix as Israeli Participants shall include any Employees and/or Non-Employees of the Company or of any Subsidiary; provided, however, that (i) Employees may only be granted 102 Awards; and (ii) Non-Employees and/or Controlling Shareholders may only be granted 3(i) Awards.

 

  3.2 The Company may designate Awards granted to Employees pursuant to Section 102 as Unapproved 102 Awards or Approved 102 Awards.

 

  3.3 The grant of Approved 102 Awards shall be made under this Appendix adopted by the Board, and shall be conditioned upon the approval of this Appendix by the ITA. To avoid any doubt, not Award shall be granted as an Approved 102 Award until 30 days have elapsed from the date that the requisite filings required by Section 102 and the rules promulgated thereunder are duly made to the ITA, unless the ITA approves otherwise in writing.

 

  3.4 Approved 102 Awards may either be classified as CGAs or OIAs.

 

  3.5 No Approved 102 Awards may be granted under this Appendix to any eligible Employee, unless and until, the Company’s election of the type of Approved 102 Awards as CGA or OIA granted to Employees (the “ Election ”), is appropriately filed with the ITA. Such Election shall become effective beginning the first date of grant of an Approved 102 Award under this Appendix and shall remain in effect at least until the end of the year following the year during which the Company first granted Approved 102 Awards under this Appendix, unless provided otherwise under Section 102. The Election shall obligate the Company to grant only the type of Approved 102 Award it has elected (CGA or OIA) during the period indicated in the preceding sentence, and shall apply to all Approved 102 Awards granted during the period the Election is in effect, all in accordance with the provisions of Section 102(g) of the Ordinance. For the avoidance of doubt, such Election shall not prevent the Company from granting Unapproved 102 Awards to Employees or 3(i) Awards to Non-Employees.

 

  3.6 All Approved 102 Awards must be held in trust by a Trustee, as described in Section 4 below, and shall also be subject to the agreement between the Trustee and the Company or any Israeli resident Subsidiary (“ Trust Agreement ”), which shall be deemed an integral part of the Approved 102 Award.

 

  3.7 For the avoidance of doubt, the designation of Unapproved 102 Awards and Approved 102 Awards shall be subject to the terms and conditions set forth in Section 102.

 


4. TRUSTEE

 

  4.1 Approved 102 Awards which shall be granted under this Appendix shall be held by the Trustee and any Shares allocated or issued upon exercise or vesting of such Approved 102 Awards and/or other property received with respect to such shares (including bonus shares and other rights) shall be allocated or issued to the Trustee and held for the benefit of the Israeli Participants for such period of time as required by Section 102 or any regulations, rules or orders or procedures promulgated thereunder (the “Holding Period”). In the case the requirements for Approved 102 Awards are not met, then the Approved 102 Awards shall be regarded as Unapproved 102 Awards, all in accordance with the provisions of Section 102.

 

  4.2 Notwithstanding anything to the contrary, the Trustee shall not release any Awards and/or any Shares allocated or issued upon exercise or vesting of Approved 102 Awards (or any other rights received with respect to such Shares) prior to the full payment of the Israeli Participant’s tax liabilities (including, without limitation, social security taxes if applicable) arising from the grant, exercise, or vesting of Approved 102 Awards granted to such Israeli Participants or the sale or transfer of any Shares issued pursuant to the Approved 102 Awards.

 

  4.3 With respect to any Approved 102 Award, subject to the provisions of Section 102 and any rules or regulation or orders or procedures promulgated thereunder, to obtain favorable tax treatment, an Israeli Participant shall not sell or release from trust any Award and/or Shares received upon the exercise or vesting of an Approved 102 Award or any other property received with respect to such Shares (including bonus shares), until the lapse of the Holding Period required under Section 102 of the Ordinance, and shall not require the Trustee to release or sell the Awards or Shares unless permitted to do so by applicable law. Notwithstanding the above, if any such sale or release occurs during the Holding Period, the sanctions applying to the Israeli Participant under Section 102 of the Ordinance and under any rules or regulation or orders or procedures promulgated thereunder shall apply to and shall be borne by such Israeli Participant.

 

  4.4 Each Approved 102 Award will be deemed granted on the date of grant stated in the applicable Award Agreement, provided that (i) the Company has provided notice to the Trustee of the Award within the timeframe specified under Section 102 or by the ITA, and (ii) the Israeli Participant has accepted or is deemed to accept the Award Agreement and any other documents required by the Company, any Subsidiary or the Trustee evidencing the acceptance of the terms of Section 102.

 

  4.5 In the event a stock dividend is declared and/or additional rights are granted with respect to Shares which derive from Awards granted as Approved 102 Awards, such stock dividend and/or rights shall also be deposited with the Trustee and will be subject to the provisions of this Appendix. The Holding Period for such Shares and/or rights shall be measured from the commencement of the Holding Period for the Award with respect to which the stock dividend was declared and/or rights granted.

 


  4.6 If an Award granted as an Approved 102 Award is exercised or vested/settled, as applicable, during the Holding Period, the Shares issued upon such exercise or vesting/settlement, as applicable, shall be issued in the name of the Trustee for the benefit of the Eligible 102 Participant or as provided under Section 102. If such an Award is exercised or vested/settled, as applicable, after the Holding Period ends, the Shares issued upon such exercise or vesting/settlement shall, at the election of the Israeli Participant, either (i) be issued in the name of the Trustee or as provided under Section 102, or (ii) be transferred to the Israeli Participant directly, provided that the Participant first complies with all applicable provisions of the Plan and this Appendix, and the Company and/or its Subsidiary confirms that all of the taxes and mandatory payments in compliance with applicable withholding requirements have been paid by the Israeli Participant.

 

  4.7 To avoid doubt, and notwithstanding anything to the contrary in the Plan no Award granted as an Approved 102 Award may be settled for cash payment or any other form of consideration other than Shares.

 

5. THE AWARDS

The terms and conditions upon which the Awards shall be issued and exercised shall be as specified in the Award Agreement to be executed pursuant to the Plan and to this Appendix. Each Award Agreement shall state, inter alia, the number of Shares to which the Award relates, the type of Award granted thereunder (whether a CGA, OIA, Unapproved 102 Award or a 3(i) Award), the vesting provisions and the exercise price (if applicable).

 

6. ASSIGNABILITY AND SALE OF AWARDS

 

  6.1 Notwithstanding any other provision of the Plan, no Award or any right with respect thereto, shall be assignable, transferable or given as collateral or any right with respect to them given to any third party whatsoever, and during the lifetime of the Israeli Participant each and all of such Israeli Participant’s rights to purchase Shares hereunder shall be exercisable only by the Israeli Participant.

Any such action made directly or indirectly, for an immediate validation or for a future one, shall be void.

 

  6.2 With respect to Approved 102 Awards, the Trustee will not perform any transaction regarding the Awards or any Shares issued pursuant to the Awards, including transferring, selling, seizing, assigning, hypothecating or pledging, disposing or assigning the Awards or any Shares subject to the Awards, and will not give any power of attorney regarding the Awards or any Shares subject to the Awards, in any manner other than permitted by the Plan, unless all taxes are paid to the ITA, or the Trustee assures that the taxes will be paid. If the Awards are transferred by will or by the laws of descent and distribution, Section 102 will apply to the heirs or transferees of the Israeli Participant.

 


7. DIVIDEND

Any cash dividends payable with respect to Shares acquired upon exercise or vesting of an Award shall be transferred to the Israeli Participant subject to any applicable withholding taxes and mandatory payments on distribution of dividends, and when applicable subject to the provisions of Section 102 and the rules, regulations or orders promulgated thereunder.

 

8. TAX CONSEQUENCES

 

  8.1 Any tax consequences arising from the grant, exercise or vesting of any Award from the issuance, sale or transfer of Shares or from any other event or act (of the Company, and/or its Subsidiaries, or the Trustee or the Israeli Participant) hereunder shall be borne solely by the Israeli Participant (including, without limitation, social security payments or social contributions, if applicable). The Company and/or its Subsidiaries, and/or the Trustee shall withhold taxes according to the requirements under the applicable laws, rules, and regulations, including withholding taxes at source. Furthermore, the Israeli Participant shall agree to indemnify the Company and/or its Subsidiaries and/or the Trustee and hold them harmless against and from any and all liability for any such tax or other payment or interest or penalty thereon, including without limitation, liabilities relating to the obligation to withhold, or to have withheld, any such tax from any payment made to the Israeli Participant. The Company and/or its Subsidiaries, and/or the Trustee may make such provisions and take such steps as it/they may deem necessary or appropriate for the withholding of all taxes required by law to be withheld with respect to Awards granted under the Plan and the exercise, vesting, sale, transfer or other disposition thereof, by withholding from proceeds of the sale of Shares acquired upon vesting of RSUs either through a voluntary sale or through a mandatory sale arranged by the Company. In case the Company and/or a Subsidiary determines that withholding from proceeds of the sale of Shares is not permissible or otherwise not desirable, the Israeli Participant further authorizes the Company and/or a Subsidiary and/or the Trustee, or their respective agents, at the Company’s discretion, to satisfy the obligations with regard to all withholding taxes through one or more of the following methods (i) irrevocable instructions given by the Israeli Participant to a broker to remit to the Company cash, in an amount equal to such withholding taxes, from a previously established account the Israeli Participant maintains with such broker; or (ii) through withholding from the Israeli Participant’s wages or other cash compensation paid to the Israeli Participant by the Company or the employer. In addition, the Israeli Participant will be required to pay any amount, including penalties, that exceeds the tax to be withheld and transferred to the tax authorities, pursuant to applicable tax laws, regulations and rules.

 


  8.2 For avoidance of doubt, the Company shall take all steps necessary that the Approved 102 Awards shall be eligible for the tax benefits pursuant to Section 102. Nevertheless, there is no assurance that all of the Awards granted as Approved 102 Awards shall be eligible for the tax benefits pursuant to Section 102. Therefore, any tax consequences arising from the grant, vesting, or exercise of any Awards, from the issuance of Shares covered thereby, or from any other event or act (of the Company, any Subsidiary, the Trustee, and/or the Israeli Participant), shall be borne solely by the Israeli Participant.

 

  8.3 The Company and/or the Subsidiary and/or, when applicable, the Trustee shall not be required to release any Award and/or any share certificate to an Israeli Participant until all required payments have been fully made to the Company and/or to the Subsidiary and all of the Israeli Participant’s tax liabilities have been satisfied.

 

  8.4 With respect to Unapproved 102 Awards, if the Israeli Participant ceases to be employed by the Company or any Subsidiary, the Israeli Participant shall extend to the Company and/or its Subsidiary a security or guarantee for the payment of tax due at the time of sale of Shares, all in accordance with the provisions of Section 102 and the rules, regulation or orders promulgated thereunder.

* * *

 


 

 

Notice of Grant of Award            SKYCURE LTD.   
and Award Agreement      

 

 

 

%%FIRST_NAME%-%    Award Number:    %%SHARE_NUMBER%-%
%%LAST_NAME%-%    Plan:    %%EQUITY_PLAN%-%
%%ADDRESS_LINE_1%-%      
%%ADDRESS_LINE_2%-%      
%%CITY%-% %%STATE%-% %%COUNTRY%-%    ID:    %%EMPLOYEE_IDENTIFIER%-%

 

 

Effective %%RSU_DATE%-%, you have been granted an award of %%TOTAL_RSU_GRANTED%-% restricted stock units.

The award will vest in increments on the date(s) shown.

 

     Shares                        Full Vest                    

 

 

By your signature and the Company’s signature below, you and the Company agree that this award is granted under and governed by the terms and conditions of the Company’s 2017 Equity Incentive Plan, as amended and the Award Agreement, including its appendices, all of which are attached and made a part of this

 

 

 

 

   

 

SKYCURE LTD.     Date

 

   

 

%%FIRST_NAME%-% %%LAST_NAME%-%     Date


SKYCURE LTD.

2017 EQUITY INCENTIVE PLAN

RSU AWARD AGREEMENT

RECITALS

A. The Board has adopted the Plan for the purpose of providing incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of Skycure Ltd. (the “Company”) and its Subsidiaries and Affiliates. The term “Company” shall include any successor to Skycure Ltd., as well as its Subsidiaries and Affiliates. Notwithstanding anything to the contrary in the Plan, any Award Agreement or otherwise, upon the termination of the Purchase Agreement, the Plan and all Awards granted thereunder will automatically terminate with no consideration due to any Participant.

B. The Participant is to render valuable services to the Company and/or its Subsidiaries and Affiliates, and this RSU Award Agreement, including the additional terms for Participants located outside of the United States in Appendix A and the country-specific terms in Appendix B (jointly, the “Agreement”) is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Company’s issuance of rights in respect of the Company’s Ordinary Shares in the form of Restricted Stock Units (each, a “RSU”).

C. All capitalized terms in this Agreement shall have the meaning assigned to them herein, including Appendix A. All undefined terms shall have the meaning assigned to them in the Plan.

NOW, THEREFORE , it is hereby agreed as follows:

1. Grant of Restricted Stock Units . The Company hereby awards to the Participant RSUs under the Plan. Each RSU represents the right to receive one share of the Company’s Ordinary Shares on the vesting date of that RSU (each, a “Share”), provided that no Award may vest or settle at or prior to the Closing, subject to the provisions of this Agreement (including any appendices hereto). The number of shares of the Company’s Ordinary Shares subject to this Award, the applicable vesting schedule for the RSUs and the Shares, the dates on which those vested Shares shall be issued to the Participant and the remaining terms and conditions governing this Award shall be as set forth in this Agreement.

2. Grant Acceptance ; Acknowledgement . The Company and the Participant agree that the RSUs are granted under and governed by the Grant Notice, this Agreement and the provisions of the Plan. The Participant: (i) acknowledges receipt of a copy of the Plan, (ii) represents that the Participant has carefully read and is familiar with their provisions, and (iii) hereby accepts the RSUs subject to all of the terms and conditions set forth herein, in the Plan and in the Grant Notice.

AWARD SUMMARY

 

Award Date and Number of Shares Subject to Award :    As set forth in the Grant Notice
Vesting Schedule :    The Shares shall vest pursuant to the schedule set forth in the Grant Notice. Notwithstanding the foregoing, if any such dates falls on a weekend or U.S. trading holiday and if the shares underlying the RSU are publically traded, the Fair Market Value of the Shares underlying the RSUs will be the closing price of the Company’s Ordinary Shares on the Nasdaq Global Select Market on the last trading day prior to the vesting date.

 

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The RSUs allocated to each applicable vesting date shall vest on that date only if the employment of the Participant has not Terminated as of such date, and no additional RSUs shall vest following the Participant’s Termination.

 

The Participant acknowledges and agrees that the Vesting Schedule may change prospectively in the event that the Participant’s service status changes between full and part-time status in accordance with Company policies relating to work schedules and vesting of awards.

Issuance Schedule    The Shares in which the Participant vests in accordance with the foregoing Vesting Schedule shall be issuable as set forth in Section 7.

3. Limited Transferability . This Award, and any interest therein, shall not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner by the Participant, otherwise than by will or by the laws of descent and distribution unless otherwise determined by the Committee or its delegate(s) in accordance with the terms of the Plan on a case-by-case basis.

4. Cessation of Service . Should the Participant’s service as an Eligible Individual to the Company or a Parent, Subsidiary or an Affiliate of the Company be Terminated for any reason (whether or not in breach of local labor laws) prior to vesting in one or more Shares subject to this Award, then the RSUs covering such unvested Shares will be immediately thereafter cancelled, the Participant shall cease to have any right or entitlement to receive any Shares under those cancelled RSUs and the Participant’s right to receive Shares pursuant to the RSUs and vest in such RSUs under the Plan will terminate effective as of the date of the Participant’s Termination; for purposes of vesting, in no event will the Participant’s service be extended by any notice period mandated under local law ( e.g ., active service would not include a period of “garden leave” or similar period pursuant to local law). For purposes of this Award, a transfer of employment between the Company and any Parent, Subsidiary and/or Affiliate shall not constitute a Termination. The Committee shall have the exclusive discretion to determine when the Participant is no longer actively providing service for purposes of the Plan and the effective date on which the Participant ceased to provide services (the “Termination Date”).

5. Corporate Transaction .

a. In the event of a transaction set forth in Section 14.1 of the Plan, any or all outstanding RSUs subject to this Agreement may be assumed, converted or replaced by the successor corporation (if any), which assumption, conversion or replacement will be binding on the Participant, or the successor corporation may substitute an equivalent award or provide substantially similar consideration to the Participant as was provided to stockholders (after taking into account the existing provisions of the RSUs).

b. In the event such successor corporation (if any) fails to assume this Award or substitute an equivalent award (as provided in Section 5(a) above) pursuant to a transaction set forth in Section 14.1 of the Plan, this Award will expire on such transaction at such time and on such conditions as the Board shall determine.

 

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c. Any action taken pursuant to clauses (a) or (b) above must either (i) preserve the exemption of these RSUs from Section 409A of the Code or (ii) comply with Section 409A of the Code.

d. This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

6. Adjustment in Shares . Should any change be made to the Company’s Ordinary Shares by reason of any stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration or if there is a change in the corporate structure, then appropriate adjustments shall be made to the total number and/or class of securities and any Dividend Equivalent Rights (as defined below) issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder.

7. Issuance of Shares of the Company’s Ordinary Shares .

a. As soon as practicable following the applicable vesting date of any portion of the RSU (including the date (if any) on which vesting of any portion of this RSU accelerates), the Company shall issue to or on behalf of the Participant a certificate (which may be in electronic form) for the applicable number of underlying Shares that so vested, subject, however, to the provisions of Section 8 pursuant to which the applicable Tax-Related Items (as defined below) are to be collected. In no event shall the date of settlement (meaning the date that Shares are issued) be later than two and one half (2  1 2 ) months after the later of (i) the end of the Company’s fiscal year in which the applicable vesting date occurs or (ii) the end of the calendar year in which the applicable vesting date occurs.

b. With respect to U.S. grantees, If the Company determines that the Participant is a “specified employee,” as defined in the regulations under Section 409A of the Code, at the time of the Participant’s “separation from service,” as defined in those regulations, then any units subject to the RSUs that are subject to Section 409A of the Code that otherwise would have been settled during the first six months following the Participant’s separation from service will instead be settled on the earliest of (i) the seventh month following the Participant’s separation from service or (ii) the date of Participant’s death following the Participant’s separation from service, unless the settlement of those units is exempt from Section 409A of the Code.

c. In no event shall fractional Shares be issued.

d. Except as set forth in clause (e) below, the holder of this Award shall not have any stockholder rights, including voting rights, with respect to the Shares subject to the RSUs until the Participant becomes the record holder of those Shares following their actual issuance and after the satisfaction of the Tax-Related Items (as defined below) .

e. As of any date that the Company pays an ordinary cash dividend on its Ordinary Shares, the Company shall credit the Participant with a dollar amount equal to (i) the per share cash dividend paid by the Company on its Ordinary Shares on such date, multiplied by (ii) the total number of RSUs (with such total number adjusted pursuant to Section 6 of this Agreement and Section 2.2 of the Plan) subject to this Award that are outstanding immediately prior to the record date for that dividend (a “Dividend Equivalent Right”). Any Dividend Equivalent Rights credited pursuant to the foregoing provisions of this Section 7(e) shall be subject to the same vesting, payment and other terms, conditions and restrictions as the original RSUs to which they relate; provided, however, that the amount of any vested Dividend

 

4


Equivalent Rights shall be paid in cash. No crediting of Dividend Equivalent Rights shall be made pursuant to this Section 7(e) with respect to any RSUs which, immediately prior to the record date for that dividend, have either been paid pursuant to Section 7 or terminated pursuant to Section 4.

8. Tax-Related Items . Regardless of any action the Company or the Participant’s actual employer (the “Employer”) takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant’s responsibility and that the Company and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the award, including the settlement of the RSUs, accrual or payment of Dividend Equivalent Rights, the subsequent sale of Shares acquired pursuant to such settlement and the receipt of any dividends; and (2) do not commit to structure the terms of the award or any aspect of the RSUs to reduce or eliminate the Participant’s liability for Tax-Related Items. The Participant acknowledges that if the Participant is subject to Tax-Related Items in more than one jurisdiction, the Company and/or the Employer may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

Prior to the settlement of the Participant’s RSUs, the Participant shall pay or make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all withholding and payment on account obligations of the Company and/or the Employer. In this regard, the Participant authorizes the Company and/or the Employer to withhold all applicable Tax-Related Items legally payable by the Participant from the Participant’s wages or other cash compensation paid to the Participant by the Company and/or the Employer. With the Company’s consent, these arrangements may also include, if permissible under local law, (a) withholding Shares that otherwise would be issued to the Participant when the Participant’s RSUs are settled, provided that the Company only withholds the amount of Shares necessary to satisfy the minimum statutory withholding amount, (b) having the Company withhold taxes from the proceeds of the sale of the Shares, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Participant’s behalf and the Participant hereby authorizes such sales by this authorization), (c) the Participant’s payment of a cash amount, or (d) any other arrangement approved by the Company; all under such rules as may be established by the Committee and in compliance with the Company’s Insider Trading Policy and 10b5-1 Trading Plan Policy, if applicable; provided however, that if the Participant is a Section 16 officer of the Company under the Exchange Act, then the Committee (as constituted in accordance with Rule 16b-3 under the Exchange Act) shall establish the method of withholding from alternatives (a)-(d) above, and the Committee shall establish the method prior to the Tax-Related Items withholding event. The Fair Market Value of these Shares, determined as of the effective date when taxes otherwise would have been withheld in cash, will be applied as a credit against the withholding taxes. The Participant shall pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold as a result of the Participant’s participation in the Plan or the Participant’s purchase of Shares that cannot be satisfied by the means previously described. Finally, the Participant acknowledges that the Company has no obligation to deliver Shares to the Participant until the Participant has satisfied the obligations in connection with the Tax-Related Items as described in this Section.

Unless determined otherwise by the Committee in advance of a Tax-Related Items withholding event, the method of withholding for this RSU will be (a) above.

9. Compliance with Laws and Regulations .

a. The issuance of shares of the Company’s Ordinary Shares pursuant to the RSU shall be subject to compliance by the Company and the Participant with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or an established market, if applicable) on which the Company’s Ordinary Shares may be listed for trading at the time of such issuance.

 

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b. The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance of any Company Ordinary Shares hereby shall relieve the Company of any liability with respect to the non-issuance of the Company’s Ordinary Shares as to which such approval shall not have been obtained.

10. Successors and Assigns . Except to the extent otherwise provided in this Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Participant, the Participant’s assigns, the legal representatives, heirs and legatees of the Participant’s estate and any beneficiaries designated by the Participant.

11. Notices . Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to the Participant shall be in writing and addressed to the Participant at the address on file with the Company. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

12. Construction . This Agreement and the Award evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan shall apply. All decisions of the Committee with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in the RSU.

13. Governing Law and Venue . The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Israel, or California if applicable with respect to the relevant possible successor of the Company, without resort to that State’s conflict-of-laws rules. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by this Award or this Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this grant is made and/or to be performed.

14. Excess Shares . If the Shares covered by this Agreement exceed, as of the date the RSU is granted, the number of shares of the Company’s Ordinary Shares which may without stockholder approval be issued under the Plan, then the Award shall be void with respect to those excess Shares, unless stockholder approval of an amendment sufficiently increasing the number of shares of the Company’s Ordinary Shares issuable under the Plan is obtained in accordance with the provisions of the Plan.

15. Employment at Will . Nothing in this Agreement or in the Plan shall confer upon the Participant any right to continue in the employment of the Company (or any Parent, Subsidiary or Affiliate employing or retaining the Participant) for any period of specific duration, or be interpreted as forming an employment or service contract with the Company (or any Parent or Subsidiary employing or retaining the Participant), or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s service with the Company at any time for any reason, with or without cause.

 

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16. Severability . The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

17. Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan, RSUs granted under the Plan or future RSUs that may be granted under the Plan (including, without limitation, disclosures that may be required by the Securities and Exchange Commission) by electronic means or to request the Participant’s consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

18. Appendices . Notwithstanding any provisions in this Agreement, for Participants outside of the United States, this Award shall be subject to the terms and conditions set forth in Appendix A and Appendix B to this Agreement. If the Participant relocates from the United States to a country outside the United States, the additional terms in Appendix A and, as applicable, the country-specific terms in Appendix B shall apply. Moreover, if the Participant relocates between the countries included in Appendix B, the country-specific terms for the new country will apply to the Participant, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. Appendix A and Appendix B constitute part of this Agreement.

19. Waiver . The Participant acknowledges that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by the Participant or any other Participant.

20. Imposition of Other Requirements . The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on this Award and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

21. A ward Subject to Company Clawback or Recoupment . The RSUs shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Participant’s employment or other service with the Company that is applicable to executive officers, employees, directors or other service providers of the Company, and in addition to any other remedies available under such policy and applicable law may require the cancelation of the Participant’s RSUs (whether vested or unvested) and the recoupment of any gains realized with respect to the Participant’s RSUs.

 

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IN WITNESS WHEREOF , the parties have executed this Agreement on this              date of                     , 201    .

 

SKYCURE LTD.
By:  

 

Title:  

 

Address:  

 

 

 

PARTICIPANT
Signature:  

 

Address:  

 

 

 

 

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APPENDIX A

ADDITIONAL PROVISIONS FOR PARTICIPANTS LOCATED

OUTSIDE OF THE UNITED STATES

1. Nature of the Grant . In accepting the RSU Agreement, the Participant acknowledges that:

a. the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan or this Agreement;

b. the grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded repeatedly in the past;

c. all decisions with respect to future grants of RSUs, if any, will be at the sole discretion of the Company;

d. the Participant’s participation in the Plan is voluntary;

e. the RSUs and the Shares subject to the RSUs are not intended to replace any pension rights or compensation;

f. the RSUs and the Shares subject to the RSUs and the income and value of same are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

g. the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;

h. if the Participant receives Shares upon vesting, the value of such Shares acquired on vesting of RSUs may increase or decrease;

i. no claim or entitlement to compensation or damages shall arise from forfeiture of the RSUs resulting from the Participant’s Termination (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any), and in consideration of this Award to which the Participant is otherwise not entitled, the Participant irrevocably agrees never to institute any claim against the Company, or any Parent, Subsidiaries or Affiliates or the Employer, waives the Participant’s ability, if any, to bring any such claim, and releases the Company, any Parent, Subsidiaries or Affiliates, and the Employer from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Participant shall be deemed irrevocably to have agreed not to pursue such claim and to have agreed to execute any and all documents necessary to request dismissal or withdrawal of such claim;

j. in the event of Termination of the Participant’s employment or service relationship (regardless of the reason for such Termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any), unless otherwise expressly provided in the Agreement or determined by the Company, the Participant’s right to vest in the RSUs under the Plan, if any, will terminate as of the date the Participant is no longer actively


providing services to the Company, the Employer or any Parent, Subsidiary or Affiliate and will not be extended by any notice period ( e.g. , the Participant’s period of service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where the Participant is employed or the terms of the Participant’s employment agreement, if any); the Committee or its designee will have sole discretion to determine the Termination Date pursuant to Section 4 of the Agreement and Section 22 of the Plan);

k. the Participant acknowledges and agrees that neither the Company, the Employer nor any Parent, Subsidiary or Affiliate of the Company shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar that may affect the value of the RSUs or of any amounts due to the Participant pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement;

l. the Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Participant’s participation in the Plan; and

m. the Participant is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to the Plan.

2. Data Privacy Notice and Consent .

a. The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement by and among, as applicable, the Employer, the Company, its Parent, its Subsidiaries and its Affiliates for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

b. The Participant understands that the Company and the Employer may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all RSUs or any other entitlement to shares of the Company’s Ordinary Shares awarded, canceled, vested, unvested or outstanding in the Participant’s favor, for the purpose of implementing, administering and managing the Plan (“Data”).

c. The Participant understands that Data may be transferred to E*Trade Financial Services, Inc., or such other stock plan service provider as may be selected by the Company in the future, which is assisting in the implementation, administration and management of the Plan. The Participant understands that these recipients may be located in the United States or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting the Participant’s local human resources representative. The Participant authorizes the Company, E*Trade Financial Services, Inc., Charles Schwab, and any other recipients of Data which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of

 

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such Data as may be required to a broker, escrow agent or other third party with whom the Shares received upon settlement of the RSUs may be deposited. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage his or her participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke his or her consent, the Participant’s employment or service status and career with the Employer will not be adversely affected; the only adverse consequence of refusing or withdrawing the Participant’s consent is that the Company would not be able to grant the Participant RSUs or other equity awards or administer or maintain such awards. Therefore, the Participant understands that refusing or withdrawing his or her consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of his or her refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative.

3. Language . If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.

 

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APPENDIX B

COUNTRY-SPECIFIC TERMS

Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement or the Plan.

This Appendix B includes country-specific terms that govern the RSUs granted to the Participant if the Participant resides and/or works in one of the countries listed herein. If the Participant is a citizen or resident of a country other than the one in which the Participant is currently residing and/or working, transfers residency and/or employment after the RSUs are granted, or is considered a resident of another country for local law purposes, the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall be applicable to the Participant.

 

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APPENDIX B

ADDENDUM

ISRAEL

SKYCURE LTD.

2017 EQUITY INCENTIVE PLAN

RSU AWARD AGREEMENT

FOR NON-U.S. EMPLOYEES

Trust Arrangement

The Participant understands and agrees that this Award is offered subject to and in accordance with the terms of the Plan and its Sub-Plan for Israeli Participants (together the “Plan”). This Award is intended to qualify as a Capital Gain Award as such term is defined in the Company’s Sub-Plan for Israeli Participants. The Award shall be deposited with the Company’s trustee appointed by the Company or its Parent, Subsidiary or Affiliate in Israel for such purpose and approved by the Israeli Tax Authority (the “Trustee”) for the Participant’s benefit. The Shares resulting from the vesting of such Awards shall be controlled by the Trustee. The Awards shall be deposited with the Trustee and the underlying Shares controlled by the Trustee as aforementioned, for at least such period of time as required by Section 102 (currently two years from the Capital Gain Award’s date of grant) or any shorter period determined under the Israeli Income Tax Ordinance [New Version] 1961 as now in effect or as hereafter amended (the “Ordinance”) or by the Israeli Tax Authority (the “Minimum Trust Period”). In the event that bonus Shares or dividends in the form of additional RSUs or Shares are issued with respect to the Shares held with the Trustee, or as a result of an adjustment made pursuant to Section 2.2 of the Plan, such RSUs or Shares shall be deposited or controlled by the Trustee, as the case may be, for the benefit of the Participant and the provisions of Section 102 of the Ordinance and the Income Tax (Tax Benefits on the Grant of Shares to Employees) Regulations 2003 shall apply to such RSUs or Shares for all purposes. In general, taxable income that should be attributed to the Participant as a result of the grant of the RSUs will be tax-free on the date of grant, but will be taxed on the sale of Shares issued upon the vesting of the RSUs or transfer of Shares from the Trustee to the Participant (a “Transfer”). In accordance with the capital gains tax route of Section 102(b)(2) of the Ordinance, if the Awards and underlying Shares are held in trust by the Trustee for the Minimum Trust Period gains derived from the sale of Shares shall be eligible to a preferential tax treatment (i.e. classified as capital gains and taxed at a rate of only 25%, except, if relevant, with regard to a benefit derived at the time of grant of the RSUs, equal to the difference between (a) the average closing price of the Company’s Share on a stock exchange during 30 trading days prior to the date of grant, and (b) the purchase price paid per each underlying Share, if any). By the Participant’s acceptance of the Agreement, the Participant; (a) acknowledges receipt of and represents that the Participant has read and is familiar with the Agreement, the Plan and its Sub-Plan for Israeli Participants; (b) accepts the Award subject to all of the terms and conditions of the Agreement and the Plan and its Appendix for Israeli Participants; (c) accepts the provisions of the trust deed signed between the Company and the Trustee. The trust deed shall be delivered to the Participant upon request. The conditions of the trust deed apply to the Award; thus, the Participant is required to carefully read the provisions of the said trust deed. Furthermore, by Participant’s acceptance of the Agreement, Participant confirms that he or she is familiar with the terms and provisions of Section 102, and agrees that he/she will not require the Trustee to release the Awards or Shares to him or her, including any rights issued to

 

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the Participant as a consequence of holding such Awards or Shares, or to sell the Awards or Shares to a third party during the Minimum Trust period, unless permitted to do so by applicable law. Without derogating from the aforementioned, if the Awards or Shares are released or sold by the Trustee during the Minimum Trust Period, the sanctions under Section 102 of the Ordinance shall apply to and be borne by the Participant. The Shares shall not be sold or released from the control of the Trustee unless the Company, the employing Parent, Subsidiary or Affiliate and the Trustee are satisfied that the full amount of tax obligations due have been paid or will be paid in relation thereto.

 

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Notice of Grant of Award and Award Agreement    SKYCURE LTD.

 

 

 

%%FIRST_NAME%-% %%LAST_NAME%-%    Award Number:    %%SHARE_NUMBER%-%
%%ADDRESS_LINE_1%-%    Plan:    %%EQUITY_PLAN%-%
%%ADDRESS_LINE_2%-%      
%%CITY%-% %%STATE%-% %%COUNTRY%-%    ID:    %%EMPLOYEE_IDENTIFIER%-%

 

 

Effective %%RSU_DATE%-%, you have been granted an award of %%TOTAL_RSU_GRANTED%-% performance based restricted stock units.

 

 

 

By your signature and the Company’s signature below, you and the Company agree that this award is granted under and governed by the terms and conditions of the Company’s 2017 Equity Incentive Plan , as may be amended, and the Award Agreement, both of which are attached and made a part of this

 

 

 

 

   

 

SKYCURE LTD.     Date

 

   

 

%%FIRST_NAME%-% %%LAST_NAME%-%     Date


SKYCURE LTD.

PERFORMANCE BASED RESTRICTED STOCK UNIT

AWARD AGREEMENT

RECITALS

A. The Board has adopted the Plan for the purpose of providing incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of Skycure Ltd. (the “Company”) and its Subsidiaries and Affiliates. The term “Company” shall include any successor to Skycure Ltd., as well as its Subsidiaries and Affiliates. Notwithstanding anything to the contrary in the Plan, any Award Agreement or otherwise, upon the termination of the Purchase Agreement, the Plan and all awards granted thereunder, including this Award, will automatically terminate with no consideration due to any participant in the Plan, including the Participant.

B. The Participant is to render valuable services to the Company and/or its Subsidiaries and Affiliates, and this Performance Based Restricted Stock Unit Agreement, including the additional terms for Participants located outside of the United States in Appendix C and the country-specific terms in Appendix D, is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Company’s issuance of rights in respect of Ordinary Shares in the form of Performance Based Restricted Stock Units (each, a “PRU”).

C. All capitalized terms in this Agreement shall have the meaning assigned to them in Appendix A or B attached hereto. All undefined terms shall have the meaning assigned to them in the Plan.

NOW, THEREFORE , it is hereby agreed as follows:

1. Grant of Performance Based Restricted Stock Units . The Company hereby awards to the Participant PRUs under the Plan. Each PRU represents the right to receive one share of Ordinary Shares (each, a “Share”) on vesting based on achievement of the performance objectives set forth in Appendix B subject to the provisions of this Agreement (including any Appendices hereto) provided that the Award may not vest or settle prior to the Closing. The number of Shares subject to this Award, the applicable vesting schedule for the PRUs, the dates on which Shares receivable upon the vesting of the PRUs shall be issued to the Participant and the remaining terms and conditions governing this Award shall be as set forth in this Agreement (including any Appendices hereto).

AWARD SUMMARY

 

Award Date and Number of Shares Subject to Award :    As set forth in the Notice of Grant of Award (the “Notice of Grant”).
Vesting Schedule :   

The Shares shall vest on the Performance Vesting Date, as described in Appendix B hereto.

 

Subject to provisions of Appendix B hereto, the Shares that may be earned on the Performance Vesting Date (as defined in Appendix B) shall vest on that date only if the employment of the Participant has not Terminated as of the last day of the Performance Period to which the Performance Vesting Date relates.

 

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Issuance Schedule :    The Shares in which the Participant vests shall be issuable as set forth in Section 6 and Appendix B. However, the actual number of vested Shares to be issued will be subject to the provisions of Section 7 (pursuant to which the applicable withholding taxes are to be collected).

2. Limited Transferability . This Award, and any interest therein, shall not be transferable or assignable by the Participant, and may not be made subject to execution, attachment or similar process, otherwise than by will or by the laws of descent and distribution or as consistent with this Agreement and the Plan.

3. Cessation of Service . Subject to Appendix B hereto, should the Participant’s service as an employee, director, consultant, independent contractor or advisor to the Company or a Parent, Subsidiary or an Affiliate of the Company be Terminated for any reason (whether or not in breach of local labor laws) prior to the end of a particular Performance Period under the Award, then the PRUs covering any unvested Shares applicable to that Performance Period will be immediately thereafter cancelled, the Participant shall cease to have any right or entitlement to receive any Shares under those cancelled PRUs and the Participant’s right to receive such PRUs and vest under the Plan, if any, will terminate effective as of the date of the Participant’s Termination. For purposes of service, transfer of employment between the Company and any Parent, Subsidiary or Affiliate shall not constitute a Termination. The Committee shall have the exclusive discretion to determine when the Participant is no longer actively providing service for purposes of the Plan.

4. Corporate Transaction .

a. In the event of a Corporate Transaction, any or all outstanding PRUs subject to this Agreement may be assumed, converted or replaced by the successor corporation (if any), which assumption, conversion or replacement will be binding on the Participant, or the successor corporation may substitute an equivalent award or provide substantially similar consideration to the Participant as was provided to stockholders (after taking into account the existing provisions of the PRUs).

b. In the event such successor corporation (if any) fails to assume this Award or substitute an equivalent award (as provided in Section 4(a) above) pursuant to a Corporate Transaction, subject to Section 5 of Appendix B, this Award will expire on such transaction at such time and on such conditions as the Board shall determine.

c. Any action taken pursuant to clauses (a) or (b) above must either (i) preserve the exemption of these PRUs from Section 409A of the Code or (ii) comply with Section 409A of the Code.

d. This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

5. Adjustment in Shares . Should any change be made to the Ordinary Shares by reason of any stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration or if there is a change in the corporate structure, then appropriate adjustments shall be made to the total number and/or class of securities issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder.

 

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6. Issuance of Shares of Ordinary Shares .

a. The Shares in which the Participant vests shall be issuable as set forth in Sections 4, 5 and 6 of Appendix B. However, the actual number of vested Shares to be issued will be subject to the provisions of Section 7 (pursuant to which the applicable withholding taxes are to be collected). The Company shall issue to or on behalf of the Participant a certificate (which may be in electronic form) for the applicable number of underlying Shares that so vested, subject, however, to the provisions of Section 7.

b. If the Company determines that the Participant is a “specified employee,” as defined in the regulations under Section 409A of the Code, at the time of the Participant’s “separation from service,” as defined in those regulations, any PRUs that otherwise would have been settled due to that “separation from service” during the first six months following the Participant’s separation from service will instead be settled during the seventh month following the Participant’s separation from service, unless the settlement of those units is exempt from Section 409A of the Code.

c. In no event shall fractional Shares be issued.

d. The holder of this Award shall not have any stockholder rights, including voting rights, with respect to the Shares subject to the PRUs until the Award holder becomes the record holder of those Shares following their actual issuance and after the satisfaction of the Tax Obligations (as defined below).

(a) As of any date that the Company pays an ordinary cash dividend on its Ordinary Shares, the Company shall credit the Participant with a dollar amount equal to (i) the per share cash dividend paid by the Company on its Ordinary Shares on such date, multiplied by (ii) the total number of PRUs (with such total number adjusted pursuant to Section 6 of this Agreement and Section 2.2 of the Plan) subject to this Award that are outstanding immediately prior to the record date for that dividend (a “Dividend Equivalent Right”). Any Dividend Equivalent Rights credited pursuant to the foregoing provisions of this Section 6(e) shall be subject to the same vesting, payment and other terms, conditions and restrictions as the original PRUs to which they relate; provided, however, that the amount of any vested Dividend Equivalent Rights shall be paid in cash. No crediting of Dividend Equivalent Rights shall be made pursuant to this Section 6(e) with respect to any PRUs which, immediately prior to the record date for that dividend, have either been paid pursuant to Section 6 or terminated pursuant to Section 4.

Tax Obligations. The Participant hereby agrees to make adequate provision for any sums required to satisfy the applicable federal, state, local and foreign employment, social insurance, payroll, income and other tax withholding obligations of the Company or any Affiliate (the “Tax Obligations”) that arise in connection with this Award. The satisfaction of the Tax Obligations shall occur at the time the Participant receives a distribution of Ordinary Shares or other property pursuant to this Award, or at any time prior to such time or thereafter as reasonably requested by the Company and/or any Affiliate in accordance with applicable law. The Participant hereby authorizes the Company, at its sole discretion and subject to any limitations under applicable law, to satisfy any such Tax Obligations by any of the following methods: (1) in the event the PRUs are to be settled in part in cash rather than settled in full in Shares, withholding from the cash to be distributed to the Participant in settlement of this Award, (2) if the Shares are publically traded, permitting the Participant to enter into a “same day sale” commitment with a broker-dealer that is a member of the National Association of Securities Dealers (an “NASD Dealer”) whereby the Participant irrevocably elects to sell a portion of the Shares to be delivered under the

 

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Award to satisfy the applicable Tax Obligations and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the proceeds necessary to satisfy the Tax Obligations directly to the Company and/or its Affiliates, and (3) withholding Shares that are otherwise to be issued and delivered to the Participant under this Award in satisfaction of the Tax Obligations; provided, however, that the amount of the Shares so withheld pursuant to alternative (3) shall not exceed the amount necessary to satisfy the required Tax Obligations using the minimum statutory withholding rates that are applicable to this kind of income. In addition, to the extent this Award is not settled in cash, the Company is authorized to satisfy any Tax Obligations by withholding for the Tax Obligations from wages and other cash compensation payable to the Participant or by causing the Participant to tender a cash payment to the Company if the Committee determines in good faith at the time the Tax Obligations arises that withholding pursuant to the foregoing alternatives (2) and (3) above are not in the best interest of the Company or the Participant. In the event the Tax Obligations arises prior to the delivery to the Participant of Ordinary Shares or it is determined after the delivery of Shares or other property that the amount of the Tax Obligations was greater than the amount withheld by the Company and/or any Affiliate, the Participant shall indemnify and hold the Company and its Affiliates harmless from any failure by the Company and/or any Affiliate to withhold the proper amount. The Company may refuse to deliver the Shares if the Participant fails to comply with the Participant’s obligations in connection with the Tax Obligations as described in this Section 7.

7. Compliance with Laws and Regulations .

a. The issuance of Shares pursuant to the vesting of the PRUs shall be subject to compliance by the Company and the Participant with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or an established market, if applicable) on which the Ordinary Shares may be listed for trading at the time of such issuance.

b. The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance of any Ordinary Shares hereby shall relieve the Company of any liability with respect to the non-issuance of the Ordinary Shares as to which such approval shall not have been obtained. The Company, however, shall use its best efforts to obtain all such approvals.

8. Successors and Assigns . Except to the extent otherwise provided in this Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Participant, the Participant’s assigns, the legal representatives, heirs and legatees of the Participant’s estate and any beneficiaries designated by the Participant.

9. Notices . Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to the Participant shall be in writing and addressed to the Participant at the address indicated below the Participant’s signature line on this Agreement (as may be updated from time to time by written notice from the Participant). All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

 

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10. Construction . This Agreement and the Notice of Grant evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan shall apply. All decisions of the Committee with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in the PRU.

11. Governing Law . The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Israel, or California if applicable with respect to the relevant possible successor of the Company, without resort to that State’s conflict-of-laws rules. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by this grant or the Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this grant is made and/or to be performed.

12. Excess Shares . If the Shares covered by this Agreement exceed, as of the Award Date, the number of Shares which may without stockholder approval be issued under the Plan, then the Award shall be void with respect to those excess Shares, unless stockholder approval of an amendment sufficiently increasing the number of Shares issuable under the Plan is obtained in accordance with the provisions of the Plan.

13. Employment at Will . Nothing in this Agreement or in the Plan shall confer upon the Participant any right to continue in the employment of the Company for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s service with the Company at any time for any reason, with or without cause.

14. Severability . The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

15. Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan, PRUs granted under the Plan or future PRUs that may be granted under the Plan (including, without limitation, disclosures that may be required by the Securities and Exchange Commission) by electronic means or to request the Participant’s consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

16. Imposition of Other Requirements . The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Award and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require me to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

 

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17. Appendices. Notwithstanding any provisions in this Agreement, for Participants outside of the United States, this Award shall be subject the terms and conditions set forth in Appendices C and D to this Agreement. In addition, if the Participant relocates from the United States to a country outside the United States, the additional terms in Appendix C and, as applicable, the country-specific terms in Appendix D shall apply. Moreover, if the Participant relocates between countries included in Appendix D, the country-specific terms for the new country will apply to the Participant, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendices C and D constitute part of this Agreement.

 

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18. IN WITNESS WHEREOF , the parties have executed this Agreement on this              date of                     , 201    .

 

SKYCURE LTD.
By:  

 

Title:  

 

Address:  

 

 

 

PARTICIPANT
Signature:  

 

Address:  

 

 

 

 

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APPENDIX A

DEFINITIONS

The following definitions shall be in effect under the Agreement:

1. Agreement shall mean this Performance Based Restricted Stock Unit Award Agreement.

2. Award shall mean the award of PRUs made to the Participant pursuant to the terms of this Agreement.

3. Award Date shall mean the date the PRUs are granted to the Participant pursuant to the Agreement and shall be the date indicated in the Notice of Grant.

4. Code shall mean the Internal Revenue Code of 1986, as amended.

5. Committee shall mean the Compensation and Leadership Development Committee of the Company Board of Directors.

6. Corporate Transaction shall mean

 

  (a) a dissolution or liquidation of the Company,

 

  (b) the consummation of a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the Awards granted under the Plan are assumed, converted or replaced by the successor corporation, which assumption will be binding on all participants under the Plan),

 

  (c) the consummation of a merger in which the Company is the surviving corporation but after which the stockholders of the Company (other than any stockholder which merges (or which owns or controls another corporation which merges) with the Company in such merger) cease to own their shares or other equity interests in the Company,

 

  (d) the sale of substantially all of the assets of the Company, or

 

  (e) any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code wherein the stockholders of the Company give up all of their equity interest in the Company (except for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the Company from or by the stockholders of the Company).

7. Ordinary Shares shall mean shares of the Company’s Ordinary Shares, of no par value.

 

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8. Notice of Grant shall mean such notice as provided by the Stock Administration Department of the Company, or such other applicable department of the Company, providing the Participant with notice of the issuance of the PRUs pursuant to the Plan and terms of this Agreement.

9. Participant shall mean the person named in the Notice of Grant relating to the PRUs covered by this Agreement.

10. Plan shall mean the Company’s 2017 Equity Incentive Plan, as the same may be amended from time to time.

 

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APPENDIX B

PERFORMANCE SCHEDULE

The number of PRUs that will vest and be earned shall be based on the metrics set forth below. Terms not otherwise defined in Appendix A or B shall have the meaning ascribed to them in the Plan. For clarity, the following terms and conditions related to performance are in relation to the Company following the Closing of the transactions contemplated by the Merger Agreement.

1. Grant of Performance Based Restricted Stock Units .

Subject to the terms and conditions of Agreement, the Notice of Grant and of the Plan, the Company hereby grants to the Participant a number of PRUs set forth in the Notice of Grant, subject to reduction and vesting as set forth below.

2. Performance Percentage.

[PERFORMANCE TERMS TO COME]

Notwithstanding anything to the contrary in this Appendix B, the Committee may make any changes in this Section 2 as it determines in its sole discretion, without the consent of the Participant.

3. Committee Certification and Vesting of PRUs .

As soon as practicable following the completion of a particular Performance Period (the date of the Committee’s determination hereunder, the “ Performance Vesting Date ” for that Performance Period), the Committee shall determine and certify in writing the Performance Levels that have been attained for the Performance Period and the resulting Performance Percentage and the number of PRUs that will vest based on such Performance Percentage (subject to the Participant’s continued employment through the end of the Performance Period or the Participant’s qualifying Termination under Section 6 hereof). Notwithstanding the foregoing, if pursuant to Section 5, the PRUs cease to be subject to the performance-vesting provisions of Section 2, certification by the Committee shall no longer be required for the PRUs to become vested pursuant to Section 5. The Committee’s determination of the number of vested PRUs shall be binding on the Participant.

4. Timing of Settlement .

Subject to Section 5 and 6 below, the following settlement provisions shall apply.

[TO COME]

5. Reserved .

[TO COME]

6. Reserved .

[TO COME]

7. Restatement of Financial Results

 

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All benefits hereunder shall be subject to any clawback policy adopted by the Board or required by law.

8. Section  409A of the Code

Notwithstanding the other provisions hereof, this Performance Based Restricted Stock Unit Agreement is intended to comply with the requirements of Section 409A of the Code, to the extent applicable, and this Performance Based Restricted Stock Unit Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with Section 409A of the Code and, if necessary, any such provision shall be deemed amended to comply with Section 409A of the Code and regulations thereunder. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under Section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. Any amount payable under this Agreement that constitutes deferred compensation subject to Section 409A of the Code shall be paid at the time provided under this Agreement or such other time as permitted under Section 409A of the Code. No interest will be payable with respect to any amount paid within a time period permitted by, or delayed because of, Section 409A of the Code. All payments to be made upon a termination of employment under this Agreement that are deferred compensation may only be made upon a “separation from service” under Section 409A of the Code. For purposes of Section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment. In no event may the Participant directly or indirectly, designate the calendar year of payment.

Notwithstanding the foregoing, in no event whatsoever shall the Company be liable for any additional tax, interest, income inclusion or other penalty that may be imposed on the Participant by Code Section 409A or for damages for failing to comply with Code Section 409A unless such failure is a result of the Company’s breach of this Plan or the Performance Based Restricted Stock Unit Agreement.

9. Definitions

Disability means a disability, whether temporary or permanent, partial or total, within the meaning of Section 22(e)(3) of the Code, as determined by the Committee.

Non-GAAP Basis shall mean the method of presentation of quarterly earnings releases and supplemental materials under the Company’s executive compensation programs generally, which (i) may exclude certain items and make adjustments and currency conversions, (ii) need not conform to standards of U.S. Generally Accepted Accounting Principles, and (ii) will be as generally reported, updated, and explained in the Company’s public filings from time to time. The Non-GAAP Basis mechanics shall be those used by the Committee in determining the Performance Percentage.

Target Grant shall mean the number of Shares associated with the PRUs as determined by the Committee, assuming a Performance Percentage of 100%.

 

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APPENDIX C

ADDITIONAL PROVISIONS

1. Nature of the Grant . In signing this Agreement, the Participant acknowledges that:

a. the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement;

b. the grant of PRUs is voluntary and occasional and does not create any contractual or other right to receive future awards of PRUs, or benefits in lieu of PRUs even if PRUs have been awarded repeatedly in the past;

c. all decisions with respect to future grants of PRUs, if any, will be at the sole discretion of the Company;

d. the Participant’s participation in the Plan is voluntary;

e. the Participant’s participation in the Plan will not create a right to further employment with the Company or the Participant’s actual employer (the “Employer”) and shall not interfere with the ability of the Employer to terminate Participant’s service at any time with or without cause;

f. PRUs are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or to the Employer, and PRUs are outside the scope of the Participant’s employment contract, if any;

g. PRUs are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculation of any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments;

h. in the event that Participant is not an employee of the Company, the grant of PRUs will not be interpreted to form an employment contract or relationship with the Company; and furthermore, the grant of PRUs will not be interpreted to form an employment contract with the Employer or any Subsidiary or Affiliate of the Company;

i. the future value of the underlying Shares is unknown and cannot be predicted with certainty;

j. if the Participant receives Shares upon vesting, the value of such Shares acquired on vesting of PRUs may increase or decrease in value; and

k. in consideration of the grant of PRUs, no claim or entitlement to compensation or damages arises from termination of the PRUs or diminution in value of the PRUs or Shares received upon vesting of PRUs resulting from Termination of the Participant’s service by the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such claim.

 

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2. Data Privacy Notice and Consent .

a. The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement by and among, as applicable, the Employer, the Company, its Parent, its Subsidiaries and its Affiliates for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

b. The Participant understands that the Company and the Employer may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all PRUs or any other entitlement to shares of Ordinary Shares awarded, canceled, vested, unvested or outstanding in the Participant’s favor, for the purpose of implementing, administering and managing the Plan (“Data”).

c. The Participant understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Participant’s country, or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker, escrow agent or other third party with whom the Shares received upon vesting of the PRUs may be deposited. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage his or her participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. The Participant understands, however, that refusal or withdrawal of consent may affect his or her ability to participate in the Plan. For more information on the consequences of his or her refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative.

3. Language . If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version, the English version will control.

 

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APPENDIX C

ADDITIONAL PROVISIONS

1. Nature of the Grant . In signing this Agreement, the Participant acknowledges that:

a. the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement;

b. the grant of PRUs is exceptional, voluntary and occasional and does not create any contractual or other right to receive future awards of PRUs, or benefits in lieu of PRUs even if PRUs have been awarded in the past;

c. all decisions with respect to future grants of PRUs, if any, will be at the sole discretion of the Company;

d. the Participant’s participation in the Plan is voluntary;

e. the PRUs and the Shares subject to the PRUs, and the income and value of same, are not intended to replace any pension rights or compensation;

f. the Participant’s participation in the Plan will not create or amend a right to further employment with the Company or, if different, the Participant’s actual employer (the “Employer”) and shall not interfere with the ability of the Employer to terminate Participant’s service at any time with or without cause;

g. PRUs are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or to the Employer, and PRUs are outside the scope of the Participant’s employment contract, if any;

h. PRUs and the Shares subject to the PRUs, and the income and value of same, are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculation of any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

i. unless otherwise agreed with the Company, the PRUs and the Shares subject to the PRUs, and the income and value of same, are not granted as consideration for, or in consideration with, the service the Participant may provide as a director of a Subsidiary or Affiliate;

j. in the event that Participant is not an employee of the Company, the grant of PRUs will not be interpreted to form an employment contract or relationship with the Company; and furthermore, the grant of PRUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;

k. the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;

 

C-3


l. if the Participant receives Shares upon vesting, the value of such Shares acquired on vesting of PRUs may increase or decrease in value;

m. in consideration of the grant of PRUs, no claim or entitlement to compensation or damages arises from termination of the PRUs or diminution in value of the PRUs or Shares received upon vesting of PRUs resulting from Termination of the Participant’s service by the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such claim;

n. neither the Company, the Employer nor any Parent, Subsidiary or Affiliate shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar that may affect the value of the PRUs or of any amounts due to the Participant pursuant to the settlement of the PRUs or the subsequent sale of any Shares acquired upon settlement;

o. the Company is not providing any tax, legal or financial advice, nor is the Company making any accommodations regarding the Participant’s participation in the Plan; and

p. the Participant should consult with his or her own personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to the Plan.

2. Data Privacy Notice and Consent .

a. The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement by and among, as applicable, the Employer, the Company, its Parent, its Subsidiaries and its Affiliates for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

b. The Participant understands that the Company and the Employer may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all PRUs or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in the Participant’s favor (“Data”), for the purpose of implementing, administering and managing the Plan.

c. The Participant understands that Data may be transferred to E*Trade Financial Corporate Services, Inc. and its affiliated companies (“E*Trade”), or such other stock plan service provider as may be selected by the Company in the future, which is assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Participant’s country, or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Participant authorizes the Company, E*Trade, and any other recipients of Data which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in

 

C-4


electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker, escrow agent or other third party with whom the Shares received upon vesting of the PRUs may be deposited. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage his or her participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke his or her consent, the Participant’s employment or service status with the Employer will not be affected; the only consequence of refusing or withdrawing the Participant’s consent is that the Company would not be able to grant the PRUs or other equity awards to the Participant or administer or maintain such awards. Therefore, the Participant understands that refusing or withdrawing his or her consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of his or her refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative.

3. Language . If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version, the English version will control.

4. Insider Trading Restrictions/Market Abuse Laws . The Participant acknowledges that the Participant may be subject to insider trading restrictions and/or market abuse laws, which may affect the Participant’s ability to acquire or sell Shares or rights to Shares ( e.g. , PRUs) under the Plan during such times as the Participant is considered to have “inside information” (as defined by the laws in the Participant’s country). The insider trading and/or market abuse laws may be different from any Company Insider Trading Policy. The Participant is responsible for ensuring compliance with any applicable restrictions and should consult his or her personal legal advisor on this matter.

5. Foreign Asset/Account and Exchange Control Reporting . The Participant’s country may have certain exchange controls and foreign asset and/or account reporting requirements which may affect his or her ability to purchase or hold Shares under the Plan or receive cash from his or her participation in the Plan (including from any dividends received or sale proceeds arising from the sale of Shares) in a brokerage or bank account outside the Participant’s country. The Participant may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. Further, the Participant may be required to repatriate Shares or proceeds acquired as a result of participating in the Plan to his or her country through a designated bank/broker and/or within a certain time. The Participant acknowledges and agrees that it is his or her responsibility to be compliant with such regulations and understands that the Participant should speak with his or her personal legal advisor for any details regarding any foreign asset/account reporting or exchange control reporting requirements in the Participant’s country arising out of his or her participation in the Plan.

 

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APPENDIX D

COUNTRY-SPECIFIC TERMS

Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement or the Plan.

This Appendix D includes country-specific terms that govern the PRUs granted to the Participant if the Participant resides and/or works in one of the countries listed herein. If the Participant is a citizen or resident of a country other than the one in which the Participant is currently residing and/or working, transfers residency and/or employment after the PRUs are granted, or is considered a resident of another country for local law purposes, the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall be applicable to the Participant.

 

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APPENDIX D

ISRAEL

[GOLDFARB TO INPUT]

 

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Exhibit 99.03

 

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F IREGLASS L TD .

2015 S HARE I NCENTIVE P LAN

 

 

Unless otherwise defined, terms used herein shall have the meaning ascribed to them in Section 2 hereof.

1. PURPOSE; TYPES OF AWARDS; CONSTRUCTION .

1.1. Purpose . The purpose of this 2015 Share Incentive Plan (as amended, this “Plan”) is to afford an incentive to Service Providers of FireGlass Ltd., an Israeli company (together with any successor corporation thereto, the “Company”), or any Affiliate of the Company, which now exists or hereafter is organized or acquired by the Company or its Affiliates, to continue as Service Providers, to increase their efforts on behalf of the Company or its Affiliates and to promote the success of the Company’s business, by providing such Service Providers with opportunities to acquire a proprietary interest in the Company by the issuance of Shares or restricted Shares (“Restricted Shares”) of the Company, and by the grant of options to purchase Shares (“Options”), Restricted Share Units (“RSUs”) and other Share-based Awards pursuant to Sections 11 through 13 of this Plan.

1.2. Types of Awards . This Plan is intended to enable the Company to issue Awards under various tax regimes, including:

(i) pursuant and subject to the provisions of Section 102 of the Ordinance (or the corresponding provision of any subsequently enacted statute, as amended from time to time), and all regulations and interpretations adopted by any competent authority, including the Israeli Income Tax Authority (the “IT A ”), including the Income Tax Rules (Tax Benefits in Stock Issuance to Employees) 5763-2003 or such other rules so adopted from time to time (the “Rules”) (such Awards that are intended to be (as set forth in the Award Agreement) and which qualify as such under Section 102 of the Ordinance and the Rules, “102 Awards”);

(ii) pursuant to Section 3(9) of the Ordinance or the corresponding provision of any subsequently enacted statute, as amended from time to time (such Awards, “ 3(9) Awards ”);

(iii) Incentive Stock Options within the meaning of Section 422 of the Code, or the corresponding provision of any subsequently enacted United States federal tax statute, as amended from time to time, to be granted to Employees who are deemed to be residents of the United States, for purposes of taxation, or are otherwise subject to U.S. Federal income tax (such Awards that are intended to be (as set forth in the Award Agreement) and which qualify as an incentive stock option within the meaning of Section 422(b) of the Code, “Incentive Stock Options”); and

(iv) Awards not intended to be (as set forth in the Award Agreement) or which do not qualify as an Incentive Stock Option to be granted to Service Providers who are deemed to be residents of the United States for purposes of taxation, or are otherwise subject to U.S. Federal income tax (“Nonqualified Stock Options”).


In addition to the issuance of Awards under the relevant tax regimes in the United States of America and the State of Israel, and without derogating from the generality of Section 25, this Plan contemplates issuances to Grantees in other jurisdictions or under other tax regimes with respect to which the Committee is empowered, but is not required, to make the requisite adjustments in this Plan and set forth the relevant conditions in an appendix to this Plan or in the Company’s agreement with the Grantee in order to comply with the requirements of such other tax regimes.

1.3. Company Status . This Plan contemplates the issuance of Awards by the Company, both as a private and public company.

1.4. Construction . To the extent any provision herein conflicts with the conditions of any relevant tax law, rule or regulation which are relied upon for tax relief in respect of a particular Award to a Grantee, the Committee is empowered, but is not required, hereunder to determine that the provisions of such law, rule or regulation shall prevail over those of this Plan and to interpret and enforce such prevailing provisions.

2. DEFINITIONS .

2.1. Terms Generally . Except when otherwise indicated by the context, (i) the singular shall include the plural and the plural shall include the singular; (ii) any pronoun shall include the corresponding masculine, feminine and neuter forms; (iii) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements, supplements or modifications set forth therein or herein), (iv) references to any law, constitution, statute, treaty, regulation, rule or ordinance, including any section or other part thereof shall refer to it as amended from time to time and shall include any successor thereof, (v) reference to a “company” or “entity” shall include a, partnership, corporation, limited liability company, association, trust, unincorporated organization, or a government or agency or political subdivision thereof, and reference to a “person” shall mean any of the foregoing or an individual, (vi) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Plan in its entirety, and not to any particular provision hereof, (vii) all references herein to Sections shall be construed to refer to Sections to this Plan; (viii) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; and (ix) use of the term “or” is not intended to be exclusive.

2.2. Defined Terms . The following terms shall have the meanings ascribed to them in this Section 2:

2.3. “Affiliate” shall mean, (i) with respect to any person, any other person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such person (with the term “control” or “controlled by” within the meaning of Rule 405 of Regulation C under the Securities Act), including, without limitation, any Parent or Subsidiary, or (ii) for the purpose of 102 Awards, “ Affiliate ” shall only mean an “employing company” within the meaning and subject to the conditions of Section 102(a) of the Ordinance.

2.4. “Applicable Law” shall mean any applicable law, rule, regulation, statute, pronouncement, policy, interpretation, judgment, order or decree of any federal, provincial, state or local governmental, regulatory or adjudicative authority or agency, of any jurisdiction, and the rules and regulations of any stock exchange, over-the-counter market or trading system on which the Company’s shares are then traded or listed.

 

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2.5. “Award” shall mean any Option, Restricted Share, RSUs or any other Share-based award granted under this Plan.

2.6. “Board” shall mean the Board of Directors of the Company.

2.7. “Code” shall mean the United States Internal Revenue Code of 1986, and any applicable regulations promulgated thereunder, all as amended.

2.8. “Committee” shall mean a committee established or appointed by the Board to administer this Plan, subject to Section 3.1.

2.9. “Companies Law” shall mean the Israel Companies Law, 5759-1999, and the regulations promulgated thereunder, all as amended from time to time.

2.10. “Controlling Shareholder” shall have the meaning set forth in Section 32(9) of the Ordinance.

2.11. “Disability” shall mean (i) the inability of a Grantee to engage in any substantial gainful activity or to perform the major duties of the Grantee’s position with the Company or its Affiliates by reason of any medically determinable physical or mental impairment which has lasted or can be expected to last for a continuous period of not less than 12 months (or such other period as determined by the Committee), as determined by a qualified doctor acceptable to the Company, (ii) if applicable, a “permanent and total disability” as defined in Section 22(e)(3) of the Code or Section 409A(a)(2)(c)(i) of the Code, as amended from time to time, or (iii) as defined in a policy of the Company that the Committee deems applicable to this Plan, or that makes reference to this Plan, for purposes of this definition.

2.12. “Employee” shall mean any person treated as an employee (including an officer or a director who is also treated as an employee) in the records of the Company or any of its Affiliates (and in the case of 102 Awards, subject to Section 9.3 or in the case of Incentive Stock Options, who is an employee for purposes of Section 422 of the Code); provided, however, that neither service as a director nor payment of a director’s fee shall be sufficient to constitute employment for purposes of this Plan. The Company shall determine in good faith and in the exercise of its discretion whether an individual has become or has ceased to be an Employee and the effective date of such individual’s employment or termination of employment, as the case may be. For purposes of a person’s rights, if any, under this Plan as of the time of the Company’s determination, all such determinations by the Company shall be final, binding and conclusive, notwithstanding that the Company or any court of law or governmental agency subsequently makes a contrary determination.

2.13. “employment”, “employed” and words of similar import shall be deemed to refer to the employment of Employees or to the services of any other Service Provider, as the case may be.

2.14. “exercise” “exercised” and words of similar import, when referring to an Award that does not require exercise or that is settled upon vesting (such as may be the case with RSUs or Restricted Shares, if so determined in their terms), shall be deemed to refer to the vesting of such an Award (regardless of whether or not the wording included reference to vesting of such an Awards explicitly).

 

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2.15. “Exercise Period” shall mean the period, commencing on the date of grant of an Award, during which an Award shall be exercisable, subject to any vesting provisions thereof (including any acceleration thereof, if any) and subject to the termination provisions hereof.

2.16. “Exercise Price” shall mean the exercise price for each Share covered by an Option or the purchase price for each Share covered by any other Award.

2.17. “Fair Market Value” shall mean, as of any date, the value of a Share or other property as determined by the Board, in its discretion, subject to the following: (i) if, on such date, the Shares are listed on any securities exchange, the average closing sales price per Share on which the Shares are principally traded over the thirty (30) day calendar period preceding the subject date (utilizing all trading days during such 30 calendar day period), as reported in The Wall Street Journal or such other source as the Company deems reliable; (ii) if, on such date, the Shares are then quoted in an over-the-counter market, the average of the closing bid and asked prices for the Shares in that market during the thirty (30) day calendar period preceding the subject date (utilizing all trading days during such 30 calendar day period), as reported in The Wall Street Journal or such other source as the Company deems reliable; (iii) if, on such date, the Shares are not then listed on a securities exchange or quoted in an over-the-counter market, or in case of any other property, such value as the Committee, in its sole discretion, shall determine, with full authority to determine the method for making such determination and which determination shall be conclusive and binding on all parties, and shall be made after such consultations with outside legal, accounting and other experts as the Committee may deem advisable; provided, however, that, if applicable, the Fair Market Value of the Shares shall be determined in a manner that satisfies the applicable requirements of and subject to Section 409A of the Code, and with respect to Incentive Stock Options, in a manner that satisfies the applicable requirements of and subject to Section 422 of the Code, subject to Section 422(c)(7) of the Code. The Committee shall maintain a written record of its method of determining such value. If the Shares are listed or quoted on more than one established stock exchange or over-the-counter market, the Committee shall determine the principal such exchange or market and utilize the price of the Shares on that exchange or market (determined as per the method described in clauses (i) or (ii) above, as applicable) for the purpose of determining Fair Market Value.

2.18. “Grantee” shall mean a person who has been granted an Award(s) under this Plan.

2.19. “Ordinance” shall mean the Israeli Income Tax Ordinance (New Version) 1961, and the regulations and rules (including the Rules) promulgated thereunder, all as amended from time to time.

2.20. “Parent” shall mean any company (other than the Company), which now exists or is hereafter organized, (i) in an unbroken chain of companies ending with the Company if, at the time of granting an Award, each of the companies (other than the Company) owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other companies in such chain, or (ii) if applicable and for purposes of Incentive Stock Options, that is a “parent corporation” of the Company, as defined in Section 424(e) of the Code.

2.21. “Retirement” shall mean a Grantee’s retirement pursuant to Applicable Law or in accordance with the terms of any tax-qualified retirement plan maintained by the Company or any of its Affiliates in which the Grantee participates or is subject to.

 

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2.22. “Securities Act” shall mean the U.S. Securities Act of 1933, and the rules and regulations promulgated thereunder, all as amended from time to time.

2.23. “Service Provider” shall mean an Employee, director, officer, consultant, advisor and any other person or entity who provides services to the Company or any Parent, Subsidiary or Affiliate thereof. Service Providers shall include prospective Service Providers to whom Awards are granted in connection with written offers of an employment or other service relationship with the Company or any Parent, Subsidiary or any Affiliates thereof, provided however that such employment or service shall have actually commenced.

2.24. “Shares” shall mean Ordinary Shares, par value NIS 0.01 of the Company (as adjusted for stock split, reverse stock split, bonus shares, combination or other recapitalization events), or shares of such other class of shares of the Company as shall be designated by the Board in respect of the relevant Award(s). “Shares” include any securities or property issued or distributed with respect thereto.

2.25. “Subsidiary” shall mean any company (other than the Company), which now exists or is hereafter organized or acquired by the Company, (i) in an unbroken chain of companies beginning with the Company if, at the time of granting an Award, each of the companies other than the last company in the unbroken chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other companies in such chain, or (ii) if applicable and for purposes of Incentive Stock Options, that is a “subsidiary corporation” of the Company, as defined in Section 424(f) of the Code.

2.26. “Ten Percent Shareholder” shall mean a Grantee who, at the time an Award is granted to the Grantee, owns shares possessing more than ten percent (10%) of the total combined voting power of all classes of shares of the Company or any Parent or Subsidiary, within the meaning of Section 422(b)(6) of the Code.

2.27. “ Trustee ” shall mean the trustee appointed by the Committee to hold the Awards (and, in relation with 102 Awards, approved by the ITA), if so appointed.

2.28. Other Defined Terms . The following terms shall have the meanings ascribed to them in the Sections set forth below:

 

Term

   Section

102 Awards

   1.2(i)

102 Capital Gains Track Awards

   9.1

102 Non-Trustee Awards

   9.2

102 Ordinary Income Track Awards

   9.1

102 Trustee Awards

   9.1

3(9) Awards

   1.2(ii)

Award Agreement

   6

Cause

   6.6.4.4

Company

   1.1

Effective Date

   24.1

Election

   9.2

 

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Eligible 102 Grantees

   9.3.1

Incentive Stock Options

   1.2 (iii)

ITA

   1.1 (i)

Market Stand-Off

   17.1

Market Stand-Off Period

   17.1

Merger/Sale

   14.2

Nonqualified Stock Options

   1.2 (iv)

Plan

   1.1

Recapitalization

   14.1

Required Holding Period

   9.5

Restricted Period

   11.2

Restricted Share Agreement

   11

Restricted Share Unit Agreement

   12

Restricted Shares

   1.1

RSUs

   1.1

Rules

   1.1 (i)

Securities

   17.1

Successor Corporation

   14.2.1

Withholding Obligations

   18.5

3. ADMINISTRATION .

3.1. To the extent permitted under Applicable Law, the Articles of Association and any other governing document of the Company, this Plan shall be administered by the Committee. In the event that the Board does not appoint or establish a committee to administer this Plan, this Plan shall be administered by the Board. In the event that an action necessary for the administration of this Plan is required under Applicable Law to be taken by the Board without the right of delegation, or if such action or power was explicitly reserved by the Board in appointing, establishing and empowering the Committee, then such action shall be so taken by the Board. In any such event, all references herein to the Committee shall be construed as references to the Board. Even if such a Committee was appointed or established, the Board may take any actions that are stated to be vested in the Committee, and shall not be restricted or limited from exercising all rights, powers and authorities under this Plan or Applicable Law.

3.2. The Board shall appoint the members of the Committee, may from time to time remove members from, or add members to, the Committee, and shall fill vacancies in the Committee, however caused, provided that the composition of the Committee shall at all times be in compliance with any mandatory requirements of Applicable Law, the Articles of Association and any other governing document of the Company. The Committee may select one of its members as its Chairman and shall hold its meetings at such times and places as it shall determine. The Committee may appoint a Secretary, who shall keep records of its meetings, and shall make such rules and regulations for the conduct of its business as it shall deem advisable and subject to mandatory requirements of Applicable Law.

 

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3.3. Subject to the terms and conditions of this Plan, any mandatory provisions of Applicable Law and any provisions of any Company policy required under mandatory provisions of Applicable Law, and in addition to the Committee’s powers contained elsewhere in this Plan, the Committee shall have full authority, in its discretion, from time to time and at any time, to determine any of the following, or to recommend to the Board any of the following if it is not authorized to take such action according to Applicable Law:

(i) eligible Grantees,

(ii) grants of Awards and setting the terms and provisions of Award Agreements (which need not be identical) and any other agreements or instruments under which Awards are made, including, but not limited to, the number of Shares underlying each Award and the class of Shares underlying each Award (if more than one class was designated by the Board),

(iii) the time or times at which Awards shall be granted,

(iv) the terms, conditions and restrictions applicable to each Award (which need not be identical) and any Shares acquired upon the exercise or (if applicable) vesting thereof, including, without limitation, (1) designating Awards under Section 1.2; (2) the vesting schedule, the acceleration thereof and terms and conditions upon which Awards may be exercised or become vested, (3) the Exercise Price, (4) the method of payment for Shares purchased upon the exercise or (if applicable) vesting of the Awards, (5) the method for satisfaction of any tax withholding obligation arising in connection with the Awards or such Shares, including by the withholding or delivery of Shares, (6) the time of the expiration of the Awards, (7) the effect of the Grantee’s termination of employment with the Company or any of its Affiliates, and (8) all other terms, conditions and restrictions applicable to the Award or the Shares not inconsistent with the terms of this Plan,

(v) to accelerate, continue, extend or defer the exercisability of any Award or the vesting thereof, including with respect to the period following a Grantee’s termination of employment or other service,

(vi) the interpretation of this Plan and any Award Agreement and the meaning, interpretation and applicability of terms referred to in Applicable Laws,

(vii) policies, guidelines, rules and regulations relating to and for carrying out this Plan, and any amendment, supplement or rescission thereof, as it may deem appropriate,

(viii) to adopt supplements to, or alternative versions of, this Plan, including, without limitation, as it deems necessary or desirable to comply with the laws of, or to accommodate the tax regime or custom of, foreign jurisdictions whose citizens or residents may be granted Awards,

(ix) the Fair Market Value of the Shares or other property,

(x) the tax track (capital gains, ordinary income track or any other track available under the Section 102 of the Ordinance) for the purpose of 102 Awards,

(xi) the authorization and approval of conversion, substitution, cancellation or suspension under and in accordance with this Plan of any or all Awards or Shares,

 

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(xii) the amendment, modification, waiver or supplement of the terms of each outstanding Award (with the consent of the applicable Grantee, if such amendments refers to the increase of the Exercise Price of Awards or reduction of the number of Shared underlying an Award (but, in each case, other than as a result of an adjustment or exercise of rights in accordance with Section 14)) unless otherwise provided under the terms of this Plan,

(xiii) without limiting the generality of the foregoing, and subject to the provisions of Applicable Law, to grant to a Grantee, who is the holder of an outstanding Award, in exchange for the cancellation of such Award, a new Award having an Exercise Price lower than that provided in the Award so canceled and containing such other terms and conditions as the Committee may prescribe in accordance with the provisions of this Plan or to set a new Exercise Price for the same Award lower than that previously provided in the Award,

(xiv) to correct any defect, supply any omission or reconcile any inconsistency in this Plan or any Award Agreement and all other determinations and take such other actions with respect to this Plan or any Award as it may deem advisable to the extent not inconsistent with the provisions of this Plan or Applicable Law, and

(xv) any other matter which is necessary or desirable for, or incidental to, the administration of this Plan and any Award thereunder.

3.4. The authority granted hereunder includes the authority to modify Awards to eligible individuals who are foreign nationals or are individuals who are employed outside Israel to recognize differences in local law, tax policy or custom, in order to effectuate the purposes of this Plan but without amending this Plan.

3.5. The Board and the Committee shall be free at all times to make such determinations and take such actions as they deem fit. The Board and the Committee need not take the same action or determination with respect to all Awards, with respect to certain types of Awards, with respect to all Service Providers or any certain type of Service Providers and actions and determinations may differ as among the Grantees, and as between the Grantees and any other holders of securities of the Company.

3.6. All decisions, determinations, and interpretations of the Committee, the Board and the Company under this Plan shall be final and binding on all Grantees (whether before or after the issuance of Shares pursuant to Awards), unless otherwise determined by the Committee, the Board or the Company, respectively. The Committee shall have the authority (but not the obligation) to determine the interpretation and applicability of Applicable Laws to any Grantee or any Awards. No member of the Committee or the Board shall be liable to any Grantee for any action taken or determination made in good faith with respect to this Plan or any Award granted hereunder.

3.7. Any officer or authorized signatory of the Company shall have the authority to act on behalf of the Company with respect to any matter, right, obligation, determination or election which is the responsibility of or which is allocated to the Company herein, provided such person has apparent authority with respect to such matter, right, obligation, determination or election. Such person or authorized signatory shall not be liable to any Grantee for any action taken or determination made in good faith with respect to this Plan or any Award granted hereunder.

 

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4. ELIGIBILITY .

Awards may be granted to Service Providers of the Company or any Affiliate thereof, taking into account, at the Committee’s discretion and without an obligation to do so, the qualification under each tax regime pursuant to which such Awards are granted, subject to the limitation on the granting of Incentive Stock Options set forth in Section 8.1. A person who has been granted an Award hereunder may be granted additional Awards, if the Committee shall so determine, subject to the limitations herein. However, eligibility in accordance with this Section 4 shall not entitle any person to be granted an Award, or, having been granted an Award, to be granted an additional Award.

Awards may differ in number of Shares covered thereby, the terms and conditions applying to them or on the Grantees or in any other respect (including, that there should not be any expectation (and it is hereby disclaimed) that a certain treatment, interpretation or position granted to one shall be applied to the other, regardless of whether or not the facts or circumstances are the same or similar).

5. SHARES .

5.1. The maximum aggregate number of Shares that may be issued pursuant to Awards under this Plan (the “ Pool ”) shall initially be 211,187 authorized but unissued Shares (except and as adjusted pursuant to Section 14.1 of this Plan), or such other number as the Board may determine from time to time (without the need to amend the Plan in case of such determination). However, except as adjusted pursuant to Section 14.1, in no event shall more than such number of Shares included in the Pool, as adjusted in accordance with Section 5.2, be available for issuance pursuant to the exercise of Incentive Stock Options.

5.2. Any Shares (a) underlying an Award granted hereunder or an award granted under the Company’s Share Option Plan (the “ Prior Plan ”) (in an amount not to exceed 196,370 Shares under the Prior Plan) that has expired, or was cancelled, terminated, forfeited or, repurchased or settled in cash in lieu of issuance of Shares, for any reason, without having been exercised; (b) if permitted by the Company, tendered to pay the Exercise Price of an Award (or the exercise price or other purchase price of any option or other award under the Prior Plan), or withholding tax obligations with respect to an Award (or any awards under the Prior Plan); or (c) if permitted by the Company, subject to an Award (or any award under the Prior Plan) that are not delivered to a Grantee because such Shares are withheld to pay the Exercise Price of such Award (or of any award under the Prior Plan), or withholding tax obligations with respect to such Award (or such other award); shall automatically, and without any further action on the part of the Company or any Grantee, again be available for grant of Awards and Shares issued upon exercise of (if applicable) vesting thereof for the purposes of this Plan (unless this Plan shall have been terminated) or unless the Board determines otherwise. Such Shares may, in whole or in part, be authorized but unissued Shares, treasury shares (dormant shares) or Shares otherwise that shall have been or may be repurchased by the Company (to the extent permitted pursuant to the Companies Law).

5.3. Any Shares under the Pool that are not subject to outstanding or exercised Awards at the termination of this Plan shall cease to be reserved for the purpose of this Plan.

5.4. From and after the Effective Date, no further grants or awards shall be made under the Prior Plan; however, Awards made under the Prior Plan before the Effective Date shall continue in effect in accordance with their terms.

6. TERMS AND CONDITIONS OF AWARDS .

Each Award granted pursuant to this Plan shall be evidenced by a written or electronic agreement between the Company and the Grantee or a written or electronic notice delivered by the Company (the “ Award Agreement ”), in substantially such form or forms and containing such terms and conditions, as the Committee shall from time to time approve. The Award Agreement shall comply with and be subject

 

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to the following general terms and conditions and the provisions of this Plan (except for any provisions applying to Awards under different tax regimes), unless otherwise specifically provided in such Award Agreement, or the terms referred to in other Sections of this Plan applying to Awards under such applicable tax regimes, or terms prescribed by Applicable Law. Award Agreements need not be in the same form and may differ in the terms and conditions included therein.

6.1. Number of Shares . Each Award Agreement shall state the number of Shares covered by the Award.

6.2. Type of Award . Each Award Agreement may state the type of Award granted thereunder, provided that the tax treatment of any Award, whether or not stated in the Award Agreement, shall be as determined in accordance with Applicable Laws.

6.3. Exercise Price . Each Award Agreement shall state the Exercise Price, if applicable. Unless otherwise set forth in this Plan, an Exercise Price of an Award of less than the par value of the Shares (if shares bear a par value) shall comply with Section 304 of the Companies Law, 1999, as amended. Subject to Sections 3 7.2 and 8.2 and to the foregoing, the Committee may reduce the Exercise Price of any outstanding Award, on terms and subject to such conditions as it deems advisable. The Exercise Price shall also be subject to adjustment as provided in Section 14 hereof.

6.4. Manner of Exercise . An Award may be exercised, as to any or all Shares as to which the Award has become exercisable, by written notice delivered in person or by mail (or such other methods of delivery prescribed by the Company) to the Chief Financial Officer/Chief Executive Officer of the Company or to such other person as determined by the Committee, or in any other manner as the Committee shall prescribe from time to time, specifying the number of Shares with respect to which the Award is being exercised (which may be equal to or lower than the aggregate number of Shares that have become exercisable at such time, subject to the last sentence of this Section), accompanied by payment of the aggregate Exercise Price for such Shares in the manner specified in the following sentence. The Exercise Price shall be paid in full with respect to each Share, at the time of exercise, either in (i) cash, (ii) if the Company’s shares are listed for trading on any securities exchange or over-the-counter market, and if the Committee so determines, all or part of the Exercise Price and any withholding taxes may be paid by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Shares and to deliver all or part of the sales proceeds to the Company or the Trustee, (iii) if the Company’s shares are listed for trading on any securities exchange or over-the-counter market, and if the Committee so determines, all or part of the Exercise Price and any withholding taxes may be paid by the delivery (on a form prescribed by the Company) of an irrevocable direction to pledge Shares to a securities broker or lender approved by the Company, as security for a loan, and to deliver all or part of the loan proceeds to the Company or the Trustee, or (iv) in such other manner as the Committee shall determine, which may include procedures for cashless exercise.

6.5. Term and Vesting of Awards .

6.5.1. Each Award Agreement shall provide the vesting schedule for the Award as determined by the Committee. The Committee shall have the authority to determine the vesting schedule and accelerate the vesting of any outstanding Award at such time and under such circumstances as it, in its sole discretion, deems appropriate. Unless otherwise resolved by the Committee and stated in the Award Agreement, and subject to Sections 6.6 and 6.7 hereof, Awards shall vest and become exercisable under the following schedule: twenty-five percent (25%) of the Shares covered by the Award, on the first anniversary of the vesting commencement date determine

 

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by the Committee (and in the absence of such determination, of date on which such Award was granted), and six and one-quarter percent (6.25%) of the Shares covered by the Award at the end of each subsequent three-month period thereafter over the course of the following three (3) years; provided that the Grantee remains continuously as a Service Provider of the Company or its Affiliates throughout such vesting dates.

6.5.2. The Award Agreement may contain performance goals and measurements (which, in case of 102 Awards, shall, if then required, be subject to obtaining a specific tax ruling or determination from the ITA), and the provisions with respect to any Award need not be the same as the provisions with respect to any other Award. Such performance goals may include, but are not limited to, sales, earnings before interest and taxes, return on investment, earnings per share, any combination of the foregoing or rate of growth of any of the foregoing, as determined by the Committee. The Committee may adjust performance goals pursuant to Awards previously granted to take into account changes in law and accounting and tax rules and to make such adjustments as the Committee deems necessary or appropriate to reflect the inclusion or the exclusion of the impact of extraordinary or unusual items, events or circumstances.

6.5.3. The Exercise Period of an Award will be ten (10) years from the date of grant of the Award, unless otherwise determined by the Committee and stated in the Award Agreement, but subject to the vesting provisions described above and the early termination provisions set forth in Sections 6.6 and 6.7 hereof. At the expiration of the Exercise Period, any Award, or any part thereof, that has not been exercised within the term of the Award and the Shares covered thereby not paid for in accordance with this Plan and the Award Agreement shall terminate and become null and void, and all interests and rights of the Grantee in and to the same shall expire.

6.6. Termination .

6.6.1. Unless otherwise determined by the Committee, and subject to Section 6.7 hereof, an Award may not be exercised unless the Grantee is then a Service Provider of the Company or an Affiliate thereof or, in the case of an Incentive Stock Option, a company or a parent or subsidiary company of such company issuing or assuming the Option in a transaction to which Section 424(a) of the Code applies, and unless the Grantee has remained continuously so employed since the date of grant of the Award and throughout the vesting dates.

6.6.2. In the event that the employment or service of a Grantee shall terminate (other than by reason of death, Disability or Retirement), all Awards of such Grantee that are unvested at the time of such termination shall terminate on the date of such termination, and all Awards of such Grantee that are vested and exercisable at the time of such termination may be exercised within up to three (3) months after the date of such termination (or such different period as the Committee shall prescribe), but in any event no later than the date of expiration of the Award’s term as set forth in the Award Agreement or pursuant to this Plan; provided, however, that if the Company (or the Subsidiary or Affiliate, when applicable) shall terminate the Grantee’s employment or service for Cause (as defined below) or if at any time during the Exercise Period (whether prior to and after termination of employment or service, and whether or not the Grantee’s employment or service is terminated by either party as a result thereof), facts or circumstances arise or are discovered with respect to the Grantee that would have constituted Cause, all Awards theretofore granted to such Grantee (whether vested or not) shall, to the extent not theretofore exercised, terminate on the date of such termination (or on such subsequent date on which such facts or circumstances arise or are discovered, as the case may be) unless otherwise determined by the Committee; and any Shares

 

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issued upon exercise or (if applicable) vesting of Awards (including other Shares or securities issued or distributed with respect thereto), whether held by the Grantee or by the Trustee for the Grantee’s benefit, shall be deemed to be irrevocably offered for sale to the Company, any of its Affiliates or any person designated by the Company to purchase, at the Company’s election and subject to Applicable Law, either for no consideration, for the par value of such Shares (if shares bear a par value) or against payment of the Exercise Price previously received by the Company for such Shares upon their issuance, as the Committee deems fit, upon written notice to the Grantee at any time after the Grantee’s termination of employment or service. Such Shares or other securities shall be sold and transferred within 30 days from the date of the Company’s notice of its election to exercise its right. If the Grantee fails to transfer such Shares or other securities to the Company, the Company, at the decision of the Committee, shall be entitled to forfeit or repurchase such Shares and to authorize any person to execute on behalf of the Grantee any document necessary to effect such transfer, whether or not the share certificates are surrendered. The Company shall have the right and authority to affect the above either by: (i) repurchasing all of such Shares or other securities held by the Grantee or by the Trustee for the benefit of the Grantee, or designate any other person who shall have the right and authority to purchase all of Such Shares or other securities, for the Exercise Price paid for such Shares, the par value of such Shares (if shares bear a par value) or for no payment or consideration whatsoever, as the Committee deems fit; (ii) forfeiting all such Shares or other securities; (iii) redeeming all such Shares or other securities, for the Exercise Price paid for such Shares, the par value of such Shares (if shares bear a par value) or for no payment or consideration whatsoever, as the Committee deems fit; (iv) taking action in order to have such Shares or other securities converted into deferred shares entitling their holder only to their par value (if shares bear a par value) upon liquidation of the Company; or (v) taking any other action which may be required in order to achieve similar results; all as shall be determined by the Committee, at its sole and absolute discretion, and the Grantee is deemed to irrevocably empower the Company or any person which may be designated by it to take any action by, in the name of or on behalf of the Grantee to comply with and give effect to such actions (including, voting such shares, filling in, signing and delivering share transfer deeds, etc.).

6.6.3. Notwithstanding anything to the contrary, the Committee, in its absolute discretion, may, on such terms and conditions as it may determine appropriate, extend the periods for which Awards held by any Grantee may continue to vest and be exercisable; it being clarified that such Awards may lose their entitlement to certain tax benefits under Applicable Law as a result of the modification of such Awards and/or in the event that the Award is exercised beyond the later of: (i) three (3) months after the date of termination of the employment or service relationship; or (ii) the applicable period under Section 6.7 below with respect to a termination of the employment or service relationship because of the death, Disability or Retirement of Grantee.

6.6.4. For purposes of this Plan:

6.6.4.1. a termination of employment or service of a Grantee shall not be deemed to occur (except to the extent required by the Code with respect to the Incentive Stock Option status of an Option) in case of (i) a transition or transfer of a Grantee among the Company and its Affiliates, (ii) a change in the capacity in which the Grantee is employed or renders service to the Company or any of its Affiliates or a change in the identity of the employing or engagement entity among the Company and its Affiliates, provided, in case of (i) and (ii) above, that the Grantee has remained continuously employed by and/or in the service of the Company and its Affiliates since the date of grant of the Award and throughout the vesting period; or (iii) if the Grantee takes any unpaid leave as set forth in Section 6.8(i) below.

 

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6.6.4.2. An entity or an Affiliate thereof assuming an Award or issuing in substitution thereof in a transaction to which Section 424(a) of the Code applies or in a Merger/Sale in accordance with Section 14 shall be deemed as an Affiliate of the Company for purposes of this Section 6.6, unless the Committee determines otherwise.

6.6.4.3. In the case of a Grantee whose principal employer or service recipient is a Subsidiary or Affiliate, the Grantee’s employment shall also be deemed terminated for purposes of this Section 6.6 as of the date on which such principal employer or service recipient ceases to be a Subsidiary or Affiliate.

6.6.4.4. The term “ Cause ” shall mean (irrespective of, and in addition to, any definition included in any other agreement or instrument applicable to the Grantee, and unless otherwise determined by the Committee) any of the following: (i) any theft, fraud, embezzlement, dishonesty, willful misconduct, breach of fiduciary duty for personal profit, falsification of any documents or records of the Company or any of its Affiliates, felony or similar act by the Grantee (whether or not related to the Grantee’s relationship with the Company); (ii) an act of moral turpitude by the Grantee, or any act that causes significant injury to, or is otherwise adversely affecting, the reputation, business, assets, operations or business relationship of the Company (or a Subsidiary or Affiliate, when applicable); (iii) any breach by the Grantee of any material agreement with or of any material duty of the Grantee to the Company or any Subsidiary or Affiliate thereof (including breach of confidentiality, non-disclosure, non-use non-competition or non-solicitation covenants towards the Company or any of its Affiliates) or failure to abide by code of conduct or other policies (including, without limitation, policies relating to confidentiality and reasonable workplace conduct); or (iv) any act which constitutes a breach of a Grantee’s fiduciary duty towards the Company or an Affiliate or Subsidiary, including disclosure of confidential or proprietary information thereof or acceptance or solicitation to receive unauthorized or undisclosed benefits, irrespective of their nature, or funds, or promises to receive either, from individuals, consultants or corporate entities that the Company or a Subsidiary does business with; (v) the Grantee’s unauthorized use, misappropriation, destruction, or diversion of any tangible or intangible asset or corporate opportunity of the Company or any of its Affiliates (including, without limitation, the improper use or disclosure of confidential or proprietary information); or (vi) any circumstances that constitute grounds for termination for cause under the Grantee’s employment or service agreement with the Company or Affiliate, to the extent applicable. For the avoidance of doubt, the determination as to whether a termination is for Cause for purposes of this Plan, shall be made in good faith by the Committee and shall be final and binding on the Grantee.

 

6.7. Death, Disability or Retirement of Grantee .

6.7.1. If a Grantee shall die while employed by, or performing service for, the Company or its Affiliates, or within the three (3) month period (or such longer period of time as determined by the Board, in its discretion) after the date of termination of such Grantee’s employment or service (or within such different period as the Committee may have provided pursuant to Section 6.6 hereof), or if the Grantee’s employment or service shall terminate by reason of Disability, all Awards theretofore granted to such Grantee may (to the extent otherwise vested and exercisable and unless earlier terminated in accordance with their terms) be exercised by the Grantee or by the Grantee’s estate or by a person who acquired the legal right to exercise such Awards by bequest or inheritance, or by a person who acquired the legal right to exercise such Awards in accordance with applicable law in the case of Disability of the Grantee, as the case may

 

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be, at any time within one (1) year (or such longer period of time as determined by the Committee, in its discretion) after the death or Disability of the Grantee (or such different period as the Committee shall prescribe), but in any event no later than the date of expiration of the Award’s term as set forth in the Award Agreement or pursuant to this Plan. In the event that an Award granted hereunder shall be exercised as set forth above by any person other than the Grantee, written notice of such exercise shall be accompanied by a certified copy of letters testamentary or proof satisfactory to the Committee of the right of such person to exercise such Award.

6.7.2. In the event that the employment or service of a Grantee shall terminate on account of such Grantee’s Retirement, all Awards of such Grantee that are exercisable at the time of such Retirement may, unless earlier terminated in accordance with their terms, be exercised at any time within the three (3) month period after the date of such Retirement (or such different period as the Committee shall prescribe).

6.8. Suspension of Vesting . Unless the Committee provides otherwise, vesting of Awards granted hereunder shall be suspended during any unpaid leave of absence, other than in the case of any (i) leave of absence which was pre-approved by the Company explicitly for purposes of continuing the vesting of Awards, or (ii) transfers between locations of the Company or any of its Affiliates, or between the Company and any of its Affiliates, or any respective successor thereof. For clarity, for purposes of this Plan, military leave, statutory maternity or paternity leave or sick leave are not deemed unpaid leave of absence.

6.9. Securities Law Restrictions . Except as otherwise provided in the applicable Award Agreement or other agreement between the Service Provider and the Company, if the exercise of an Award following the termination of the Service Provider’s employment or service (other than for Cause) would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities Act or equivalent requirements under equivalent laws of other applicable jurisdictions, then the Award shall remain exercisable and terminate on the earlier of (i) the expiration of a period of three (3) months (or such longer period of time as determined by the Board, in its discretion) after the termination of the Service Provider’s employment or service during which the exercise of the Award would not be in such violation, or (ii) the expiration of the term of the Award as set forth in the Award Agreement or pursuant to this Plan. In addition, unless otherwise provided in a Grantee’s Award Agreement, if the sale of any Shares received upon exercise or (if applicable) vesting of an Award following the termination of the Grantee’s employment or service (other than for Cause) would violate the Company’s insider trading policy, then the Award shall terminate on the earlier of (i) the expiration of a period equal to the applicable post-termination exercise period after the termination of the Grantee’s employment or service during which the exercise of the Award would not be in violation of the Company’s insider trading policy, or (ii) the expiration of the term of the Award as set forth in the applicable Award Agreement or pursuant to this Plan.

6.10. Voting Proxy . Until immediately after the listing for trading on a stock exchange or market or trading system of the Company’s (or the Successor Corporation’s) shares, the Shares subject to an Award or to be issued pursuant to an Award or any other Securities, shall, unless otherwise determined by the Committee, be subject to an irrevocable proxy and power of attorney by the Grantee or the Trustee (if so requested from the Trustee), as the case may be, to the Company, which shall designate such person or persons (with a right of substitution) from time to time as determined by the Committee (and in the absence of such determination, the CEO or Chairman of the Board, ex officio). The Trustee is deemed to be instructed by the Grantee to sign such proxy, as requested by the Company. The proxy shall entitle the holder thereof to receive notices, vote and take such other actions in respect of the Shares or other

 

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Securities. Any person holding or exercising such voting proxies shall do so solely in his capacity as the proxy holder and not individually. All Awards granted hereunder shall be conditioned upon the execution of such irrevocable proxy in substantially the form prescribed by the Committee from time to time. So long as any such Shares are subject to such irrevocable proxy and power of attorney or held by a Trustee (and unless a proxy was given by the Trustee as aforesaid), (i) in any shareholders meeting or written consent in lieu thereof, such Shares shall be voted by the proxy holder (or the Trustee, as applicable), unless directed otherwise by the Board, in the same proportion as the result of the vote at the shareholders’ meeting (or written consent in lieu thereof) in respect of which the Shares are being voted (whether an extraordinary or annual meeting, and whether of the share capital as one class or of any class thereof), and (ii) or in any act or consent of shareholders under the Company’s Articles of Association or otherwise, such Shares shall be cast by the proxy holder (or the Trustee, as applicable), unless directed otherwise by the Board, in the same proportion as the result of the shareholders’ act or consent. The provisions of this Section shall apply to the Grantee and to any purchaser, assignee or transferee of any Shares.

6.11. Other Provisions . The Award Agreement evidencing Awards under this Plan shall contain such other terms and conditions not inconsistent with this Plan as the Committee may determine, at or after the date of grant, including provisions in connection with the restrictions on transferring the Awards or Shares covered by such Awards, which shall be binding upon the Grantees and any purchaser, assignee or transferee of any Awards, and other terms and conditions as the Committee shall deem appropriate.

7. NONQUALIFIED STOCK OPTIONS .

Awards granted pursuant to this Section 7 are intended to constitute Nonqualified Stock Options and shall be subject to the general terms and conditions specified in Section 6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations. In the event of any inconsistency or contradictions between the provisions of this Section 7 and the other terms of this Plan, this Section 7 shall prevail.

7.1. Certain Limitations on Eligibility for Nonqualified Stock Options . Nonqualified Stock Options may not be granted to a Service Provider who is deemed to be a resident of the United States for purposes of taxation or who is otherwise subject to United States federal income tax unless the Shares underlying such Options constitute “service recipient stock” under Section 409A of the Code or unless such Options comply with the payment requirements of Section 409A of the Code.

7.2. Exercise Price . The Exercise Price of a Nonqualified Stock Option shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option unless the Committee specifically indicates that the Awards will have a lower Exercise Price and the Award complies with Section 409A of the Code. Notwithstanding the foregoing, a Nonqualified Stock Option may be granted with an exercise price lower than the minimum exercise price set forth above if such Award is granted pursuant to an assumption or substitution for another option in a manner qualifying under the provisions of that complies with Section 424(a) of the Code 1.409A-1(b)(5)(v)(D) of the U.S. Treasury Regulations or any successor guidance.

 

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8. INCENTIVE STOCK OPTIONS .

Awards granted pursuant to this Section 8 are intended to constitute Incentive Stock Options and shall be granted subject to the following special terms and conditions, the general terms and conditions specified in Section 6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations. In the event of any inconsistency or contradictions between the provisions of this Section 8 and the other terms of this Plan, this Section 8 shall prevail.

8.1. Eligibility for Incentive Stock Options . Incentive Stock Options may be granted only to Employees of the Company, or to Employees of a Parent or Subsidiary, determined as of the date of grant of such Options. An Incentive Stock Option granted to a prospective Employee upon the condition that such person become an Employee shall be deemed granted effective on the date such person commences employment, with an exercise price determined as of such date in accordance with Section 8.2.

8.2. Exercise Price . The Exercise Price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of the Shares covered by the Awards on the date of grant of such Option or such other price as may be determined pursuant to the Code. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an exercise price lower than the minimum exercise price set forth above if such Award is granted pursuant to an assumption or substitution for another option in a manner that complies with the provisions of Section 424(a) of the Code.

8.3. Date of Grant . Notwithstanding any other provision of this Plan to the contrary, no Incentive Stock Option may be granted under this Plan after 10 years from the date this Plan is adopted, or the date this Plan is approved by the shareholders, whichever is earlier.

8.4. Exercise Period . No Incentive Stock Option shall be exercisable after the expiration of ten (10) years after the effective date of grant of such Award, subject to Section 8.6. No Incentive Stock Option granted to a prospective Employee may become exercisable prior to the date on which such person commences employment.

8.5. $100,000 Per Year Limitation . The aggregate Fair Market Value (determined as of the date the Incentive Stock Option is granted) of the Shares with respect to which all Incentive Stock Options granted under this Plan and all other “incentive stock option” plans of the Company, or of any Parent or Subsidiary or Affiliate, become exercisable for the first time by each Grantee during any calendar year shall not exceed one hundred thousand United States dollars ($100,000) with respect to such Grantee. To the extent that the aggregate Fair Market Value of Shares with respect to which such Incentive Stock Options and any other such incentive stock options are exercisable for the first time by any Grantee during any calendar year exceeds one hundred thousand United States dollars ($100,000), such options shall be treated as Nonqualified Stock Options. The foregoing shall be applied by taking options into account in the order in which they were granted. If the Code is amended to provide for a different limitation from that set forth in this Section 8.5, such different limitation shall be deemed incorporated herein effective as of the date and with respect to such Awards as required or permitted by such amendment to the Code. If an Option is treated as an Incentive Stock Option in part and as a Nonqualifed Stock Option in part by reason of the limitation set forth in this Section 8.5, the Grantee may designate which portion of such Option the Grantee is exercising. In the absence of such designation, the Grantee shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Separate certificates representing each such portion may be issued upon the exercise of the Option.

8.6. Ten Percent Shareholder . In the case of an Incentive Stock Option granted to a Ten Percent Shareholder, (i) the Exercise Price shall not be less than one hundred and ten percent (110%) of the Fair Market Value of a Share on the date of grant of such Incentive Stock Option, and (ii) the Exercise Period shall not exceed five (5) years from the effective date of grant of such Incentive Stock Option.

 

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8.7. Payment of Exercise Price . Each Award Agreement evidencing an Incentive Stock Option shall state each alternative method by which the Exercise Price thereof may be paid.

8.8. Leave of Absence . Notwithstanding Section 6.8, a Grantee’s employment shall not be deemed to have terminated if the Grantee takes any leave as set forth in Section 6.8(i); provided, however, that if any such leave exceeds three (3) months, on the day that is six (6) months following the commencement of such leave any Incentive Stock Option held by the Grantee shall cease to be treated as an Incentive Stock Option and instead shall be treated thereafter as a Nonqualified Stock Option, unless the Grantee’s right to return to employment is guaranteed by statute or contract.

8.9. Exercise Following Termination for Disability . Notwithstanding anything else in this Plan to the contrary, Incentive Stock Options that are not exercised within three (3) months following termination of the Grantee’s employment with the Company or its Parent or Subsidiary or a corporation or a Parent or Subsidiary of such corporation issuing or assuming an Option in a transaction to which Section 424(a) of the Code applies, or within one year in case of termination of the Grantee’s employment with the Company or its Parent or Subsidiary due to a Disability (within the meaning of Section 22(e)(3) of the Code), shall be deemed to be Nonqualified Stock Options.

8.10. Adjustments to Incentive Stock Options . Any Awards Agreement providing for the grant of Incentive Stock Options shall indicate that adjustments made pursuant to this Plan with respect to Incentive Stock Options could constitute a “modification” of such Incentive Stock Options (as that term is defined in Section 424(h) of the Code) or could cause adverse tax consequences for the holder of such Incentive Stock Options and that the holder should consult with his or her tax advisor regarding the consequences of such “modification” on his or her income tax treatment with respect to the Incentive Stock Option.

8.11. Notice to Company of Disqualifying Disposition . Each Grantee who receives an Incentive Stock Option must agree to notify the Company in writing immediately after the Grantee makes a Disqualifying Disposition of any Shares received pursuant to the exercise of Incentive Stock Options. A “Disqualifying Disposition” is any disposition (including any sale) of such Shares before the later of (i) two years after the date the Grantee was granted the Incentive Stock Option, or (ii) one year after the date the Grantee acquired Shares by exercising the Incentive Stock Option. If the Grantee dies before such Shares are sold, these holding period requirements do not apply and no disposition of the Shares will be deemed a Disqualifying Disposition.

9. 102 AWARDS .

Awards granted pursuant to this Section 9 are intended to constitute 102 Awards and shall be granted subject to the following special terms and conditions, the general terms and conditions specified in Section 6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations. In the event of any inconsistency or contradictions between the provisions of this Section 9 and the other terms of this Plan, this Section 9 shall prevail.

9.1. Tracks . Awards granted pursuant to this Section 9 are intended to be granted pursuant to Section 102 of the Ordinance pursuant to either (i) Section 102(b)(2) thereof, under the capital gain track (“102 Capital Gain Track Awards”), or (ii) Section 102(b)(1) thereof under the ordinary income track (“102 Ordinary Income Track Awards”, and together with 102 Capital Gain Track Awards, “102 Trustee Awards”). 102 Trustee Awards shall be granted subject to the special terms and conditions contained in this Section 9, the general terms and conditions specified in Section 6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Options under different tax laws or regulations.

 

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9.2. Election of Track . Subject to Applicable Law, the Company may grant only one type of 102 Trustee Awards at any given time to all Grantees who are to be granted 102 Trustee Awards pursuant to this Plan, and shall file an election with the ITA regarding the type of 102 Trustee Awards it elects to grant before the date of grant of any 102 Trustee Awards (the “Election”). Such Election shall also apply to any other securities, including bonus shares, received by any Grantee as a result of holding the 102 Trustee Awards. The Company may change the type of 102 Trustee Awards that it elects to grant only after the expiration of at least 12 months from the end of the year in which the first grant was made in accordance with the previous Election, or as otherwise provided by Applicable Law. Any Election shall not prevent the Company from granting Awards, pursuant to Section 102(c) of the Ordinance without a Trustee (“102 Non-Trustee Awards”).

9.3. Eligibility for Awards .

9.3.1. Subject to Applicable Law, 102 Awards may only be granted to an “employee” within the meaning of Section 102(a) of the Ordinance (which as of the date of the adoption of this Plan means (i) individuals employed by an Israeli company being the Company or any of its Affiliates, and (ii) individuals who are serving and are engaged personally (and not through an entity) as “office holders” by such an Israeli company), but may not be granted to a Controlling Shareholder (“Eligible 102 Grantees”). Eligible 102 Grantees may receive only 102 Awards, which may either be granted to a Trustee or granted under Section 102 of the Ordinance without a Trustee.

9.4. 102 Award Grant Date .

9.4.1. Each 102 Award will be deemed granted on the date determined by the Committee, subject to Section 9.4.2, provided that (i) the Grantee has signed all documents required by the Company or pursuant to Applicable Law, and (ii) with respect to 102 Trustee Award, the Company has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA, and if an agreement is not signed and delivered by the Grantee within 90 days from the date determined by the Committee (subject to Section 9.4.2), then such 102 Trustee Award shall be deemed granted on such later date as such agreement is signed and delivered and on which the Company has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA. In the case of any contradiction, this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated in any corporate resolution or Award Agreement.

9.4.2. Unless otherwise permitted by the Ordinance, any grants of 102 Trustee Awards that are made on or after the date of the adoption of this Plan or an amendment to this Plan, as the case may be, that may become effective only at the expiration of thirty (30) days after the filing of this Plan or any amendment thereof (as the case may be) with the ITA in accordance with the Ordinance shall be conditional upon the expiration of such 30-day period, such condition shall be read and is incorporated by reference into any corporate resolutions approving such grants and into any Award Agreement evidencing such grants (whether or not explicitly referring to such condition), and the date of grant shall be at the expiration of such 30-day period, whether or not the date of grant indicated therein corresponds with this Section. In the case of any contradiction, this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated in any corporate resolution or Award Agreement.

 

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9.5. 102 Trustee Awards .

9.5.1. Each 102 Trustee Award, each Share issued pursuant to the exercise of any 102 Trustee Award, and any rights granted thereunder, including bonus shares, shall be issued to and registered in the name of the Trustee and shall be held in trust for the benefit of the Grantee for the requisite period prescribed by the Ordinance or such longer period as set by the Committee (the “ Required Holding Perio d ”). In the event that the requirements under Section 102 of the Ordinance to qualify an Award as a 102 Trustee Award are not met, then the Award may be treated as a 102 Non-Trustee Award or 3(9) Award, all in accordance with the provisions of the Ordinance. After expiration of the Required Holding Period, the Trustee may release such 102 Trustee Awards and any such Shares, provided that (i) the Trustee has received an acknowledgment from the ITA that the Grantee has paid any applicable taxes due pursuant to the Ordinance, or (ii) the Trustee and/or the Company and/or its Affiliate withholds all applicable taxes and compulsory payments due pursuant to the Ordinance arising from the 102 Trustee Awards and/or any Shares issued upon exercise or (if applicable) vesting of such 102 Trustee Awards. The Trustee shall not release any 102 Trustee Awards or Shares issued upon exercise or (if applicable) vesting thereof prior to the payment in full of the Grantee’s tax and compulsory payments arising from such 102 Trustee Awards and/or Shares or the withholding referred to in (ii) above.

9.5.2. Each 102 Trustee Award shall be subject to the relevant terms of the Ordinance, the Rules and any determinations, rulings or approvals issued by the ITA, which shall be deemed an integral part of the 102 Trustee Awards and shall prevail over any term contained in this Plan or Award Agreement that is not consistent therewith. Any provision of the Ordinance, the Rules and any determinations, rulings or approvals by the ITA not expressly specified in this Plan or Award Agreement that are necessary to receive or maintain any tax benefit pursuant to Section 102 of the Ordinance shall be binding on the Grantee. The Grantee granted a 102 Trustee Awards shall comply with the Ordinance and the terms and conditions of the trust agreement entered into between the Company and the Trustee. The Grantee shall execute any and all documents that the Company and/or its Affiliates and/or the Trustee determine from time to time to be necessary in order to comply with the Ordinance and the Rules.

9.5.3. During the Required Holding Period, the Grantee shall not release from trust or sell, assign, transfer or give as collateral, the Shares issuable upon the exercise or (if applicable) vesting of a 102 Trustee Awards and/or any securities issued or distributed with respect thereto, until the expiration of the Required Holding Period. Notwithstanding the above, if any such sale, release or other action occurs during the Required Holding Period it may result in adverse tax consequences to the Grantee under Section 102 of the Ordinance and the Rules, which shall apply to and shall be borne solely by such Grantee. Subject to the foregoing, the Trustee may, pursuant to a written request from the Grantee, but subject to the terms of this Plan, release and transfer such Shares to a designated third party, provided that both of the following conditions have been fulfilled prior to such release or transfer: (i) payment has been made to the ITA of all taxes and compulsory payments required to be paid upon the release and transfer of the Shares, and confirmation of such payment has been received by the Trustee and the Company, and (ii) the Trustee has received written confirmation from the Company that all requirements for such release and transfer have been fulfilled according to the terms of the Company’s corporate documents, any agreement governing the Shares, this Plan, the Award Agreement and any Applicable Law.

 

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9.5.4. If a 102 Trustee Award is exercised or (if applicable) vested, the Shares issued upon such exercise or (if applicable) vesting shall be issued in the name of the Trustee for the

benefit of the Grantee.

9.5.5. Upon or after receipt of a 102 Trustee Award, if required, the Grantee may be required to sign an undertaking to release the Trustee from any liability with respect to any action or decision duly taken and executed in good faith by the Trustee in relation to this Plan, or any 102 Trustee Awards or Share granted to such Grantee thereunder.

9.6. 102 Non-Trustee Awards . The foregoing provisions of this Section 9 relating to 102 Trustee Awards shall not apply with respect to 102 Non-Trustee Awards, which shall, however, be subject to the relevant provisions of Section 102 of the Ordinance and the applicable Rules. The Committee may determine that 102 Non-Trustee Awards, the Shares issuable upon the exercise or (if applicable) vesting of a 102 Non-Trustee Awards and/or any securities issued or distributed with respect thereto, shall be allocated or issued to the Trustee, who shall hold such 102 Non-Trustee Awards and all accrued rights thereon (if any), in trust for the benefit of the Grantee and/or the Company, as the case may be, until the full payment of tax arising from the 102 Non-Trustee Awards, the Shares issuable upon the exercise or (if applicable) vesting of a 102 Non-Trustee Awards and/or any securities issued or distributed with respect thereto. The Company may choose, alternatively, to force the Grantee to provide it with a guarantee or other security, to the satisfaction of each of the Trustee and the Company, until the full payment of the applicable taxes.

9.7. Israeli Index Base for 102 Awards . Each 102 Award will be subject to the Israeli index base of the Value of Benefit, as defined in Section 102(a) of the Ordinance, as determined by the Committee in its discretion, pursuant to the Rules, from time to time. The Committee may amend (which may have a retroactive effect) the Israeli index base, pursuant to the Ordinance, without the Grantee’s consent.

9.8. Written Grantee Undertaking . To the extent and with respect to any 102 Trustee Award, and as required by Section 102 of the Ordinance and the Rules, by virtue of the receipt of such Award, the Grantee is deemed to have undertaken and confirm in writing the following (and such undertaking is deemed incorporated into any documents signed by the Grantee in connection with the employment or service of the Grantee and/or the grant of such Award). The following written undertaking shall be deemed to apply and relate to all 102 Trustee Awards granted to the Grantee, whether under this Plan or other plans maintained by the Company, and whether prior to or after the date hereof.

9.8.1. The Grantee shall comply with all terms and conditions set forth in Section 102 of the Ordinance with regard to the “Capital Gain Track” or the “Ordinary Income Track”, as applicable, and the applicable rules and regulations promulgated thereunder, as amended from time to time;

9.8.2. The Grantee is familiar with, and understands the provisions of, Section 102 of the Ordinance in general, and the tax arrangement under the “Capital Gain Track” or the “Ordinary Income Track” in particular, and its tax consequences; the Grantee agrees that the 102 Trustee Awards and Shares that may be issued upon exercise or (if applicable) vesting of the 102 Trustee Awards (or otherwise in relation to the 102 Trustee Awards), will be held by a trustee appointed pursuant to Section 102 of the Ordinance for at least the duration of the “Holding Period” (as such term is defined in Section 102) under the “Capital Gain Track” or the “Ordinary Income Track”, as applicable. The Grantee understands that any release of such 102 Trustee Awards or Shares from trust, or any sale of the Share prior to the termination of the Holding Period, as defined above, will result in taxation at marginal tax rate, in addition to deductions of appropriate social security, health tax contributions or other compulsory payments; and

 

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9.8.3. The Grantee agrees to the trust deed signed between the Company, his employing company and the trustee appointed pursuant to Section 102 of the Ordinance.

10. 3(9) AWARDS .

Awards granted pursuant to this Section 10 are intended to constitute 3(9) Awards and shall be granted subject to the general terms and conditions specified in Section 6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations. In the event of any inconsistency or contradictions between the provisions of this Section 10 and the other terms of this Plan, this Section 10 shall prevail.

10.1. To the extent required by the Ordinance or the ITA or otherwise deemed by the Committee to be advisable, the 3(9) Awards and/or any shares or other securities issued or distributed with respect thereto granted pursuant to this Plan shall be issued to a Trustee nominated by the Committee in accordance with the provisions of the Ordinance. In such event, the Trustee shall hold such Awards and/or any shares or other securities issued or distributed with respect thereto in trust, until exercised or (if applicable) vested by the Grantee and the full payment of tax arising therefrom, pursuant to the Company’s instructions from time to time as set forth in a trust agreement, which will have been entered into between the Company and the Trustee. If determined by the Board or the Committee, and subject to such trust agreement, the Trustee shall be responsible for withholding any taxes to which a Grantee may become liable upon issuance of Shares, whether due to the exercise or (if applicable) vesting of Awards.

10.2. Shares pursuant to a 3(9) Award shall not be issued, unless the Grantee delivers to the Company payment in cash or by bank check or such other form acceptable to the Committee of all withholding taxes due, if any, on account of the Grantee acquired Shares under the Award or gives other assurance satisfactory to the Committee of the payment of those withholding taxes.

11. RESTRICTED SHARES .

The Committee may award Restricted Shares to any eligible Grantee, including under Section 102 of the Ordinance. Each Award of Restricted Shares under this Plan shall be evidenced by a written agreement between the Company and the Grantee (the “ Restricted Share Agreement ”), in such form as the Committee shall from time to time approve. The Restricted Shares shall be subject to all applicable terms of this Plan, which in the case of Restricted Shares granted under Section 102 of the Ordinance shall include Section 9 hereof, and may be subject to any other terms that are not inconsistent with this Plan. The provisions of the various Restricted Shares Agreements entered into under this Plan need not be identical. The Restricted Share Agreement shall comply with and be subject to Section 6 and the following terms and conditions, unless otherwise specifically provided in such Agreement and not inconsistent with this Plan, or Applicable Law:

11.1. Purchase Price . Section 6.4 shall not apply. Each Restricted Share Agreement shall state an amount of Exercise Price to be paid by the Grantee, if any, in consideration for the issuance of the Restricted Shares and the terms of payment thereof, which may include, payment in cash or, subject to the Committee’s approval, by issuance of promissory notes or other evidence of indebtedness on such terms and conditions as determined by the Committee.

 

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11.2. Restrictions . Restricted Shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution (in which case they shall be transferred subject to all restrictions then or thereafter applicable thereto), until such Restricted Shares shall have vested (the period from the date on which the Award is granted until the date of vesting of the Restricted Share thereunder being referred to herein as the “ Restricted Period ”). The Committee may also impose such additional or alternative restrictions and conditions on the Restricted Shares, as it deems appropriate, including the satisfaction of performance criteria. Such performance criteria may include, but are not limited to, sales, earnings before interest and taxes, return on investment, earnings per share, any combination of the foregoing or rate of growth of any of the foregoing, as determined by the Committee or pursuant to the provisions of any Company policy required under mandatory provisions of Applicable Law. Certificates for shares issued pursuant to Restricted Share Awards, if issued, shall bear an appropriate legend referring to such restrictions, and any attempt to dispose of any such shares in contravention of such restrictions shall be null and void and without effect. Such certificates may, if so determined by the Committee, be held in escrow by an escrow agent appointed by the Committee, or, if a Restricted Share Award is made pursuant to Section 102 of the Ordinance, by the Trustee. In determining the Restricted Period of an Award the Committee may provide that the foregoing restrictions shall lapse with respect to specified percentages of the awarded Restricted Shares on successive anniversaries of the date of such Award. To the extent required by the Ordinance or the ITA, the Restricted Shares issued pursuant to Section 102 of the Ordinance shall be issued to the Trustee in accordance with the provisions of the Ordinance and the Restricted Shares shall be held for the benefit of the Grantee for at least the Required Holding Period.

11.3. Forfeiture; Repurchase . Subject to such exceptions as may be determined by the Committee, if the Grantee’s continuous employment with or service to the Company or any Affiliate thereof shall terminate for any reason prior to the expiration of the Restricted Period of an Award or prior to the timely payment in full of the Exercise Price of any Restricted Shares, any Shares remaining subject to vesting or with respect to which the purchase price has not been paid in full, shall thereupon be forfeited, transferred to, and redeemed, repurchased or cancelled by, as the case may be, in any manner as set forth in Section 6.6.2(i) through (v), subject to Applicable Laws and the Grantee shall have no further rights with respect to such Restricted Shares.

11.4. Ownership . During the Restricted Period the Grantee shall possess all incidents of ownership of such Restricted Shares, subject to Section 6.10 and Section 11.2, including the right to vote and receive dividends with respect to such Shares. All securities, if any, received by a Grantee with respect to Restricted Shares as a result of any stock split, stock dividend, combination of shares, or other similar transaction shall be subject to the restrictions applicable to the original Award.

12. RESTRICTED SHARE UNITS .

An RSU is an Award covering a number of Shares that is settled, if vested and (if applicable) exercised, by issuance of those Shares. An RSU may be awarded to any eligible Grantee, including under Section 102 of the Ordinance, provided that, to the extent required by Applicable Laws, a specific ruling is obtained from the ITA to grant RSUs as 102 Trustee Awards. The Award Agreement relating to the grant of RSUs under this Plan (the “ Restricted Share Unit Agreement ”), shall be in such form as the Committee shall from time to time approve. The RSUs shall be subject to all applicable terms of this Plan, which in the case of RSUs granted under Section 102 of the Ordinance shall include Section 9 hereof, and may be subject to any other terms that are not inconsistent with this Plan. The provisions of the various Restricted Share Unit Agreements entered into under this Plan need not be identical. RSUs may be granted in consideration of a reduction in the recipient’s other compensation.

 

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12.1. Exercise Price . No payment of Exercise Price shall be required as consideration for RSUs, unless included in the Award Agreement or as required by Applicable Law (including, Section 304 of the Companies Law, 1999, as amended), and Section 6.4 shall apply, if applicable.

12.2. Shareholders’ Rights . The Grantee shall not possess or own any ownership rights in the Shares underlying the RSUs and no rights as a shareholder shall exist prior to the actual issuance of Shares in the name of the Grantee.

12.3. Settlements of Awards . Settlement of vested RSUs shall be made in the form of Shares. Distribution to a Grantee of an amount (or amounts) from settlement of vested RSUs can be deferred to a date after settlement as determined by the Committee. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until the grant of RSUs is settled, the number of Shares underlying such RSUs shall be subject to adjustment pursuant hereto.

12.4. Section 409A Restrictions . Notwithstanding anything to the contrary set forth herein, any RSUs granted under this Plan that are not exempt from the requirements of Section 409A of the Code shall contain such restrictions or other provisions so that such RSUs will comply with the requirements of Section 409A of the Code, if applicable to the Company. Such restrictions, if any, shall be determined by the Committee and contained in the Restricted Share Unit Agreement evidencing such RSU. For example, such restrictions may include a requirement that any Shares that are to be issued in a year following the year in which the RSU vests must be issued in accordance with a fixed, pre-determined schedule.

13. OTHER SHARE OR SHARE-BASED AWARDS .

13.1. The Committee may grant other Awards under this Plan pursuant to which Shares (which may, but need not, be Restricted Shares pursuant to Section 11 hereof), cash (in settlement of Share-based Awards) or a combination thereof, are or may in the future be acquired or received, or Awards denominated in stock units, including units valued on the basis of measures other than market value.

13.2. The Committee may also grant stock appreciation rights without the grant of an accompanying option, which rights shall permit the Grantees to receive, at the time of any exercise of such rights, cash equal to the amount by which the Fair Market Value of the Shares in respect to which the right was granted is so exercised exceed the exercise price thereof. The exercise price of any such stock appreciation right granted to a Grantee who is subject to U.S. federal income tax shall be determined in compliance with Section 7.2.

13.3. Such other Share-based Awards as set forth above may be granted alone, in addition to, or in tandem with any Award of any type granted under this Plan.

14. EFFECT OF CERTAIN CHANGES .

14.1. General . In the event of a division or subdivision of the outstanding share capital of the Company, any distribution of bonus shares (stock split), consolidation or combination of share capital of the Company (reverse stock split), reclassification with respect to the Shares or any similar recapitalization events (each, a “ Recapitalization ”), a merger (including, a reverse merger and a reverse triangular merger), consolidation, amalgamation or like transaction of the Company with or into another corporation, a reorganization (which may include a combination or exchange of shares, spin-off or other corporate divestiture or division, or other similar occurrences, the Committee shall have the authority to make, without the need for a consent of any holder of an Award, such adjustments as determined by the Committee to be appropriate, in its discretion, in order to adjust (i) the number and class of shares

 

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reserved and available for grants of Awards, (ii) the number and class of shares covered by outstanding Awards, (iii) the Exercise Price per share covered by any Award, (iv) the terms and conditions concerning vesting and exercisability and the term and duration of the outstanding Awards, and (v) any other terms of the Award that in the opinion of the Committee should be adjusted. Any fractional shares resulting from such adjustment shall be treated as determined by the Committee, and in the absence of such determination shall be rounded to the nearest whole share, and the Company shall have no obligation to make any cash or other payment with respect to such fractional shares. No adjustment shall be made by reason of the distribution of subscription rights or rights offering to outstanding shares or other issuance of shares by the Company, unless the Committee determines otherwise. The adjustments determined pursuant to this Section 14.1 (including a determination that no adjustment is to be made) shall be final, binding and conclusive.

14.2. Merger/Sale of Company . In the event of (i) a sale of all or substantially all of the assets of the Company, or a sale (including an exchange) of all or substantially all of the shares of the Company, to any person, or a purchase by a shareholder of the Company or by an Affiliate of such shareholder, of all the shares of the Company held by all or substantially all other shareholders or by other shareholders who are not Affiliated with such acquiring party; (ii) a merger (including, a reverse merger and a reverse triangular merger), consolidation, amalgamation or like transaction of the Company with or into another corporation; (iii) a scheme of arrangement for the purpose of effecting such sale, merger, consolidation, amalgamation or other transaction; (iv) approval by the shareholders of the Company of a complete liquidation or dissolution of the Company, or (v) such other transaction or set of circumstances that is determined by the Board, in its discretion, to be a transaction subject to the provisions of this Section 14.2 excluding any of the above transactions in clauses (i) through (v) if the Board determines that such transaction should be excluded from the definition hereof and the applicability of this Section 14.2 (such transaction, a “Merger/Sale”), then, without derogating from the general authority and power of the Board or the Committee under this Plan, without the Grantee’s consent and action and without any prior notice requirement:

14.2.1. Unless otherwise determined by the Committee in its sole and absolute discretion, any Award then outstanding shall be assumed or be substituted by the Company, or by the successor corporation in such Merger/Sale or by any parent or Affiliate thereof, as determined by the Committee in its discretion (the “Successor Corporation”), under terms as determined by the Committee or the terms of this Plan applied by the Successor Corporation to such assumed or substituted Awards.

For the purposes of this Section 14.2.1, the Award shall be considered assumed or substituted if, following a Merger/Sale, the Award confers on the holder thereof the right to purchase or receive, for each Share underlying an Award immediately prior to the Merger/Sale, either (i) the consideration (whether stock, cash, or other securities or property, or any combination thereof) distributed to or received by holders of Shares in the Merger/Sale for each Share held on the effective date of the Merger/Sale (and if holders were offered a choice or several types of consideration, the type of consideration as determined by the Committee), or (ii) regardless of the consideration received by the holders of Shares in the Merger/Sale, solely shares or any type of Awards (or their equivalent) of the Successor Corporation at a value to be determined by the Committee in its discretion, or a certain type of consideration (whether stock, cash, or other securities or property, or any combination thereof) as determined by the Committee. Any of the above consideration referred to in clauses (i) and (ii) shall be subject to the same vesting and expiration terms of the Awards applying immediately prior to the Merger/Sale, unless determined

 

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by the Committee in its discretion that the consideration shall be subject to different vesting and expiration terms, or other terms, and the Committee may determine that it be subject to other or additional terms. The foregoing shall not limit the Committee’s authority to determine, in its sole discretion, that in lieu of such assumption or substitution of Awards for Awards of the Successor Corporation, such Award will be substituted for any other type of asset or property, including as set forth in Section 14.2.2 hereunder.

14.2.2. Regardless of whether or not Awards are assumed or substituted, the Committee may (but shall not be obligated to), in its sole discretion:

14.2.2.1. provide for the Grantee to have the right to exercise the Award in respect of Shares covered by the Award which would otherwise be exercisable or vested, under such terms and conditions as the Committee shall determine, and the cancellation of all unexercised Awards (whether vested or unvested) upon or immediately prior to the closing of the Merger/Sale, unless the Committee provides for the Grantee to have the right to exercise the Award, or otherwise for the acceleration of vesting of such Award, as to all or part of the Shares covered by the Award which would not otherwise be exercisable or vested, under such terms and conditions as the Committee shall determine; and/or

14.2.2.2. provide for the cancellation of each outstanding Award at or immediately prior to the closing of such Merger/Sale, and payment to the Grantee of an amount in cash, shares of the Company, the acquiror or of a corporation or other business entity which is a party to the Merger/Sale or other property, as determined by the Committee to be fair in the circumstances, and subject to such terms and conditions as determined by the Committee. The Committee shall have full authority to select the method for determining the payment (being the Black-Scholes model or any other method). The Committee’s determination may further provide that payment shall be set to zero if the value of the Shares is determined to be less than the Exercise Price or in respect of Shares covered by the Award which would not otherwise be exercisable or vested, or that payment may be made only in excess of the Exercise Price.

14.2.3. The Committee may, in its sole discretion, determine that any payments made in respect of Awards shall be made or delayed to the same extent that payment of consideration to the holders of the Shares in connection with the Merger/Sale is made or delayed as a result of escrows, indemnification, earn outs, holdbacks or any other contingencies; and the terms and conditions applying to the payment made to the Grantees, including participation in escrow, indemnification, releases, earn-outs, holdbacks or any other contingencies.

14.2.4. The Committee may, in its sole discretion, determine to suspend the Grantee’s rights to exercise any vested portion of an Award for a period of time prior to the completion of a Merger/Sale transaction.

14.2.5. Notwithstanding anything to the contrary, in the event of a Merger/Sale, the Committee may determine, in its sole discretion, that upon completion of such Merger/Sale the terms of any Award shall be otherwise amended, modified or terminated, as the Committee shall deem in good faith to be appropriate and without any liability to the Company or its Affiliates and to their respective officers, directors, employees and representatives and the respective successors and assigns of any of the foregoing in connection with the method of treatment or chosen course of action permitted hereunder.

14.2.6. Neither the authorities and powers of the Committee under this Section 14.2, nor the exercise or implementation thereof, shall (i) be restricted or limited in any way by any adverse consequences (tax or otherwise) that may result to any holder of an Award, and (ii) as, inter

 

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alia, being a feature of the Award upon its grant, be deemed to constitute a change or an amendment of the rights of such holder under this Plan, nor shall any such adverse consequences (as well as any adverse tax consequences that may result from any tax ruling or other approval or determination of any relevant tax authority) be deemed to constitute a change or an amendment of the rights of such holder under this Plan, and may be effected without consent of any Grantee and without any liability to the Company or its Affiliates and to their respective its officers, directors, employees and representatives and the respective successors and assigns of any of the foregoing. The Committee need not take the same action with respect to all Awards or with respect to all Service Providers. The Committee may take different actions with respect to the vested and unvested portions of an Award. The Committee may determine an amount or type of consideration to be received or distributed in a Merger/Sale which may differ as among the Grantees, and as between the Grantees and any other holders of shares of the Company.

14.2.7. The Committee’s determinations pursuant to this Section 14 shall be conclusive and binding on all Grantees.

14.2.8. If determined by the Committee, the Grantees shall be subject to the definitive agreement(s) in connection with the Merger/Sale as applying to holders of Shares including, such terms, conditions, representations, undertakings, liabilities, limitations, releases, indemnities, participating in transaction expenses and escrow arrangement, in each case as determined by the Committee. Each Grantee shall execute such separate agreement(s) or instruments as may be requested by the Company, the Successor Corporation or the acquiror in connection with such in such Merger/Sale and in the form required by them. The execution of such separate agreement(s) may be a condition to the receipt of assumed or substituted Awards, payment in lieu of the Award or the exercise of any Award.

14.3. Reservation of Rights . Except as expressly provided in this Section 14 (if any), the Grantee of an Award hereunder shall have no rights by reason of any Recapitalization of shares of any class, any increase or decrease in the number of shares of any class, or any dissolution, liquidation, reorganization (which may include a combination or exchange of shares, spin-off or other corporate divestiture or division, or other similar occurrences), Merger/Sale. Any issue by the Company of shares of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number, type or price of shares subject to an Award. The grant of an Award pursuant to this Plan shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structures or to merge or to consolidate or to dissolve, liquidate or sell, or transfer all or part of its business or assets or engage in any similar transactions.

15. NON-TRANSFERABILITY OF AWARDS; SURVIVING BENEFICIARY .

15.1. All Awards granted under this Plan by their terms shall not be transferable other than by will or by the laws of descent and distribution, unless otherwise determined by the Committee or under this Plan, provided that with respect to Shares issued upon exercise or (if applicable) the vesting of Awards the restrictions on transfer shall be the restrictions referred to in Section 16 (Conditions upon Issuance of Shares) hereof. Subject to the above provisions, the terms of such Award, this Plan and any applicable Award Agreement shall be binding upon the beneficiaries, executors, administrators, heirs and successors of such Grantee. Awards may be exercised or otherwise realized, during the lifetime of the Grantee, only by the Grantee or by his guardian or legal representative, to the extent provided for herein. Any transfer of an Award not permitted hereunder (including transfers pursuant to any decree of divorce, dissolution or separate maintenance, any property settlement, any separation agreement or any other

 

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agreement with a spouse) and any grant of any interest in any Award to, or creation in any way of any direct or indirect interest in any Award by, any party other than the Grantee shall be null and void and shall not confer upon any party or person, other than the Grantee, any rights. A Grantee may file with the Committee a written designation of a beneficiary, who shall be permitted to exercise such Grantee’s Award or to whom any benefit under this Plan is to be paid, in each case, in the event of the Grantee’s death before he or she fully exercises his or her Award or receives any or all of such benefit, on such form as may be prescribed by the Committee and may, from time to time, amend or revoke such designation. If no designated beneficiary survives the Grantee, the executor or administrator of the Grantee’s estate shall be deemed to be the Grantee’s beneficiary. Notwithstanding the foregoing, upon the request of the Grantee and subject to Applicable Law the Committee, at its sole discretion, may permit the Grantee to transfer the Award to a trust whose beneficiaries are the Grantee and/or the Grantee’s immediate family members (all or several of them).

15.2. Notwithstanding any other provisions of the Plan to the contrary, no Incentive Stock Option may be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution or in accordance with a beneficiary designation pursuant to Section 15.1. Further, all Incentive Stock Options granted to a Grantee shall be exercisable during his or her lifetime only by such Grantee.

15.3. As long as the Shares are held by the Trustee in favor of the Grantee, all rights possessed by the Grantee over the Shares are personal, and may not be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.

15.4. If and to the extent a Grantee is entitled to transfer an Award and/or Shares underlying an Award in accordance with the terms of the Plan and any other applicable agreements, such transfer shall be subject (in addition, to any other conditions or terms applying thereto) to receipt by the Company from such proposed transferee of a written instrument, on a form reasonably acceptable to the Company, pursuant to which such proposed transferee agrees to be bound by all provisions of the Plan and any other applicable agreements, including without limitation, any restrictions on transfer of the Award and/or Shares set forth herein (however, failure to so deliver such instrument to the Company as set forth above shall not derogate from all such provisions applying on any transferee).

15.5. The provisions of this Section 15 shall apply to the Grantee and to any purchaser, assignee or transferee of any Shares.

16. CONDITIONS UPON ISSUANCE OF SHARES; GOVERNING PROVISIONS.

16.1. Legal Compliance . The grant of Awards and the issuance of Shares upon exercise or settlement of Awards shall be subject to compliance with all Applicable Laws as determined by the Company, including, applicable requirements of federal, state and foreign law with respect to such securities. The Company shall have no obligations to issue Shares pursuant to the exercise or settlement of an Award and Awards may not be exercised or settled, if the issuance of Shares upon exercise or settlement would constitute a violation of any Applicable Laws as determined by the Company, including, applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Shares may then be listed. In addition, no Award may be exercised unless (i) a registration statement under the Securities Act shall at the time of exercise or settlement of the Award be in effect with respect to the shares issuable upon exercise of the Award, or (ii) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Award may be issued in accordance with the terms of an applicable exemption from the registration requirements of the

 

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Securities Act. The inability of the Company to obtain authority from any regulatory body having jurisdiction, if any, deemed by the Company to be necessary to the lawful issuance and sale of any Shares hereunder, and the inability to issue Shares hereunder due to non-compliance with any Company policies with respect to the sale of Shares, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority or compliance shall not have been obtained or achieved. As a condition to the exercise of an Award, the Company may require the person exercising such Award to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any Applicable Law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company, including to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares, all in form and content specified by the Company.

16.2. Provisions Governing Shares . Shares issued pursuant to an Award shall be subject to the Articles of Association of the Company, any limitation, restriction or obligation included in any shareholders agreement applicable to all or substantially all of the holders of shares (regardless of whether or not the Grantee is a formal party to such shareholders agreement), any other governing documents of the Company, all policies, manuals and internal regulations adopted by the Company from time to time, in each case, as may be amended from time to time, including any provisions included therein concerning restrictions or limitations on disposition of Shares (such as, but not limited to, right of first refusal and lock up/market stand-off) or grant of any rights with respect thereto, forced sale and bring along provisions, any provisions concerning restrictions on the use of inside information and other provisions deemed by the Company to be appropriate in order to ensure compliance with Applicable Laws. Each Grantee shall execute such separate agreement(s) as may be requested by the Company relating to matters set forth in this Section 16.2. The execution of such separate agreement(s) may be a condition by the Company to the exercise of any Award.

16.3. Forced Sale . In the event the that Board approves a Merger/Sale effected by way of a forced or compulsory sale (whether pursuant to the Company’s Articles of Association or pursuant to Section 341 of the Companies Law), then, without derogating from such provisions and in addition thereto, the Grantee shall be obligated, and shall be deemed to have agreed to the offer to effect the Merger/Sale on the terms approved by the Board (and the Shares held by or for the benefit of the Grantee shall be included in the shares of the Company approving the terms of such Merger/Sale for the purpose of satisfying the required majority), and shall sell all of the Shares held by or for the benefit of the Grantee on the terms and conditions applying to the holders of Shares, in accordance with the instructions then issued by the Board, whose determination shall be final. No Grantee shall contest, bring any claims or demands, or exercise any appraisal rights related to any of the foregoing. The proxy pursuant to Section 6.10 includes an authorization of the holder of such proxy to sign, by and on behalf of any Grantee, such documents and agreements as are required to affect the sale of Shares in connection with such Merger/Sale.

16.4. Share Transfer Restrictions . Any transfer or other disposition of Shares or any interest therein is subject to the prior approval of the Board, which, if granted (without any obligation to do so), may be subject to such terms, conditions and restrictions, as it deems appropriate. The terms, conditions and restrictions of any approval may differ from one Grantee to another, and need not be the same. Any transfer or otherwise grant of any interest in any Shares to any third party that does not comply with this Section shall be null and void and shall not confer upon any person, other than the Grantee, any rights. This Section shall terminate immediately after the public offering of securities of the Company pursuant to an effective registration statement filed under the Securities Act or equivalent law in another

 

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jurisdiction and the listing for trading on a stock exchange or market or trading system. This Section shall apply in addition to any other limitation, restriction and/or condition in this Plan (including, without limitation, after the application of Section 16), any Award Agreement, shareholders agreement, Company’s Articles of Association or other instrument between the Grantee and the Company or by which the Grantee is bound. This Section shall not apply to a transfer of Shares in a sale of all or substantially all of the shares of the Company which was approved by the Board or pursuant to the Company’s Articles of Association or upon a Merger/Sale.

17. MARKET STAND-OFF

17.1. In connection with any underwritten public offering of equity securities of the Company pursuant to an effective registration statement filed under the Securities Act or equivalent law in another jurisdiction, the Grantee shall not directly or indirectly, without the prior written consent of the Company or its underwriters, (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any Shares or other Awards, any securities of the Company (whether or not such Shares were acquired under this Plan), or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Shares or securities of the Company and any other shares or securities issued or distributed in respect thereto or in substitution thereof (collectively, “ Securities ”), or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Securities, whether any such transaction described in clauses (i) or (ii) is to be settled by delivery of Securities, in cash or otherwise. The foregoing provisions of this Section 17.1 shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement. Such restrictions (the “ Market Stand-Off ”) shall be in effect for such period of time (the “ Market Stand-Off Period ”): (A) following the first public filing of the registration statement relating to the underwritten public offering until the extirpation of 180 days following the effective date of such registration statement relating to the Company’s initial public offering or 90 days following the effective date of such registration statement relating to any other public offering, in each case, provided, however, that if (1) during the last 17 days of the initial Market Stand- Off Period, the Company releases earnings results or announces material news or a material event or (2) prior to the expiration of the initial Market Stand-Off Period, the Company announces that it will release earnings results during the 15-day period following the last day of the initial Market Stand-Off Period, then in each case the Market Stand-Off Period will be automatically extended until the expiration of the 18-day period beginning on the date of release of the earnings results or the announcement of the material news or material event; or (B) such other period as shall be requested by the Company or the underwriters. Notwithstanding anything herein to the contrary, if the underwriter(s) and the Company agree on a termination date of the Market Stand-Off Period in the event of failure to consummate a certain public offering, then such termination shall apply also to the Market Stand-Off Period hereunder with respect to that particular public offering.

17.2. In the event of a subdivision of the outstanding share capital of the Company, the distribution of any securities (whether or not of the Company), whether as bonus shares or otherwise, and whether as dividend or otherwise, a recapitalization, a reorganization (which may include a combination or exchange of shares or a similar transaction affecting the Company’s outstanding securities without receipt of consideration), a consolidation, a spin-off or other corporate divestiture or division, a reclassification or other similar occurrence, any new, substituted or additional securities which are by reason of such transaction distributed with respect to any Shares subject to the Market Stand-Off, or into which such Shares thereby become convertible, shall immediately be subject to the Market Stand-Off.

 

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17.3. In order to enforce the Market Stand-Off, the Company may impose stop-transfer instructions with respect to the Shares acquired under this-Plan until the end of the applicable Market Stand-Off period.

17.4. The underwriters in connection with a registration statement so filed are intended third party beneficiaries of this Section 17 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Each Grantee shall execute such separate agreement(s) as may be requested by the Company or the underwriters in connection with such registration statement and in the form required by them, relating to Market Stand-Off (which need not be identical to the provisions of this Section 17, and may include such additional provisions and restrictions as the underwriters deem advisable) or that are necessary to give further effect thereto. The execution of such separate agreement(s) may be a condition by the Company to the exercise of any Award.

17.5. Without derogating from the above provisions of this Section 17 or elsewhere in this Plan, the provisions of this Section 17 shall apply to the Grantee and the Grantee’s heirs, legal representatives, successors, assigns, and to any purchaser, assignee or transferee of any Awards or Shares.

18. AGREEMENT REGARDING TAXES; DISCLAIMER .

18.1. If the Committee shall so require, as a condition of exercise of an Award, the release of Shares by the Trustee or the expiration of the Restricted Period, a Grantee shall agree that, no later than the date of such occurrence, the Grantee will pay to the Company (or the Trustee, as applicable) or make arrangements satisfactory to the Committee and the Trustee (if applicable) regarding payment of any applicable taxes and compulsory payments of any kind required by Applicable Law to be withheld or paid.

18.2. TAX LIABILITY . ALL TAX CONSEQUENCES UNDER ANY APPLICABLE LAW WHICH MAY ARISE FROM THE GRANT OF ANY AWARDS OR THE EXERCISE THEREOF, THE SALE OR DISPOSITION OF ANY SHARES GRANTED HEREUNDER OR ISSUED UPON EXERCISE OR (IF APPLICABLE) THE VESTING OF ANY AWARD, THE ASSUMPTION, SUBSTITUTION, CANCELLATION OR PAYMENT IN LIEU OF AWARDS OR FROM ANY OTHER ACTION IN CONNECTION WITH THE FOREGOING (INCLUDING WITHOUT LIMITATION ANY TAXES AND COMPULSORY PAYMENTS, SUCH AS SOCIAL SECURITY OR HEALTH TAX PAYABLE BY THE GRANTEE OR THE COMPANY IN CONNECTION THEREWITH) SHALL BE BORNE AND PAID SOLELY BY THE GRANTEE, AND THE GRANTEE SHALL INDEMNIFY THE COMPANY, ITS SUBSIDIARIES AND AFFILIATES AND THE TRUSTEE, AND SHALL HOLD THEM HARMLESS AGAINST AND FROM ANY LIABILITY FOR ANY SUCH TAX OR PAYMENT OR ANY PENALTY, INTEREST OR INDEXATION THEREON. EACH GRANTEE AGREES TO, AND UNDERTAKES TO COMPLY WITH, ANY RULING, SETTLEMENT, CLOSING AGREEMENT OR OTHER SIMILAR AGREEMENT OR ARRANGEMENT WITH ANY TAX AUTHORITY IN CONNECTION WITH THE FOREGOING WHICH IS APPROVED BY THE COMPANY.

18.3. NO TAX ADVICE . THE GRANTEE IS ADVISED TO CONSULT WITH A TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING, EXERCISING OR DISPOSING OF AWARDS HEREUNDER. THE COMPANY DOES NOT ASSUME ANY RESPONSIBILITY TO ADVISE THE GRANTEE ON SUCH MATTERS, WHICH SHALL REMAIN SOLELY THE RESPONSIBILITY OF THE GRANTEE.

 

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18.4. TAX TREATMENT . THE COMPANY DOES NOT UNDERTAKE OR ASSUME ANY LIABILITY OR RESPONSIBILITY TO THE EFFECT THAT ANY AWARD SHALL QUALIFY WITH ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT, OR BENEFIT FROM ANY PARTICULAR TAX TREATMENT OR TAX ADVANTAGE OF ANY TYPE AND THE COMPANY SHALL BEAR NO LIABILITY IN CONNECTION WITH THE MANNER IN WHICH ANY AWARD IS EVENTUALLY TREATED FOR TAX PURPOSES, REGARDLESS OF WHETHER THE AWARD WAS GRANTED OR WAS INTENDED TO QUALIFY UNDER ANY PARTICULAR TAX REGIME OR TREATMENT. THIS PROVISION SHALL SUPERSEDE ANY TYPE OF AWARDS OR TAX QUALIFICATION INDICATED IN ANY CORPORATE RESOLUTION OR AWARD AGREEMENT, WHICH SHALL AT ALL TIMES BE SUBJECT TO THE REQUIREMENTS OF APPLICABLE LAW. THE COMPANY DOES NOT UNDERTAKE AND SHALL NOT BE REQUIRED TO TAKE ANY ACTION IN ORDER TO QUALIFY THE AWARD WITH THE REQUIREMENT OF ANY PARTICULAR TAX TREATMENT AND NO INDICATION IN ANY DOCUMENT TO THE EFFECT THAT ANY AWARD IS INTENDED TO QUALIFY FOR ANY TAX TREATMENT SHALL IMPLY SUCH AN UNDERTAKING. NO ASSURANCE IS MADE BY THE COMPANY OR ANY OF ITS AFFILIATES THAT ANY PARTICULAR TAX TREATMENT ON THE DATE OF GRANT WILL CONTINUE TO EXIST OR THAT THE AWARD WOULD QUALIFY AT THE TIME OF EXERCISE OR DISPOSITION THEREOF WITH ANY PARTICULAR TAX TREATMENT. THE COMPANY AND ITS AFFILIATES SHALL NOT HAVE ANY LIABILITY OR OBLIGATION OF ANY NATURE IN THE EVENT THAT AN AWARD DOES NOT QUALIFY FOR ANY PARTICULAR TAX TREATMENT, REGARDLESS WHETHER THE COMPANY COULD HAVE OR SHOULD HAVE TAKEN ANY ACTION TO CAUSE SUCH QUALIFICATION TO BE MET AND SUCH QUALIFICATION REMAINS AT ALL TIMES AND UNDER ALL CIRCUMSTANCES AT THE RISK OF THE GRANTEE. THE COMPANY DOES NOT UNDERTAKE OR ASSUME ANY LIABILITY TO CONTEST A DETERMINATION OR INTERPRETATION (WHETHER WRITTEN OR UNWRITTEN) OF ANY TAX AUTHORITIES, INCLUDING IN RESPECT OF THE QUALIFICATION UNDER ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT. IF THE AWARDS DO NOT QUALIFY UNDER ANY PARTICULAR TAX TREATMENT IT COULD RESULT IN ADVERSE TAX CONSEQUENCES TO THE GRANTEE.

18.5. The Company or any Subsidiary or Affiliate may take such action as it may deem necessary or appropriate, in its discretion, for the purpose of or in connection with withholding of any taxes and compulsory payments which the Trustee, the Company or any Subsidiary or Affiliate is required by any Applicable Law to withhold in connection with any Awards (collectively, “Withholding Obligations”). Such actions may include (i) requiring a Grantees to remit to the Company in cash an amount sufficient to satisfy such Withholding Obligations and any other taxes and compulsory payments, payable by the Company in connection with the Award or the exercise or (if applicable) the vesting thereof; (ii) subject to Applicable Law, allowing the Grantees to provide Shares to the Company, in an amount that at such time, reflects a value that the Committee determines to be sufficient to satisfy such Withholding Obligations; (iii) withholding Shares otherwise issuable upon the exercise of an Award at a value which is determined by the Committee to be sufficient to satisfy such Withholding Obligations; or (iv) any combination of the foregoing. The Company shall not be obligated to allow the exercise of any Award by or on behalf of a Grantee until all tax consequences arising from the exercise of such Award are resolved in a manner acceptable to the Company.

 

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18.6. Each Grantee shall notify the Company in writing promptly and in any event within ten (10) days after the date on which such Grantee first obtains knowledge of any tax bureau inquiry, audit, assertion, determination, investigation, or question relating in any manner to the Awards granted or received hereunder or Shares issued thereunder and shall continuously inform the Company of any developments, proceedings, discussions and negotiations relating to such matter, and shall allow the Company and its representatives to participate in any proceedings and discussions concerning such matters. Upon request, a Grantee shall provide to the Company any information or document relating to any matter described in the preceding sentence, which the Company, in its discretion, requires.

18.7. With respect to 102 Non-Trustee Options, if the Grantee ceases to be employed by the Company or any Affiliate, the Grantee shall extend to the Company and/or its Affiliate with whom the Grantee is employed a security or guarantee for the payment of taxes due at the time of sale of Shares, all in accordance with the provisions of Section 102 of the Ordinance and the Rules.

18.8. For the purpose hereof “tax(es)” means (a) all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments, including all income, capital gains, transfer, withholding, payroll, employment, social security, national security, health tax, wealth surtax, stamp, registration and estimated taxes, customs duties, fees, assessments and charges of any similar kind whatsoever (including under Section 280G of the Code), (b) all interest, indexation differentials, penalties, fines, additions to tax or additional amounts imposed by any taxing authority in connection with any item described in clause (a), (c) any transferee or successor liability in respect of any items described in clauses (a) or (b) payable by reason of contract, assumption, transferee liability, successor liability, operation of Applicable Law, or as a result of any express or implied obligation to assume Taxes or to indemnify any other person, and (d) any liability for the payment of any amounts of the type described in clause (a) or (b) payable as a result of being a member of an affiliated, consolidated, combined, unitary or aggregate group for any taxable period, including under U.S. Treasury Regulations Section 1.1502-6(a) (or any predecessor or successor thereof of any analogous or similar provision under Law) or otherwise.

18.9. If a Grantee makes an election under Section 83(b) of the Code to be taxed with respect to an Award as of the date of transfer of Shares rather than as of the date or dates upon which the Grantee would otherwise be taxable under Section 83(a) of the Code, such Grantee shall deliver a copy of such election to the Company upon or prior to the filing such election with the U.S. Internal Revenue Service. Neither the Company nor any Affiliate shall have any liability or responsibility relating to or arising out of the filing or not filing of any such election or any defects in its construction.

19. RIGHTS AS A SHAREHOLDER; VOTING AND DIVIDENDS .

19.1. Subject to Section 11.4, a Grantee shall have no rights as a shareholder of the Company with respect to any Shares covered by an Award until the Grantee shall have exercised the Award, paid the Exercise Price therefor and becomes the record holder of the subject Shares. In the case of 102 Awards or 3(9) Awards (if such Awards are being held by a Trustee), the Trustee shall have no rights as a shareholder of the Company with respect to the Shares covered by such Award until the Trustee becomes the record holder for such Shares for the Grantee’s benefit, and the Grantee shall not be deemed to be a shareholder and shall have no rights as a shareholder of the Company with respect to the Shares covered by the Award until the date of the release of such Shares from the Trustee to the Grantee and the transfer of record ownership of such Shares to the Grantee (provided however that the Grantee shall be entitled to receive from the Trustee any cash dividend or distribution made on account of the Shares held by the Trustee for such Grantee’s benefit, subject to any tax withholding and compulsory payment). No adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distribution of other rights for which the record date is prior to the date on which the Grantee or Trustee (as applicable) becomes the record holder of the Shares covered by an Award, except as provided in Section 14 hereof.

 

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19.2. With respect to all Awards issued in the form of Shares hereunder or upon the exercise or (if applicable) the vesting of Awards hereunder, any and all voting rights attached to such Shares shall be subject to Section 6.9, and the Grantee shall be entitled to receive dividends distributed with respect to such Shares, subject to the provisions of the Company’s Articles of Association, as amended from time to time, and subject to any Applicable Law.

19.3. The Company may, but shall not be obligated to, register or qualify the sale of Shares under any applicable securities law or any other Applicable Law.

20. NO REPRESENTATION BY COMPANY .

By granting the Awards, the Company is not, and shall not be deemed as, making any representation or warranties to the Grantee regarding the Company, its business affairs, its prospects or the future value of its Shares. The Company shall not be required to provide to any Grantee any information, documents or material in connection with the Grantee’s considering an exercise of an Award. To the extent that any information, documents or materials are provided, the Company shall have no liability with respect thereto. Any decision by a Grantee to exercise an Award shall solely be at the risk of the Grantee.

21. NO RETENTION RIGHTS .

Nothing in this Plan, any Award Agreement or in any Award granted or agreement entered into pursuant hereto shall confer upon any Grantee the right to continue in the employ of, or be in the service of the Company or any Subsidiary or Affiliate thereof as a Service Provider or to be entitled to any remuneration or benefits not set forth in this Plan or such agreement, or to interfere with or limit in any way the right of the Company or any such Subsidiary or Affiliate to terminate such Grantee’s employment or service (including, any right of the Company or any of its Affiliates to immediately cease the Grantee’s employment or service or to shorten all or part of the notice period, regardless of whether notice of termination was given by the Company or its Affiliates or by the Grantee). Awards granted under this Plan shall not be affected by any change in duties or position of a Grantee, subject to Sections 6.6 through 6.8. No Grantee shall be entitled to claim and the Grantee hereby waives any claim against the Company or any Subsidiary or Affiliate that he or she was prevented from continuing to vest Awards as of the date of termination of his or her employment with, or services to, the Company or any Subsidiary or Affiliate. No Grantee shall be entitled to any compensation in respect of the Awards which would have vested had such Grantee’s employment or engagement with the Company (or any Subsidiary or Affiliate) not been terminated.

22. PERIOD DURING WHICH AWARDS MAY BE GRANTED.

Awards may be granted pursuant to this Plan from time to time within a period of ten (10) years from the Effective Date, which period may be extended from time to time by the Board. From and after such date (as extended) no grants of Awards may be made and this Plan shall continue to be in full force and effect with respect to Awards or Shares issued thereunder that remain outstanding.

23. AMENDMENT OF THIS PLAN AND AWARDS .

23.1. The Board at any time and from time to time may suspend, terminate, modify or amend this Plan, whether retroactively or prospectively. Any amendment effected in accordance with this Section shall be binding upon all Grantees and all Awards, whether granted prior to or after the date of such amendment, and without the need to obtain the consent of any Grantee. No termination or amendment of this Plan shall affect any then outstanding Award unless expressly provided by the Board.

 

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23.2. Subject to changes in Applicable Law that would permit otherwise, without the approval of the Company’s shareholders, there shall be (i) no increase in the maximum aggregate number of Shares that may be issued under this Plan as Incentive Stock Options (except by operation of the provisions of Section 14.1), (ii) no change in the class of persons eligible to receive Incentive Stock Options, and (iii) no other amendment of this Plan that would require approval of the Company’s shareholders under any Applicable Law. Unless not permitted by Applicable Law, if the grant of an Award is subject to approval by shareholders, the date of grant of the Award shall be determined as if the Award had not been subject to such approval. Failure to obtain approval by the shareholders shall not in any way derogate from the valid and binding effect of any grant of an Award, which is not an Incentive Stock Option. Upon approval of an amendment to this Plan by the shareholders of the Company as set forth above, all Incentive Stock Options granted under this Plan on or after such amendment shall be fully effective as if the shareholders of the Company had approved the amendment on the same date.

23.3. The Board or the Committee at any time and from time to time may modify or amend any Award theretofore granted, including any Award Agreement, whether retroactively or prospectively.

24. APPROVAL .

24.1. This Plan shall take effect upon its adoption by the Board (the “ Effective Date ”).

24.2. Solely with respect to grants of Incentive Stock Options, this Plan shall also be subject to shareholders’ approval, within one year of the Effective Date, by a majority of the votes cast on the proposal at a meeting or a written consent of shareholders (however, if the grant of an Award is subject to approval by shareholders, the date of grant of the Award shall be determined as if the Award had not been subject to such approval). Failure to obtain such approval by the shareholders within such period shall not in any way derogate from the valid and binding effect of any grant of an Award, except that any Options previously granted under this Plan may not qualify as Incentive Stock Options but, rather, shall constitute Nonqualified Stock Options. Upon approval of this Plan by the shareholders of the Company as set forth above, all Incentive Stock Options granted under this Plan on or after the Effective Date shall be fully effective as if the shareholders of the Company had approved this Plan on the Effective Date.

24.3. 102 Awards are conditional upon the filing with or approval by the ITA, if required, as set forth in Section 9.49. Failure to so file or obtain such approval shall not in any way derogate from the valid and binding effect of any grant of an Award, which is not an 102 Award.

25. RULES PARTICULAR TO SPECIFIC COUNTRIES: SECTION 409A.

25.1. Notwithstanding anything herein to the contrary, the terms and conditions of this Plan may be supplemented or amended with respect to a particular country or tax regime by means of an appendix to this Plan, and to the extent that the terms and conditions set forth in any appendix conflict with any provisions of this Plan, the provisions of such appendix shall govern. Terms and conditions set forth in such appendix shall apply only to Awards granted to Grantees under the jurisdiction of the specific country or such other tax regime that is the subject of such appendix and shall not apply to Awards issued to a Grantee not under the jurisdiction of such country or such other tax regime. The adoption of any such appendix shall be subject to the approval of the Board or the Committee, and if determined by the Committee to be required in connection with the application of certain tax treatment, pursuant to applicable stock exchange rules or regulations or otherwise, then also the approval of the shareholders of the Company at the required majority.

 

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25.2. This Section 25.2 shall only apply to Awards granted to Grantees who are subject to United States Federal income tax.

25.2.1 It is the intention of the Company that no Award shall be deferred compensation subject to Code Section 409A unless and to the extent that the Committee specifically determines otherwise as provided in Section 25.2.2, and the Plan and the terms and conditions of all Awards shall be interpreted and administered accordingly.

25.2.2 The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for payment or elective or mandatory deferral of the payment or delivery of Shares or cash pursuant thereto, and any rules regarding treatment of such Awards in the event of a Change in Control, shall be set forth in the applicable Award Agreement and shall be intended to comply in all respects with Section 409A of the Code, and the Plan and the terms and conditions of such Awards shall be interpreted and administered accordingly.

25.2.3 The Company shall have complete discretion to interpret and construe the Plan and any Award Agreement in any manner that establishes an exemption from (or compliance with) the requirements of Code Section 409A. If for any reason, such as imprecision in drafting, any provision of the Plan and/or any Award Agreement does not accurately reflect its intended establishment of an exemption from (or compliance with) Code Section 409A, as demonstrated by consistent interpretations or other evidence of intent, such provision shall be considered ambiguous as to its exemption from (or compliance with) Code Section 409A and shall be interpreted by the Company in a manner consistent with such intent, as determined in the discretion of the Company. If, notwithstanding the foregoing provisions of this Section 25.2.3, any provision of the Plan or any such agreement would cause a Grantee to incur any additional tax or interest under Code Section 409A, the Company shall reform such provision in a manner intended to avoid the incurrence by such Grantee of any such additional tax or interest; provided that the Company shall maintain, to the extent reasonably practicable, the original intent and economic benefit to the Grantee of the applicable provision without violating the provisions of Code Section 409A.

25.2.4 Notwithstanding any other provision in the Plan, any Award Agreement, or any other written document establishing the terms and conditions of an Award, if any Grantee is a “specified employee,” within the meaning of Section 409A of the Code, as of the date of his or her “separation from service” (as defined under Section 409A of the Code), then, to the extent required by Treasury Regulation Section 1.409A-3(i)(2) (or any successor provision), any payment made to such Grantee on account of his or her separation from service shall not be made before a date that is six months after the date of his or her separation from service. The Committee may elect any of the methods of applying this rule that are permitted under Treasury Regulation Section 1.409A-3(i)(2)(ii) (or any successor provision).

25.2.5 Notwithstanding any other provision of this Section 25.2 to the contrary, although the Company intends to administer the Plan so that Awards will be exempt from, or will comply with, the requirements of Code Section 409A, the Company does not warrant that any

 

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Award under the Plan will qualify for favorable tax treatment under Code Section 409A or any other provision of federal, state, local, or non-United States law. The Company shall not be liable to any Grantee for any tax, interest, or penalties the Grantee might owe as a result of the grant, holding, vesting, exercise, or payment of any Award under the Plan.

26. GOVERNING LAW; JURISDICTION .

This Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Israel, except with respect to matters that are subject to tax laws, regulations and rules of any specific jurisdiction, which shall be governed by the respective laws, regulations and rules of such jurisdiction. Certain definitions, which refer to laws other than the laws of such jurisdiction, shall be construed in accordance with such other laws. The competent courts located in Tel-Aviv-Jaffa, Israel shall have exclusive jurisdiction over any dispute arising out of or in connection with this Plan and any Award granted hereunder. By signing any Award Agreement or any other agreement relating to an Award, each Grantee irrevocably submits to such exclusive jurisdiction.

27. NON-EXCLUSIVITY OF THIS PLAN .

The adoption of this Plan shall not be construed as creating any limitations on the power or authority of the Company to adopt such other or additional incentive or other compensation arrangements of whatever nature as the Company may deem necessary or desirable or preclude or limit the continuation of any other plan, practice or arrangement for the payment of compensation or fringe benefits to employees generally, or to any class or group of employees, which the Company or any Affiliate now has lawfully put into effect, including any retirement, pension, savings and stock purchase plan, insurance, death and disability benefits and executive short-term or long-term incentive plans.

28. MISCELLANEOUS .

28.1. Survival . The Grantee shall be bound by and the Shares issued upon exercise or (if applicable) the vesting of any Awards granted hereunder shall remain subject to this Plan after the exercise or (if applicable) the vesting of Awards, in accordance with the terms of this Plan, whether or not the Grantee is then or at any time thereafter employed or engaged by the Company or any of its Affiliates.

28.2. Additional Terms . Each Award awarded under this Plan may contain such other terms and conditions not inconsistent with this Plan as may be determined by the Committee, in its sole discretion.

28.3. Fractional Shares . No fractional Share shall be issuable upon exercise or vesting of any Award and the number of Shares to be issued shall be rounded down to the nearest whole Share, with in any Share remaining at the last vesting date due to such rounding to be issued upon exercise at such last vesting date.

28.4. Severability . If any provision of this Plan, any Award Agreement or any other agreement entered into in connection with an Award shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction. In addition, if any particular provision contained in this Plan, any Award Agreement or any other agreement entered into in connection with an Award shall for any reason be held to be excessively broad as to duration, geographic scope, activity or subject, it shall be construed by limiting and reducing such provision as to such characteristic so that the provision is enforceable to fullest extent compatible with Applicable Law as it shall then appear.

 

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28.5. Captions and Titles . The use of captions and titles in this Plan or any Award Agreement or any other agreement entered into in connection with an Award is for the convenience of reference only and shall not affect the meaning or interpretation of any provision of this Plan or such agreement.

*         *         *

 

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NOTICE OF OPTION GRANT

You have been granted the following options (the “ Options ”) to purchase Ordinary Shares par value NIS 0.01 each (the “ Shares ”) of FireGlass Ltd. (the “ Company ”), pursuant and subject to the terms and conditions of the Company’s 2015 Share Incentive Plan, a copy of which is attached hereto as Exhibit A (as may be amended from time to time, the “ Plan ”), and the additional terms and conditions contained herein. Unless otherwise defined, capitalized terms used herein shall have the meaning ascribed to them under the Plan hereof.

 

Grantee:  

 

Date of Grant:  

 

such date being subject to Section 9.4 of the Plan and Section 10.2 of this Agreement
Intended Type of Award:                Incentive Stock Option (U.S.)
( check one ):                Nonqualified Stock Option (U.S.)
                 Option designated as 102 Capital Gains Track Award (with Trustee) (Israel)
                 Option designated as 3(9) Award (Israel)
the above being subject to Section 9 of the Option Agreement, Section 18.4 of the Plan and applicable law
Exercise Price   US$                                           per Share
Number of Shares underlying the Options:  

 

Vesting Commencement Date:  

 

Vesting Schedule:   Subject to the terms of the Plan (including Sections 6.6 and 6.7 thereof), the Options shall vest and become exercisable under the following schedule: 25% of the Shares covered by the Options, on the first anniversary of the date on the Vesting Commencement Date, and 6.25% of the Shares covered by the Options at the end of each subsequent three-month period thereafter over the course of the subsequent 3 years; provided , in each case, that the Grantee remains continuously as a Service Provider of the Company or its Affiliates throughout each such vesting date.
Exercise Period:   The date determined in accordance with and subject to Section 8 of the Option Agreement and the provisions of the Plan

The Options are governed by this Notice and by the provisions of the Plan and the Option Agreement, both of which are attached to and made an integral part of this Notice. By signing the Option Agreement, the Grantee acknowledges receipt of copies of the Plan and the Option Agreement, represents that the Grantee read and is familiar with their provisions, and hereby accepts the Options subject to all of their terms and conditions.


THIS OPTION AGREEMENT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THE OPTIONS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR SUCH APPLICABLE LAWS OF OTHER JURISDICTIONS, OR QUALIFIED UNDER ANY SECURITIES LAW OR ANY OTHER JURISDICTION, AND, SUBJECT TO THEIR TERMS, MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR SUCH APPLICABLE LAWS OF OTHER JURISDICTIONS COVERING THIS AGREEMENT AND/OR SUCH SECURITIES, OR THE HOLDER RECEIVES AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY STATING THAT SUCH OFFERING, SALE, TRANSFER, ASSIGNMENT, PLEDGE OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE SECURITIES ACT AND THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE LAW.

OPTION AGREEMENT

The Company has granted to the Grantee named in the Notice of Option Grant to which this Option Agreement (this “ Agreement ”) is attached Options upon the terms and conditions set forth in the Notice and this Agreement. The Options have been granted pursuant to and shall in all respects be subject to the terms and conditions of the Notice, this Agreement and the Plan, the provisions of which are incorporated herein by reference and made an integral part of this Agreement.

By signing this Agreement, the Grantee: (a) represents that the Grantee has received copies of, and has read and is familiar with the terms and conditions of, the Notice, the Plan and this Agreement, (b) accepts the Options, the Shares issued upon the exercise thereof and/or any securities issued or distributed with respect thereto are subject to all of the terms and conditions of the Notice, the Plan this Agreement, the Trust Agreement and any other documents ancillary hereto or thereto, and (c) agrees to accept as binding, conclusive and final all decisions and interpretations of the Board or the Committee upon any questions arising under the Notice, the Plan or this Agreement (whether before or after the issuance of Shares pursuant to the Options) . While certain terms and conditions are included in this Agreement, such terms and conditions shall not in any way derogate from the applicability of all other terms and conditions set forth in the Plan. The Grantee acknowledges that the terms and conditions of the Plan may be amended from time to time as set forth therein, and therefore, any reference to the Plan shall be deemed to refer to the Plan as amended from time to time, including any amendments adopted after the date of grant. Unless otherwise stated, in the event of any inconsistency or contradiction between any of the terms of this Agreement and the provisions of the Plan, the terms and provisions of this Agreement shall prevail.

1. No Disposition of Options . The Options shall not be sold, pledged or otherwise transferred (whether by operation of law or otherwise), and shall not be subject to sale under execution, attachment, levy or similar process (each of the foregoing, a “ Transfer ”) other than by will or by the laws of descent and distribution.

2. Issuance and Disposition of Shares .

2.1. Legal Compliance . The Company shall have no obligations to issue Shares pursuant to the exercise or settlement of Options and Options may not be exercised or settled (even if vested), if the issuance of Shares upon exercise or settlement would constitute a violation of any Applicable Laws as determined by the Company, including, applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Shares may then be listed. THE GRANTEE IS CAUTIONED THAT THE OPTIONS MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS AND THOSE SET FORTH IN THE PLAN ARE SATISFIED. ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE TO EXERCISE THE OPTIONS WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED.

2.2. Provisions Governing Shares . Shares issued upon exercise of Options shall be subject to the restrictions referred to in Section 16 of the Plan (Conditions upon Issuance of Shares; Governing Provisions) and in this Agreement, the Articles of Association of the Company, any limitation, restriction or obligation included in any shareholders agreement applicable to all or substantially all of the holders of Shares (regardless of whether or not the Grantee is a formal party to such shareholders agreement), any other governing documents of the Company, and all policies, manuals and internal regulations adopted by

 

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the Company from time to time, in each case, as may be amended from time to time, including, without limitation, any provisions included therein concerning restrictions or limitations on disposition of Shares (such as, but not limited to, right of first refusal and lock-up/market stand-off) or grant of any rights with respect thereto, forced sale and bring along provisions, any provisions concerning a restrictions on the use of inside information and other provisions deemed by the Company to be appropriate in order to ensure compliance with Applicable Laws and with the requirements of any transaction entered into or proposed to be entered into by the Company. By exercising an Option the Grantee is deemed to have undertaken to comply with all the foregoing provisions. Each Grantee shall execute such separate agreement(s) as may be requested by the Company relating to matters set forth in this Section 2. The execution of such separate agreement(s) may be a condition by the Company to the exercise of any Options.

2.3. Forced Sale . In the event the that Board approves a Merger/Sale effected by way of a forced or compulsory sale (whether pursuant to the Company’s Articles of Association or pursuant to Section 341 of the Companies Law), then, without derogating from such provisions and in addition thereto, the Grantee agrees to the offer to effect the Merger/Sale on the terms approved by the Board (and that the Shares held by or for the benefit of the Grantee shall be included in the shares of the Company approving the terms of such Merger/Sale for the purpose of satisfying the required majority), and to sell all of the Shares held by or for the benefit of the Grantee on the terms and conditions applying to the holders of Shares, in accordance with the instructions then issued by the Board, whose determination shall be final. The Grantee agrees not contest, bring any claims or demands, or exercise any appraisal rights related to any of the foregoing. The proxy pursuant to this Agreement includes an authorization of the proxy holder to sign, by and on behalf of any Grantee, such documents and agreements as are required to affect the sale of Shares in connection with such Merger/Sale.

2.4. Waiver . As a material precondition to the Company’s grant of Option and issuance of any Shares under the Plan, the Grantee hereby irrevocably waives any right of first refusal, pre-emptive, co-sale, participation rights or other similar rights with respect to any prior or future Transfer of any shares in the Company by other shareholder or the issuance of securities by the Company, if such right was so provided in any agreement between the Company and any of its shareholders, in the Articles of Association or in any other governing document of the Company. The Grantee acknowledges and agrees that the Company and its shareholders are entitled to rely on this irrevocable waiver.

2.5. Additional or Substituted Securities . In the event that in connection with the declaration of a share dividend (bonus shares), a share split, a reverse share split, a reorganization (which may include a combination or exchange of shares), a consolidation, a spin-off or other corporate divestiture or division, a recapitalization, a reclassification or other similar occurrence affecting the Company’s outstanding securities without receipt of consideration (or in consideration for the par value, if shares bear par value), any new, substituted or additional securities or other property (other than cash dividend) are distributed by reason of such occurrence with respect to any Shares which are subject to this Section 2, or into which such Shares thereby become convertible, then such substituted or additional securities or other property (if distributed) shall immediately be subject to this Section 2. Any adjustments to reflect the distribution of such securities or other property shall be conclusively determined by the Company. The terms and conditions contained herein and in the Plan in respect of the Option and/or the Shares shall apply to any new, substituted or additional securities or other property resulting from the above adjustments.

2.6. Market Stand-Off . As a material precondition to the grant of Options and the issuance of any Shares in accordance with the Plan, and without limitation of Section 17 of the Plan, the Grantee hereby executes a market stand-off undertaking in the form attached hereto as Exhibit B .

2.7. Board Approval . Any Transfer or other disposition of Shares or any interest therein is subject to the prior approval of the Board, which, if granted (without any obligation to do so), may be subject to such terms, conditions and restrictions, as it deems appropriate. The terms, conditions and restrictions of any approval may differ from one Grantee to another, and need not be the same. Any Transfer or otherwise grant of any interest in any Shares to any third party that does not comply with this Section shall be null and void and shall not confer upon any person, other than the Grantee, any rights. This provision shall terminate immediately after the IPO. This Section shall apply in addition to any other limitation, restriction and/or condition in the Plan or this Agreement (including, without limitation, after the application of Section 16 of the Plan), any shareholders agreement, Company’s charter documents or other instrument between the Grantee and the Company or by which the Grantee is bound. This Section shall not apply to a transfer of Shares in a Merger/Sale.

 

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3. Exercise Procedures .

3.1. The Grantee may exercise Options that have become exercisable by giving a signed written notice to the Company, delivered in person or by mail (or such other methods of delivery prescribed by the Company) to the Chief Financial Officer/Chief Executive Officer of the Company or to such other person as determined by the Committee, or in any other manner as the Committee shall prescribe from time to time. The exercise notice shall be in a form prescribed by the Company from time to time. The Grantee shall specify in the notice the election to exercise Options, the number of Shares for which it is being exercised (which may be equal to or lower than the aggregate number of Shares that have become exercisable at such time, subject to the last sentence of this Section), accompanied by payment of the aggregate Exercise Price for such Shares in the manner permitted by the Plan. In the event that Options are being exercised by the representative of the Grantee, if permitted under the Plan, the notice shall be accompanied by proof (satisfactory to the Company) of the representative’s right to exercise such Options.

3.2. After receiving a proper and duly executed notice of exercise in the form prescribed by the Company, the Company shall cause to be issued a certificate or certificates for the Shares as to which the Options have been exercised, registered in the name of the person exercising such Options, except that in case of Options designated as 102 Trustee Awards, the Shares shall be issued to and in the name of the Trustee for the benefit of the Grantee. The issuance shall be subject to the payment of any and all applicable taxes and compulsory payments by the Grantee. Subject to Section 19 of the Plan, the Grantee shall have no rights as a shareholder with respect to any Shares subject to Options until the Grantee shall have duly exercised the Options, paid the full Exercise Price therefor, if required, paid all applicable taxes and compulsory payments therefor and becomes the record holder of the subject Shares.

3.3. Without derogating from the provision of the Plan, in the event that the Company or, with respect to 102 Trustee Awards, the Trustee, determines that it is required to withhold any tax as a result of the exercise of Options, the Grantee, as a condition to the exercise of Options, shall make arrangements satisfactory to the Company and the Trustee, if applicable, to enable it to satisfy all withholding requirements. The Grantee shall also make arrangements satisfactory to the Company and the Trustee, if applicable, to enable it to satisfy any withholding requirements that may arise in connection with the vesting or disposition of Shares acquired pursuant to the grant of an Option under the Plan. Furthermore, the Grantee shall indemnify the Company and the Trustee, if applicable, and hold them harmless against and from any and all liability for any such tax or interest or penalty thereon, including without limitation, liabilities relating to withholding.

4. Payment of Exercise Price . The Exercise Price shall be paid in cash or in such other manner as determined in accordance with the Plan.

5. Irrevocable Proxy . As a material precondition to the Company’s grant of Options and issuance of Shares in accordance with the Plan, the Grantee hereby executes an irrevocable proxy in the form attached hereto as Exhibit C (and, if applicable, instructs the Trustee to sign such proxy, as requested by the Company), to the Company which shall designate such person or persons (with a right of substitution) from time to time as determined by the Committee (and in the absence of such determination, the CEO or Chairman of the Board, ex officio). The provisions of this Section shall apply to the Grantee and to any purchaser, assignee or transferee of any Shares.

6. Repurchase Right . Grantee agrees that all Shares issued pursuant to the exercise of the Option shall be subject to certain repurchase rights in favor of the Company or its assigns as provided in the Plan.

7. Legend . The Company may at any time place legends referencing the restriction imposed on the Shares (including, without limitation, right of first refusal and right of repurchase) and any applicable federal, state or foreign securities law restrictions on all certificates representing Shares subject to the provisions of this Agreement. The Grantee shall, at the request of the Company, promptly present to the Company any and all certificates representing Shares acquired pursuant to Options in the possession of the Grantee in order to carry out the provisions of this Section. Unless otherwise specified by the Company, legends placed on such certificates may include, but shall not be limited to, the following:

 

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7.1. THIS SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR SUCH APPLICABLE LAWS OF OTHER JURISDICTIONS, OR QUALIFIED UNDER ANY SECURITIES LAW OR ANY OTHER JURISDICTION, AND, SUBJECT TO THEIR TERMS, MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR SUCH APPLICABLE LAWS OF OTHER JURISDICTIONS COVERING SUCH SECURITIES, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, STATING THAT SUCH OFFERING, SALE, TRANSFER, ASSIGNMENT, PLEDGE OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION OR PROSPECTUS DELIVERY REQUIREMENTS OF THE SECURITIES ACT OR THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE LAW.

7.2. THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE COMPANY’S ARTICLES OF ASSOCIATION, THE COMPANY’S SHARE INCENTIVE PLAN AND THE OPTION AGREEMENT WITH THE COMPANY, EACH AS AMENDED FROM TIME TO TIME, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE OF THIS COMPANY.

8. Term and Expiration . The Options shall expire in accordance with the Plan, including in case the Grantee’s employment or service terminates for any reason.

9. Tax Matters and Consultation .

9.1. THE GRANTEE IS ADVISED TO CONSULT WITH A TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING OPTIONS HEREUNDER. THE COMPANY DOES NOT ASSUME ANY RESPONSIBILITY TO ADVISE THE GRANTEE ON SUCH MATTERS, WHICH SHALL REMAIN SOLELY THE RESPONSIBILITY OF THE GRANTEE. Without derogating from Section 18 of the Plan, and notwithstanding anything to the contrary, including the indication under “Type of Award” above, the Company shall be under no duty to ensure, and no representation or commitment is made, that the Option qualifies or will qualify under any particular tax treatment (such as Section 102, ISO or any other treatment), nor shall the Company be required to take any action for the qualification of any Option under such tax treatment. If the Options do not qualify under any particular tax treatment it could result in adverse tax consequences to the Grantee. By signing below, Grantee agrees that the Company and its Affiliates and their respective employees, directors, officers and shareholders shall not be liable for any tax, penalty, interest or cost incurred by Grantee as a result of such determination, nor will any of them have any liability of any kind or nature in the event that, for any reason whatsoever, an Option does not qualify for any particular tax treatment.

9.2. Without limitation of the foregoing, with respect to Incentive Stock Option and Nonqualified Stock Option, there is no guarantee that the Internal Revenue Service (“ IRS ”) will determine that the Exercise Price of these Option represent the fair market value thereof as of the Date of Grant in compliance with the requirements of Section 409A of the Code. If the IRS determines that the Exercise Price is less than such fair market value it could result in adverse tax consequences to Grantee.

9.3. In case of Incentive Stock Options, adjustments made pursuant to the Plan with respect to Incentive Stock Options could constitute a “modification” of such Incentive Stock Options (as that term is defined in Section 424(h) of the Code) or could cause adverse tax consequences for the Grantee and the Grantee should consult with his or her tax advisor regarding the consequences of such “modification” on his or her income tax treatment with respect to the Incentive Stock Option.

10. Section  102 Awards .

10.1. Eligibility for Awards . Subject to Applicable Law, 102 Awards may only be granted to an “employee” within the meaning of Section 102(a) of the Ordinance (which as of the date hereof means (i) individuals employed by an Israeli company being the Company or any of its Affiliates, and (ii) individuals who are serving and are engaged personally (and not through an entity) as “office holders” by such an Israeli company), but may not be granted to a Controlling Stockholder (“ Eligible 102 Grantees ”). Eligible 102 Grantees may receive only 102 Awards, which may either be granted to a Trustee or granted under Section 102 of the Ordinance without a Trustee.

 

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10.2. 102 Award Grant Date.

10.2.1. Each 102 Award will be deemed granted on the date determined by the Committee, subject to Section 10.2.2, provided that (i) the Grantee has signed all documents required by the Company or pursuant to Applicable Law, and (ii) with respect to 102 Trustee Awards, the Company has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA, and if this Agreement is not signed and delivered by the Grantee within 90 days from the date determined by the Committee (subject to Section 10.2.2), then such 102 Trustee Award shall be deemed granted on such later date as this Agreement is signed and delivered and on which the Company has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA. In the case of any contradiction, this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated in the Notice of Option Grant or in any corporate resolution or any agreement.

10.2.2. Unless otherwise permitted by the Ordinance, any grants of 102 Trustee Awards that are made on or after the date of the adoption of this Plan or an amendment to this Plan, as the case may be, that may become effective only at the expiration of thirty (30) days after the filing of this Plan or any amendment thereof (as the case may be) with the ITA in accordance with the Ordinance shall be conditional upon the expiration of such 30-day period, such condition shall be read and is incorporated by reference into any corporate resolutions approving such grants and into this Agreement and any agreement evidencing such grants (whether or not explicitly referring to such condition), and the date of grant shall be at the expiration of such 30-day period, whether or not the date of grant indicated therein corresponds with this Section. In the case of any contradiction, this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated in the Notice of Option Grant or in any corporate resolution or any agreement.

10.3. To the extent and with respect to 102 Trustee Awards, the Grantee acknowledges, undertakes and confirms that: (i) the Grantee fully understands that Section 102 Ordinance and the rules and regulations enacted thereunder apply to the Options, and (ii) the Grantee understands the provisions of Section 102 of the Ordinance, the tax track chosen thereunder and the implications thereof. If applicable, the terms of such Options shall also be subject to the terms of the Trust Agreement made between the Company and the Trustee for the benefit of the Grantee, and the Grantee shall sign all documents requested by the Company or the Trustee, in accordance with and under the trust agreement. A copy of the trust agreement is available for the Grantee’s review, during normal working hours, at the Company’s offices .

10.4. Grantee Undertaking . Without derogating from the generality of the foregoing, to the extent and with respect to any Options that are 102 Capital Gain Track Awards, and as required by Section 102 of the Ordinance and the Rules, the Grantee acknowledges, undertakes and confirms in writing the following (which shall be apply and relate to all Awards granted to the Grantee, whether under this Plan or other plans maintained by the Company, and whether prior to or after the date hereof, if any):

10.4.1. The Grantee shall comply with all terms and conditions set forth in Section 102 of the Ordinance with regard to the “Capital Gain Track” and the applicable rules and regulations promulgated thereunder, as amended from time to time;

10.4.2. The Grantee is familiar with, and understands the provisions of, Section 102 of the Ordinance in general, and the tax arrangement under the “Capital Gain Track” in particular, and its tax consequences; the Grantee agrees that the Options and Shares that may be issued upon exercise of the Options (or otherwise in relation to the Options), will be held by a trustee appointed pursuant to Section 102 of the Ordinance for at least the duration of the Holding Period, as defined in Section 102 under the “Capital Gain Track”. The Grantee understands that any release of such Options or Shares from trust, or any sale of the Share prior to the termination of the Holding Period, will result in taxation at marginal tax rates, in addition to deductions of appropriate social security, health tax contributions or other compulsory payments; and

10.4.3. The Grantee agrees to the trust agreement signed between the Company, his employing company and the trustee appointed pursuant to Section 102 of the Ordinance and shall sign all documents requested by the Company or the Trustee, in accordance with and under the trust agreement.

 

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11. Plan Termination or Amendment . The Board may terminate or amend the Plan or the Option at any time, subject to the Plan and any such amendment shall apply on the Grantee and this Option Agreement (including the Options and Shares issuable or issued pursuant thereto), without any required consent of the Grantee. Except as set forth above, this Agreement shall not be amended without the consent of the parties hereto.

 

12. Miscellaneous .

12.1. Further Assurances . The Grantee shall perform such further acts and execute such further documents as may reasonably be necessary by the Company to carry out and give full effect to the provisions of this Agreement and the Plan.

12.2. Fractional Shares . No fractional Share shall be issuable upon exercise or vesting of any Options and the number of Shares to be issued shall be rounded down to the nearest whole Share, with in any Share remaining at the last vesting date due to such rounding to be issued upon exercise at such last vesting date.

12.3. Entire Agreement . This Agreement (together with the Notice and all Exhibits) and the Plan constitutes the full and entire understanding and agreement between the parties with regard to the subject matters hereof and thereof, and supersede all prior agreements and understandings, both written and oral (with no concession being made as to the existence of any such agreements and understandings).

12.4. Governing Law; Jurisdiction . This Agreement shall be governed by and construed according to the laws of the State of Israel, without regard to the conflict of law provisions thereof. Any dispute arising under or proceeding in relation to this Agreement shall be resolved exclusively in the competent court in Tel Aviv-Jaffa, and each of the parties hereby irrevocably submits to the exclusive jurisdiction of such court.

12.5. Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and enforceable against the parties, and all of which together shall be considered one and the same agreement, it being understood that all parties need not sign the same counterpart. The exchange of an executed Agreement (in counterparts or otherwise) by facsimile transmission, electronic transmission or electronic signature shall be sufficient to bind the parties to the terms and conditions of this Agreement, as an original.

- Signature Pages Following -

 

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IN WITNESS WHEREOF, the parties have duly executed and delivered this OPTION AGREEMENT as of the date last written below.

 

Grantee:      FIREGLASS LTD.

 

    

 

Name:  

 

     Name:   

 

ID no.:  

 

     Title:   

 

Date:  

 

     Date:   

 


EXHIBIT A

THE PLAN

as of the date hereof, subject to further amendments


EXHIBIT B

Market Stand-Off Undertaking

To:

FireGlass Ltd. (the “ Company ”); and

The underwriters

Dear Sirs:

In connection with any underwritten public offering of equity securities of the Company pursuant to an effective registration statement filed under the U.S. Securities Act of 1933, as amended, or equivalent law in another jurisdiction, and in recognition of the benefit that such an offering will confer upon the undersigned as a shareholder of the Company, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned agrees with the Company and each underwriter, during the Lock Up Period (as defined below), that the undersigned will not, without the prior written consent of the Company or the underwriters (or the lead underwriter, as the underwriters shall agree among themselves), directly or indirectly, (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of, or otherwise dispose of or transfer any shares or any securities convertible into or exchangeable or exercisable for shares or securities of the Company, whether now owned or hereafter acquired by the undersigned or with respect to which the undersigned has or hereafter acquires the power of disposition (including, without limitation, Awards under any Company share or equity plan) and any shares or other securities issued or distributed with respect to or in substitution of any of the foregoing (collectively, the “ Lock Up Securities ”), (ii) exercise any right with respect to the registration of any of the Lock Up Securities, or file or cause to be filed any registration statement in connection therewith, under the U.S. Securities Act of 1933, as amended, or equivalent law in another jurisdiction, or (iii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Lock Up Securities, whether any such swap or transaction in this clause (iii) or (i) above is to be settled by delivery of shares or other securities of the Company, in cash or otherwise. The foregoing provisions shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement.

The restrictions contained in this letter shall be in effect for such period of time (the “ Lock Up Period ”): (A) following the first public filing of the registration statement relating to the underwritten public offering until the extirpation of 180 days following the effective date of such registration statement relating to the Company’s initial public offering or 90 days following the effective date of such registration statement relating to any other public offering; in each case, provided, however, that if (1) during the last 17 days of the initial Lock Up Period, the Company releases earnings results or announces material news or a material event or (2) prior to the expiration of the initial Lock Up Period, the Company announces that it will release earnings results during the 15-day period following the last day of the initial Lock Up Period, then in each case the Lock Up Period will be automatically extended until the expiration of the 18-day period beginning on the date of release of the earnings results or the announcement of the material news or material event; or (B) as shall be requested by the Company or the underwriter(s). Notwithstanding anything herein to the contrary, if the underwriter(s) and the Company agreed on a termination date of the Lock Up Period in the event of failure to consummation a certain public offering, then such termination shall apply also to the Lock Up Period hereunder with respect to that particular public offering.

In the event of a subdivision of the outstanding share capital of the Company, the distribution of any securities (whether or not of the Company), whether as bonus shares or otherwise, and whether as dividend or otherwise, a recapitalization, a reorganization (which may include a combination or exchange of shares or a similar transaction affecting the Company’s outstanding securities without receipt of consideration), a consolidation, a spin-off or other corporate divestiture or division, a reclassification or other similar occurrence, any new, substituted or additional securities which are by reason of such transaction distributed with respect to any Lock Up Securities, or into which such Lock Up Securities thereby become convertible, shall immediately be subject to the provisions and restrictions contained herein.


EXHIBIT B

The undersigned agrees that, prior to engaging in any transaction or taking any other action that is subject to the terms of this letter during the Lock Up Period, it will give notice thereof to the Company and will not consummate such transaction or take any such action unless it has received written confirmation from the Company that the Lock Up Period has expired.

The Company may impose and the undersigned agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the Lock Up Securities except in compliance with the foregoing restrictions.

The undersigned understands that the Company and the underwriters are relying upon this letter in proceeding toward consummation of the offering. The underwriters in connection with a registration statement so filed are intended third party beneficiaries of this letter and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. The undersigned shall execute (and hereby empowers the Company as its proxy and attorney-in-fact to do so in his/her name) such separate agreement(s) as may be requested by the Company or the underwriters in connection with such registration statement and in the form required by them (which need not be identical to the provisions of this letter, and may include such additional provisions and restrictions as the underwriter(s) deem advisable) or that are necessary to give further effect thereto. The execution of such separate agreement(s) may be a condition by the Company to the exercise of any Award under the Company’s share incentive plan(s).

This letter is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors, assigns, and the purchaser or transferee of any Lock Up Securities. The Company, may, at its discretion, and without any further consent, release or remove some or all of the restrictions contained in this letter, or allow certain exceptions to such restrictions (whether in general or in any specific case, and such relief or exceptions need not be the same or identical among to all persons bound by them).

This letter shall not derogate from any provision or restriction contained in any Company’s share incentive plan(s), agreement between the undersigned the Company or the underwriters, or any restriction or limitation pursuant to applicable law.

 

Very truly yours,

Signature:                                                                                      

Print Name:                                                                                 

Date:                                                                                               


EXHIBIT C

FIREGLASS LTD.

(the “ Company ”)

IRREVOCABLE PROXY AND POWER OF ATTORNEY

Unless otherwise defined, capitalized terms used herein shall have the meaning ascribed to them under the Company’s Share Incentive Plan and are incorporated herein by reference.

I, the undersigned, hereby irrevocably appoints the Company, which shall designate such person or persons as determined by the Committee (and in the absence of such determination, the CEO or Chairman of the Board of Directors of the Company, ex officio), with full power of substitution, as my proxy and attorney-in-fact to: (i) cause any number of shares, of any class, of the Company owned by me or by the Trustee for my benefit, under the Plan or any other share incentive or option plan of the Company, and any other shares or securities issued or distributed in respect thereto or in substitution or exchange thereof, at any time and from time to time, and as may be adjusted (collectively, the “ Shares ”), to be counted as present at any and all Shareholders Meetings (as defined below); (ii) represent me and to vote in my name at any and all Shareholders Meetings in respect of the Shares; (iii) sign and execute on my behalf any written resolutions or consents in lieu of a Shareholder Meeting or any other consent, in respect of the Shares; (iv) exercise or fail to exercise, in the proxyholder’s sole and absolute discretion, any rights or obligations attached to any and all Shares, and sign on my behalf any document or instrument relating to such rights or obligations, including, without limitation, shareholders agreements, documents concerning rights of bring along, tag along, first refusal, preemptive rights, co-sale rights, information rights, registration rights, lock-up/market stand-off and any other rights or obligations, if any, whether included in the incorporation documents of the Company or any other document or instrument as shall be from time to time (which exercise may impose on the undersigned monetary liability in connection with a Merger/Sale); and (v) agree to the offer to effect a Merger/Sale on the terms approved by the Board (and the Shares held by me or for my benefit shall be included in the shares of the Company approving the terms of such Merger/Sale for the purpose of satisfying any required majority), sell all of the Shares held by me or for my benefit, in accordance with the instructions then issued by the Board, whose determination shall be final, and sign on my behalf any document or instrument relating thereto, including, without limitation, share transfer documents, as are required to affect a compulsory sale of Shares in connection with a Merger/Sale pursuant to the Plan; (vi) receive all notices and communications with respect to the above, including, without limitation, notices of any Shareholders Meeting (including any adjournment or postponement thereof) or any written resolution or consent in lieu thereof. “ Shareholders Meetings ” shall mean any meeting of the shareholders of the Company, however called, whether an extraordinary or annual meeting and whether of the share capital as one class or of any class thereof, and including any adjournment or postponement thereof), or any act or consent of shareholders of the Company (whether of the share capital as one class or of any class thereof) under the Company’s Articles of Association or otherwise.

This proxy and power of attorney shall be exercised in accordance with the Plan, including, without limitation, Section 6.10 thereof. In any Shareholders Meeting or written consent in lieu thereof, the Shares shall be voted by the proxy holder, unless directed otherwise by the Board, in the same proportion as the result of the vote at the Shareholders Meeting in respect of which the Shares are being voted, and in any act or consent of shareholders under the Company’s Articles of Association or otherwise, such Shares shall be cast by the proxy holder, unless directed otherwise by the Board, in the same proportion as the result of the shareholders’ act or consent.

As long as this proxy and power of attorney is in effect, any and all voting rights I may have with respect to the Shares shall be exercised exclusively by this proxy and power of attorney. The undersigned hereby revokes any proxy(ies) and power of attorney heretofore given in respect of the Shares to any person(s) and agrees not to give any other proxies or and power of attorney in derogation or preventing the undersigned from complying with its obligations hereof, until such time as this proxy is no longer in full force and effect. The undersigned acknowledges and agrees that this proxy shall be irrevocable and is a special power of attorney coupled with an interest sufficient in law to support an irrevocable power and shall survive the bankruptcy, death, adjudication of incompetence or the like of undersigned. This proxy and power of attorney shall survive the transfer of Shares, until duly replaced by a similar power and power of attorney executed by the transferee. The Company is an intended third party beneficiary of this proxy and power of attorney. Any person holding or exercising such voting proxies is doing so solely in his/her capacity as the proxy holder and not individually. This proxy shall terminate and be of no further force and effect immediately after the listing for trading on a stock exchange or market or trading system of shares of the Company or of the Successor Corporation (as such term is defined in the Plan).


EXHIBIT C

IN WITNESS WHEREOF, the undersigned has executed this IRREVOCABLE PROXY as of the date written below.

 

Signature:  

 

Printed Name:  

 

ID number:  

 

Date:  

 


 

FIREGLASS LTD.

Notice of Grant of Award

and Award Agreement

(“Grant Notice”)

 

 

 

%%FIRST_NAME%-% %%LAST_NAME%-%    Award Number:    %%SHARE_NUMBER%-%
%%ADDRESS_LINE_1%-%    Plan:    %%EQUITY_PLAN%-%
%%ADDRESS_LINE_2%-%      
%%CITY%-% %%STATE%-% %%COUNTRY%-%    ID:    %%EMPLOYEE_IDENTIFIER%-%

 

 

Effective %%RSU_DATE%-%, you have been granted an award of %%TOTAL_RSU_GRANTED%-% restricted stock units.

The award will vest in increments on the date(s) shown.

 

Shares

  

Full Vest

   %%VEST_DATE_PERIOD1%-%
   %%VEST_DATE_PERIOD2%-%
   %%VEST_DATE_PERIOD3%-%
   %%VEST_DATE_PERIOD4%-%

 

 

By your signature and the Company’s signature below, you and the Company agree that this award is granted under and governed by the terms and conditions of the Company’s 2015 Share Incentive Plan as may be amended and the Agreement, both of which are attached and made a part of this document.

 

 

 

 

    

 

FIREGLASS LTD.      Date

 

    

 

%%FIRST_NAME%-% %%LAST_NAME%-%      Date


FIREGLASS LTD.

RESTRICTED STOCK UNIT

AWARD AGREEMENT

RECITALS

A. The Board has adopted the FireGlass Ltd. 2015 Share Incentive Plan (the “ Plan ”) for the purpose of providing incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of FireGlass, Ltd. ( “ FireGlass ”) and its Subsidiaries and Affiliates. Notwithstanding anything to the contrary in the Plan, any agreement or otherwise, upon the termination of the Share Purchase Agreement between Symantec Corporation (“ Symantec ”), FS Acquisition Ltd., FireGlass and the other parties thereto, dated June 30, 2017 (the “ SPA ”) prior to Closing (as defined below), this Award, will automatically terminate with no consideration due to any participant in the Plan, including the Participant.

B. The Participant is to render valuable services to the Company and/or its Subsidiaries and Affiliates, and this RSU Award Agreement, including the additional terms for Participants located outside of the United States in Appendix A and the country-specific terms in Appendix B (jointly, the “ Agreement ”) is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Company’s issuance of rights in respect of the shares of the Company’s ordinary shares (the “ Ordinary Shares ”) in the form of Restricted Stock Units (each, a “ RSU ”).

C. All capitalized terms in this Agreement shall have the meaning assigned to them herein, including Appendix A. All undefined terms shall have the meaning assigned to them in the Plan.

NOW, THEREFORE , it is hereby agreed as follows:

1. Grant of Restricted Stock Units . The Company hereby awards to the Participant RSUs under the Plan. Each RSU represents the right to receive one share of the Ordinary Shares on the vesting date of that RSU (each, a “Share”), provided that no Award may vest or settle at or prior to the Closing (as defined in the SPA), subject to the provisions of this Agreement (including any appendices hereto). The number of Ordinary Shares subject to this Award, the applicable vesting schedule for the RSUs, the dates on which those vested Shares shall be issued to the Participant and the remaining terms and conditions governing this Award shall be as set forth in this Agreement.

AWARD SUMMARY

 

Date of grant and Number of Shares Subject to Award:    As set forth in the Grant Notice
Vesting Schedule:    The Shares shall vest pursuant to the schedule set forth in the Grant Notice. Notwithstanding the foregoing, if any such dates falls on a weekend or U.S. trading holiday and if the shares underlying the RSU are publically traded, the Fair Market Value of the Shares underlying the RSUs will be the closing price of the Ordinary Shares on the Nasdaq Global Select Market on the last trading day prior to the vesting date.

 

2


  

The RSUs allocated to each applicable vesting date shall vest on that date only if the employment of the Participant has not terminated as of such date, and no additional RSUs shall vest following the Participant’s Termination Date.

 

The Participant acknowledges and agrees that the Vesting Schedule may change prospectively in the event that the Participant’s service status changes between full and part-time status in accordance with Company policies relating to work schedules and vesting of awards.

Issuance Schedule    The Shares in which the Participant vests in accordance with the foregoing Vesting Schedule shall be issuable as set forth in Section 6. However, the actual number of vested Shares to be issued will be subject to the provisions of Section 7 pursuant to which the applicable withholding taxes are to be collected.

2. Limited Transferability . This Award, and any interest therein, shall not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner by the Participant, otherwise than by will or by the laws of descent and distribution unless otherwise determined by the Committee or its delegate(s) in accordance with the terms of the Plan on a case-by-case basis.

3. Cessation of Service . Should the Participant’s service to the Company or a Parent, Subsidiary or an Affiliate of the Company be terminated for any reason (whether or not in breach of local labor laws) prior to vesting in one or more Shares subject to this Award, then the RSUs covering such unvested Shares will be immediately thereafter cancelled, the Participant shall cease to have any right or entitlement to receive any Shares under those cancelled RSUs and the Participant’s right to receive Shares pursuant to the RSUs and vest in such RSUs under the Plan will terminate effective as of the date of the Participant’s termination of service; in no event will the Participant’s service be extended by any notice period mandated under local law ( e.g ., service would not include a period of “garden leave” or similar period pursuant to local law). For purposes of this Award, a transfer of employment between the Company and any Subsidiary and/or Affiliate shall not constitute a termination of service. The Committee shall have the exclusive discretion to determine when the Participant is no longer providing service for purposes of the Plan and the effective date on which the Participant ceased to provide services (the “ Termination Date ”).

4. Corporate Transaction .

a. In the event of a Corporate Transaction, any or all outstanding RSUs subject to this Agreement may be assumed by the successor corporation (if any), which assumption will be binding on the Participant, or the successor corporation may substitute an equivalent award or provide substantially similar consideration to the Participant as was provided to stockholders (after taking into account the existing provisions of the RSUs).

b. In the event such successor corporation (if any) fails to assume this Award or substitute an equivalent award (as provided in Section 4(a) above) pursuant to a Corporate Transaction, this Award will expire on such transaction at such time and on such conditions as the Board shall determine.

 

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c. Any action taken pursuant to clauses (a) or (b) above must either (i) preserve the exemption of these RSUs from Section 409A of the Code or (ii) comply with Section 409A of the Code.

d. This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

e. Corporate Transaction shall mean:

i. a dissolution or liquidation of the Company,

ii. the consummation of a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the Awards granted under the Plan are assumed, converted or replaced by the successor corporation, which assumption will be binding on all participants under the Plan),

iii. the consummation of a merger in which the Company is the surviving corporation but after which the stockholders of the Company (other than any stockholder which merges (or which owns or controls another corporation which merges) with the Company in such merger) cease to own their shares or other equity interests in the Company,

iv. the sale of substantially all of the assets of the Company, or

v. any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code wherein the stockholders of the Company give up all of their equity interest in the Company (except for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the Company from or by the stockholders of the Company).

5. Adjustment in Shares . Should any change be made to the Ordinary Shares by reason of any stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration or if there is a change in the corporate structure, then appropriate adjustments shall be made to the total number and/or class of securities issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder.

6. Issuance of Ordinary Shares .

a. As soon as practicable following the applicable vesting date of any portion of the RSU (including the date (if any) on which vesting of any portion of this RSU accelerates), the Company shall issue to or on behalf of the Participant a certificate (which may be in electronic form) for the applicable number of underlying Shares that so vested, subject, however, to the provisions of Section 7 pursuant to which the applicable Tax Obligations (as defined below) are to be collected. In no event shall the date of settlement (meaning the date that Shares are issued) be later than two and one half (2  1 2 ) months after the later of (i) the end of the Company’s fiscal year in which the applicable vesting date occurs or (ii) the end of the calendar year in which the applicable vesting date occurs. Distribution from settlement of vested RSUs can be deferred to a date after settlement as determined by the Committee.

 

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b. If the Company determines that the Participant is a “specified employee,” as defined in the regulations under Section 409A of the Code, at the time of the Participant’s “separation from service,” as defined in those regulations, then any units subject to the RSUs that are subject to Section 409A of the Code that otherwise would have been settled during the first six months following the Participant’s separation from service will instead be settled on the earliest of (i) the seventh month following the Participant’s separation from service or (ii) the date of Participant’s death following the Participant’s separation from service, unless the settlement of those units is exempt from Section 409A of the Code.

c. In no event shall fractional Shares be issued.

d. Except as set forth in clause (e) below, the holder of this Award shall not have any stockholder rights, including voting rights, with respect to the Shares subject to the RSUs until the Participant becomes the record holder of those Shares following their actual issuance and after the satisfaction of the Tax Obligations (as defined below).

e. As of any date that the Company pays an ordinary cash dividend on its Ordinary Shares, the Company shall credit the Participant with a dollar amount equal to (i) the per share cash dividend paid by the Company on its Ordinary Shares on such date, multiplied by (ii) the total number of RSUs (with such total number adjusted pursuant to Section 5 of this Agreement and the Plan) subject to this Award that are outstanding immediately prior to the record date for that dividend (a “ Dividend Equivalent Right ”). Any Dividend Equivalent Rights credited pursuant to the foregoing provisions of this Section 6(e) shall be subject to the same vesting, payment and other terms, conditions and restrictions as the original RSUs to which they relate; provided, however, that the amount of any vested Dividend Equivalent Rights shall be paid in cash. No crediting of Dividend Equivalent Rights shall be made pursuant to this Section 6(e) with respect to any RSUs which, immediately prior to the record date for that dividend, have either been paid pursuant to Section 6 or terminated pursuant to Sections 3 or 4. Notwithstanding anything to the contrary, no payments shall be made under this subsection unless the Company receives appropriate tax ruling from the Israeli Tax Authority.

7. Tax Obligations . The Participant hereby agrees to make adequate provision for any sums required to satisfy the applicable federal, state, local and foreign employment, social insurance, payroll, income and other tax withholding obligations of the Company or any Affiliate (the “ Tax Obligations ”) that arise in connection with this Award. The satisfaction of the Tax Obligations shall occur at the time the Participant receives a distribution of Ordinary Shares or other property pursuant to this Award, or at any time prior to such time or thereafter as reasonably requested by the Company and/or any Affiliate in accordance with applicable law. The Participant hereby authorizes the Company, at its sole discretion and subject to any limitations under applicable law, to satisfy any such Tax Obligations by any of the following methods: (1) in the event the RSUs are to be settled in part in cash rather than settled in full in Shares, withholding from the cash to be distributed to the Participant in settlement of this Award, (2) if the Shares are publically traded, permitting the Participant to enter into a “same day sale” commitment with a broker-dealer that is a member of the National Association of Securities Dealers (an “ NASD Dealer ”) whereby the Participant irrevocably elects to sell a portion of the Shares to be delivered under the Award to satisfy the applicable Tax Obligations and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the proceeds necessary to satisfy the Tax Obligations directly to the Company and/or its Affiliates, and (3) withholding Shares that are otherwise to be issued and delivered to the Participant under this Award in satisfaction of the Tax Obligations; provided, however ,

 

5


that the amount of the Shares so withheld pursuant to alternative (3) shall not exceed the amount necessary to satisfy the required Tax Obligations using the minimum statutory withholding rates that are applicable to this kind of income. In addition, the Company is authorized to satisfy any Tax Obligations by withholding for the Tax Obligations from wages and other cash compensation payable to the Participant or by causing the Participant to tender a cash payment to the Company if the Committee determines in good faith at the time the Tax Obligations arises that withholding pursuant to the foregoing alternatives (2) and (3) above are not in the best interest of the Company or the Participant. In the event the Tax Obligations arises prior to the delivery to the Participant of Ordinary Shares or it is determined after the delivery of Shares or other property that the amount of the Tax Obligations was greater than the amount withheld by the Company and/or any Affiliate, the Participant shall indemnify and hold the Company and its Affiliates harmless from any failure by the Company and/or any Affiliate to withhold the proper amount. The Company may refuse to deliver the Shares if the Participant fails to comply with the Participant’s obligations in connection with the Tax Obligations as described in this Section 7.

8. Compliance with Laws and Regulations .

a. The issuance of Ordinary Shares pursuant to the RSU shall be subject to compliance by the Company and the Participant with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or an established market, if applicable) on which the Ordinary Shares may be listed for trading at the time of such issuance.

b. The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance of any Ordinary Shares hereby shall relieve the Company of any liability with respect to the non-issuance of the Ordinary Shares as to which such approval shall not have been obtained.

9. Successors and Assigns . Except to the extent otherwise provided in this Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Participant, the Participant’s assigns, the legal representatives, heirs and legatees of the Participant’s estate and any beneficiaries designated by the Participant.

10. Notices . Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to the Participant shall be in writing and addressed to the Participant at the address on file with the Company. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

11. Construction . This Agreement and the Award evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan shall apply. All decisions of the Committee with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in the RSU.

12. Governing Law and Venue . The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Israel, or the State of California, if applicable with respect to the relevant possible successor of the Company, without resort to that State’s conflict-of-laws rules. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by this grant or the Agreement, the parties hereby submit to and consent to the exclusive

 

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jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this grant is made and/or to be performed.

13. Excess Shares . If the Shares covered by this Agreement exceed, as of the date the RSU is granted, the number of Ordinary Shares which may without stockholder approval be issued under the Plan, then the Award shall be void with respect to those excess Shares, unless stockholder approval of an amendment sufficiently increasing the number of Ordinary Shares issuable under the Plan is obtained in accordance with the provisions of the Plan.

14. Employment at Will . Nothing in this Agreement or in the Plan shall confer upon the Participant any right to continue in the employment of the Company (or any Parent or Subsidiary employing or retaining the Participant) for any period of specific duration, or be interpreted as forming an employment or service contract with the Company (or any Parent or Subsidiary employing or retaining the Participant), or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s service with the Company at any time for any reason, with or without cause.

15. Severability . The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

16. Imposition of Other Requirements . The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on this Award and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

17. A ward Subject to Company Clawback or Recoupment . The RSUs shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Participant’s employment or other service with the Company that is applicable to executive officers, employees, directors or other service providers of the Company, and in addition to any other remedies available under such policy and applicable law may require the cancelation of the Participant’s RSUs (whether vested or unvested) and the recoupment of any gains realized with respect to the Participant’s RSUs.

 

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IN WITNESS WHEREOF , the parties have executed this Agreement on this         date of                    , 201    .

 

FIREGLASS LTD.
By:  

 

Title:  

 

Address:  

 

PARTICIPANT
Signature:  

 

Address:  

 

 

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APPENDIX A

ADDITIONAL PROVISIONS

1. Nature of the Grant . In signing this Agreement, the Participant acknowledges that:

a. the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement;

b. the grant of RSUs is exceptional, voluntary and occasional and does not create any contractual or other right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded in the past;

c. all decisions with respect to future grants of RSUs, if any, will be at the sole discretion of the Company;

d. the Participant’s participation in the Plan is voluntary;

e. the RSUs and the Shares subject to the RSUs, and the income and value of same, are not intended to replace any pension rights or compensation;

f. the Participant’s participation in the Plan will not create or amend a right to further employment with the Company or, if different, the Participant’s actual employer (the “ Employer ”) and shall not interfere with the ability of the Employer to terminate Participant’s service at any time with or without cause;

g. RSUs are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or to the Employer, and RSUs are outside the scope of the Participant’s employment contract, if any;

h. RSUs and the Shares subject to the RSUs, and the income and value of same, are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculation of any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

i. unless otherwise agreed with the Company, the RSUs and the Shares subject to the RSUs, and the income and value of same, are not granted as consideration for, or in consideration with, the service the Participant may provide as a director of a Subsidiary or Affiliate;

j. in the event that Participant is not an employee of the Company, the grant of RSUs will not be interpreted to form an employment contract or relationship with the Company; and furthermore, the grant of RSUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;

k. the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;

l. if the Participant receives Shares upon vesting, the value of such Shares acquired on vesting of RSUs may increase or decrease in value;


m. in consideration of the grant of RSUs, no claim or entitlement to compensation or damages arises from termination of the RSUs or diminution in value of the RSUs or Shares received upon vesting of RSUs resulting from Termination of the Participant’s service by the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such claim;

n. neither the Company, the Employer nor any Parent, Subsidiary or Affiliate shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar that may affect the value of the RSUs or of any amounts due to the Participant pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement;

o. the Company is not providing any tax, legal or financial advice, nor is the Company making any accommodations regarding the Participant’s participation in the Plan; and

p. the Participant should consult with his or her own personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to the Plan.

2. Data Privacy Notice and Consent .

a. The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement by and among, as applicable, the Employer, the Company, its Parent, its Subsidiaries and its Affiliates for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

b. The Participant understands that the Company and the Employer may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all RSUs or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in the Participant’s favor (“Data”), for the purpose of implementing, administering and managing the Plan.

c. The Participant understands that Data may be transferred to E*Trade Financial Corporate Services, Inc. and its affiliated companies (“E*Trade”), or such other stock plan service provider as may be selected by the Company in the future, which is assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Participant’s country, or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Participant authorizes the Company, E*Trade, and any other recipients of Data which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker, escrow agent or other third party with whom the Shares received upon vesting of the RSUs may be deposited. The Participant understands that Data will be held only as long as is

 

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necessary to implement, administer and manage his or her participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke his or her consent, the Participant’s employment or service status with the Employer will not be affected; the only consequence of refusing or withdrawing the Participant’s consent is that the Company would not be able to grant the RSUs or other equity awards to the Participant or administer or maintain such awards. Therefore, the Participant understands that refusing or withdrawing his or her consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of his or her refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative.

3. Language . If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version, the English version will control.

4. Insider Trading Restrictions/Market Abuse Laws . The Participant acknowledges that the Participant may be subject to insider trading restrictions and/or market abuse laws, which may affect the Participant’s ability to acquire or sell Shares or rights to Shares ( e.g. , RSUs) under the Plan during such times as the Participant is considered to have “inside information” (as defined by the laws in the Participant’s country). The insider trading and/or market abuse laws may be different from any Company Insider Trading Policy. The Participant is responsible for ensuring compliance with any applicable restrictions and should consult his or her personal legal advisor on this matter.

5. Foreign Asset/Account and Exchange Control Reporting . The Participant’s country may have certain exchange controls and foreign asset and/or account reporting requirements which may affect his or her ability to purchase or hold Shares under the Plan or receive cash from his or her participation in the Plan (including from any dividends received or sale proceeds arising from the sale of Shares) in a brokerage or bank account outside the Participant’s country. The Participant may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. Further, the Participant may be required to repatriate Shares or proceeds acquired as a result of participating in the Plan to his or her country through a designated bank/broker and/or within a certain time. The Participant acknowledges and agrees that it is his or her responsibility to be compliant with such regulations and understands that the Participant should speak with his or her personal legal advisor for any details regarding any foreign asset/account reporting or exchange control reporting requirements in the Participant’s country arising out of his or her participation in the Plan.

 

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APPENDIX B

COUNTRY-SPECIFIC TERMS

Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement or the Plan.

This Appendix B includes country-specific terms that govern the RSUs granted to the Participant if the Participant resides and/or works in one of the countries listed herein. If the Participant is a citizen or resident of a country other than the one in which the Participant is currently residing and/or working, transfers residency and/or employment after the RSUs are granted, or is considered a resident of another country for local law purposes, the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall be applicable to the Participant.

 

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APPENDIX B

ADDENDUM

ISRAEL

FIREGLASS LTD.

2015 SHARE INCENTIVE PLAN

RSU AWARD AGREEMENT

FOR NON-U.S. EMPLOYEES

RSUs Payable Only in Shares

RSUs granted to Participants residing in Israel shall be paid in Shares only. In no event shall any of such RSUs be paid in cash, notwithstanding any discretion contained in the Plan, or any provision in the Agreement to the contrary.

Trust Arrangement

The Participant understands and agrees that this Award is offered subject to and in accordance with the terms of the Plan. This Award is intended to qualify as a 102 Capital Gains Track Award as such term is defined in the Plan. The Award shall be deposited with the Company’s trustee appointed by the Company or its Parent, Subsidiary or Affiliate in Israel for such purpose and approved by the Israeli Tax Authority (the “ Trustee ”) for the Participant’s benefit in accordance with the Plan. The Shares resulting from the vesting of such Awards shall be controlled by the Trustee. The Awards shall be deposited with the Trustee and the underlying Shares controlled by the Trustee as aforementioned, for at least such period of time as required by Section 102 (currently two years from the 102 Capital Gains Track Award’s date of grant) or any shorter period determined under the Israeli Income Tax Ordinance (New Version) 1961 as now in effect or as hereafter amended (the “ Ordinance ”) or by the Israeli Tax Authority (the “ Minimum Trust Period ”). In the event that bonus Shares or dividends in the form of additional RSUs or PRUs or Shares are issued with respect to the Shares held with the Trustee, or as a result of an adjustment made pursuant to the Plan, such RSUs or PRUs or Shares shall be deposited or controlled by the Trustee, as the case may be, for the benefit of the Participant and the provisions of Section 102 of the Ordinance and the Income Tax (Tax Benefits on the Grant of Shares to Employees) Regulations 2003 shall apply to such RSUs or PRUs or Shares for all purposes. In general, taxable income that should be attributed to the Participant as a result of the grant of the RSUs or PRUs will be tax-free on the date of grant, but will be taxed on the sale of Shares issued upon the vesting of the RSUs or PRUs or transfer of Shares from the Trustee to the Participant (a “ Transfer ”). In accordance with the capital gains tax route of Section 102(b)(3) of the Ordinance, if the Awards and underlying Shares are held in trust by the Trustee for the Minimum Trust Period gains derived from the sale of Shares shall be eligible to a preferential tax treatment (i.e. classified as capital gains and taxed at a rate of only 25%, except, if relevant, with regard to a benefit derived at the time of grant of the RSUs or PRUs, equal to the difference between (a) the average closing price of the Company’s Share on a stock exchange during 30 trading days prior to the date of grant, and (b) the purchase price paid per each underlying Share, if any). By the Participant’s acceptance of the Agreement, the Participant; (a) acknowledges receipt of and represents that the Participant has read and is familiar with the Agreement and the Plan and the specific provisions for Israeli Participants; (b) accepts the Award subject to all of the terms and conditions of the Agreement and the Plan and the Appendix for Israeli Participants; (c) accepts the provisions of the trust deed signed between

 

13


the FireGlass and/or the Company and the Trustee. The trust deed shall be delivered to the Participant upon request. The conditions of the trust deed apply to the Award; thus, the Participant is required to carefully read the provisions of the said trust deed. Furthermore, by Participant’s acceptance of the Agreement, Participant confirms that he or she is familiar with the terms and provisions of Section 102 of the Ordinance, and agrees that he/she will not require the Trustee to release the Awards or Shares to him or her, including any rights issued to the Participant as a consequence of holding such Awards or Shares, or to sell the Awards or Shares to a third party during the Minimum Trust period, unless permitted to do so by applicable law. Without derogating from the aforementioned, if the Awards or Shares are released or sold by the Trustee during the Minimum Trust Period, the sanctions under Section 102 of the Ordinance shall apply to and be borne by the Participant. The Shares shall not be sold or released from the control of the Trustee unless the Company, the employing Parent, Subsidiary or Affiliate and the Trustee are satisfied that the full amount of tax obligations due have been paid or will be paid in relation thereto.

 

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APPENDIX B

ADDENDUM

UNITED KINGDOM

FIREGLASS, LTD.

2017 SHARE INCENTIVE PLAN

RSU AWARD AGREEMENT

FOR NON-U.S. EMPLOYEES

RSUs Payable Only in Shares

RSUs granted to Participants residing in the United Kingdom shall be paid in Shares only. In no event shall any of such RSUs be paid in cash, notwithstanding any discretion contained in the Plan, or any provision in the Agreement to the contrary.

Tax-Related Items

The following provisions supplement Section 7 of the Agreement:

If payment or withholding of the income tax due in connection with the RSUs is not made within ninety (90) days after the end of the tax year in which the event giving rise to the income tax obligation arose, or such other period specified in Section 222(1)(c) of the U.K. Income Tax (Earnings and Pensions) Act 2003, (the “Due Date”), the amount of any uncollected income tax shall constitute a loan owed by the Participant to the Employer, effective as of the Due Date. The Participant agrees that the loan will bear interest at the then-current official rate of Her Majesty’s Revenue & Customs (“HMRC”), it shall be immediately due and repayable, and the Company or the Employer may recover it at any time thereafter by any of the means referred to in Section 7 of the Agreement. Notwithstanding the foregoing, if the Participant is a director or executive officer of the Company (within the meaning of Section 13(k) of the U.S. Securities Exchange Act of 1934, as amended), the Participant shall not be eligible for a loan from the Company to cover income tax. In the event that the Participant is a director or executive officer and income taxes are not collected from or paid by the Participant by the Due Date, the amount of any uncollected income tax may constitute a benefit to the Participant on which additional income tax and national insurance contributions (“NICs”) may be payable. The Participant will be responsible for reporting any income tax due on this additional benefit directly to HMRC under the self-assessment regime and for reimbursing the Company or the Employer (as applicable) for any employee NICs due on this additional benefit, which may be recovered from the Participant by the Company or the Employer at any time thereafter by any of the means referred to in Section 7 of the Agreement.

Joint Election . As a condition of participation in the Plan and the vesting of the RSUs, the Participant agrees to accept any liability for secondary Class 1 NICs (“Employer NICs”). To accomplish the foregoing, the Participant agrees to execute a joint election with the Company and/or the Employer, the form of such joint election being formally approved by HMRC (the “Joint Election”), and any other required consent or election. The Participant further agrees to execute such other joint elections as may be required between the Participant and any successor to the Company and/or the Employer. The Participant further agrees that the Company and/or the Employer may collect the Employer NICs from the Participant by any of the means set forth in Section 7 of the Agreement.

 

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If the Participant does not accept the grant (and thus, enter into a Joint Election) prior to the vesting of the RSUs, the Participant will permanently forfeit the RSUs, without any liability to the Company and/or the Employer.

 

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F & W DRAFT: 7/20/17

FIREGLASS LTD.

Notice of Grant of Award

and Award Agreement

 

 

 

%%FIRST_NAME%-% %%LAST_NAME%-%    Target Grant:    %%SHARE_NUMBER%-%
%%ADDRESS_LINE_1%-%    Plan:    %%EQUITY_PLAN%-%
%%ADDRESS_LINE_2%-%      
%%CITY%-% %%STATE%-% %%COUNTRY%-%    ID:    %%EMPLOYEE_IDENTIFIER%-%

 

 

Effective %%PRU_DATE%-%, you have been granted an award of %%TOTAL_PRU_GRANTED%-% performance based restricted stock units.

 

 

By your signature and the Company’s signature below, you and the Company agree that this award is granted under and governed by the terms and conditions of the Company’s 2015 Share Incentive Plan, as may be amended, and the Award Agreement, both of which are attached and made a part of this document.

 

 

 

 

  

 

FIREGLASS LTD.    Date

 

  

 

%%FIRST_NAME%-% %%LAST_NAME%-%    Date


FIREGLASS LTD.

PERFORMANCE BASED RESTRICTED STOCK UNIT

AWARD AGREEMENT

RECITALS

A. The Board has adopted the FireGlass Ltd. 2015 Share Incentive Plan (the “ Plan ”) for the purpose of providing incentives to attract, retain and motivate eligible persons whose present and potential contributions are important to the success of FireGlass Ltd. ( “ FireGlass ”) and its Subsidiaries and Affiliates. Notwithstanding anything to the contrary in the Plan, any Agreement or otherwise, upon the termination of the Share Purchase Agreement between Symantec Corporation (“ Symantec ”), FS Acquisition Ltd., the Company and the other parties thereto, dated June 30, 2017 (the “ SPA ”) prior to Closing (as defined below), this Award, will automatically terminate with no consideration due to any participant in the Plan, including the Participant. The term “Company” shall mean Symantec after the closing as defined in the SPA (the “ Closing ”) (as defined below).

B. The Participant is to render valuable services to the Company and/or its Subsidiaries and Affiliates, and this Performance Based Restricted Stock Unit Agreement, including the additional terms for Participants located in Israel in Appendix C and the country-specific terms in Appendix D, is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Company’s issuance of rights in respect of Ordinary Shares in the form of Performance Based Restricted Stock Units (each, a “ PRU ”).

C. All capitalized terms in this Agreement shall have the meaning assigned to them in this Agreement, including Appendix A or Appendix B. All undefined terms shall have the meaning assigned to them in the Plan.

NOW, THEREFORE , it is hereby agreed as follows:

1. Grant of Performance Based Restricted Stock Units . The Company hereby awards to the Participant PRUs under the Plan. Each PRU represents the right to receive one share of Ordinary Shares (each, a “ Share ”) based on achievement of the performance objectives set forth in Appendix B subject to the provisions of this Agreement (including any Appendices hereto) provided that the Award may not vest or settle prior to the Closing. The number of Shares subject to this Award, the applicable vesting schedule for the PRUs, the dates on which Shares receivable upon the vesting of the PRUs shall be issued to the Participant and the remaining terms and conditions governing this Award shall be as set forth in this Agreement (including any Appendices hereto).

AWARD SUMMARY

 

Award Date and Target Grant:    As set forth in the Notice of Grant of Award (the “ Notice of Grant ”).
Vesting Schedule:   

The Shares shall vest on the Performance Vesting Date, as described in Appendix B hereto.

 

Subject to provisions of Section 6 of Appendix B hereto, the Shares that may be earned and vested on the Performance Vesting Date (as defined in Appendix B) shall vest on that date only if the employment of the Participant has not Terminated as of the last day of the Performance Period to which the Performance Vesting Date relates.

 

2


Issuance Schedule:    The Shares in which the Participant vests shall be issuable as set forth in Section 6 and Appendix B. However, the actual number of vested Shares to be issued will be subject to the provisions of Section 7 (pursuant to which the applicable withholding taxes are to be collected).

2. Limited Transferability . This Award, and any interest therein, shall not be transferable or assignable by the Participant, and may not be made subject to execution, attachment or similar process, otherwise than by will or by the laws of descent and distribution or as consistent with this Agreement and the Plan.

3. Cessation of Service . Subject to Section 6 of Appendix B hereto, should the Participant’s service as an employee, director, consultant, independent contractor or advisor to the Company or a Parent, Subsidiary or an Affiliate of the Company be Terminated for any reason (whether or not in breach of local labor laws) prior to the end of a particular Performance Period under the Award, then the PRUs covering any unvested Shares applicable to that Performance Period will be immediately thereafter cancelled, the Participant shall cease to have any right or entitlement to receive any Shares under those cancelled PRUs and the Participant’s right to receive such PRUs and vest under the Plan, if any, will terminate effective as of the date of the Participant’s Termination. For purposes of service, transfer of employment between the Company and any Parent, Subsidiary or Affiliate shall not constitute a Termination. The Committee shall have the exclusive discretion to determine when the Participant is no longer actively providing service for purposes of the Plan.

4. Corporate Transaction .

a. In the event of a Corporate Transaction, any or all outstanding PRUs subject to this Agreement may be assumed, converted or replaced by the successor corporation (if any), which assumption, conversion or replacement will be binding on the Participant, or the successor corporation may substitute an equivalent award or provide substantially similar consideration to the Participant as was provided to stockholders (after taking into account the existing provisions of the PRUs).

b. In the event such successor corporation (if any) fails to assume this Award or substitute an equivalent award (as provided in Section 4(a) above) pursuant to a Corporate Transaction, subject to Section 5 of Appendix B, this Award will expire on such transaction at such time and on such conditions as the Board shall determine.

c. Any action taken pursuant to clauses (a) or (b) above must either (i) preserve the exemption of these PRUs from Section 409A of the Code or (ii) comply with Section 409A of the Code.

d. This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

e. As of any date that the Company pays an ordinary cash dividend on its Ordinary Shares, the Company shall credit the Participant with a dollar amount equal to (i) the per share cash dividend paid by the Company on its Ordinary Shares on such date, multiplied by (ii) the total number of PRUs (with such total number adjusted pursuant to Section 5 of this Agreement and the Plan) subject to this Award that are

 

3


outstanding immediately prior to the record date for that dividend (a “ Dividend Equivalent Right ”). Any Dividend Equivalent Rights credited pursuant to the foregoing provisions of this Section 6(e) shall be subject to the same vesting, payment and other terms, conditions and restrictions as the original PRUs to which they relate; provided, however, that the amount of any vested Dividend Equivalent Rights shall be paid in cash. No crediting of Dividend Equivalent Rights shall be made pursuant to this Section 6(e) with respect to any PRUs which, immediately prior to the record date for that dividend, have either been paid pursuant to Section 6 or terminated pursuant to Sections 3 or 4. Notwithstanding anything to the contrary, no payments shall be made under this subsection unless the Company receives appropriate tax ruling from the Israeli Tax Authority.

5. Adjustment in Shares . Should any change be made to the Ordinary Shares by reason of any stock dividend, recapitalization, stock split, reverse stock split, subdivision, combination, reclassification or similar change in the capital structure of the Company without consideration or if there is a change in the corporate structure, then appropriate adjustments shall be made to the total number and/or class of securities issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder.

6. Issuance of Shares of Ordinary Shares .

a. The Shares in which the Participant vests shall be issuable as set forth in Appendix B. However, the actual number of vested Shares to be issued will be subject to the provisions of Section 7 (pursuant to which the applicable withholding taxes are to be collected). The Company shall issue to or on behalf of the Participant a certificate (which may be in electronic form) for the applicable number of underlying Shares that so vested, subject, however, to the provisions of Section 7.

b. If the Company determines that the Participant is a “specified employee,” as defined in the regulations under Section 409A of the Code, at the time of the Participant’s “separation from service,” as defined in those regulations, any PRUs that otherwise would have been settled due to that “separation from service” during the first six months following the Participant’s separation from service will instead be settled during the seventh month following the Participant’s separation from service, unless the settlement of those units is exempt from Section 409A of the Code.

c. In no event shall fractional Shares be issued.

d. The holder of this Award shall not have any stockholder rights, including voting rights, with respect to the Shares subject to the PRUs until the Award holder becomes the record holder of those Shares following their actual issuance and after the satisfaction of the Tax Obligations (as defined below).

7. Tax Obligations . The Participant hereby agrees to make adequate provision for any sums required to satisfy the applicable federal, state, local and foreign employment, social insurance, payroll, income and other tax withholding obligations of the Company or any Affiliate (the “ Tax Obligations ”) that arise in connection with this Award. The satisfaction of the Tax Obligations shall occur at the time the Participant receives a distribution of Ordinary Shares or other property pursuant to this Award, or at any time prior to such time or thereafter as reasonably requested by the Company and/or any Affiliate in accordance with applicable law. The Participant hereby authorizes the Company, at its sole discretion and subject to any limitations under applicable law, to satisfy any such Tax Obligations by any of the following methods: (1) in the event the PRUs are to be settled in part in cash rather than settled in full in Shares, withholding from the cash to be distributed to the Participant in settlement of this Award, (2) if the Shares are publically traded, permitting the Participant to enter into a “same day sale” commitment with a broker-dealer that is a member of the National Association of Securities Dealers (an “ NASD

 

4


Dealer ”) whereby the Participant irrevocably elects to sell a portion of the Shares to be delivered under the Award to satisfy the applicable Tax Obligations and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to forward the proceeds necessary to satisfy the Tax Obligations directly to the Company and/or its Affiliates, and (3) withholding Shares that are otherwise to be issued and delivered to the Participant under this Award in satisfaction of the Tax Obligations; provided, however , that the amount of the Shares so withheld pursuant to alternative (3) shall not exceed the amount necessary to satisfy the required Tax Obligations using the minimum statutory withholding rates that are applicable to this kind of income. In addition, the Company is authorized to satisfy any Tax Obligations by withholding for the Tax Obligations from wages and other cash compensation payable to the Participant or by causing the Participant to tender a cash payment to the Company if the Committee determines in good faith at the time the Tax Obligations arises that withholding pursuant to the foregoing alternatives (2) and (3) above are not in the best interest of the Company or the Participant. In the event the Tax Obligations arises prior to the delivery to the Participant of Ordinary Shares or it is determined after the delivery of Shares or other property that the amount of the Tax Obligations was greater than the amount withheld by the Company and/or any Affiliate, the Participant shall indemnify and hold the Company and its Affiliates harmless from any failure by the Company and/or any Affiliate to withhold the proper amount. The Company may refuse to deliver the Shares if the Participant fails to comply with the Participant’s obligations in connection with the Tax Obligations as described in this Section 7.

8. Compliance with Laws and Regulations .

a. The issuance of Shares pursuant to the vesting of the PRUs shall be subject to compliance by the Company and the Participant with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or an established market, if applicable) on which the Ordinary Shares may be listed for trading at the time of such issuance.

b. The inability of the Company to obtain approval from any regulatory body having authority deemed by the Company to be necessary to the lawful issuance of any Ordinary Shares hereby shall relieve the Company of any liability with respect to the non-issuance of the Ordinary Shares as to which such approval shall not have been obtained. The Company, however, shall use its best efforts to obtain all such approvals.

9. Successors and Assigns . Except to the extent otherwise provided in this Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and the Participant, the Participant’s assigns, the legal representatives, heirs and legatees of the Participant’s estate and any beneficiaries designated by the Participant.

10. Notices . Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Company at its principal corporate offices. Any notice required to be given or delivered to the Participant shall be in writing and addressed to the Participant at the address indicated below the Participant’s signature line on this Agreement (as may be updated from time to time by written notice from the Participant). All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.

11. Construction . This Agreement and the Notice of Grant evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan shall apply. All decisions of the Committee with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in the PRU.

 

5


12. Governing Law . The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Israel, or the State of California, if applicable with respect to the relevant possible successor of the Company, without resort to that State’s conflict-of-laws rules. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by this grant or the Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts for the United States for the Northern District of California, and no other courts, where this grant is made and/or to be performed.

13. Excess Shares . If the Shares covered by this Agreement exceed, as of the Award Date, the number of Shares which may without stockholder approval be issued under the Plan, then the Award shall be void with respect to those excess Shares, unless stockholder approval of an amendment sufficiently increasing the number of Shares issuable under the Plan is obtained in accordance with the provisions of the Plan.

14. Employment at Will . Nothing in this Agreement or in the Plan shall confer upon the Participant any right to continue in the employment of the Company for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s service with the Company at any time for any reason, with or without cause.

15. Severability . The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.

16. Imposition of Other Requirements . The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Award and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require me to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

17. A ward Subject to Company Clawback or Recoupment . The PSUs shall be subject to clawback or recoupment pursuant to any compensation clawback or recoupment policy adopted by the Board or required by law during the term of the Participant’s employment or other service with the Company that is applicable to executive officers, employees, directors or other service providers of the Company, and in addition to any other remedies available under such policy and applicable law may require the cancelation of the Participant’s PSUs (whether vested or unvested) and the recoupment of any gains realized with respect to the Participant’s PSUs.

 

6


IN WITNESS WHEREOF , the parties have executed this Agreement on this              date of                     , 20117.

 

FIREGLASS LTD.
By:  

 

Title:  

 

Address:

 

 

 

 

 

PARTICIPANT
Signature:  

 

Address:  

 

 

 

 

7


APPENDIX A

DEFINITIONS

The following definitions shall be in effect under the Agreement:

1. Agreement shall mean this Performance Based Restricted Stock Unit Award Agreement.

2. Award shall mean the award of PRUs made to the Participant pursuant to the terms of this Agreement.

3. Award Date shall mean the date the PRUs are granted to the Participant pursuant to the Agreement and shall be the date indicated in the Notice of Grant.

4. Code shall mean the Internal Revenue Code of 1986, as amended.

5. Committee shall mean the Compensation and Leadership Development Committee of the Company Board of Directors.

6. Corporate Transaction shall mean

 

  (a) a dissolution or liquidation of the Company,

 

  (b) the consummation of a merger or consolidation in which the Company is not the surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company or their relative stock holdings and the Awards granted under the Plan are assumed, converted or replaced by the successor corporation, which assumption will be binding on all participants under the Plan),

 

  (c) the consummation of a merger in which the Company is the surviving corporation but after which the stockholders of the Company (other than any stockholder which merges (or which owns or controls another corporation which merges) with the Company in such merger) cease to own their shares or other equity interests in the Company,

 

  (d) the sale of substantially all of the assets of the Company, or

 

  (e) any other transaction which qualifies as a “corporate transaction” under Section 424(a) of the Code wherein the stockholders of the Company give up all of their equity interest in the Company (except for the acquisition, sale or transfer of all or substantially all of the outstanding shares of the Company from or by the stockholders of the Company).

7. Notice of Grant shall mean such notice as provided by the Stock Administration Department of the Company, or such other applicable department of the Company, providing the Participant with notice of the issuance of the PRUs pursuant to the Plan and terms of this Agreement.

8. Ordinary Shares shall mean shares of the Company’s ordinary shares.

 

A-1


9. Participant shall mean the person named in the Notice of Grant relating to the PRUs covered by this Agreement.

10. Plan shall mean the Company’s 2015 Share Incentive Plan, as the same may be amended from time to time.

 

 

A-2


APPENDIX B

PERFORMANCE SCHEDULE

The number of PRUs that will be earned and vest shall be based on the metrics set forth below. Terms not otherwise defined in this Agreement, including Appendix A and Appendix B, shall have the meaning assigned to them in the Plan.

1. Grant of Performance Based Restricted Stock Units .

Subject to the terms and conditions of Agreement, the Notice of Grant and of the Plan, the Company hereby grants to the Participant a number of PRUs set forth in the Notice of Grant, subject to reduction and vesting as set forth below.

2. Performance Metrics.

The Participant can earn the PRUs based on the Company’s performance over each of the Company’s fiscal years ending March 30, 2018 (the “ 2018 Performance Period ”), March 29, 2019 (the “ 2019 Performance Period ”), and April 3, 2020 (the “ 2020 Performance Period ”, each a “ Performance Period ”), in each case as follows:

(a) 2018 Performance Period . The number of PRUs that will be earned following the last day of the 2018 Performance Period will range from 0% to 100% of the 2018 Performance Period Portion of the Target Grant, and shall be based fifty percent (50%) upon the Company’s achievement of Product Milestones (such portion the “ Product Milestones Portion ”) and fifty percent (50%) Billings for the 2018 Performance Period, each as determined by the Committee as set forth in Tables 1 and 2 below.

TABLE 1

 

Product Milestones

  

Billings

  

Billings Percentage

See Table 2    Less than 80% of Management Annual Plan    0%
   At or above 80% of Management Annual Plan and up to 100% of Management Annual Plan    Interpolated between 0% and 100%
   At or above 100% of Management Annual Plan    100%

 

B-1


TABLE 2

ALL of the below deliverables must be met by the last day of the 2018 Performance Period for the Product Milestones Portion of the Target Award Grant to vest. No partial vesting of the Product Milestones Portion will be provided if ALL of the Product Milestone Success Metrics as set forth in Table 2 below are not fully met.

 

Product Milestones

  

Description

  

Product Milestone Success Metrics

Release 1.8 (Haiku)    Existing planned FireGlass feature release (see Schedule 1 to this Table 2)    GA August 2017
Release 1.9 (Iyengar)    Existing planned FireGlass feature release + 1 ( see Schedule 2 to this Table 2)    GA October 2017
Calendar Year 2017’Q4 Release    Expand VRM Coverage with Safari Support    VRM mode works for 75% of Alexa Top 100
Calendar Year 2017’Q4 Release    Enhance mobile support for Android    Beta status for Android
Committed customer RFEs   

DRAC Isolation (Java) (for Rackspace)

Granular Auth Profiles (for Rackspace)

   Released per customer commitment, but must be GA by end of Symantec Fiscal Year 2018
Symantec Rebranding    Level 0 rebrand, Logo, stylesheet, color palettes (no change to navigation/menu structure)   

Has Symantec branding

GA in FG Release v1.9 or Calendar Year 2017’Q4 release

Licensing to capacity model    Licensed based on VA resource capacity (e.g. CPU, memory) instead of user band for on-prem SW    GA in FG Release v1.9 or Calendar Year 2017’Q4 release
FG policy from SG    Parse and extract HTTP Header with FG policy configuration from SG    FG policy can be controlled via custom HTTP Header, GA Symantec Fiscal Year 2018
Multi-Tenant    Multi-tenant awareness, preserve tenant ID, use tenant ID for state synch, inject tenant ID into logs for reporting    Can be used to offer a multi-tenant solution (with WSS), GA by end of Symantec Fiscal Year 2018
Use BC/GINlib    Replace 3rd party Cyren with BC/GINLib    Uses GIN Categories & Risk levels
Fiscal Year 2017’Q4 Release    Anti-Phishing User Education    GA by end of Symantec Fiscal Year 2018

Link isolation in Symantec

Email Security.cloud

   Provide documented integration process for Email Security.cloud to rewrite email URL links    Process available by end of Calendar Year 2017

Anti-phishing in Symantec

Email Security.cloud

   Provide documented integration process for Email Security.cloud to provide Anti-phishing    Process available by end of Calendar Year 2017

 

B-2


SCHEDULE 1

 

Release 1.8 (Haiku)   

GA August 2017

UX

 

•    VRM – Full IE support for VRM sites, increase coverage by additional hundreds of websites

 

•    DASH video streaming

Cloud elasticity (new instance orchestration on demand)

Ease of deployment

 

•    Simple registration

 

•    Even-simpler proxy chaining integration (dedicated 3 rd party proxy object)

Java isolation (Rackspace RFE)
WebGL multi-platform support
GRM Japanese support

 

B-3


SCHEDULE 2

 

Release 1.9 (Iyengar)    GA October 2017

Scalability

 

•    Servers-side cookie synchronization and enhanced TIE load balancing

 

•    Major performance improvement for VRM (avoid software composition)

Mobile –Alpha, Android-only

UX

 

•    VRM – Increase by additional hundreds of websites, auto-failover to GRM if needed, FireFox support

Cloud Multi Tenancy phase I (support delegated policy decisions to WSS, send logs with tenant ID)

Ease of development

 

•    Enhanced diagnostic tools, advanced troubleshooting guide

Customer success dashboard
New CI system (longevity, multiple browsers)

(b) 2019 Performance Period . The number of PRUs that will be earned following the last day of the Company’s 2019 Performance Period will range from 0% to 100% of the 2019 Performance Period Portion of the Target Grant, and shall be determined based upon the Company’s achievement of Billings for the 2019 Performance Period, each as determined by the Committee as set forth in Table 3 below.

TABLE 3

 

Billings

   Billings Percentage
Less than 80% of Management Annual Plan    0%
At or above 80% of Management Annual Plan and up to 100% of Management Annual Plan    Interpolated between 0% and 100%

At or above 100% of Management Annual Plan

   100%

(c) 2020 Performance Period . The number of PRUs that will be earned following the last day of the 2020 Performance Period will range from 0% to 100% of the 2020 Performance Period Portion of the Target Grant, and shall be determined based upon the Company’s achievement of Billings for the 2020 Performance Period, each as determined by the Committee as set forth in Table 4 below.

 

B-4


TABLE 4

 

Billings

   Billings Percentage
Less than 80% of Management Annual Plan    0%
At or above 80% of Management Annual Plan and up to 100% of Management Annual Plan    Interpolated between 0% and 100%
At or above 100% of Management Annual Plan    100%

Nothing in this Section or elsewhere in the Agreement shall be read as allowing Participant to earn more than 100% of the Target Grant.

3. Committee Certification and Vesting of PRUs .

In order to vest in the earned the PRUs, the Participant must be employed through the end of the applicable Performance Period for which the performance relates except as provided in Sections 5 and 6 below.

As soon as practicable following the completion of the applicable Performance Period (the “ Performance Vesting Date ”), the Committee shall determine and certify in writing the applicable performance levels that have been attained for such applicable Performance Period and the number of PRUs that will vest based on the applicable performance percentage set forth in Tables 1 through 4 of Section 2 of this Appendix B (subject to the Participant’s continued employment through the end of the applicable Performance Period pursuant to Section 5 or Section 6 below). Notwithstanding the foregoing, if the provisions of Section 5 apply, certification by the Committee shall no longer be required for the PRUs to become vested pursuant to Section 5. The Committee’s certification shall be binding on the Participant.

4. Timing of Settlement .

 

    Subject to Section 5 and 6 below, the following settlement provisions shall apply.

 

    PRUs shall be settled as soon as reasonably practicable following the end of the applicable Performance Vesting Date but no later than two and one/half months following the end of the applicable Performance Period.

5. Change of Control .

In the event of a Corporate Transaction constituting a Change of Control, where the Participant’s PRUs are assumed or substituted consistent with Section 4(a) of the Agreement, the portion of the Participant’s PRUs that remain unvested will, to the extent applicable, be subject to the acceleration provisions of Section 1 of the Executive Retention Plan upon a qualifying termination (as well as all other provisions of such plan, including Section 3 thereof). For the avoidance of the doubt, the foregoing acceleration provisions assume a qualifying termination following such Change of Control as set forth in Section 1 of the Executive Retention Plan.    If any portion of the Target Grant failed to vest in a Performance Period that has already ended, then that unvested portion of the Target Grant shall not vest and/or accelerate in the event of a qualified termination pursuant to the Executive Retention Plan.

 

B-5


In the event of a Corporate Transaction constituting a Change of Control, where the successor corporation fails to assume the Participant’s PRUs or substitute an equivalent award such that Section 4(b) of the Agreement applies and the Award expires, the PRUs will accelerate and become immediately payable in full with respect to the portion of the Target Grant that remains unvested and subject to a current or future Performance Period.

6. Death, Disability and Involuntary Termination .

If the Participant’s employment with the Company (or any majority or greater owned subsidiary) terminates for any reason prior to the commencement of any applicable Performance Period or as a result of death or Disability, the PRU shall be immediately cancelled without consideration for such applicable Performance Period.

If a Participant’s employment with the Company (or any majority or greater owned subsidiary) terminates by reason of Involuntary Termination, death or Disability during any Performance Period, and provided, in the case of Involuntary Termination, that the Participant returns and makes effective a general release of claims in favor of the Company (and any majority or greater owned subsidiary) within 60 days following such termination of employment, then the number of PRUs shall accelerate and vest as follows:

(A) if the Involuntary Termination, death or Disability occurs during the 2018 Performance Period, then no PRUs shall accelerate or vest,

(B) if the Involuntary Termination, death or Disability occurs during the 2019 Performance Period, then the PRU shall accelerate and vest as to the product of (i) the 2019 Performance Portion of the Target Grant, multiplied by both (ii) the applicable Proration Factor and (iii) the actual performance percentage earned applicable to Table 3 of Section 2 of this Appendix B (provided that, the applicable performance percentage shall not be determined until after the close of the applicable Performance Period and shall be determined in the same manner as is used for all other Participants for such Performance Period), and

(C) if the Involuntary Termination, death or Disability occurs during the 2020 Performance Period, then the PRU shall accelerate and vest as to the product of (i) the 2020 Performance Portion of the Target Grant (disregarding the Catch-Up Portion), multiplied by both (ii) the applicable Proration Factor and (iii) the actual performance percentage earned applicable to Table 4 of Section 2 of this Appendix B (provided that, the applicable performance percentage shall not be determined until after the close of the applicable Performance Period and shall be determined in the same manner as is used for all other Participants for such Performance Period).

For purposes of service, transfer of employment between the Company and any Subsidiary or Affiliate shall not constitute a termination of service. The Committee shall have the exclusive discretion to determine when the Participant is no longer actively providing service for purposes of the Plan.

7. Restatement of Financial Results

All benefits hereunder shall be subject to any clawback policy adopted by the Board or required by law.

 

B-6


8. Section  409A of the Code

Notwithstanding the other provisions hereof, this Performance Based Restricted Stock Unit Agreement is intended to comply with the requirements of Section 409A of the Code, to the extent applicable, and this Performance Based Restricted Stock Unit Agreement shall be interpreted to avoid any penalty sanctions under Section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with Section 409A of the Code and, if necessary, any such provision shall be deemed amended to comply with Section 409A of the Code and regulations thereunder. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under Section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. Any amount payable under this Agreement that constitutes deferred compensation subject to Section 409A of the Code shall be paid at the time provided under this Agreement or such other time as permitted under Section 409A of the Code. No interest will be payable with respect to any amount paid within a time period permitted by, or delayed because of, Section 409A of the Code. All payments to be made upon a termination of employment under this Agreement that are deferred compensation may only be made upon a “separation from service” under Section 409A of the Code. For purposes of Section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment. In no event may Participant directly or indirectly, designate the calendar year of payment.

Notwithstanding the foregoing, in no event whatsoever shall the Company be liable for any additional tax, interest, income inclusion or other penalty that may be imposed on a Participant by Code Section 409A or for damages for failing to comply with Code Section 409A unless such failure is a result of the Company’s breach of this Plan or the Performance Based Restricted Stock Unit Agreement.

9. Definitions

(a) Billings shall mean actual amounts invoiced for FireGlass products to parties other than the Company, any Parent and its Subsidiaries and Affiliates pursuant to the Company’s financial practices and policies and based on actual amounts invoiced for each applicable FireGlass product, in all cases to be derived from the Company’s financial system of record. Notwithstanding anything in this subsection to the contrary (i) all calculations of Billings shall be audited by the Company’s Enterprise Finance unit under the authority of the Senior Vice President of such Enterprise Finance unit, (ii) any disputes shall be determined by the Company’s Chief Executive Officer and Chief Financial Officer jointly in their sole discretion subject always to the binding authority of the Committee as otherwise forth in this Agreement and (iii) any adjustments to the Billings targets shall be approved by the Committee. Any Billings amounts issued in non-USD currencies will be converted into USD using the applicable Symantec fiscal year plan level exchange rates for purposes of calculation.

(b) Billings Percentage shall mean the applicable percentages identified in Tables 1 through 4 of Section 2 of this Appendix B.

(d) Cause shall mean the dismissal or discharge of a Participant from employment for one or more of the following reasons or actions: (i) gross negligence or willful misconduct in the performance of duties to the Company (other than as a result of a Disability) that has resulted or is likely to result in substantial and material damage to the Company, after a demand for substantial performance is delivered by the Company which specifically identifies the manner in which it believes the individual has not substantially performed his/her duties and provides the individual with a reasonable opportunity to cure any alleged gross negligence or willful misconduct (ii) commission of any act or fraud with respect to the Company or its affiliates; or (iii) conviction of a felony or crime involving moral turpitude causing material harm to the business and affairs of the Company.

 

B-7


(e) Change of Control shall have the meaning assigned to it in the Executive Retention Plan (specifically excluding the transactions and Closing contemplated by the SPA); provided, however , that, to the extent that any amount constituting deferred compensation (as defined in Section 409A of the Code) would vest or become payable by reason of a Change in Control, such amount shall vest or become payable only if the event constituting a Change in Control would also qualify as a change in ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company, each as defined within the meaning of Section 409A of the Code, as it has been and may be amended from time to time, and any proposed or final Treasury Regulations and Internal Revenue Service guidance that has been promulgated or may be promulgated thereunder from time to time.

(f) Executive Retention Plan shall mean the Symantec Executive Retention Plan as in effect on the date of this Agreement and as hereafter amended from time to time.

(g) Involuntary Termination shall mean the Participant’s termination of employment by the Company without Cause.

(h) Proration Factor shall mean a percentage, determined by the quotient of the following: the numerator of which is the number of calendar months (rounded up to the next whole month) the Participant was in the employ of the Company (or any majority or greater owned subsidiary) during the period commencing at the start of the applicable Performance Period and ending on the date of termination of employment and the denominator of which is twelve (12).

(i) Management Annual Plan shall mean $10,000,000 in Billings in the 2018 Performance Period, $44,000,000 in Billings in the 2019 Performance Period, and $106,000,000 in Billings in the 2020 Performance Period.

(j) Management Cumulative Plan shall mean $160,000,000 in Billings in the 2018 Performance Period, the 2019 Performance Period and the 2020 Performance Period in the aggregate for the 2019 Performance Period and the 2020 Performance Period.

(k) Product Milestones shall mean the product milestones set forth in Table 2 to Section 2(a) to this Appendix B.

(l) Product Milestone Success Metrics shall mean the metrics set forth in Table 2 to Section 2(a) to this Appendix B.

(m) Target Grant shall mean the number of shares of Ordinary Shares associated with the PRU grant as determined by the Committee.

(n) 2018 Performance Period Portion of the Target Grant shall be equal to twenty-five percent (25%) of the Target Grant.

(o) 2019 Performance Period Portion of the Target Grant shall be equal to thirty-seven and one-half percent (37.5%) of the Target Grant.

 

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(p) 2020 Performance Period Portion of the Target Grant shall be equal to thirty-seven and one-half percent (37.5%) of the Target Grant. Notwithstanding the foregoing, if the achievement for the 2018 Performance Period Portion of the Target Grant and/or the 2019 Performance Period Portion of the Target Grant is below 100% of the Management Annual Plan for Performance Periods that include the 2018 Performance Period and the 2019 Performance Period but at or above 70% of the Management Annual Plan for Performance Periods that include the 2018 Performance Period and the 2019 Performance Period, then (A) the 2020 Performance Period Portion of the Target Grant will be calculated solely based on the Management Cumulative Plan and (B) the 2020 Performance Period Portion of the Target Grant shall equal (i) thirty-seven and one-half percent (37.5%) of the Target Grant plus an additional portion equal to (ii) any portion of the 2018 Performance Period Portion of the Target Grant and 2019 Performance Period Portion of the Target Grant that did not vest as set forth in this Appendix B excluding the Product Milestones Portion of the 2018 Performance Period (such additional portion the “ Catch-Up Portion ”).

 

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APPENDIX C

ADDITIONAL PROVISIONS

 

1. Nature of the Grant . In signing this Agreement, the Participant acknowledges that:

a. the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement;

b. the grant of PRUs is exceptional, voluntary and occasional and does not create any contractual or other right to receive future awards of PRUs, or benefits in lieu of PRUs even if PRUs have been awarded in the past;

c. all decisions with respect to future grants of PRUs, if any, will be at the sole discretion of the Company;

d. the Participant’s participation in the Plan is voluntary;

e. the PRUs and the Shares subject to the PRUs, and the income and value of same, are not intended to replace any pension rights or compensation;

f. the Participant’s participation in the Plan will not create or amend a right to further employment with the Company or, if different, the Participant’s actual employer (the “ Employer ”) and shall not interfere with the ability of the Employer to terminate Participant’s service at any time with or without cause;

g. PRUs are an extraordinary item that do not constitute compensation of any kind for services of any kind rendered to the Company or to the Employer, and PRUs are outside the scope of the Participant’s employment contract, if any;

h. PRUs and the Shares subject to the PRUs, and the income and value of same, are not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculation of any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;

i. unless otherwise agreed with the Company, the PRUs and the Shares subject to the PRUs, and the income and value of same, are not granted as consideration for, or in consideration with, the service the Participant may provide as a director of a Subsidiary or Affiliate;

j. in the event that Participant is not an employee of the Company, the grant of PRUs will not be interpreted to form an employment contract or relationship with the Company; and furthermore, the grant of PRUs will not be interpreted to form an employment contract with any Subsidiary or Affiliate;

k. the future value of the underlying Shares is unknown, indeterminable and cannot be predicted with certainty;

 

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l. if the Participant receives Shares upon vesting, the value of such Shares acquired on vesting of PRUs may increase or decrease in value;

m. in consideration of the grant of PRUs, no claim or entitlement to compensation or damages arises from termination of the PRUs or diminution in value of the PRUs or Shares received upon vesting of PRUs resulting from Termination of the Participant’s service by the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such claim;

n. neither the Company, the Employer nor any Parent, Subsidiary or Affiliate shall be liable for any foreign exchange rate fluctuation between the Participant’s local currency and the United States Dollar that may affect the value of the PRUs or of any amounts due to the Participant pursuant to the settlement of the PRUs or the subsequent sale of any Shares acquired upon settlement;

o. the Company is not providing any tax, legal or financial advice, nor is the Company making any accommodations regarding the Participant’s participation in the Plan; and

p. the Participant should consult with his or her own personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to the Plan.

 

2. Data Privacy Notice and Consent .

a. The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement by and among, as applicable, the Employer, the Company, its Parent, its Subsidiaries and its Affiliates for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

b. The Participant understands that the Company and the Employer may hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all PRUs or any other entitlement to Shares awarded, canceled, vested, unvested or outstanding in the Participant’s favor (“Data”), for the purpose of implementing, administering and managing the Plan.

c. The Participant understands that Data may be transferred to E*Trade Financial Corporate Services, Inc. and its affiliated companies (“E*Trade”), or such other stock plan service provider as may be selected by the Company in the future, which is assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Participant’s country, or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Participant authorizes the Company, E*Trade, and any other recipients of Data which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in

 

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electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker, escrow agent or other third party with whom the Shares received upon vesting of the PRUs may be deposited. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage his or her participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. Further, the Participant understands that he or she is providing the consents herein on a purely voluntary basis. If the Participant does not consent, or if the Participant later seeks to revoke his or her consent, the Participant’s employment or service status with the Employer will not be affected; the only consequence of refusing or withdrawing the Participant’s consent is that the Company would not be able to grant the PRUs or other equity awards to the Participant or administer or maintain such awards. Therefore, the Participant understands that refusing or withdrawing his or her consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of his or her refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative.

3. Language . If the Participant has received this Agreement or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version, the English version will control.

4. Insider Trading Restrictions/Market Abuse Laws . The Participant acknowledges that the Participant may be subject to insider trading restrictions and/or market abuse laws, which may affect the Participant’s ability to acquire or sell Shares or rights to Shares ( e.g. , PRUs) under the Plan during such times as the Participant is considered to have “inside information” (as defined by the laws in the Participant’s country). The insider trading and/or market abuse laws may be different from any Company Insider Trading Policy. The Participant is responsible for ensuring compliance with any applicable restrictions and should consult his or her personal legal advisor on this matter.

5. Foreign Asset/Account and Exchange Control Reporting . The Participant’s country may have certain exchange controls and foreign asset and/or account reporting requirements which may affect his or her ability to purchase or hold Shares under the Plan or receive cash from his or her participation in the Plan (including from any dividends received or sale proceeds arising from the sale of Shares) in a brokerage or bank account outside the Participant’s country. The Participant may be required to report such accounts, assets or transactions to the tax or other authorities in his or her country. Further, the Participant may be required to repatriate Shares or proceeds acquired as a result of participating in the Plan to his or her country through a designated bank/broker and/or within a certain time. The Participant acknowledges and agrees that it is his or her responsibility to be compliant with such regulations and understands that the Participant should speak with his or her personal legal advisor for any details regarding any foreign asset/account reporting or exchange control reporting requirements in the Participant’s country arising out of his or her participation in the Plan.

 

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APPENDIX D

COUNTRY-SPECIFIC TERMS

Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement or the Plan.

This Appendix D includes country-specific terms that govern the PRUs granted to the Participant if the Participant resides and/or works in one of the countries listed herein. If the Participant is a citizen or resident of a country other than the one in which the Participant is currently residing and/or working, transfers residency and/or employment after the PRUs are granted, or is considered a resident of another country for local law purposes, the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall be applicable to the Participant.

 

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APPENDIX D

ADDENDUM

ISRAEL

FIREGLASS LTD.

2015 SHARE INCENTIVE PLAN

PRU AWARD AGREEMENT

FOR NON-U.S. EMPLOYEES

PRUs Payable Only in Shares

PRUs granted to Participants residing in Israel shall be paid in Shares only. In no event shall any of such PRUs be paid in cash, notwithstanding any discretion contained in the Plan, or any provision in the Agreement to the contrary.

Trust Arrangement

The Participant understands and agrees that this Award is offered subject to and in accordance with the terms of the Plan. This Award is intended to qualify as a 102 Capital Gains Track Award as such term is defined in the Plan. The Award shall be deposited with the Company’s trustee appointed by the Company or its Parent, Subsidiary or Affiliate in Israel for such purpose and approved by the Israeli Tax Authority (the “ Trustee ”) for the Participant’s benefit in accordance with the Plan. The Shares resulting from the vesting of such Awards shall be controlled by the Trustee. The Awards shall be deposited with the Trustee and the underlying Shares controlled by the Trustee as aforementioned, for at least such period of time as required by Section 102 (currently two years from the 102 Capital Gains Track Award’s date of grant) or any shorter period determined under the Israeli Income Tax Ordinance (New Version) 1961 as now in effect or as hereafter amended (the “ Ordinance ”) or by the Israeli Tax Authority (the “ Minimum Trust Period ”). In the event that bonus Shares or dividends in the form of additional RSUs or PRUs or Shares are issued with respect to the Shares held with the Trustee, or as a result of an adjustment made pursuant to the Plan, such RSUs or PRUs or Shares shall be deposited or controlled by the Trustee, as the case may be, for the benefit of the Participant and the provisions of Section 102 of the Ordinance and the Income Tax (Tax Benefits on the Grant of Shares to Employees) Regulations 2003 shall apply to such RSUs or PRUs or Shares for all purposes. In general, taxable income that should be attributed to the Participant as a result of the grant of the RSUs or PRUs will be tax-free on the date of grant, but will be taxed on the sale of Shares issued upon the vesting of the RSUs or PRUs or transfer of Shares from the Trustee to the Participant (a “ Transfer ”). In accordance with the capital gains tax route of Section 102(b)(3) of the Ordinance, if the Awards and underlying Shares are held in trust by the Trustee for the Minimum Trust Period gains derived from the sale of Shares shall be eligible to a preferential tax treatment (i.e. classified as capital gains and taxed at a rate of only 25%, except, if relevant, with regard to a benefit derived at the time of grant of the RSUs or PRUs, equal to the difference between (a) the average closing price of the Company’s Share on a stock exchange during 30 trading days prior to the date of grant, and (b) the purchase price paid per each underlying Share, if any). By the Participant’s acceptance of the Agreement, the Participant; (a) acknowledges receipt of and represents that the Participant has read and is familiar with the Agreement and the Plan and the specific provisions for Israeli Participants; (b) accepts the Award subject to all of the terms and conditions of the Agreement and the

 

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Plan and the Appendix for Israeli Participants; (c) accepts the provisions of the trust deed signed between the FireGlass and/or the Company and the Trustee. The trust deed shall be delivered to the Participant upon request. The conditions of the trust deed apply to the Award; thus, the Participant is required to carefully read the provisions of the said trust deed. Furthermore, by Participant’s acceptance of the Agreement, Participant confirms that he or she is familiar with the terms and provisions of Section 102 of the Ordinance, and agrees that he/she will not require the Trustee to release the Awards or Shares to him or her, including any rights issued to the Participant as a consequence of holding such Awards or Shares, or to sell the Awards or Shares to a third party during the Minimum Trust period, unless permitted to do so by applicable law. Without derogating from the aforementioned, if the Awards or Shares are released or sold by the Trustee during the Minimum Trust Period, the sanctions under Section 102 of the Ordinance shall apply to and be borne by the Participant. The Shares shall not be sold or released from the control of the Trustee unless the Company, the employing Parent, Subsidiary or Affiliate and the Trustee are satisfied that the full amount of tax obligations due have been paid or will be paid in relation thereto.

 

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