State of Israel | | | 7389 | | | Not applicable |
(State or other jurisdiction of incorporation or organization) | | | (Primary Standard Industrial Classification Code Number) | | | (I.R.S. Employer Identification Number) |
Jeffrey A. Brill Maxim O. Mayer-Cesiano Andrea L. Nicolás B. Chase Wink Skadden, Arps, Slate, Meagher & Flom LLP One Manhattan West New York, NY 10001 Tel: 212-735-3000 | | | Aaron M. Lampert Sharon Gazit Goldfarb Seligman & Co. 98 Yigal Alon Street Tel Aviv 6789141 Israel Tel: 972-3-608-9999 | | | Mark A. Brod Jonathan Corsico Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, NY 10017 Tel: 212-455-2000 | | | Ory Nacht Michal Herzfeld Herzog Fox & Neeman 6 Yitzhak Sadeh St. Herzog Tower Tel Aviv 6777506 Israel Tel: 972-3-692-2020 |
Exhibit Number | | | Description |
| | | Agreement and Plan of Merger, dated as of September 15, 2021, by and among Pagaya Technologies Ltd., EJF Acquisition Corp. and Rigel Merger Sub Inc. | |
| | | Amended and Restated Articles of Association of Pagaya Technologies Ltd. (as currently in effect) | |
| | | Form of Amended and Restated Articles of Association of Pagaya Technologies Ltd. (to be effective upon consummation of the Merger) | |
| | | Amended and Restated Memorandum and Articles of EJF Acquisition Corp. (incorporated by reference to Exhibit 3.1 of EJF Acquisition Corp.’s Current Report on Form 8-K filed with the SEC on February 24, 2021) | |
| | | Specimen Unit Certificate of EJF Acquisition Corp. (incorporated by reference to Exhibit 4.1 of EJF Acquisition Corp.’s Amendment No. 3 to Form S-1 filed with the SEC on February 18, 2021) | |
| | | Specimen Class A Common Stock Certificate of EJF Acquisition Corp. (incorporated by reference to Exhibit 4.2 of EJF Acquisition Corp.’s Amendment No. 3 to Form S-1 filed with the SEC on February 18, 2021) | |
| | | Specimen Warrant Certificate of EJF Acquisition Corp. (incorporated by reference to Exhibit 4.3 of EJF Acquisition Corp.’s Amendment No. 3 to Form S-1 filed with the SEC on February 18, 2021) | |
| | | Warrant Agreement, dated as of February 24, 2021, between Continental Stock Transfer & Trust Company and EJF Acquisition Corp. (incorporated by reference to Exhibit 4.1 of EJF Acquisition Corp.’s Current Report on Form 8-K filed with the SEC on February 24, 2021) | |
| | | Specimen Common Share Certificate of Pagaya Technologies Ltd. | |
| | | Specimen Warrant Certificate of Pagaya Technologies Ltd. | |
| | | Form of Assignment, Assumption and Amendment Agreement, by and among Pagaya Technologies Ltd., EJF Acquisition Corp. and Continental Stock Transfer & Trust Company | |
| | | Registration and Shareholder Rights Agreement, by and among EJF Acquisition Corp., Wilson Boulevard LLC and certain security holders (incorporated by reference to Exhibit 10.3 of EJF Acquisition Corp. Current Report on Form 8-K filed with the SEC on March 1, 2021) | |
| | | Form of Registration Rights Agreement (to be effective upon consummation of the Merger) | |
| | | Opinion of Goldfarb Seligman & Co. as to the validity of Pagaya Ordinary Shares to be issued | |
| | | Opinion of Skadden, Arps, Slate, Meagher & Flom LLP as to the validity of the Pagaya Warrants to be issued | |
| | | Investment Management Trust Agreement, dated as of February 24, 2021, by and between Continental Stock & Trust Company and EJF Acquisition Corp. (incorporated by reference to Exhibit 10.2 of EJF Acquisition Corp.’s Current Report on Form 8-K filed with the SEC on February 24, 2021) | |
| | | Administrative Services Agreement, dated as of February 24, 2021, by and between EJF Acquisition Corp. and Wilson Boulevard LLC (incorporated by reference to Exhibit 10.5 of EJF Acquisition Corp’s Current Report on Form 8-K filed with the SEC on February 24, 2021) | |
| | | Letter Agreement, dated as of February 24, 2021, by and among EJF Acquisition Corp., Wilson Boulevard LLC and each of EJF Acquisition Corp.’s officers and directors (incorporated by reference to Exhibit 10.4 of EJF Acquisition Corp.’s Current Report on Form 8-K filed with the SEC on February 24, 2021) | |
| | | EJFA Voting Agreement, dated as of September 15, 2021, by and between Pagaya Technologies Ltd. and Wilson Boulevard LLC (included as Annex G to the proxy statement/prospectus) | |
| | | Pagaya Voting Agreement, dated as of September 15, 2021, by and among EJF Acquisition Corp., Pagaya Technologies Ltd., and certain of Pagaya Technologies Ltd.’s shareholders (included as Annex F to the proxy statement/prospectus) |
Exhibit Number | | | Description |
| | | Side Letter Agreement, dated as of September 15, 2021, by and between Pagaya Technologies Ltd., EJF Acquisition Corp. and Wilson Boulevard LLC (included as Annex E to the proxy statement/prospectus) | |
| | | Subscription Agreement, dated as of September 15, 2021, by and between Pagaya Technologies Ltd. and EJFA Debt Opportunities Master Fund, LP (included as Annex D to the proxy statement/prospectus) | |
| | | Form of Subscription Agreement | |
| | | Pagaya Technologies Ltd.’s 2016 Equity Incentive Plan | |
| | | Pagaya Technologies Ltd. 2016 Equity Incentive Plan Stock Option Sub-Plan for United States Persons | |
| | | Pagaya Technologies Ltd.’s 2021 Equity Incentive Plan | |
| | | Pagaya Technologies Ltd. 2021 Equity Incentive Plan Stock Option Sub-Plan for United States Persons | |
| | | Form of Pagaya Technologies Ltd.’s 2022 Share Incentive Plan | |
| | | Form of Pagaya Technologies Ltd. Indemnification, Insurance and Exculpation Undertaking | |
| | | Credit Agreement, dated as of December 23, 2021, by and among Pagaya Technologies Ltd., the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent | |
| | | Amendment No. 1 to Credit Agreement, dated as of March 15, 2022, by and among Pagaya Technologies Ltd., the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as administrative agent | |
| | | Pagaya Technologies Ltd. Compensation Policy for Executive Officers and Directors | |
| | | Pagaya Technologies Ltd. 2022 Share Incentive Plan (Sub-plan for Israeli Participants) | |
| | | List of subsidiaries of Pagaya Technologies Ltd. | |
| | | Consent of Ernst & Young Global Limited, independent registered accounting firm for Pagaya Technologies Ltd. | |
| | | Consent of Marcum LLP, independent registered accounting firm for EJF Acquisition Corp. | |
| | | Consent of Goldfarb Seligman & Co. (included in Exhibit 5.1) | |
| | | Consent of Skadden, Arps. Slate, Meagher & Flom LLP (included in Exhibit 5.2) | |
| | | Consent of Duff & Phelps, financial advisor to EJF Acquisition Corp. | |
| | | Power of Attorney (included on signature page to the initial filing of the Registration Statement) | |
| | | Form of Proxy Card for Special Meeting | |
| | | Consent of Emanuel J. Friedman to be named as a director | |
| | | Filing Fee Table |
* | Previously filed. |
† | Certain schedules or similar attachments to this Exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of all omitted schedules or similar attachments to the SEC upon its request. |
†† | Certain identified information has been redacted from the exhibit in accordance with Item 601(b)(10) of Regulation S-K. The Company agrees to furnish supplementally an unredacted copy of the exhibit to the SEC upon its request. |
††† | Indicates a management contract or compensatory plan. |
| | | PAGAYA TECHNOLOGIES LTD. | |||||||
| | | | | | | ||||
| | | By: | | | /s/ Gal Krubiner | ||||
| | | | | Name: | | | Gal Krubiner | ||
| | | | | Title: | | | Chief Executive Officer | ||
| | | By: | | | /s/ Michael Kurlander | ||||
| | | | | Name: | | | Michael Kurlander | ||
| | | | | Title: | | | Chief Financial Officer | ||
NAME | | | POSITION | | | DATE |
| | | | | |||
/s/ Gal Krubiner | | | Chief Executive Officer and Board Member (Principal Executive Officer) | | | May 18, 2022 |
Gal Krubiner | | | ||||
| | | | | |||
* | | | Chief Financial Officer (Principal Financial Officer) | | | May 18, 2022 |
Michael Kurlander | | | ||||
| | | | | |||
* | | | Chief Accounting Officer (Principal Accounting Officer) | | | May 18, 2022 |
Scott Bower | | | ||||
| | | | | |||
* | | | Chairman | | | May 18, 2022 |
Avi Zeevi | | | ||||
| | | | | |||
* | | | Board Member | | | May 18, 2022 |
Amy Pressman | | | ||||
| | | | | |||
* | | | Board Member | | | May 18, 2022 |
Harvey Golub | | | ||||
| | | | | |||
* | | | Chief Technology Officer and Board Member | | | May 18, 2022 |
Avital Pardo | | | ||||
| | | | | |||
* | | | Board Member | | | May 18, 2022 |
Dan Petrozzo | | | ||||
| | | | | |||
* | | | Board Member | | | May 18, 2022 |
Mircea Ungureanu | | | ||||
| | | | | |||
* | | | Chief Revenue Officer and Board Member | | | May 18, 2022 |
Yahav Yulzari | | | ||||
| | | | | |||
/s/ Gal Krubiner | | | Attorney-In-Fact | | | May 18, 2022 |
Gal Krubiner | |
| | | Pagaya US Holding Company LLC | |||||||
| | | | | | | ||||
| | | By: | | | /s/ Gal Krubiner | ||||
| | | | | Name: | | | Gal Krubiner | ||
| | | | | Title: | | | Authorized Person | ||
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|
EXHIBITS
|
|||
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Exhibit A
|
| |
SPAC Voting Agreement
|
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Exhibit B
|
| |
Company Voting Agreement
|
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Exhibit C
|
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Form of Incentive Equity Plan
|
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Exhibit D
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Form of Registration Rights Agreement
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Exhibit E
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Form of Amended and Restated Articles of Association
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Exhibit F
|
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Form of Plan of Merger
|
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Exhibit G
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Form of Memorandum of Association of the Surviving Company
|
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Exhibit H
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Residency Notice
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if to SPAC, to:
|
||||||
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EJF Acquisition Corp.
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2107 Wilson Boulevard
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Suite 410
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Arlington, VA 22201
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Attention:
|
| |
Kevin Stein
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Email:
|
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*@ejfcap.com
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||||||
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with a copy to (which shall not constitute notice):
|
||||||
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Simpson Thacher & Bartlett LLP
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900 G Street, NW
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Washington, D.C. 20001
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Attention:
|
| |
Jonathan Corsico
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Email:
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jonathan.corsico@stblaw.com
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| ||||||||
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and
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||||||
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Simpson Thacher & Bartlett LLP
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425 Lexington Avenue
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New York, NY 10017
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Attention:
|
| |
Mark Brod; Michael Wolfson
|
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Email:
|
| |
mbrod@stblaw.com; mwolfson@stblaw.com
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||||||
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and
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||||||
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||||||
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Herzog Fox & Neeman
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Herzog Tower, 6 Yitzhak Sadeh Street
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Tel Aviv 6777506, Israel
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Attention:
|
| |
Ory Nacht, Adv.
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Email:
|
| |
nachto@herzoglaw.co.il
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||||||
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and
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||||||
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||||||
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| |
Walkers
|
|||
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| |
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| |
190 Elgin Avenue
|
|||
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| |
George Town, Grand Cayman
|
|||
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| |
KY1-9001
|
|||
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| |
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| |
Cayman Islands
|
|||
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| |
|
| |
Attention:
|
| |
Andrew Barker
|
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| |
|
| |
Email:
|
| |
andrew.barker@walkersglobal.com
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|
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| |
|
||||||
|
|
| |
if to the Company or Merger Sub to:
|
||||||
|
|
| |
|
||||||
|
|
| |
|
| |
Pagaya Technologies Ltd.
|
|||
|
|
| |
|
| |
90 Park Ave,
|
|||
|
|
| |
|
| |
New York, NY 10016
|
|||
|
|
| |
|
| |
Attention:
|
| |
Gal Krubiner
|
|
|
| |
|
| |
|
| |
Richmond Glasgow
|
|
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| |
|
| |
Email:
|
| |
*@pagaya-inv.com
|
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| |
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| |
|
| |
*@pagaya.com
|
|
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| |
|
||||||
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|
| |
with a copy to (which shall not constitute notice):
|
||||||
|
|
| |
|
||||||
|
|
| |
|
| |
Skadden, Arps, Slate, Meagher & Flom LLP
|
|||
|
|
| |
|
| |
One Manhattan West
|
|||
|
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| |
|
| |
New York, NY 10001
|
|||
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| |
|
| |
Attention:
|
| |
Jeffrey A. Brill
|
|
|
| |
|
| |
|
| |
Maxim Mayer-Cesiano
|
|
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| |
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| |
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| |
B. Chase Wink
|
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| |
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| |
Email:
|
| |
jeffrey.brill@skadden.com
|
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| |
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| |
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| |
maxim.mayercesiano@skadden.com
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| |
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| |
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| |
b.chase.wink@skadden.com
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| |
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||||||
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| |
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| |
Goldfarb Seligman & Co.
|
|||
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| |
|
| |
98 Yigal Alon Street
|
|||
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| |
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| |
Tel Aviv
|
|||
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| |
|
| |
6789141
|
|||
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| |
|
| |
Israel
|
|||
|
|
| |
|
| |
Attention:
|
| |
Aaron M. Lampert
|
|
|
| |
|
| |
|
| |
Sharon Gazit
|
|
|
| |
|
| |
Email:
|
| |
aaron.lampert@goldfarb.com
|
|
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| |
|
| |
|
| |
sharon.gazit@goldfarb.com
|
|
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| |
|
||||||
|
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| |
and
|
||||||
|
|
| |
|
||||||
|
|
| |
|
| |
Maples and Calder (Cayman) LLP
|
|||
|
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| |
|
| |
PO Box 309, Ugland House
|
|||
|
|
| |
|
| |
Grand Cayman
|
|||
|
|
| |
|
| |
KY1-1104
|
|||
|
|
| |
|
| |
Cayman Islands
|
|||
|
|
| |
|
| |
Attention:
|
| |
Suzanne Correy
|
|
|
| |
|
| |
Email:
|
| |
Suzanne.Correy@maples.com
|
|
|
| |
PAGAYA TECHNOLOGIES LTD.
|
||||||
|
|
| |
|
| |
|
| |
|
|
|
| |
By:
|
| |
/s/ Avi Zeevi
|
|||
|
|
| |
|
| |
Name:
|
| |
Avi Zeevi
|
|
|
| |
|
| |
Title:
|
| |
Chairman of the Board of Directors
|
|
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| |
|
| |
|
| |
|
|
|
| |
By:
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/s/ Gal Krubiner
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Name:
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Gal Krubiner
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Title:
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Chief Executive Officer
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RIGEL MERGER SUB INC.
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By:
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/s/ Gal Krubiner
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Name:
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Gal Krubiner
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Title:
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Director
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EJF ACQUISITION CORP.
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By:
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/s/ Kevin Stein
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Name:
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Kevin Stein
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Title:
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Chief Executive Officer
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1
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The constituent companies (as defined in the Statute) to this Merger are the Surviving Company and the Merging Company.
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2
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The surviving company (as defined in the Statute) is the Surviving Company.
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3
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The registered office of the Surviving Company is Walkers Corporate Limited, 190 Elgin Avenue, George Town, Grand Cayman KY1-9008,
Cayman Islands and the registered office of the Merging Company is c/o Maples Corporate Services Limited of PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.
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4
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Immediately prior to the Effective Date (as defined below), the share capital of the Surviving Company will be US$55,500 divided
into 500,000,000 Class A ordinary shares of a par value of US$0.0001 each, 50,000,000 Class B ordinary shares of a par value of US$0.0001 each and 5,000,000 preference shares of a par value of US$0.0001 each.
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5
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Immediately prior to the Effective Date (as defined below), the share capital of the Merging Company will be US$50,000 divided
into 50,000 shares of a par value of US$1.00 each.
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6
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The date on which it is intended that the Merger is to take effect is the date that this Plan of Merger is registered by the
Registrar in accordance with section 233(13) of the Statute (the “Effective Date”).
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7
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The terms and conditions of the Merger, including the manner and basis of converting shares in each constituent company into
shares in the Surviving Company, are set out in the Merger Agreement in the form annexed at Annexure 1 hereto.
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8
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The rights and restrictions attaching to the shares in the Surviving Company are set out in the Amended and Restated Memorandum
and Articles of Association of the Surviving Company in the form annexed at Annexure 2 hereto.
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9
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The Memorandum and Articles of Association of the Surviving Company shall be amended and restated by the deletion in their
entirety and the substitution in their place of the Amended and Restated Memorandum and Articles of Association in the form annexed at Annexure 2 hereto on the Effective Date.
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10
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There are no amounts or benefits which are or shall be paid or payable to any director of either constituent company or the
Surviving Company consequent upon the Merger.
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11
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The Merging Company has granted no fixed or floating security interests that are outstanding as at the date of this Plan of
Merger.
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12
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The Surviving Company has granted no fixed or floating security interests that are outstanding as at the date of this Plan of
Merger.
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13
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The names and addresses of each director of the surviving company (as defined in the Statute) are:
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14
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This Plan of Merger has been approved by the board of directors of each of the Surviving Company and the Merging Company pursuant
to section 233(3) of the Statute.
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15
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This Plan of Merger has been authorised by the shareholders of each of the Surviving Company and the Merging Company pursuant to
section 233(6) of the Statute by way of resolutions passed at an extraordinary general meeting of the Surviving Company and written resolutions of the sole shareholder of the Merging Company, as applicable.
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16
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At any time prior to the Effective Date, this Plan of Merger may be:
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(a)
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change the Effective Date provided that such changed date shall not be a date later than the ninetieth day after the date of
registration of this Plan of Merger with the Registrar of Companies; and
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(b)
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effect any other changes to this Plan of Merger which the board of directors of both the Surviving Company and the Merging Company
expressly authorise.
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17
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This Plan of Merger may be executed in counterparts.
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18
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This Plan of Merger shall be governed by and construed in accordance with the laws of the Cayman Islands.
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SIGNED by
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)
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Duly authorised for
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)
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and on behalf of
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)
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Director
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EJF Acquisition Corp.
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)
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SIGNED by
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)
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Duly authorised for
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)
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and on behalf of
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)
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Director
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Rigel Merger Sub Inc.
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)
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Exhibit 3.1
The Companies Law, 5759-1999
A Company Limited By Shares
Amended And Restated Articles Of Association
of
PAGAYA TECHNOLOGIES LTD.
Dated March 17, 2021
PRELIMINARY
| 1. | Company’s Objectives. |
| 1.1 | The Company is a private company. |
| 1.2 | The objects for which the Company is founded are to engage in any business, commercial, industrial or other activity of any kind, which is not legally prohibited or restricted by law. |
| 1.3 | The Company may contribute reasonable amounts for any suitable purpose or categories of purpose even if such contributions do not fall within business considerations of the Company. The Board may determine the amounts of the contributions, the purpose or category of purposes for which the contribution is to be made, and the identity of the recipients of any contribution. |
| 2. | Interpretation |
| 2.1 | In these Articles, unless the context otherwise requires: |
| Affiliate | means an entity or person, which, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such transferor-shareholder. For the purpose of these Articles, “Control” shall mean the holding of more than 50% of the equity or voting rights, voting control, or power to influence in an entity or the right to appoint a majority of its board of directors or other equivalent body, whether directly or indirectly through voting agreements or otherwise. The term “Controlled” shall have a correlative meaning. |
| Articles or the | |
| Articles | |
| of Associations | means these Amended and Restated Articles of Association of the Company, as they may be amended and replaced from time to time. |
| Board or the | |
| Board | |
| of Directors | means the Board of Directors of the Company elected or properly appointed in accordance with the provisions of these Articles of Association; any committee of the Board of Directors to the extent that any of the authorities of the Board of Directors are delegated to it. |
| Business Day | means a day on which commercial banks in Israel are required to be open for business. |
| Clal | means Clal Insurance Company Ltd. (Nostro) (in Hebrew: כ׌׌ חברה ׌בי×~וח בע”מ (עבור × ×•×¡×~רו)), Clal Insurance Company Ltd. (for the benefit of participating insurance policies under its management)(in Hebrew: כ׌׌ חברה ׌בי×~וח בע”מ (עבור פו׌יסות משתתפות ×‘× ×™×”×•×Œ×”)), Clal Pension and Provident Funds Ltd. (for the benefit of provident funds and pension funds under its management) (in Hebrew: כ׌׌ ×¤× ×¡×™×” וגמ׌ בע”מ (עבור קופות גמ׌ ×•×§×¨× ×•×ª ×¤× ×¡×™×” ×‘× ×™×”×•×Œ×”)), “Atudot” – Pension Fund for Employees and Independents Ltd. (for the benefit of pension funds under its management)(in Hebrew:“עתודות” - קרן ×¤× ×¡×™×” ×Œ×©×›×™×¨×™× ×•×¢×¦×ž××™×™× ×‘×¢”מ (עבור ×§×¨× ×•×ª ×¤× ×¡×™×” ×‘× ×™×”×•×Œ×”) |
| Clal Insurance Company Ltd. (for the benefit of participating insurance policies under its management), Clal Pension and Provident Funds Ltd. (for the benefit of provident funds and pension funds under its management) and “Atudot” — Pension Fund for Employees and Independents Ltd. (for the benefit of pension funds under its management) shall be referred to herein collectively as the “Clal Pension Funds”. | |
| Companies Law | means the Companies Law, 5759-1999 or any law, which may replace or amend it, as shall be in force from time to time. |
| Companies | |
| Ordinance | means those sections of the Companies Ordinance [New Version] 5743 — 1983 that remain in force after the date of the coming into force of the Companies Law, as the same shall be amended from time to time thereafter, or any other law which shall replace those sections after the date of entry into force of the Companies Law. |
| Company | means Pagaya Technologies Ltd. |
| Coral Blue | means Coral Blue Investment Pte. Ltd. |
| Deemed | |
| Liquidation | means (i) a merger, consolidation, recapitalization or similar event of the Company with or into another corporation in a single transaction or a series of transactions as a result of which the Shareholders of the Company immediately prior to such transaction do not own in such capacity a majority of the voting securities of the surviving entity or the parent of the surviving entity, (ii) a sale or grant of an exclusive, perpetual, worldwide license (other than the license in the ordinary course of business, which does not amount to a de facto sale of all or substantially all of the Company) or other disposition of all or substantially all of the intellectual property rights of the Company, or all or substantially all of the Company’s assets, in each case, other than to a wholly-owned subsidiary of the Company, (iii) a sale of all or substantially all of the Shares of the Company or the sale of all or substantially all of the shares of one or more subsidiaries of the Company that own(s) all or substantially all of the aggregate assets of the Company and its subsidiaries taken as a whole, other than to a wholly-owned subsidiary of the Company, or (iv) any transaction or series of related transactions as a result of which at least 50% of the Shares of the Company are transferred to any third party; in all cases, other than the issuance of Shares of the Company solely for financing purposes. |
| Director or | |
| Directors | means a member or members of the Board of Directors who are elected or appointed in accordance with the provisions of these Articles of Association, including an Alternate Director serving in such capacity at the relevant time. |
| Founders | Gal Krubiner, Avital Pardo and Yahav Yulzari. |
| GF | Means Saro, L.P., Jim Brown and Golub Investments, LP. |
| GF shall have the right to assign and allocate any of its rights under these Articles to any of the above-mentioned member(s) of GF and shall not be required to do so on a proportionate basis; provided that the member(s) of GF holding the majority of the issued and outstanding share capital of the Company shall be deemed as a representative(s) of all the GF members for the purpose of administering or exercising any specific right under these Articles and any notice provided by such representative(s) shall be binding upon all the members of GF. |
| GIC Entities | means Coral Blue and Radiance. |
| IPO | means the consummation of the initial underwritten public offering or a direct listing of the Company’s securities pursuant to an effective registration statement under the U.S. Securities Act of 1933, as amended, or under any other applicable securities law that results in a class of the Company’s equity securities being listed on a United States national securities exchange. |
| Minimum | |
| Share | |
| Threshold | means 3.0% of the Company’s issued and outstanding share capital on an as converted basis (except that as to GF and the New Investors Group, it shall be understood to mean 2.5% of the Company’s issued and outstanding share capital on an as converted basis), excluding (both in the numerator and the denominator) (i) any shares issued by the Company which are Excluded Securities, (ii) any Additional Shares issued by the Company which do not result in an adjustment under Article 7.2.5 and (iii) any other shares issued or sold by the Company where the Preferred Shareholders do not have a right to purchase their pro-rata share of such shares. |
| New Investors | |
| Group | Viola 4 P, Limited Partnership, Poalim Ventures Ltd., SCB 10X Company Limited and Aflac Ventures LLC. |
| All Shares held by any Shareholder of the New Investors Group shall be aggregated together for the purpose of determining the availability of rights under articles 12, 25, 26 and 44.7 for such Shareholders, including rights which are conditioned on the relevant Shareholder holding Shares representing a minimum percentage, etc. | |
| For the avoidance of doubt, no Shareholder of the New Investors Group shall be obligated in any manner to vote together with any other member of the New Investors Group, nor act in any manner as a group except as specifically set forth hereunder. | |
| New Securities | means shares of the Company, whether now authorized or not, and rights, options or warrants to purchase shares, and securities of any type whatsoever that are convertible into shares of the Company; provided, however, that the term “New Securities” does not include: (i) Ordinary Shares issued or reserved for issuance upon exercise of options granted under a plan or other arrangements approved by the Company’s Board of Directors and granted to officers, directors, employees or consultants of the Company or a subsidiary; (ii) issuances of securities pro-rata to all shareholders, as bonus shares or upon share splits, share dividends, reclassification and similar recapitalization events; (iii) securities issued upon the conversion of the Preferred Shares; (iv) securities issued in a Public Event; (v) (A) shares or securities issued to Viola Credit Five Fund, Limited Partnership pursuant to that certain warrant issued and delivered by the Company on November 20, 2017, as amended on March 4, 2019, (B) up to 3,348 Preferred D Shares issued to Coral Blue (or an affiliate thereof) pursuant to that certain warrant issued and delivered by the Company on June 1, 2020, (C) up to 23,434 Preferred D Shares issued to Radiance (or an affiliate thereof) pursuant to that certain warrant issued and delivered by the Company on June 1, 2020, and (D) up to 3,348 Preferred D Shares, which may be issued in two parts to Aflac Ventures LLC (or an affiliate thereof) pursuant to that certain warrant issued and delivered by the Company on June 1, 2020, and in accordance with the adjustment mechanism thereunder; (vi) those certain warrants issued pursuant to the Preferred E Share Purchase Agreement and any underlying shares issuable upon exercise thereof; and (vii) any shares or securities issued to a Strategic Party and exempt from the definition “New Securities” by a resolution adopted by the Preferred Majority, provided however that no member of the Preferred Majority consenting in writing to the exclusion of an issuance from the definition of “New Securities” (the “Waiving Shareholders”) shall, directly or indirectly (including through any person controlled by the Waiving Shareholders or any Permitted Transferee thereof), participate in the offering of those certain New Securities which were so excluded (provided, for the sake of clarification, that nothing herein shall be deemed as preventing the Waiving Shareholders from participating in an offering of securities in connection with a financing round in the framework of which such exclusion from the definition of “New Securities” is made, but provided further that all the Shareholders entitled to participate in the offering under Article 12 hereto shall have the opportunity to participate in the offering of securities as part of the financing round that were not so excluded by the Waiving Shareholders on a pro rata basis among them in accordance with the provisions of Article 12, mutatis mutandis) (such excluded securities in subsections (i) through (vi), the “Excluded Securities”). |
| It is clarified that the limitations on the ability of the Preferred Majority to exclude issuances of securities from the definition of “New Securities” provided for in subsection (vi) above do not apply to an investment by any entities belonging to the Viola Group, other than entities investing under the “Carmel” name or the “Viola Ventures” or the “Viola 4 P, Limited Partnership”, name, regardless of whether such entities change their names in the future. | |
| Oak | means HC/FT Partners II, L.P. |
| Office | means the registered office of the Company for the time being. |
| Ordinary | |
| Shareholder | means a holder of Ordinary Shares. |
| Ordinary | |
| Shares | means Ordinary Shares of the Company, nominal value NIS 0.01 each. |
| Ordinary | |
| Issue Price | means for the Preferred A Shares - US$ 3.3750, for the Preferred A-1 Shares - US$ 18.90, for the Preferred B Shares - US$ 35.810163, for the Preferred C Shares - US$ 72.5727, for the Preferred D Shares - US $149.3534, and for the Preferred E Shares – US $ 838.49, in each case as adjusted for any share splits, share combinations, distributions of bonus shares and other recapitalization events in accordance with Article 7.2. |
| Permitted | |
| Transferee | means as defined in Article 25.2 below. |
| Preferred A | |
| Shares | means Series A Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred A-1 | |
| Shares | means Series A Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred B | |
| Shares | means Series B Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred C | |
| Shares | means Series C Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred D | |
| Shares | means Series D Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred E | |
| Shares | means Series E Preferred Shares of the Company, nominal value NIS 0.01 each. |
| Preferred | |
| Shares | means the Preferred A Shares, the Preferred A-1 Shares, the Preferred B Shares, the Preferred C Shares, the Preferred D Shares, and the Preferred E Shares, as applicable. |
| Preferred | |
| Director(s) | means as defined in Article 44.1.4 below. |
| Preferred | |
| Majority | means the holders of a majority of the then outstanding Preferred Shares, voting together as a single class on an as converted basis. |
| Preferred C | |
| Majority | means the holders of a majority of the issued and outstanding Preferred C Shares, voting together as a single class (on an as converted basis). |
| Preferred D | |
| Majority | means the holders of a majority of the issued and outstanding Preferred D Shares, voting together as a single class (on an as converted basis). |
| Preferred E | |
| Majority | means the holders of a majority of the issued and outstanding Preferred E Shares, voting together as a single class (on an as converted basis). |
| Preferred | |
| Shareholder | means a holder of Preferred Shares. |
| Public Event | means either an IPO or the completion of a SPAC Transaction. |
| Radiance | means Radiance Star Pte. Ltd. |
| Register | means the register of Shareholders to be kept in accordance with the Companies Law, or, if the Company shall have any additional register(s) outside of Israel, any such additional register(s) as the case may be. |
| SCB | means The Siam Commercial Bank Public Company Limited and / or SCB 10X Company Limited. |
| Series E | |
| Closing | means the Closing under the Series E Preferred Share Purchase Agreement |
| Series E Preferred | |
| Share Purchase | |
| Agreement | means the Series E Preferred Share Purchase Agreement, by and among the Company and Tiger Global Private Investment Partners XIV, L.P. (or one or more affiliates thereof) (“Tiger”) and other purchasers, dated March 17, 2021. |
| Shares | shall have the meaning set forth in Article 5. |
| Shareholder | means any person that owns Shares, at any given time. |
| Shareholder | |
| Resolution | means a resolution adopted by holders of majority of the voting power of the Company represented, personally or by proxy, and voting with respect thereto (excluding abstentions), unless a different majority is required in respect to such matter pursuant to the Companies Law or these Articles at the time the resolution is voted on, in which case a “Shareholder Resolution” shall mean a resolution adopted by such required majority. |
| SPAC | means a newly formed special purpose acquisition entity, which (i) has been formed with the purpose of raising capital, (ii) has completed an initial public offering resulting in the equity interests of such entity being listed on a United States national securities exchange, and (iii) does not conduct any material business or maintain any material assets other than cash. |
| SPAC Transaction | means an acquisition, merger or other business combination pursuant between the Company and a SPAC (or a subsidiary thereof), provided that (i) the transaction shall result in a class of equity securities of the surviving parent entity being listed on a United States national securities exchange, and (ii) the Company or its shareholders shall receive a majority of the voting stock of the combined company as a result of the transaction consummated in connection therewith. |
| Strategic | |
| Investor | means an entity or person that, as determined by the Board in its reasonable good faith opinion, has or could have a substantial interest, or a potential substantial interest, in the business of the Company. |
| Viola | |
| Ventures | means Viola Ventures, IV (A) L.P., Viola Ventures, IV (B) L.P., Viola Ventures IV CEO Program, L.P. and/or Viola Ventures IV Principals Fund, L.P. |
| 2.2 | Subject to the provisions of this Article, in these Articles, unless the context otherwise requires, expressions used herein which are defined in the Companies Law, or any modification thereof in force at the date at which these Articles become binding upon the Company, shall have the meaning so defined. |
| 2.3 | In these Articles, words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine and words importing persons shall include bodies corporate. |
| 2.4 | Any Article in these Articles which provides for an arrangement which differs in whole or in part from any provision in the Companies Law or the Companies Ordinance, as the case may be, which can be stipulated against, amended or added to, in whole or with regard to specific matters or within specific limitations, in accordance with any law, shall be considered a stipulation against the provision of the Companies Law or Companies Ordinance, as the case may be, even if the actual stipulation is not specified in the said Article, and even if it is expressly stated in the Article (in whatever form) that the effectiveness of the Article is subject to the provisions of any law. |
| 2.5 | In the event of a contradiction between any Article and the provisions of any law that may not be stipulated against, amended or added to, the provisions of the said law shall prevail, provided that nothing thereby shall nullify or impair the effectiveness of these Articles in general or any other Article therein. |
| 2.6 | In the event that a Hebrew version of these Articles is filed with any regulatory or governmental agency, including the Israeli Registrar of Companies, then whether or not such Hebrew version contains signatures of Shareholders, such Hebrew version shall be considered solely a convenience translation and shall have no binding effect, as between the Shareholders of the Company and with respect to any third party. The English version shall be the only binding version of these Articles, and in the event of any contradiction or inconsistency between the meaning of the English version and the meaning of the Hebrew version of these Articles, the Hebrew version shall be disregarded, shall have no binding effect and shall have no impact on the interpretation of these Articles or any provision hereof. |
LIMITATION OF LIABILITY; PRIVATE COMPANY
| 3. | The Company is a private company limited by shares and therefore the liability of the Shareholders of the Company for the indebtedness of the Company shall be limited as follows: |
| 3.1 | Each Shareholder’s obligations to the Company’s obligations shall be limited to the payment of the nominal value of the shares held by such Shareholder, subject to the provisions of the Companies Law. |
| 3.2 | If at any time the Company shall issue shares with no nominal value, the liability of the Shareholders shall be limited to payment of the amount that the Shareholders should have paid to the Company in the respect of each share according to the conditions of issuance. |
| 4. | The Company is a private company, and: |
| 4.1 | The number of Shareholders of the Company (exclusive of persons who are in the employment of the Company and of persons who have been formerly in the employment of the Company and were, while in such employment, and have continued after such employment to be, Shareholders of the Company) is not to exceed fifty (50), but where two (2) or more persons hold one (1) or more share(s) in the Company jointly, they shall, for the purposes of this Article, be treated as a single Shareholder; |
| 4.2 | The right to transfer shares shall be restricted as hereinafter provided. |
| 4.3 | Any offer to the public to subscribe for any shares or debentures of the Company is prohibited. |
SHARE CAPITAL
| 5. | Authorized Share Capital. |
The share capital of the Company is 104,650 New Israeli Shekels (“NIS”), divided into an aggregate of 10,465,000 Shares designated as follows:
| (i) | 8,258,757 Ordinary Shares; |
| (ii) | 370,370 Preferred A Shares; |
| (iii) | 179,398 Preferred A-1 Shares; |
| (iv) | 412,554 Preferred B Shares; |
| (v) | 343,498 Preferred C Shares; |
| (vi) | 713,076 Preferred D Shares; |
| (vii) | 187,347 Preferred E Shares. |
The Ordinary Shares, the Preferred A Shares, the Preferred A-1 Shares, the Preferred B Shares the Preferred C Shares, the Preferred D Shares, and the Preferred E Shares shall be collectively referred to as the “Shares.” The powers, preferences, rights, restrictions and other matters relating to the Shares of the Company are as set forth in these Articles.
The Preferred A Shares, the Preferred A-1 Shares, the Preferred B Shares, the Preferred C Shares, the Preferred D Shares and the Preferred E Shares, unless specifically set forth in these Articles, shall (i) have all of the same rights and privileges and (ii) vote together as one class on all matters that may require the approval of a class of shareholders of the Company.
| 6. | Ordinary Shares. |
Subject to any provisions in these Articles conferring special preferences and rights, Ordinary Shares in respect of which all calls have been fully paid, shall confer on their holders the right to receive notices of, and to attend and to vote at, general meetings of the Company, the right to receive dividends and to participate in the distribution of the surplus assets of the Company upon its winding-up and certain other rights all as are specified in these Articles.
| 7. | Preferred Shares. |
The Preferred Shares shall confer upon the holders thereof all of the rights accruing to holders of Ordinary Shares and, in addition, shall confer the following rights and any other special rights contained in these Articles:
| 7.1 | Voting Rights. |
Subject to Article 41 and any other provision hereof conferring special rights as to voting, or restricting the right to vote, each holder of Preferred Share shall have one vote for each Ordinary Share which the Preferred Shares held by such holder of record could be converted into pursuant to Article 7.2 hereof, in every resolution, regardless to whether the vote thereon is conducted by a show of hands, by written consent in lieu of a meeting, or by any other mean, on all matters entitled to be voted on by the Shareholders of the Company or by the holders of Preferred Shares voting together as a single class on an as converted basis (except as otherwise expressly provided herein or as required by law).
| 7.2 | Conversion. |
| 7.2.1 | Right to Convert. Each Preferred Share shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, and without the payment of additional consideration by the holder thereof, into such number of fully paid and non-assessable Ordinary Shares as is determined by dividing the applicable Original Issue Price of such share by the Conversion Price (as defined below) of such share, in effect at the time of conversion. The initial Conversion Price of a Preferred Share shall be the applicable Original Issue Price thereof; provided, however, that each such Conversion Price shall be subject to adjustment as set forth in this Article 7.2 below (the “Conversion Price”). |
| 7.2.2 | Automatic Conversion. Each Preferred Share shall automatically be converted into Ordinary Shares as provided in sub-Article 7.2.3, upon the earlier of: (i) in the event that the Preferred Majority consents in writing to such conversion, provided, however, with respect to the conversion of the Preferred E Shares, the consent or affirmative vote of the Preferred E Majority shall be required unless such conversion occurs in connection with a transaction pursuant to which the holders of Preferred E Shares receive consideration per Preferred E Share at least equal to the Preferred E Preference Amount; or (ii) mandatorily immediately prior to the closing of a Public Event, subject to the consummation of such Public Event. |
| 7.2.3 | Mechanism of Conversion |
| (i) | A conversion of Preferred Shares pursuant to the election of the holder thereof, shall be made by the surrender of the applicable certificate or certificates for such Preferred Shares, at the principal office of the Company, together with written notice of the election to convert all or any number of the Preferred Shares represented by such certificate or certificates and, if applicable, any event on which such conversion is contingent. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the certificate representing the Preferred Shares to be converted, and the person(s) entitled to receive the Ordinary Shares into which the Preferred Shares are convertible shall be treated for all purposes as the record holder(s) of such Ordinary Shares as of such date. |
| (ii) | If the conversion is in connection with a Public Event, the conversion will occur upon the closing of the sale of securities pursuant to the IPO or the closing of the SPAC Transaction, as applicable. |
| (iii) | If the conversion is an automatic conversion, then the conversion shall be deemed to have taken place automatically regardless of whether the certificates representing such Shares have been tendered to the Company, but from and after such conversion any such certificates not tendered to the Company shall be deemed to evidence solely the Ordinary Shares received upon such conversion and the right to receive a certificate for such Ordinary Shares. |
| (iv) | The Company shall, as soon as practicable after the conversion and tender of the certificates for the Preferred Shares converted, issue and deliver to the holder(s) of such Preferred Shares, a certificate or certificates for the number of Ordinary Shares into which such Preferred Shares are then convertible. |
| (v) | To the extent required, each conversion shall be made by converting or reclassifying the applicable Preferred Share into one fully paid and non-assessable Ordinary Share and the Company shall, at such time, issue to the holder thereof, for no additional charge (a portion of the premium paid for such Preferred Share being attributed as payment on account of the nominal value of such additional Ordinary Shares), such additional number of fully paid and non-assessable Ordinary Shares as is required so that the total number of Ordinary Shares so issued together with the one Ordinary Share into which the Preferred Share was converted or reclassified will equal such number of Ordinary Shares into which such Preferred Share is then convertible. |
| 7.2.4 | Adjustment of Conversion Price for Certain Splits, Dividends and Combinations. |
The applicable Conversion Price of each of the Preferred Shares shall be proportionately adjusted as set forth below:
| (i) | Adjustments for Splits and Combinations. |
If the Company shall subdivide its Ordinary Shares, the applicable Conversion Price shall be proportionately decreased, so that the number of Ordinary Shares into which the Preferred Shares are convertible shall be increased in proportion to such increase in the aggregate number of Ordinary Shares. If the Company shall combine its Ordinary Shares, the applicable Conversion Price shall be proportionately increased, so that the number of Ordinary Shares into which the Preferred Shares are convertible shall be decreased in proportion to such decrease in the aggregate number of Ordinary Shares. Any adjustment under this subsection shall become effective as of the earlier of (i) the date such subdivision or combination becomes effective; or (ii) if the Company shall fix a record date for the purpose of so subdividing or combining, such record date.
| (ii) | Recapitalizations. |
If at any time or from time to time the Ordinary Shares shall be changed into the same or a different number of shares of any other class or series of shares of the Company, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination of shares provided for elsewhere in this Article 7.2 or a merger or other reorganization referred to in Article 7.3 to the extent that such event is deemed to be a Deemed Liquidation), provision shall be made, concurrently with the effectiveness of such reorganization or reclassification, so that the holders of Preferred Shares shall thereafter be entitled to receive, upon conversion of their Preferred Shares and in lieu of the Ordinary Shares into which such Preferred Shares are convertible, such number of other class or series of shares of the Company, which a holder of such number of Ordinary Shares deliverable upon conversion immediately prior to such change would have been entitled to receive upon such change. In any such case, appropriate adjustment shall be made in the application of the provisions of this Article 7.2 with respect to the rights of the Preferred Shareholders and of the Preferred Shares after the recapitalization, to the end that the provisions of this Article 7.2 (including adjustment, if necessary, of the Conversion Price then in effect and the number of shares into which the Preferred Shares are convertible) shall be applicable after that event in a manner as nearly equivalent as may be practicable to the manner in which they were applied prior to such event.
| (iii) | Adjustment for Certain Dividends and Distributions. If at any time or from time to time the Company shall make or issue, or fix a record date for the determination of holders of Ordinary Shares entitled to receive, a dividend or other distribution payable on the Ordinary Shares in additional Ordinary Shares, then and in each such event the Conversion Price in effect immediately before such event shall be decreased as of the time of such issuance or, in the event such a record date shall have been fixed, as of the close of business on such record date, by multiplying the Conversion Price then in effect by a fraction: |
| (a) | the numerator of which shall be the total number of Ordinary Shares issued and outstanding immediately prior to the time of such issuance or the close of business on such record date; and |
| (b) | the denominator of which shall be the total number of Ordinary Shares issued and outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of Ordinary Shares issuable in payment of such dividend or distribution. |
| (c) | Notwithstanding the foregoing (a) if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, the Conversion Price shall be recomputed accordingly as of the close of business on such record date and thereafter the Conversion Price shall be adjusted pursuant to this subsection as of the time of actual payment of such dividends or distributions; and (b) that no such adjustment shall be made if the holders of the Preferred Shares simultaneously receive a dividend or other distribution of Ordinary Shares in a number equal to the number of Ordinary Shares as they would have received if all outstanding Preferred Shares had been converted into Ordinary Shares on the date of such event. |
| (iv) | Adjustments for Other Dividends and Distributions. If at any time or from time to time the Company shall make or issue, or fix a record date for the determination of holders of Ordinary Shares entitled to receive, a dividend or other distribution payable in securities of the Company (other than a distribution of Ordinary Shares in respect of outstanding Ordinary Shares) or in other property and the provisions of Article 7.3 do not apply to such dividend or distribution, then and in each such event the holders of Preferred Shares shall receive, simultaneously with the distribution to the holders of Ordinary Shares, a dividend or other distribution of such securities or other property in an amount equal to the amount of such securities or other property as they would have received if all outstanding Preferred Shares had been converted into Ordinary Shares on the date of such event. |
| 7.2.5 | Adjustments to Conversion Price for Dilutive Issues. |
| (i) | Special Definitions. For purposes of this sub-Article 7.2.5, the following definitions shall apply: |
| (a) | “Options” shall mean rights, options or warrants to subscribe for, purchase or otherwise acquire either Ordinary Shares or Convertible Securities (as defined below). |
| (b) | “Convertible Securities” shall mean any evidence of indebtedness, shares or other securities directly or indirectly convertible into or exchangeable for Ordinary Shares or Preferred Shares (not including Options). |
| (c) | “Additional Shares” shall mean all Ordinary Shares issued (or, pursuant to Article 7.2.5(iv), deemed to be issued) by the Company after the Series E Closing (the “Series E Original Issue Date”) with the exception of the Excluded Securities. |
| (ii) | Adjustment for the Conversion Price of Preferred Shares. |
If prior to the closing of a Public Event, the Company shall issue Additional Shares (including Additional Shares deemed to be issued pursuant to Article 7.2.5(iv)) without consideration or for a consideration per share less than the applicable Conversion Price of the Preferred Shares, in effect on the date of and immediately prior to such issuance, then in such event the applicable Conversion Price of the Preferred Shares shall be reduced, concurrent with such issuance, to a price equal to a fraction: (A) the numerator of which is the sum of: (1) the total number of Ordinary Shares outstanding, immediately prior to the issuance of such Additional Shares multiplied by the applicable Conversion Price of the Preferred Shares, in effect immediately prior to the issuance of such Additional Shares, plus (2) the total amount of the consideration received by the Company for such Additional Shares in such dilutive event, and (B) the denominator of which is the sum of: (1) the total number of Ordinary Shares outstanding immediately prior to the issuance of such Additional Shares, plus (2) the number of such Additional Shares issued in such dilutive event. For the purpose of the above calculation, the number of Ordinary Shares outstanding immediately prior to such issue of the Additional Shares shall be calculated on a fully diluted basis, treating for this purpose as issued and outstanding all Ordinary Shares issuable upon exercise of Options outstanding immediately prior to such issue or upon conversion or exchange of Convertible Securities (including the Preferred Shares) outstanding (assuming exercise of any outstanding Options therefor) immediately prior to such issue.
The formula can be expressed algebraically as follows:
| P1 | = | (PxN) +C |
| N+n |
where:
P = Conversion Price of the Preferred Shares immediately prior to the dilutive issuance.
P1 = New Conversion Price of the Preferred Shares after the dilutive issuance.
N = Total number of Ordinary Shares outstanding immediately prior to the dilutive issuance of Additional Shares (treating for this purpose as outstanding all Ordinary Shares issuable upon exercise of Options outstanding immediately prior to such issue or upon conversion or exchange of Convertible Securities (including the Preferred Shares) outstanding (assuming exercise of any outstanding Options therefor) immediately prior to such issue).
n = Number of Additional Shares issued in the dilutive issuance.
C = Total amount of consideration received by the Company for the
Additional Shares issued in the dilutive issuance.
| (iii) | No Adjustment of Conversion Price. No adjustments of any Conversion Price shall be made in an amount less than one cent per share. |
| (iv) | Deemed Issue of Additional Shares. In the event the Company at any time or from time to time after the Series E Closing Date shall issue any Option or Convertible Securities (excluding Options or Convertible Securities which are themselves Excluded Securities), which are themselves Additional Shares, or shall fix a record date for the determination of holders of any class of securities then entitled to receive any such Options or Convertible Securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein for a subsequent adjustment of such number (including provisions designed to protect against dilution) of Ordinary Shares issuable upon the exercise of such Options or, in the case of Convertible Securities and Options for Convertible Securities, the conversion or exchange of such Convertible Securities, shall be deemed to be Additional Shares issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date, provided that in any such case in which Additional Shares are deemed to be issued: |
| (a) | no further adjustment in the applicable Conversion Price shall be made upon the subsequent issue of Convertible Securities or shares of Ordinary Shares upon the exercise of such Options or conversion or exchange of such Convertible Securities, in each case, pursuant to their respective terms; |
| (b) | if such Options or Convertible Securities by their terms (but excluding automatic adjustments to such terms pursuant to anti-dilution or similar provisions of such Options or Convertible Securities), provide, with the passage of time or otherwise, for any increase or decrease in the consideration payable to the Company, or decrease or increase in the number of Ordinary Shares issuable, upon the exercise, conversion or exchange thereof, the applicable Conversion Price computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto), and any subsequent adjustments based thereon, shall, upon any such increase or decrease becoming effective, be recomputed to such Conversion Price as would have obtained had such increase or decrease been in effect upon the original date of issuance of such Options or Convertible Securities; |
| (c) | upon the expiration of any such Options or any rights of conversion or exchange under such Convertible Securities which shall not have been exercised, the applicable Conversion Price computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto), and any subsequent adjustments based thereon, shall, upon such expiration, be recomputed as if: |
| (1) | in the case of Convertible Securities or Options for Ordinary Shares, the only Additional Shares issued were Ordinary Shares, if any, actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities and the consideration received therefor was the consideration actually received by the Company for the issue of all such Options, whether or not exercised, plus the consideration actually received by the Company upon such exercise, or for the issue of all such Convertible Securities which were actually converted or exchanged, plus the additional consideration, if any, actually received by the Company upon such conversion or exchange; and |
| (2) | in the case of Options for Convertible Securities, only the Convertible Securities, if any, actually issued upon the exercise thereof were issued at the time of issue of such Options, and the consideration received by the Company for the Additional Shares deemed to have been then issued was the consideration actually received by the Company for the issue of all such Options, whether or not exercised, plus the consideration deemed to have been received by the Company upon the issue of the Convertible Securities with respect to which such Options were actually exercised; |
| (d) | [Reserved]. |
| (e) | no readjustment pursuant to clauses (b) or (c) above shall have the effect of increasing the Conversion Price to an amount which exceeds the lower of (i) the applicable Conversion Price in effect immediately prior to the original adjustment made as a result of the issuance of such Options or Convertible Securities, or (ii) the applicable Conversion Price that would have resulted from other issuances of Additional Shares (other than deemed issuances of Additional Shares as a result of the issuance of such Option or Convertible Security) between the original adjustment date and such readjustment date. |
| (v) | Determination of Consideration. For purposes of this Article 7.2, the consideration received by the Company for the issue of any Additional Shares shall be computed as follows: |
| (a) | Cash and Property. Such consideration shall: |
| (1) | insofar as it consists of cash, be computed at the aggregate amount of cash received by the Company excluding amounts paid or payable for accrued interest; |
| (2) | insofar as it consists of property other than cash, be computed at the fair market value thereof at the time of such issue, as determined in good faith by the Board of Directors; and |
| (3) | in the event Additional Shares are issued together with other shares or securities or other assets of the Company for consideration which covers both, be the proportion of such consideration so received, computed as provided in clauses (1) and (2) above, as determined in good faith by the Board of Directors. |
| (b) | Options and Convertible Securities. The consideration per share received by the Company for Additional Shares deemed to have been issued pursuant to Article 7.2.5(iv), relating to Options and Convertible Securities, shall be determined by dividing (x) the total amount, if any, received or receivable by the Company as consideration for the issue of such Options or Convertible Securities, plus the minimum aggregate amount of additional consideration (in each case as set forth in the instrument relating thereto, without regard to any provision contained therein for any subsequent adjustment of such consideration) payable to the Company upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities, by (y) the maximum number of Ordinary Shares (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities, as determined in Article 7.2.5(iv) hereof. |
| 7.2.6 | Multiple Closing Dates. In the event the Company issues Additional Shares at more than one closing, as a part of one transaction or a series of related transactions, resulting in an adjustment to the Conversion Price pursuant to the terms of Article 7.2.5, then, upon the final such issuance, the Conversion Price shall be readjusted to give effect to all such issuances as if they occurred on the first closing (and without giving effect to any additional adjustments as a result of any such subsequent issuances within such period). |
| 7.2.7 | No Fractional Shares and Certificates as to Adjustments. |
| (i) | No fractional shares shall be issued upon conversion of the Preferred Shares, and the number of Ordinary Shares to be issued shall be rounded up or down to the nearest whole share. All Ordinary Shares (including fractions thereof) issuable upon conversion of more than one Preferred Share by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional share. |
| (ii) | Upon the occurrence of each adjustment or readjustment of the Conversion Price of Preferred Shares pursuant to this Article 7.2, the Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Preferred Shares a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request at any time of any holder of Preferred Shares furnish or cause to be furnished to such holder a like certificate setting forth (a) such adjustment or readjustment, (b) the Conversion Price of the Preferred Shares at the time in effect, and (c) the number of Ordinary Shares and the amount, if any, of other property which at the time would be received upon the conversion of a Preferred Share held by such holder. |
| 7.2.8 | Notices of Record Date. In the event of any taking by the Company of a record date for the purpose of determining the holders of any class of securities who are entitled to receive any dividend (including a cash dividend) or other distribution, any right to subscribe for, purchase or otherwise acquire any shares of any class or any other securities or property, or to receive any other right, the Company shall mail to each Preferred Shareholder, at least ten (10) days prior to the record date specified therein, a notice specifying the record date for the purpose of such dividend, distribution or right, and the amount and character of such dividend, distribution or right. |
| 7.2.9 | Reservation of Shares Issuable Upon Conversion. The Company shall at all times keep available out of its authorized but unissued Ordinary Shares, for the purpose of effecting the conversion of the Preferred Shares, such number of its Ordinary Shares as shall from time to time be sufficient to effect the conversion of all issued Preferred Shares according to the then applicable Conversion Price; and if at any time the number of authorized but unissued Ordinary Shares shall not be sufficient to effect the conversion of all then issued Preferred Shares, then the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued Ordinary Shares to such number of shares as shall be sufficient for such purposes. Without derogating from the aforesaid, in the event that in the opinion of the Company’s legal counsel, any conversion of Preferred Shares shall require additional Shareholders’ resolutions or consents, each Shareholder shall execute any such document and/or resolutions reasonably necessary to effectuate such conversion. |
| 7.2.10 | Conversion Effected by Reclassification. If applicable, conversion of the Preferred Shares may be effected by way of reclassification of the Preferred Shares into Ordinary Shares or issuance of additional Ordinary Shares, as shall be required by the conversion at the then existing conversion rate determined pursuant to Article 7.2.1. To the extent that any corporate action shall be required to effect the above, all Shareholders shall provide their affirmative vote to any such corporate action and execute any such document and/or resolutions reasonably necessary to effectuate the same. |
| 7.2.11 | Waiver. The anti-dilution rights provided to the Preferred Shares under this Article 7.2 shall not be waived without the prior written consent of the Preferred Majority, provided, however, that such waiver shall not apply to the Preferred E Shares, unless it includes the prior written consent of the Preferred E Majority. |
| 7.3 | Distribution Preference. |
In the event of (i) any dissolution, liquidation, bankruptcy or winding-up of the Company, or (ii) any distribution of cash or in kind to Shareholders of the Company (including dividends) (but excluding bonus shares distributed pro-rata to all shareholders), or (iii) a Deemed Liquidation of the Company (provided that with respect to the event described in subsection (iv) of the definition of “Deemed Liquidation”, the provisions of this Article 7.3 shall only apply to the Preferred Shares sold as part of such transaction) (each of (i), (ii) and (iii), a “Distribution Event”), then all dividends, assets or proceeds legally available for distribution to the Shareholders in such event (the “Distributable Proceeds”) shall be distributed among the Shareholders according to the following order of preference.
| 7.3.1 | Distribution Waterfall. |
| (i) | First, each holder of Preferred E Shares shall be entitled to receive, on a pari passu basis with the other holders of Preferred E Shares, in respect of each Preferred E Share held by it, an amount per share equal to the higher of (A) its Original Issue Price (after adjustment pursuant to Article 7.2), plus cumulative interest at a rate of 7% per annum accruing from the applicable issue date of each such Preferred Share, compounded annually, plus an amount equal to all declared but unpaid dividends on each such Preferred E Share, less the amount of distributions, including any dividends, actually received in a prior Distribution Event which were paid on account of each such Preferred E Share (such amount, the “Preferred E Preference Amount”), prior and in preference to all other holders of shares of the Company; OR (B) the pro rata portion of the Distributable Proceeds such holder of Preferred E Shares would have received had all Preferred Shares which would have received a greater portion of the Distributable Proceeds on an as-converted basis been converted into Ordinary Shares pursuant to Article 7.2 immediately prior to such Distribution Event (for the avoidance of doubt, such calculation of the pro-rata amount shall be made with respect to the Distributable Proceeds after deducting the Preferred Preference Amount (as defined below), if any, previously distributed in accordance with this Article 7.3, if any, and shall exclude any Preferred Shares that received their Preferred Preference Amount) (such amount, the “Pro-Rata Amount”). If upon the occurrence of such Distribution Event, the Distributable Proceeds shall be insufficient to permit the full payment of the Preferred E Preference Amount, then the Distributable Proceeds shall be distributed ratably among all the holders of Preferred E Shares only, and in proportion to the preferential amounts such Shareholders would otherwise be entitled to receive as specified above. |
| (ii) | Second, each holder of Preferred D Shares shall be entitled to receive, on a pari passu basis with the other holders of Preferred D Shares, in respect of each Preferred D Share held by it, an amount per share equal to the higher of (A) its Original Issue Price (after adjustment pursuant to Article 7.2), plus cumulative interest at a rate of 7% per annum accruing from the applicable issue date of each such Preferred Share, compounded annually, plus an amount equal to all declared but unpaid dividends on each such Preferred D Share, less the amount of distributions, including any dividends, actually received in a prior Distribution Event which were paid on account of each such Preferred D Share (such amount, the “Preferred D Preference Amount”), prior and in preference to all other holders of shares of the Company; OR (B) the portion of the Distributable Proceeds applicable Pro-Rata Amount of the holders of the Preferred D Shares. If upon the occurrence of such Distribution Event, the Distributable Proceeds, if any, remaining available for distribution following payment of the Preferred E Preference Amount shall be insufficient to permit the full payment of the Preferred D Preference Amount, then the Distributable Proceeds shall be distributed ratably among all the holders of Preferred D Shares only, and in proportion to the preferential amounts such Shareholders would otherwise be entitled to receive as specified above. |
| (iii) | Third, each holder of Preferred C Shares shall be entitled to receive, on a pari passu basis with the other holders of Preferred C Shares, in respect of each Preferred C Share held by it, an amount per share equal to the higher of (A) its Original Issue Price (after adjustment pursuant to Article 7.2), plus cumulative interest at a rate of 7% per annum accruing from the applicable issue date of each such Preferred Share, compounded annually, plus an amount equal to all declared but unpaid dividends on each such Preferred C Share, less the amount of distributions, including any dividends, actually received in a prior Distribution Event which were paid on account of each such Preferred C Share (such amount, the “Preferred C Preference Amount”), prior and in preference to all other holders of shares of the Company; OR (B) the applicable Pro-Rata Amount of the holders of the Preferred C Shares. If upon the occurrence of such Distribution Event, the balance of the Distributable Proceeds, if any, remaining available for distribution following payment of the Preferred D Preference Amount, shall be insufficient to permit the full payment of the Preferred C Preference Amount, then the Distributable Proceeds shall be distributed ratably among all the holders of Preferred C Shares only, and in proportion to the preferential amounts such Shareholders would otherwise be entitled to receive as specified above. |
| (iv) | Fourth, each holder of Preferred B Shares shall be entitled to receive, on a pari passu basis with the other holders of Preferred B Shares, in respect of each Preferred B Share held by it, an amount per share equal to the higher of (A) its Original Issue Price (after adjustment pursuant to Article 7.2), plus cumulative interest at a rate of 7% per annum accruing from the applicable issue date of each such Preferred Share, compounded annually, plus an amount equal to all declared but unpaid dividends on each such Preferred B Share, less the amount of distributions, including any dividends, actually received in a prior Distribution Event which were paid on account of each such Preferred B Share (such amount, the “Preferred B Preference Amount”), prior and in preference to all other holders of shares of the Company; OR (B) the applicable Pro-Rata Amount of the holders of the Preferred B Shares. If upon the occurrence of such Distribution Event, the balance of the Distributable Proceeds, if any, remaining available for distribution following payment of the Preferred D Preference Amount and the Preferred C Preference Amount, shall be insufficient to permit the full payment of the Preferred B Preference Amount, then the Distributable Proceeds shall be distributed ratably among all the holders of Preferred B Shares only, and in proportion to the preferential amounts such Shareholders would otherwise be entitled to receive as specified above. |
| (v) | Fifth, each holder of Preferred A Shares and Preferred A-1 Shares (together, the “Remaining Preferred Shares”) shall be entitled to receive, on a pari passu basis with the other holders of the Remaining Preferred Shares, in respect of each Remaining Preferred Share held by it, an amount per share equal to the higher of (A) its Original Issue Price (after adjustment pursuant to Article 7.2), plus cumulative interest at a rate of 7% per annum accruing from the applicable issue date of each such Remaining Preferred Share, compounded annually, plus an amount equal to all declared but unpaid dividends on each such Remaining Preferred Share, less the amount of distributions, including any dividends, actually received in a prior Distribution Event which were paid on account of each such Remaining Preferred Share (such amount, the “Remaining Preferred Shares Preference Amount” and together with the “Preferred E Preference Amount, ” “Preferred D Preference Amount”, the “Preferred C Preference Amount” and “Preferred B Preference Amount”, the “Preferred Preference Amount”), prior and in preference to all holders of Ordinary Shares of the Company; OR (B) the applicable Pro-Rata Amount of the holders of the Remaining Preferred Shares. If upon the occurrence of such Distribution Event, the balance of the Distributable Proceeds, if any, remaining available for distribution following payment of the Preferred E Preference Amount, Preferred D Preference Amount, the Preferred C Preference Amount and the Preferred B Preference Amount, shall be insufficient to permit the full payment of the Remaining Preferred Shares Preference Amount, then the remaining Distributable Proceeds shall be distributed ratably among all the holders of the Remaining Preferred Shares only, and in proportion to the preferential amounts such Shareholders would otherwise be entitled to receive as specified above. |
| (vi) | Sixth, following payment to the holders of the Preferred Shares their Preferred Preference Amount or their Pro-Rata Amount, in full, as applicable, according to this Article 7.3 above, the remaining Distributable Proceeds available for distribution (if at all) shall be distributed among the holders of Ordinary Shares (excluding, for greater certainty, any Ordinary Shares issued upon the conversion of Preferred Shares who received their Preferred Preference Amount or the Pro-Rata Amount, as applicable, pursuant to Articles 7.3.1(i), 7.3.1(ii), and 7.3.1(iii) and 7.3.1(iv) above) on a pro rata basis in proportion to the number of Ordinary Shares held by the respective holders thereof. |
| 7.3.2 | Whenever the distribution provided for in this Sub-article shall be payable in securities or property other than cash, the value of such distribution shall be the fair market value of such securities or property as determined in such Distribution Event, and if not so determined, as determined in good faith by the Board (or by the liquidator in the case of winding up). |
| 7.3.3 | In the event of any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend (including a cash dividend) or other distribution, any right to subscribe for, purchase or otherwise acquire any Shares of any class or any other securities or property, or to receive any other right, the Company shall mail to each Preferred Shareholder and/or Ordinary Shareholder, respectively, at least ten (10) days prior to the date specified therein, a notice specifying the date on which any such record is to be taken for the purpose of such dividend, distribution or right, and the amount and character of such dividend, distribution or right. |
| 8. | Special Rights; Modification of Rights |
Subject to the provisions of these Articles, including, without limitation, Article 41, and subject further to the Companies Law, the Company may issue shares with such preferred or deferred rights or issue from its unissued capital, if such exists, redeemable preferred shares, shares with limited or special rights, limited or preferred rights to dividends or limited or preferred voting or other rights as the Company may decide from time to time.
| 8.1 | Subject to any other special majority requirement in these Articles, including, without limitation, pursuant to Article 41, if at any time the share capital is divided into different classes of shares, the Company may modify, convert, broaden, add or otherwise alter the rights, privileges, advantages, restrictions and provisions related at that time to the shares of any class by a resolution passed at a general meeting of the holders of all the Shares as one class notwithstanding the provisions of Section 20(c) of the Companies Law, and subject to any other special majority or consent requirement in these Articles, including, without limitation, pursuant to Article 41, the holders of the Ordinary Shares, the Preferred Shares and any other class of preferred shares, shall not be entitled to any class vote, except with respect to direct and adverse changes of the rights attached to such shares under the Articles (provided that for the purpose of any such class vote, the Preferred A Shares and the Preferred A-1 Shares shall be treated and vote together as one class). It is hereby clarified that any resolution explicitly required to be adopted pursuant to these Articles by the consent of a separate class of shares, whether by way of a separate general meeting of such class or by way of written consent, shall be given by the holders of shares of such class entitled to vote or give consent thereon and no holder of shares of a certain class shall be banned from voting or consenting by virtue of being a holder of more than one class or series of shares of the Company, irrespective of any conflicting interests that may exist between such different classes of shares. A Shareholder shall not be required to refrain from participating in the discussion, voting and/or consenting on any resolution concerning an amendment to any class or series of shares held by such Shareholder, due to the fact that such Shareholder may benefit in one way or another from the outcome of such resolution. |
| 8.2 | The provisions of these Articles relating to general meetings and to the convening thereof and to notices in respect thereof and to resolutions to be passed thereat shall, mutatis mutandis, apply to every separate general meeting as mentioned above. |
| 8.3 | Unless otherwise provided by these Articles, including, without limitation, Article 41, (a) the enlargement or increase of the authorized or issued share capital of an existing class of shares, or the issuance of additional shares thereof, (b) the creation of any new class of shares (including a new class of shares which confer one or more rights, preferences or privileges which are superior to any right, power, preference or privilege of one or more other existing classes or series of shares of the Company or pari passu with such other classes), or the issuance of shares thereof, and (c) a waiver or a change, in whole or in part, to a right, preference or privilege of a class of shares (such as liquidation rights, anti-dilution rights, registration rights, pre-emptive rights, etc., whether set forth in these Articles or in any agreement), whether applied on a one-time or permanent basis and whether applied in connection with a current or a future event, which waiver or change is applied in the same manner to all classes of shares to which such waiver or change is or may be applicable, regardless of whether the economic effect of such change affects classes of shares differently ; shall not be deemed to be a direct and adverse change to the rights, preferences or privileges attached to any one (1) class or series of shares. Furthermore, any waiver or change to the rights attached to a class of shares shall not be deemed to be a direct change to the rights attached to any other class of shares. The aforementioned shall not derogate from Article 41 to the extent applicable. |
| 8.4 | All Shares held by two or more Shareholders who are Affiliates of one another shall be aggregated together for the purpose of determining the availability of any rights under these Articles for such Shareholders, including rights which are conditioned on the relevant Shareholder holding Shares representing a minimum percentage, etc. |
| 9. | Alteration of Share Capital. |
| 9.1 | Subject to any other special majority requirement in these Articles, including, without limitation, pursuant to Article 41 and any other provision hereof conferring special rights as to voting, or restricting the right to vote, the Company may from time to time, by a Shareholders Resolution, whether or not all the shares authorized have been issued, and whether or not the whole of the Shares then issued has been called up for payment, increase its share capital by the creation of new Shares, and such increase shall be in such amount and shall be divided into Shares of such nominal amounts, and be issued subject to such restrictions and terms and with such rights and preferences, as the resolution creating the same shall provide, and in particular the Shares may be issued with preferential or deferred rights as to dividends or the distribution of assets and with special, limited or no voting rights. |
| 9.2 | Unless otherwise provided in the resolution authorizing the increase of share capital, the new Shares shall be subject to the same provisions applicable to the Shares of the original capital with regard to the payment of calls, lien, forfeiture, transfer, transmission and otherwise. |
| 10. | Consolidation; Subdivision; Cancellation and Reduction of Share Capital. |
| 10.1 | Subject to any other special majority requirement in these Articles, including, without limitation, pursuant to Article 41 below, the Company may, by a Shareholders Resolution and in accordance with and subject to the Companies Law: |
| 10.1.1 | Consolidate its share capital or any portion thereof and divide it into Shares of larger nominal value than its existing Shares; |
| 10.1.2 | Divide its existing Shares or any portion thereof by subdivision into Shares of smaller nominal value; |
| 10.1.3 | Cancel any unissued Shares provided there is no obligation of the Company, including a contingent obligation, to issue the Shares, and reduce in such manner its share capital by the amount of the Shares which were cancelled; |
| 10.1.4 | Reduce its share capital in any manner permitted by law and subject to any condition required by law; |
| 10.1.5 | Convert part of its issued and paid-up Shares into deferred shares. |
| 10.2 | With respect to any consolidation of issued Shares into Shares of larger nominal value, and with respect to any other action which may result in fractional shares, the Board of Directors may settle any difficulty which may arise with regard thereto, as it deems fit, including, inter alia, resort to one or more of the following actions, subject to applicable law: |
| 10.2.1 | Determine, as to the holder of Shares so consolidated, which issued Shares shall be consolidated into each Share of larger nominal value; |
| 10.2.2 | Allot, in contemplation of or subsequent to such consolidation or other action, such Shares or fractional shares sufficient to preclude or remove fractional share holdings; |
| 10.2.3 | Redeem in the case of redeemable Shares, and subject to applicable law, such Shares or fractional Shares sufficient to preclude or remove fractional share holdings; and |
| 10.2.4 | Cause the transfer of fractional Shares by certain Shareholders of the Company to other Shareholders thereof so as to most expediently preclude or remove any fractional shareholdings, and cause the transferees to pay the transferors the fair value of fractional Shares so transferred, and the Board of Directors is hereby authorized to act as agent for the transferors and transferees with power of substitution for purposes of implementing the provisions of this Article. |
SHARES
| 11. | Allotment of Shares. |
Subject to and in addition to any other special majority requirement in these Articles, including, without limitation, pursuant to Article 41, to the extent applicable, the Shares other than the issued and outstanding Shares, shall be under the control of the Board of Directors who may issue or allot them or give any person the option to acquire them or otherwise dispose of them for cash or other consideration to such persons, on such terms and conditions, and either at a premium or at par, or, subject to the provisions of the Companies Law, at a discount and at such times as the Board of Directors may deem fit, and with full authority to serve on any person a call on any Shares either at par or at a premium, or, subject as aforesaid, at a discount, during such time and for such consideration as the Board of Directors may deem fit.
| 12. | Pre-Emptive Rights. |
| 12.1 | Prior to the consummation of a Public Event, if the Company proposes to issue or sell any New Securities, the Company shall grant, prior to such issuance, to each Preferred Shareholder and to each Founder, each holding at least the Minimum Share Threshold (each, an “Entitled Holder”) the right to purchase its pro-rata share of the New Securities. An “Entitled Holder’s pro-rata share”, for purposes of this Article, is the ratio of the number of Ordinary Shares held by such Entitled Holder immediately prior to the issuance of the New Securities (on an as converted basis) in relation to the total number of all Ordinary Shares issued and outstanding (on an as converted basis) and held by all the Entitled Holders immediately prior to the issuance of New Securities. Each Entitled Holder shall also have a right of over-allotment (the “Overallotment Right”) such that if any other Entitled Holder declines or fails to exercise its right hereunder to purchase its pro-rata share of the New Securities, each other Entitled Holder exercising its preemptive right hereunder in full, may purchase such declining Entitled Holder’s portion, on a pro-rata basis to those Entitled Holders exercising their right of over-allotment and shall indicate its intention in its notice to the Company referred to below. |
| 12.2 | In the event the Company proposes to issue New Securities, it shall give each Entitled Holder written notice of its intention, describing the type of New Securities, their price and the general terms upon which the Company proposes to issue the same (the “Offer”). Each Entitled Holder shall have fourteen (14) days after such notice is mailed or delivered to elect to purchase its pro rata share of such New Securities and any additional Shares as may be available for overallotment, upon the terms and conditions specified in the notice, by giving binding written notice to the Company and stating therein the maximum amount of New Securities elected to be purchased (the “Subscription Notice”). |
| 12.3 | An Entitled Holder who shall not have given a Subscription Notice within the said fourteen (14)-day period shall be conclusively deemed to have rejected the Offer to him/it. A qualified or conditional acceptance of an Offer shall be conclusively deemed a rejection thereof. |
| 12.4 | In the event the Entitled Holders fail to exercise fully the preemptive right within the said fourteen (14) days period, the Company shall have ninety (90) days thereafter to sell to any third party, the remainder of the New Securities with respect to which the Entitled Holders’ preemptive right was not exercised, at a price and upon terms no more favorable to the purchasers thereof than specified in the Company’s notice to the Entitled Holders. In the event the Company has not sold the New Securities within the ninety (90) days period, the Company shall not issue or sell any New Securities without first complying with the provisions of this Article 12. |
| 12.5 | The preemptive rights under this Article 12 may be assigned by each Entitled Holder to its applicable Permitted Transferees. The preemptive rights under this Article 12 may be assigned by each Founder to his Permitted Transferee; provided that such Permitted Transferee shall execute, upon exercise of such preemptive rights, an irrevocable proxy in a form approved by the Board with respect to the securities purchased upon such exercise, granting such Founder full and complete irrevocable authority to vote all such securities until an IPO. |
| 12.6 | The provisions of Section 290 of the Companies Law shall not apply to the Company. |
| 12.7 | The Overallotment Right may be waived by a resolution of the Shareholders of the Company holding the majority of the issued and outstanding share capital of the Company, which majority includes the Preferred Majority, provided, however that the Shareholders consenting in writing to the waiver of the Overallotment Right shall not participate, directly or indirectly (including through any person controlled by the waiving Shareholders or any Permitted Transferee thereof), in an offering of that portion of New Securities, in connection with which it consented to such waiver of the Overallotment Right, above its pro-rata share (in accordance with Article 12.1 above). It is clarified that the limitations on the ability to waive the Overallotment Right provided for in this Article 12.7 do not apply to an investment by any entities belonging to the Viola Group, other than any entities investing under the “Carmel” name or the “Viola Ventures” or the “Viola 4 P, Limited Partnership,” name, regardless of whether such entities change their names in the future. |
| 12.8 | Notwithstanding the foregoing, if the implementation of the provisions of this Article 12 may, in the opinion of the Company’s counsel, constitute an offer to the public under applicable laws which is subject to prospectus requirements, then the preemptive right pursuant to this Articles 12 shall be in effect only in respect of such number of offerees which shall not require the preparation of a prospectus (in accordance with applicable law), and the offerees for such purpose shall be: (i) the type of offerees the offering to which is exempted from such prospectus requirements, and (ii) such Entitled Holders who are entitled to purchase the largest pro rata portion among all those Entitled Holders eligible to participate in the offer under this Article 12, not including and in addition to the offerees under clause (i), the offering to which is exempted from such prospectus requirements. |
| 12.9 | The Company acknowledges that under applicable Israeli law or regulation relating to the regulation of Israeli provident funds and pension funds (as may be amended, the “Regulations”) (a) the aggregate holdings of all the Clal Pension Funds in the Company may not exceed twenty percent (20%) of the issued and outstanding share capital of the Company, and the aggregate holdings of all Israeli provident funds in the Company may not exceed, in the aggregate, fifty percent (50%) of issued and outstanding share capital of the Company, without the loss of tax exempt status (the aforesaid 20% and/or 50% limitations, the “Tax Holding Limitations”), and (b) the aggregate holdings of the Clal Pension Funds in the Company may not exceed forty-nine percent (49%) of the issued and outstanding share capital of the Company without a breach of regulatory requirements (such 49% limitation, the “Regulatory Holding Limitation”). Therefore, for so long as and to the extent that: (i) the Regulations prohibit any deviation above the Tax Holding Limitations, and absent an appropriate tax ruling, or (ii) the Regulations prohibit any deviation above the Regulatory Holding Limitation, then each of the cases in (i) and (ii), the Company (a) shall promptly notify the Clal Pension Funds in writing regarding any expected deviation above the Tax Holding Limitations and the Regulatory Holding Limitation, other than any such deviation as a result of any actions of Clal Pension Funds, (b) shall not consummate any transaction in which the Company shall repurchase or redeem its own shares, without providing the Clal Pension Funds with a prior written notice of at least 30 days; and (c) the Board of Directors shall not unreasonably withhold its consent to any such transfer of shares of the Clal Pension Funds’ holdings in the Company to the extent necessary for the Clal Pension Funds to be in compliance with the Regulations and register such transfer of shares, all subject to the provisions of these Articles, including Article 24. |
| 12.10 | The Company acknowledges that under applicable law or regulation, the aggregate combined holdings of SCB in the Company may not exceed ten percent (10%) of the issued and outstanding share capital of the Company without a breach of such regulatory requirements (such 10% limitation, the “SCB Holding Limitation”). Therefore, for so long as and to the extent that the applicable regularity regulations prohibit any deviation above the SCB Holding Limitation, the Company (a) shall promptly notify SCB in writing regarding any expected deviation above the SCB Holding Limitation, other than any such deviation resulting from any actions of SCB, (b) shall not consummate any transaction in which the Company shall repurchase or redeem its own shares, without providing SCB with a prior written notice of at least 30 days; and (c) the Board of Directors shall not unreasonably withhold its consent to any such transfer of shares of SCB’s holdings in the Company to the extent necessary for SCB to be in compliance with the applicable regulations and register such transfer of shares, all subject to the provisions of these Articles, including Article 24. |
| 13. | Payment of Installments. |
If by the conditions of allotment of any Share, the whole or any part of the price thereof shall be payable by installments, every such installment shall, when due, be paid to the Company by the registered holder of the Share for the time being or from time to time or by his administrators.
| 14. | Registered Holder. |
Save as herein otherwise provided, the Company shall be entitled to treat the registered holder of any Share as the absolute owner thereof, and, accordingly, shall not, except as ordered by a court of competent jurisdiction, or as by statute required, be bound to recognize any equitable or other claim to or interest in such Share on the part of any other person and the Company shall not be bound by or required to recognize any equitable, contingent, future or partial interest in any Shares or any right whatsoever in respect of any Shares other than an absolute right to the entirety thereof in the registered holder.
| 15. | Share Certificates. |
| 15.1 | The certificates of title to Shares (“Share Certificates”) shall be issued under the seal or the rubber stamp of the Company and shall bear the signatures of one Director, or such other person or persons as are authorized by the Board of Directors. |
| 15.2 | Every Shareholder shall be entitled to one Share Certificate for all the Shares registered in his name, and if the Board of Directors so approves (upon payment of the amount which may from time to time be fixed by the Board of Directors), to several Share Certificates each for one or more such Shares. |
A Share Certificate of Shares registered in the names of two or more persons shall be delivered to the person first named on the Register in respect of such co-ownership.
| 15.3 | If a Share Certificate is defaced, lost or destroyed, it may be renewed on payment of such fee, if any, and on such terms as to evidence and indemnity, as the Board of Directors thinks fit. |
| 16. | Calls on Shares. |
| 16.1 | The Board of Directors may from time to time make such calls as it deems fit upon the Shareholders in respect of all moneys unpaid (according to their terms of issuance or agreement with the Company) on the Shares held by them respectively, and by the conditions of allotment thereof not made payable at fixed times, and each Shareholder shall pay the amount of every call so made on him to the persons and at the time and place appointed by the Board of Directors. A call may be made payable by installments, and shall be deemed to have been made when the resolution of the Board of Directors authorizing such call was passed. |
| 16.2 | No less than fourteen (14) days’ notice of any call shall be given in writing, specifying the time and place of payment, and to whom such call shall be paid, provided that before the time for payment of such call the Board of Directors may, by notice in writing to the Shareholders, revoke the same or extend the time for payment thereof. |
| 16.3 | The joint holders of a Share shall be jointly and severally liable to pay all calls in respect thereof. |
| 16.4 | If by the terms of issue of any Share or otherwise any amount is made payable at any fixed time or by installments at fixed times, whether on account of the nominal value of the Share or by the way of premium, every such amount or installment shall be payable as if it were a call duly made by the Board of Directors of which due notice had been given, and all the provisions herein contained in respect of such calls shall apply to such amount or to such installment. |
| 16.5 | If the amount of any call or installment is not paid on or before the due date for payment thereof, then the person who is for the time being the owner of the Share on which the call was made or the installment became due, shall pay interest on the said amount at the maximum rate permissible under law for the time being, or at such lesser rate as may be fixed by the Board of Directors from time to time, as from the date of payment until the same is actually paid. The Board of Directors shall, however, be at liberty to waive the payment of interest, wholly or in part. No Shareholder shall be entitled to receive any dividend or to exercise any privileges as a Shareholder until he shall have paid all calls for the time being due and payable on every share held by him whether alone or jointly with any other person together with interest and expenses (if any). |
| 17. | Prepayment. |
If the Board of Directors deems fit, it may receive from any Shareholder willing to advance the same, any amounts due on account of all or any of his shares which have not yet been called or in respect of which the date of payment has not yet fallen due, and, unless otherwise agreed with such Shareholder, the Board of Directors may pay him interest on all or any of the amounts so advanced, up to the date when same would, if not paid in advance, have fallen due, at such rate of interest as may be agreed upon between the Board of Directors and such Shareholder, and the Board of Directors may at any time repay any amount so advanced by giving such Shareholder a seven days’ prior notice in writing.
| 18. | Forfeiture of Shares. |
| 18.1 | If any Shareholder fails to pay any call or installment on or before the day appointed for payment of the same, the Board of Directors may at any time thereafter, subject to the provisions of Section 181 of the Companies Law, as long as the said call or installment remains unpaid, resolve to forfeit all or any of the Shares in respect to which the call had been made, in the event the Shareholder does not pay the same, as provided below, together with any interest that may have accrued and all expenses that may have been incurred by reason of attempting to collect any such non-payment. |
| 18.2 | Notice of any such resolution shall be served on the Shareholder. The notice shall name a day (being not less than fourteen (14) days from the date of the notice and which may be extended by the Board of Directors) and a place or places on and at which such call or installment and such interest and expenses as aforesaid are to be paid. The notice shall also state that in the event of non-payment at or before the time and at the place appointed, the Shares in respect of which the call was made or installment is payable will be ipso facto forfeited, save Shares that have been fully paid for. |
| 18.3 | Any forfeiture as aforesaid shall include all dividends declared in respect of the forfeited Shares and not actually paid before the forfeiture. |
| 18.4 | Any Share so forfeited shall be the property of the Company, subject to Section 308 of the Companies Law, and the Board of Directors may, subject to the provisions hereof, sell, re-allot and otherwise dispose of the same as it may deem fit. |
| 18.5 | The Board of Directors may at any time, before any Share so forfeited shall have been sold, re-allotted or otherwise disposed of, annul the forfeiture on such conditions as it deems fit. No such annulment shall stop the Board of Directors from re-exercising its powers of forfeiture pursuant to these Articles. |
| 18.6 | Any Shareholder whose Shares have been forfeited shall cease to be a Shareholder in respect of the forfeited Shares, but shall, notwithstanding, be liable to pay, and shall forthwith pay, to the Company, all calls, installments, interest and expenses owing upon or in respect of such Shares at the time of forfeiture, together with interest thereon from the time of forfeiture, until payment, at the maximum rate of interest permissible under law for the time being, and the Board of Directors may enforce the payment of such moneys, or any part thereof, if it so thinks fit, but shall not be under any obligation to do so. |
| 18.7 | The provisions of these Articles relating to forfeiture shall apply to any case of nonpayment of a known sum which, according to the terms of issue or allotment of the Share, is payable at any fixed time, whether on account of the nominal value of the Share or by way of premium, as if such a sum were payable under a call duly made, notified and delivered. |
| 19. | Lien. |
| 19.1 | Except to the extent that the same may be waived or subordinated in writing, the Company shall have a first and paramount lien upon all the Shares registered in the name of each Shareholder (without regard to any equitable or other claim or interest in such Shares on the part of any other person), and upon the proceeds of the sale thereof, for his debts, liabilities and obligations to the Company arising from any amount payable by such Shareholder in respect of any unpaid or partly paid Share. Such lien shall extend to all dividends from time to time declared or paid in respect of such Share. Unless otherwise decided, the registration by the Company of a transfer of Shares shall be deemed to be a waiver on the part of the Company of the lien (if any) on such Shares, immediately prior to such transfer. |
| 19.2 | For the purpose of enforcing such lien, the Board of Directors may sell the Shares subject thereto in such manner as it deems fit; but no sale shall be made until the period for the fulfillment or discharge of the debts, liabilities and engagements as aforesaid shall have arrived, and until notice in writing of the Company’s intention to sell shall have been served on such Shareholder, his executors or administrators, and the payment, fulfillment or discharge of such debts, liabilities or engagements is not made during the seven days after such notice. |
| 19.3 | The net proceeds of any such sale, after payment of the costs thereof, shall be applied in or towards satisfaction of the debts, liabilities or engagements of such Shareholder (including debts, liabilities and engagements which have not yet fallen due for payment or satisfaction) and the remainder (if any) shall be paid to the Shareholder, his executors, administrators or assigns. |
| 20. | Sale after Forfeiture or for Enforcement of Lien. |
Upon any sale after forfeiture or for enforcing a lien in exercise of the powers hereinbefore given, the Board of Directors may appoint some person to execute an instrument of transfer of the Shares sold and cause the purchaser’s name to be entered in the Register in respect of the Shares sold, and the purchaser shall not be bound to see to the regularity of the proceedings, or to the application of the purchase money, and after his name has been entered in the Register in respect of such Shares, the validity of the sale shall not be impeached by any person, and the remedy of any person aggrieved by the sale, if grounds for any remedy exist in accordance with law, shall be in damages only and against the Company exclusively.
| 21. | Redeemable Shares. |
The Company may, subject to the provisions of the Companies Law, issue redeemable Shares and redeem them.
| 22. | Purchase of the Company’s Shares. |
The Company may, subject to and in accordance with the provisions of the Companies Law and these Articles, purchase or undertake to purchase, or provide finance and/or assistance or undertake to provide finance and/or assistance, directly or indirectly, with respect to the purchase of, its Shares or securities which may be converted into Shares of the Company or which confer rights upon the holders thereof to purchase Shares of the Company.
| 23. | Borrowing Powers. |
Subject to the provisions of these Articles, the Board of Directors may from time to time, at its discretion, borrow or secure the payment of any sum or sums of money for the purposes of the Company. The Directors may raise or secure the repayment of such sum or sums in such manner, at such times and upon such terms and conditions in all respects as they think fit, and in particular, by the issue of bonds, perpetual or redeemable debentures, debenture stock, or any mortgages, charges, or other securities on the undertaking of the whole or any part of the property of the Company, both present and future, including its uncalled capital for the time being and its called but unpaid capital.
TRANSFER AND TRANSMISSION OF SHARES.
| 24. | Effectiveness and Registration. |
| 24.1 | Any transfer of Shares of the Company, except for Permitted Transfers (other than to a Permitted Transferee who is a Forbidden Transferee (as defined below), will be subject to the approval of the Board of Directors, which shall not be unreasonably withheld and shall be provided in reasonable promptness, provided the transfer is made in accordance with the provisions of Articles 24 to 25. In addition, the Company shall be entitled to reject a transfer of Shares if the transfer is (i) to a person who has been convicted of a criminal offense involving moral turpitude or who is a competitor of the Company, or (ii) to an entity controlled or managed by a person described in clause (i) (persons described in clauses (i) and (ii) are referred to herein as a “Forbidden Transferee”). |
| 24.2 | No transfer of Shares shall be approved or registered unless a proper instrument of transfer has been submitted to the Company (or its transfer agent) together with the Share Certificate for the transferred Shares (if such has been issued) and with any other evidence the Board of Directors may require in order to prove to its satisfaction the rights of the transferor in the transferred Shares. Subject to the transfer limitations set forth in these Articles, a Shareholder shall not make any transfer of the Shares, unless (i) such transfer is in compliance with these Articles, as shall be amended from time to time and any other agreement governing the subject matter and to which the transferring Shareholder is subject, as shall be from time to time; and (ii) such transferee undertook in advance in writing to be bound by and to be subject to the terms and conditions of the Articles of Association as shall be amended from time to time and any other agreement governing the subject matter and to which the transferring Shareholder is subject, as shall be from time to time, as if it was an original party thereunder. |
| 24.3 | The instrument of transfer shall be signed by the transferor and the transferee, shall be duly stamped, if required by law, and the transferor shall be considered the owner of the Shares until the transferee is registered in the Register in respect of the Shares transferred to him. The instrument of transfer of any Share shall be in writing in the following form or as near thereto as possible, or in a usual or accepted form that shall be approved by the Board of Directors: |
“I ___________ of ____________ (the “Transferor”) in consideration of the sum of _____________ paid to me by _____ of _______ (the “Transferee”) hereby transfer to the Transferee shares of NIS 0.01 each, denoted by numbers __________ to _________ (both inclusive) of PAGAYA TECHNOLOGIES LTD., to be held by the Transferee, the executors and administrators of his estate, his custodian and his legal personal representative, under the same conditions under which I myself held them immediately prior to signing this instrument of transfer, and I, the Transferee, hereby agree to accept the above mentioned Shares in accordance with the above mentioned conditions.
IN WITNESS THEREOF we hereby affix our signatures this ______ day of ______ 20_.
| The Transferor | The Transferee” |
| 24.4 | The Board of Directors may suspend the registration of transfers during the fourteen (14) days immediately preceding the ordinary general meeting in each year. |
| 24.5 | Instruments of transfer that are registered shall remain in the Company’s possession; however, instruments of transfer which the Board of Directors refuses to register in accordance with this Article, shall be returned, on demand, to whomever delivered them along with the Share Certificate (if delivered). |
| 24.6 | The executors and administrators of a deceased sole holder of a Share, or, if there are no executors or administrators, the persons beneficially entitled as heirs of a deceased sole holder, shall be the only persons recognized by the Company as having any title to the Share. In case of a Share registered in the names of two or more holders, the Company shall recognize the survivor or survivors as the only persons having any title to or benefit in the Share. Nothing herein contained shall release the estate of a deceased joint holder from any liability in respect of any Share jointly held by him. |
| 24.7 | Any person becoming entitled to a Share in consequence of the death of any person, upon producing evidence of the grant of probate or letters of administration or declaration of succession or such other evidence as the Board of Directors may deem sufficient that he sustains the character in respect of which he proposes to act under this Article or of his title, shall be registered as a Shareholder in respect of such shares, or may, subject to the regulations as to transfer herein contained, transfer such Shares. |
| 24.8 | The Company may recognize the receiver or liquidator of any Shareholder in winding-up or dissolution, or the trustee in bankruptcy or any official receiver of a bankrupt Shareholder as being entitled to the Shares registered in the name of such Shareholder. |
| 24.9 | The receiver or liquidator of a Shareholder in winding-up or dissolution, or the trustee in bankruptcy, or any official receiver of any bankrupt Shareholder, upon producing such evidence as the Board of Directors may deem sufficient that he sustains the character in respect of which he proposes to act under this Article or of his title, may, with the consent of the Board of Directors (which the Board of Directors may refuse to grant without giving any reason for its refusal), be registered as a Shareholder in respect of such Shares, or may, subject to the regulations as to transfer herein contained, transfer such Shares. |
| 24.10 | A person upon whom the ownership of a Share devolves by transmission shall be entitled to receive, and may give a discharge for any dividends or other monies payable in respect of the Share but he shall not be entitled in respect of it to receive notices, or to attend or vote at meetings of the Company, or, save as otherwise provided herein, to exercise any of the rights or privileges of a Shareholder unless and until he shall be registered in the Register. |
| 25. | Right of First Refusal. |
Dispositions, including Dispositions by the Founders, shall be subject to the Right of First Refusal set forth in this Article 25.
| 25.1 | The term “Disposition” shall mean any sale, assignment, transfer, pledge, charge or other encumbrance or other dispositions; provided, however, that, a Founder may pledge up to fifty percent of his Shares for purposes of securing personal indebtedness in the form of mortgages, margin loans, or securities lending arrangements; provided that in any event such Shares are not voted by lender and lender shall not have recourse to dispose of the Shares on a default without such pledge being deemed a “Disposition.” |
| 25.2 | The term “Permitted Transferee” means (A) with respect to a Shareholder: (i) any member of such Shareholder’s immediate family (i.e., parents, spouse, siblings and children) (“Family Members”) and with respect to any Founder any transfer shall be limited to 50% of such Founder’s holdings as of the Series D Closing; (ii) a trustee whose sole beneficiaries are such Shareholder or his Family Members; (iii) any entity wholly owned by such Shareholder; (iv) a trustee by will or operation of law; and (v) a vehicle created for tax planning or trust and estate purposes the beneficiary of which is or the Controlling party of which is the Shareholder, (B) in addition, as to each Investor (i) limited or general partnerships (and the general or limited partners thereof) managed directly or indirectly by the same management company or the same managing general partner or any entity which Controls, is Controlled by, or is under common Control with the Investor; limited or general partnerships (and the general or limited partners thereof) managed directly or indirectly by an Affiliate of the management company or the managing general partner of the general or limited partnership in question (e.g. managed by general partners which are under similar Control as the general partner of such Investor); and (ii) transferees that become transferees either (x) in a Disposition of the entire shareholdings of the Investor in the Company which are part of a Disposition of a significant portion of portfolio of investments, (y) a Disposition in connection with the dissolution of the Investor, or (z) a Disposition resulting from a regulatory or tax constraint applicable to the Investor or any of the partners in the Investor, in all cases, other than pursuant to subsection (B)(ii) above, the transfer to the Permitted Transferee shall be possible, only provided that (i) such Permitted Transferee shall remain within the definition of Permitted Transferee, and that the transferor undertakes to reacquire the transferred securities in the event that such Permitted Transferee ceases to be deemed a Permitted Transferee of such transferor; and (ii) a Permitted Transferee of a transferee who received its/his shares from the transferor in a Permitted Transfer (the “Original Transferor”) shall only be deemed a Permitted Transferee under this definition, to the extent that he/it is a Permitted Transferee of the Original Transferor; (C) in addition, as to Clal, (x) reputable transferees which are not competitors of the Company, that become transferees of Clal in a Disposition of the entire interest in a pension and/or provident fund (the “Fund”) managed by Clal Insurance Company Ltd. and/or its Affiliates, which interest includes all the investments of the Fund, including the shareholdings in the Company; (D) in addition, as to Viola 4 P, Limited Partnership, the general or limited partners of Viola 4 P, Limited Partnership and their Affiliates.; (E) in addition, as to [Tiger], the general or limited partners of [Tiger] and their Affiliates. |
| 25.3 | The term “Permitted Transfer” means a transfer to a Permitted Transferee; subject to any terms and conditions contained in these Articles and any ancillary agreement with respect to the transferred securities to which the transferor or the transferee is a party and; provided that a transfer of any share pursuant to this Article 25.3 shall only be treated as a Permitted Transfer if the transferee agrees in writing to be bound by the terms and conditions of these Articles and any ancillary agreement with respect to the transferred securities to which the transferor or the transferee is a party; and provided further that any transfer by a Founder to a Permitted Transferee shall be effected only if such Permitted Transferee executes, upon such transfer and as a condition thereto, an irrevocable proxy in a form approved by the Board with respect to the transferred securities granting the Founder full and complete irrevocable authority to vote all the securities so transferred until a Public Event. |
| 25.4 | Except for Permitted Transfers in accordance with Article 25.3, if at any time prior to a Public Event, a Shareholder (in these Articles 25 and 26, the “Selling Shareholder”) desires to effect a Disposition of any or all of his or its Shares (the “Offered Shares”), such Selling Shareholder shall first give written notice to the Company, which shall promptly thereafter deliver such notice (“Notice of Sale”) to each Entitled Holder (each, an “Offeree”). |
| 25.4.1 | The Notice of Sale shall state the following: the number of Offered Shares; that the Offered Shares will, upon the Disposition, be free of all liens, charges and encumbrances, that a bona fide offer has been received from a third party and such third party’s name; and the price, terms of payment and conditions for the purchase of the Offered Shares together with any term sheet or other written offer provided by such third party. |
| 25.4.2 | For a period of 14 days from delivery of the Notice of Sale, each Offeree may elect to purchase all or any part of its pro rata share of the Offered Shares and shall also have a right of over-allotment such that if any Offeree declines or fails to exercise its right hereunder to purchase its pro-rata share of the Offered Shares, each other Offeree exercising its right of first refusal hereunder may purchase such declining Offeree’s portion, on a pro-rata basis to those Offerees exercising their right of over-allotment (based on each purchaser’s pro-rata share). |
| 25.4.3 | An Offeree’s “pro-rata share”, for purposes of this Article 25.4, is the ratio of the number of Ordinary Shares held by such Offeree immediately prior to the Disposition of the Offered Shares (on an as converted basis) in relation to the total number of all Ordinary Shares issued and outstanding immediately prior to the Disposition of the Offered Shares (on an as converted basis) held by all the Offerees (excluding the Selling Shareholder). |
| 25.4.4 | The right of first refusal under this Article 25.4 shall be exercised by an Offeree by delivery of a binding notice to the Selling Shareholder with a copy to the Company within 14 days from delivery of the Notice of Sale, stating its election to purchase all or a portion of its pro rata share of such Offered Shares, and to the extent applicable, any additional Shares as may be available for over-allotment, and stating therein the maximum amount of Offered Shares elected to be purchased. If the Offeree(s) expressed their wish to purchase all but not less than all of the Offered Shares (the “Buying Shareholders”), then they shall acquire all such Offered Shares, in proportion to their respective pro rata shares, provided that no Buying Shareholder shall be entitled or required to acquire under the provisions of this Article 25.4 more than the number of Offered Shares initially accepted by such Buying Shareholder, and upon the allocation to it of the full number of Shares so accepted, such Buying Shareholder shall be disregarded in any subsequent computations and allocations hereunder with respect to such Disposition. Any Shares remaining after the computation of such respective entitlements shall be re-allocated among the Buying Shareholders (other than those to be disregarded as aforesaid), in the same manner, until one hundred percent (100%) of the Offered Shares have been allocated as aforesaid. The purchase of the Offered Shares shall be on the same terms and conditions as stated in the Notice of Sale. |
| 25.4.5 | If the Offerees did not exercise their right of first refusal or elected to purchase in the aggregate less than all of the Offered Shares, then the Selling Shareholder shall be free, within 90 days of the date of expiration of the Option, to sell all the Offered Shares to the prospective buyer set forth in the Notice of Sale at the price and on the terms contained in the Notice of Sale. If such sale is not consummated within such 90-day period, the Selling Shareholder shall not sell or transfer the Offered Shares, or any other Shares acquired before or after the date hereof, without again complying with the provisions of this Article 25.4. |
| 25.5 | In the event that there is a situation in which fractional Shares will need to be transferred, the number of Shares will be rounded to the nearest whole number so that only full Shares will be transferred. |
| 25.6 | The provisions of Article 25 shall not apply to a Disposition effected pursuant to Article 27 below (Bring Along) or to Shares sold by Co Sale Holders pursuant to Article 26 or to a Deemed Liquidation. In addition, the provisions of Article 25 shall not apply to a Disposition of Preferred Shares by any Preferred Shareholder. |
| 25.7 | The provisions of Article 25 shall be of no further force and effect immediately prior to and conditioned upon the consummation of a Public Event. |
| 25.8 | An Offeree may freely assign its rights under this Article 25 to a Permitted Transferee. |
| 25.9 | Notwithstanding the foregoing, if the implementation of the provisions of Article 25.4 may constitute an offer to the public under applicable laws which is subject to prospectus requirements, then the right of first refusal pursuant to Article 25.4 shall be in effect only in respect of such number of offerees which shall not require the preparation of a prospectus (in accordance with applicable law), and the offerees for such purpose shall be: (i) the type of offerees the offering to which is exempted from such prospectus requirements, and (ii) such Offerees who are entitled to purchase the largest pro rata portion among all those Offerees eligible to participate in the offer under Article 25.4, not including and in addition to the offerees under clause (i), the offering to which is exempted from such prospectus requirements. |
| 26. | Co-Sale Rights. |
| 26.1 | If, at any time prior to the consummation of a Public Event, any Founder and/or their respective Permitted Transferees desires to effect a Disposition of the Offered Shares, except for a Permitted Transfer according to Article 25.3 above, then the provisions of this Article 26 shall apply and each holder of Preferred Shares that holds at least the Minimum Share Threshold (in this Article 26, a “Co Sale Holder”) shall have the right to participate on a pro rata basis in the proposed Disposition, all as set forth below. |
| 26.2 | The Co Sale Holder’s right to participate shall be exercisable by a written notice to the Company and the Selling Shareholder within 14 days after receipt of the Notice of Sale (as mentioned in sub-article 25.4 above), in which each Co Sale Holder wishing to participate in such sale or transfer (the “Participating Shareholder”) shall notify the Selling Shareholder of the number of Shares such Co Sale Holder wishes to sell in such sale or transfer, on the same terms and conditions as the Selling Shareholder, provided, however, that such number shall not exceed such Participating Shareholder’s pro rata portion out of the Offered Shares. For the purpose of this Article 26, the term “Participating Shareholder’s pro rata portion” shall mean the number of shares owned at such time by the Co Sale Holder (on an as converted basis), in proportion to the respective number of Shares owned at such time by the Selling Shareholder and all the Co Sale Holders (on an as converted basis) wishing to participate in such sale or transfer. If such option is exercised by the Participating Shareholders, the Selling Shareholder shall not proceed with such sale unless such Participating Shareholders are given the right to participate and if the purchaser in such transaction does not agree to purchase the additional Shares offered for sale by the Participating Shareholders, the number of Offered Shares that the Selling Shareholder may sell in such sale or transfer shall be correspondingly reduced. |
| 26.3 | In the event that no participation notices have been delivered within the aforesaid 14-day period, or if some participation notices have been delivered within the aforesaid 14-day period, the Selling Shareholder may, within ninety (90) days after the expiration of the aforesaid 14-day period, transfer the Offered Shares identified in the Notice of Sale (together with the Participating Shareholders, if any, who elected to exercise their co-sale right within the aforesaid 14-day period), at a price and on the terms that are not more favorable to the purchaser(s) thereof than those stated in the Notice of Sale. If such transfer is not consummated within such ninety (90) days period, the Selling Shareholder shall not transfer any of the Offered Shares without complying again with all of the provisions of this Article 26. |
| 26.4 | In the event that a fractional Share will need to be transferred, the number of Shares will be rounded to the nearest whole number so that only full Shares are transferred. |
| 26.5 | The provisions of this Article 26 shall be of no further force and effect immediately prior to and conditioned upon the consummation of a Public Event. |
| 26.6 | The provisions of Article 26 shall not apply to (i) a Disposition effected pursuant to Article 27 below (Bring Along) or (ii) a Deemed Liquidation. |
| 26.7 | A Co Sale Holder may freely assign its rights under this Article 26 to a Permitted Transferee. |
| 27. | Bring Along. |
| 27.1 | Notwithstanding Article 26 above and without limitation of any provision of applicable law, but subject in any event to Article 7.3 (Distribution Preference), this Article 27, and 41 (Negative Covenants), in the event that prior to a Public Event, a majority of the issued and outstanding share capital of the Company on an as converted basis, including the Preferred Majority (collectively, the “Proposing Shareholders”), shall have approved and accepted a transaction or series of related transactions with any person or persons regarding a sale, whether through a purchase, merger or otherwise, of all the Company’s issued and outstanding share capital, or a sale of all or substantially all of the Company’s assets (the “Transaction”), then: |
| 27.1.1 | at every meeting of the Shareholders of the Company called with respect to any of the following, and at every adjournment or postponement thereof, and on every action or approval by written consent of the Shareholders of the Company with respect to any of the following, the other Shareholders (such other Shareholders, collectively, the “Remaining Holders”) shall vote all Shares of the Company that such Remaining Holders then hold or for which such Remaining Holders otherwise then have voting power: (A) in favor of approval of the Transaction and any matter that could reasonably be expected to facilitate the Transaction, and (B) against any proposal for any recapitalization, merger, sale of assets or other business combination (other than the Transaction) between the Company and any person or entity other than the party or parties to the Transaction or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Company under the definitive agreement(s) related to the Transaction or which could result in any of the conditions to the Company’s obligations under such agreement(s) not being fulfilled, in each case unless otherwise determined by the Proposing Shareholders. |
| 27.1.2 | If the Transaction is structured as a sale of Shares, each Remaining Holder shall agree to sell all of the Shares and rights to acquire Shares of the Company held by such Remaining Holder on the terms and conditions approved by the Proposing Shareholders. |
| 27.1.3 | Each Remaining Holder shall take all necessary actions in connection with the consummation of the Transaction as requested by the Company or the Proposing Shareholders and shall, if requested by the Proposing Shareholders, execute and deliver any agreements and instruments prepared in connection with such Transaction which agreements are executed by the Proposing Shareholders and approved by the Board, provided that each Shareholder’s liability (other than in the case of fraud by such Shareholder) is up to the proceeds it receives from the Transaction, and provided that any liability, and escrow and holdback of proceeds of a Transaction is allocated on a pro-rata basis among all Shareholders (pro-rata on the basis of the total proceeds to be actually distributed thereto to each Shareholder, taking into consideration any liquidation preferences provided as part of such distribution). |
| 27.1.4 | In the event that a Remaining Holder fails to surrender its certificate in connection with the consummation of a Transaction, such certificate shall be deemed cancelled and the Company shall be authorized to issue a new certificate in the name of the Remaining Holder and the Board of Directors shall be authorized to establish an escrow account, for the benefit of such Remaining Holder into which the consideration for such securities represented by such cancelled certificate shall be deposited and to appoint a trustee to administer such account. |
| 27.1.5 | Each Remaining Holder hereby grants to such person as may be designated by the Board an irrevocable proxy, coupled with an interest, upon (and only upon) a failure or a refusal by any such Remaining Holder to vote its Shares or act in accordance with its contractual obligations herewith, to so vote such Shares or make other actions to effect the foregoing obligations of the Remaining Holders herein. The Company and all of its shareholders, each agree and acknowledge that: (i) monetary damages would not adequately compensate an injured party for the breach of this Article 27 by any party; (ii) this Article 27 shall be specifically enforceable; and (iii) any breach or threatened breach of this Article 27 shall be the proper subject of a temporary or permanent injunction or restraining order. |
| 27.2 | The majority set forth in Article 27.1 is hereby determined also for the purposes of Sections 341 of the Companies Law, and the procedure set forth in Section 341 of the Companies Law regarding the forced sale by Shareholders which do not participate in the Transaction shall apply. Notwithstanding Section 341 of the Companies Law to the contrary: (i), the price and other terms and conditions of a Transaction shall be considered to apply equally as to all Shareholders, if the application of such price and all such other terms and conditions to the respective Shares of the Company held by each Shareholder is made based upon and in accordance with the respective rights, preferences and privileges applicable to such Shares under these Articles (e.g., if each such Share receives the respective portion of the proceeds of such proposed Transaction as determined pursuant to the provisions of Article 7.3 above); and (ii) any bonus, retention payment, monetary incentive, management compensation and/or any similar payment or arrangement, payable or offered in connection with the Transaction by either the Company or by the purchaser in the Transaction to any Shareholder of the Company in his/her capacity as an employee or service provider of the Company and separately from any payment or distribution to which such Shareholder is entitled by virtue of his ownership of Shares in the Company, shall not be deemed contrary to the provisions of Section 341 of the Companies Law and Shareholders not receiving any such separate payment shall not be deemed, for purposes of Section 341 of the Companies Law, to be treated unequally compared to any Shareholders receiving such payment; provided, however, that any such bonus, retention payment, monetary incentive, management compensation and/or similar payment or arrangement is approved in advance by the Preferred Majority. |
| 27.3 | For the removal of doubt, any proceeds payable to the Shareholders hereunder shall be distributed in accordance with the provisions relating to `Distribution Preference’ as set forth in the Article 7.3 above, and each of the Shareholders will receive the consideration per Share in the same form and amount for each Share held thereby, and, except for with respect to sub section (ii) in Article 27.2 above, if any Shareholders are given an option as to the form and amount of consideration to be received, all Shareholders will be given the same option. |
| 27.4 | Limitations on Indemnification, etc. Notwithstanding the provisions set forth in this Article 27, the obligations of a Shareholder to take any action whatsoever under this Article 27, including without prejudice to the generality of the foregoing (i) voting all shares held by it in favor of the Transaction; (ii) selling or transferring all of its shares in the Company pursuant to such Transaction; and (iii) the timely delivery of documents and instruments as may be required elsewhere in this Article 27, shall be subject to the satisfaction of each of the following conditions: |
| 27.4.1 | Limitations on Representations, Warranties and Indemnities. The only representations, warranties or indemnities that a Shareholder shall be required to make in connection with a Transaction are representations, warranties or indemnities with respect to its ownership of shares and securities and ability to convey title free and clear of liens, encumbrances and third party rights, or adverse claims; its corporate power and authority and consents; enforceability and binding effect on such Shareholder; no finders’ fee agreed to by such Shareholder; non contravention and no breach by such Shareholder; representations relating to securities law matters pertaining to such Shareholder; absence of legal proceedings involving such Shareholder that may affect the consummation of the Transaction; and accuracy of tax information applicable to such Shareholder, and indemnities related to the Company’s representations, warranties and covenants in the Transaction, as set forth below (the “Required Obligations”). The Required Obligations shall be in the same form for all Shareholders of the Company and shall be given by Shareholder on a several but not joint basis only (other than as set forth below). Notwithstanding any other provisions of this clause, the maximum aggregate liability of a Shareholder shall be limited to the amount of consideration actually received by such Shareholder or payable to such Shareholder or placed in escrow or otherwise held for such Shareholder, as applicable, except with respect to claims related to fraud of such Shareholder, the liability for which need not be limited as to such Shareholder. The liability of a Shareholder with respect to any representation, warranty, indemnity or covenant made by the Company in connection with a Transaction shall be several and not joint with any other person (except to the extent that funds may be paid out of an escrow established or deducted from any amount to be paid by buyer (such as holdback and earn-outs) to cover breach of representations, warranties and covenants of the Company and the Required Obligations) and such liability shall be limited to a pro rata share of an escrow account, a holdback amount or a similar mechanism. |
| 27.4.2 | Other Agreements. No Shareholder shall be required to amend, extend or terminate any commercial contract or other commercial relationship with the Company, the purchaser or its respective affiliates or subsidiaries (with the exception of (i) the termination of any agreement between the Shareholder and the Company related to the purchase or holding shares of the Company, and (ii) termination under the terms of the applicable agreement). |
| 27.4.3 | Covenants. No Shareholder shall be required to agree to any covenants other than reasonable covenants regarding confidentiality, no solicitation, and publicity and in relation to actions necessary to transfer its Shares to the buyer in the Transaction. |
| 28. | Other Subject Securities |
The Company shall not issue any securities, or any other right to subscribe for, or convert to, securities (including options or Shares issued or granted under option or share incentive plan approved by the Board), or effect any transfer of securities by any Shareholder until it has satisfactory evidence that such subscriber or transferee (to the extent such subscriber or transferee is not a Shareholder prior to the issuance or transfer) shall be bound by, and be subject to, the provisions of these Articles, including without limitation, Articles 25, 26 and 27 hereof.
RECORD DATE FOR NOTICE OF GENERAL MEETING
| 29. | Notwithstanding any other provision of these Articles to the contrary, and subject to applicable law, the Board of Directors may fix a date, not exceeding sixty (60) days prior to the date of any general meeting, as the date as of which Shareholders entitled to notice of and to vote at such meeting shall be determined, and all persons who were registered in the Register as holders of voting Shares on such date and no others shall be entitled to notice of and to vote at such meeting. A determination of Shareholders of record entitled to notice of and to vote at any meeting shall apply to any adjournment of such meeting, provided, however, that the Board may fix a new record date for the adjourned meeting. |
GENERAL MEETINGS
| 30. | Annual General Meeting. |
Annual general meetings shall be held at least once in every calendar year, but not later than fifteen (15) months after the last preceding annual general meeting, at such time and place as the Board of Directors may determine. All general meetings other than Annual General Meetings of the Company shall be called “Extraordinary General Meetings”.
| 31. | Extraordinary General Meetings. |
The Board of Directors may whenever it thinks fit convene an Extraordinary General Meeting, and shall be obliged to do so upon a request in writing as provided in the Companies Law.
| 32. | Notice. |
| 32.1 | Unless a longer period is prescribed by applicable law, at least a seven (7) day prior notice, specifying the place, the day and the hour of the meeting and the general nature of every matter on the agenda, shall be given to all Shareholders entitled to receive notices by notice sent by mail, fax, e-mail or otherwise served as hereinafter provided. Notwithstanding the foregoing, if all Shareholders entitled to receive notices of general meetings so agree, a general meeting may be held if less than seven (7) days’ notice or the period otherwise required by law, as the case may be, is given and generally in such manner as such Shareholders may approve. |
| 32.2 | The accidental omission to give notice of a meeting to any Shareholder, or the non-receipt of notice sent to such Shareholder, shall not invalidate the proceedings at such meeting. |
PROCEEDINGS AT GENERAL MEETINGS
| 33. | Quorum. |
| 33.1 | Subject to Article 41, no business shall be transacted at a general meeting unless the requisite quorum is present at the commencement of the business, and no resolution shall be passed unless the requisite quorum is present when the resolution is voted upon. Unless otherwise provided in these Articles, one or more Shareholders, present in person or by proxy, holding or representing Shares conferring in the aggregate at least the majority of the voting rights of the Company (on as converted basis), including the Preferred Majority, shall constitute a quorum. |
| 33.2 | Shareholders entitled to be present and vote at a general meeting may participate in a general meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other and such participation in a meeting shall constitute attendance in person at the meeting. |
| 33.3 | Subject to Article 41, if a meeting is called and no quorum is present, within half an hour from the time appointed for the meeting, it shall stand adjourned to the same day in the following week, at the same time and place or such other time and place as set forth in the notice of such a meeting. At an adjourned General (or Extraordinary) Meeting any number of Shareholders present in person or by proxy holding or representing Shares conferring in the aggregate at least 33% of the voting rights of the Company shall constitute a quorum. At an adjourned General Meeting the only business to be considered shall be those matters which might have been lawfully considered at the General Meeting originally called if a requisite quorum had been present, and the only resolutions to be adopted are such types of resolutions which could have been adopted at the General Meeting originally called. If such quorum is not present the adjourned meeting shall be cancelled. |
| 35. | Chairman. |
| 35.1 | The Chairman of the Board of Directors will serve as the Chairman of the general meetings of the Company. If the Board of Directors has no Chairman or if he is not present 15 minutes from the time stated for the commencement of the meeting, those present may choose from amongst them a person to chair the meeting. |
| 35.2 | The Chairman of any general meeting of the Company shall not be entitled to a second or casting vote. |
| 36. | Adoption of Resolutions at General Meetings. |
| 36.1 | Unless otherwise prescribed by applicable law or by these Articles, including, without limitation, Article 41, a resolution of the Shareholders will be deemed adopted if approved by a simple majority of the voting rights of the Company represented personally or by proxy and voting thereon at a meeting at which a quorum is present (excluding abstentions). |
| 36.2 | Every question submitted to a general meeting shall be decided by a show of hands, but if a written ballot is demanded by a Shareholder, present in person or by proxy and entitled to vote at the meeting, the same shall be decided by a written ballot. A written ballot may be demanded before the proposed resolution is voted upon or immediately after the declaration by the Chairman of the results of the vote by a show of hands. If a written ballot is demanded after such declaration, the results of the vote by a show of hands shall be of no effect, and the proposed resolution shall be decided by a written ballot. If a written ballot is demanded as aforesaid, it shall be taken in such manner and at such time and place as the Chairman of the meeting directs, and either at once or after an interval or adjournment, or otherwise, and the result of the written ballot shall be deemed to be the resolution of the meeting at which the written ballot was demanded. The demand for a written ballot may be withdrawn at any time before the written ballot is taken. The demand for a written ballot shall not prevent the continuance of a meeting for the transaction of any business other than the question on which the written ballot has been demanded. A written ballot demanded on the election of a Chairman and on a question of an adjournment of a meeting shall be taken forthwith. |
| 36.3 | A declaration by the Chairman of the meeting that a resolution has been carried unanimously, or carried by a particular majority, or rejected, and an entry to that effect in the book of proceedings of the Company, shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favor of or against such resolution. |
| 37. | Power to Adjourn. |
The Chairman of a general meeting at which a quorum is present may, with the consent of the holders of a majority of the voting rights of the Company represented, personally or by proxy, at the meeting and voting on the question of adjournment, adjourn the same from time to time and from place to place and the Chairman shall do so if so directed by the meeting; but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place. A notice of the adjournment and of the matters to be included on the agenda of the adjourned meeting shall be given to all Shareholders.
| 38. | Resolutions in Writing. |
A resolution in writing signed by all Shareholders then entitled to vote at general meetings or to which all such Shareholders have given their written consent (including, but not limited to, by letter, facsimile, e-mail or otherwise) shall be deemed to have been adopted as if it were adopted at a general meeting of the Company duly convened and held. Any such resolution may consist of several documents in like form and signed or consented to as aforesaid, by one or more Shareholders.
| 39. | Votes of Shareholders. |
| 39.1 | Subject to any special conditions, rights or restrictions to voting rights set forth in the terms of issue of any Shares or attached at the time to any class of Shares, including, without limitation, Article 41, every Shareholder present in person or by proxy, whether in a vote by a show of hands or by written ballot, shall have one vote for each Ordinary Share held by him of record and in the case of a Preferred Shareholder, one vote for each Ordinary Share into which the Preferred Shares held by him of record could be converted. |
| 39.2 | A company or other corporate body being a Shareholder of the Company may duly authorize any person it deems fit to be its representative at any meeting of the Company or to execute or deliver a proxy on its behalf, as provided for below. Any person so authorized shall be entitled to exercise on behalf of the corporation which he represents all the powers which the corporation could have exercised if it were an individual Shareholder. Upon the request of the Chairman of the meeting, written evidence of such authorization (in form reasonably acceptable to the Chairman) shall be delivered to him. |
| 39.3 | In case of joint holders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders; and for this purpose seniority shall be determined by the order in which the names stand in the Register. |
| 39.4 | Shareholders may vote either personally or by proxy, or, if the Shareholder is a company or other corporate body, by a representative pursuant to Article 38.2 or by a duly authorized proxy, as prescribed hereinafter. |
| 39.5 | No Shareholder (or proxy or representative of a Shareholder) shall be entitled to vote at a general meeting unless all calls or other sums presently payable by him in respect of his Shares in the Company have been paid. |
| 40. | Class Meetings. |
The provisions of these Articles relating to General Meetings shall apply, mutatis mutandis, to any separate General Meeting of the holders of the Shares of a particular class, provided however, that the requisite quorum at such separate General Meeting shall be Shareholder(s) present in person or proxy holding Shares conferring in the aggregate a majority of the voting power of the Shares of such class, on an as converted basis.
| 41. | Proxy. |
| 41.1 | Any instrument appointing a proxy or representative shall be in writing under the hand of the appointer or of his attorney duly authorized in writing, or, if such appointer is a corporation, under its common seal if any, or under the hand of some officer duly authorized in that behalf. |
| 41.2 | Every instrument of proxy, whether for a specified meeting or otherwise shall, as nearly as circumstances will admit, be substantially in the following form: |
“I ________________ of _______________ being a Shareholder of PAGAYA TECHNOLOGIES LTD. (the “Company”) hereby appoint __________of __________ or, failing him, ________________ of __________ as my proxy to vote for me and on my behalf at the Annual or Extraordinary or Adjourned (as the case may be) General Meeting of the Company, to be held on the day __________ of and at any adjournment thereof.
IN WITNESS WHEREOF, I affix my signature this _____ day of _______ 2_____.”
A vote given in accordance with the terms of an instrument of appointment of attorney or proxy shall be valid notwithstanding the previous death of the principal, or revocation of the appointment, or transfer of the Share in respect of which the vote is given, unless notice in writing of the death, revocation or transfer shall have been received at the Office or by the Chairman of the meeting before the vote is given.
| 42. | Negative Covenants. |
| 42.1 | Until the consummation of a Public Event, the Company shall not, whether by action or through resolution of the Company’s general meeting, take any action set forth below, without first obtaining the consent (by vote or written consent) of the Preferred Majority: |
| 42.1.1 | amend the Articles of Association or take other action which would have the effect of amending or adversely affecting the rights, preferences or privileges of the Preferred Shares; |
| 42.1.2 | authorize or issue (including by way of merger, reclassification, recapitalization or any other way) any share capital, or other rights or securities convertible into or exchangeable for share capital or any equivalent rights under benefit plans, with rights equal to or superior to the rights of the Preferred Shares; |
| 42.1.3 | effect a Deemed Liquidation; |
| 42.1.4 | increase the number of the Company’s Directors above eight (8) or change the composition of the Board of Directors; |
| 42.1.5 | other than in compliance with the Companies Laws, effect or undertake to effect any interested party transaction with any shareholder, director or officer having a value of more than $120,000; |
| 42.1.6 | effect a liquidation, bankruptcy, dissolution or winding up of the Company; |
| 42.1.7 | transfer all or substantially all of the assets of the Company (including through the grant of an exclusive, perpetual, worldwide license (other than the license in the ordinary course of business, which does not amount to a de facto sale of all or substantially all of the Company)) from one or more wholly-owned subsidiaries of the Company that own(s) all or substantially all the aggregate assets of the Company and its subsidiaries taken as a whole, other than to a wholly-owned subsidiary of the Company; |
| 42.1.8 | effect any transaction or series of related transactions as a result of which more than 50% of the shares of one or more subsidiaries of the Company that own(s) all or substantially all of the aggregate assets of the Company and its subsidiaries taken as a whole, are transferred to any third party, other than (i) the issuance of such shares solely for financing purposes and/or (ii) a transaction following which the Shareholders of the Company immediately prior to such transaction continue to own, directly or indirectly, the majority of the voting securities of such subsidiaries; |
| 42.1.9 | redeem or repurchase, subject to applicable law, any shares of Preferred Shares, or Ordinary Shares (other than pursuant to employee or consulting agreements giving the right to repurchase shares upon termination of services at no greater than the original cost thereof); or |
| 42.1.10 | change the principal business of the Company from Data driven investment and investment management. |
| 42.2 | Notwithstanding anything to the contrary herein, any amendment to, or waiver of, rights granted specifically by name in these Articles to a certain Shareholder shall require the prior written consent of such Shareholder. Any right granted to a specified majority of holders of a specified class of Shares may not be amended or terminated or the observance of any specific term of these Articles granted to such specified majority may not be waived, without the written consent of such specified majority of holders of such class of Shares. Any amendment of this Article 41 shall require the consent of the Preferred Majority |
| 42.3 | Notwithstanding anything to the contrary herein, (i) amending or waiving the liquidation preference of the Preferred C Shares under Article 7.3.1; (ii) amending or removing this Article 41.3, but solely with respect the requirement to obtain the consent of the Preferred C Majority as provided therein, and (iii) the issuance of any additional Preferred C Shares; shall, in each case, require the prior written consent of the Series C Majority. |
| 42.4 | Notwithstanding anything to the contrary herein, (i) amending or waiving the definitions of “New Securities” or “Additional Securities”, the provisions of Article 7.2.2 and 7.2.5, the liquidation preference of the Preferred D Shares under Article 7.3.1; (ii) amending or removing this Article 41.4, but solely with respect the requirement to obtain the consent of the Preferred D Majority as provided therein, and (iii) that issuance of any additional Preferred D Shares (or any options or rights to purchase such shares) after the closing of the Series D Preferred Share Purchase Agreement and if applicable, the Additional Closing thereunder, shall, in each case, require the prior written consent of the Series D Majority. |
BOARD OF DIRECTORS
| 43. | Powers of the Board of Directors. |
| 43.1 | In addition to all powers and authorities of the Board of Directors as specified in the Companies Law, the determination of the Company’s policy, and the supervision of the General Manager and the Company’s officers shall be vested in the Board of Directors. In addition, the Board of Directors may exercise all such powers and do all such acts and things as the Company is, by these Articles or under the law, authorized to exercise and do, and are not hereby or by statute directed or required to be exercised or done by the Company in a general meeting, but subject, nevertheless, to the provisions of the Companies Law, and to these Articles and any regulations or resolution not being inconsistent with these Articles made from time to time by the Company in a general meeting; provided that no such regulation or resolution shall invalidate any prior act done by or pursuant to the directions of the Board of Directors which would have been valid if such regulation or resolution had not been made. |
| 43.2 | Without prejudice to any of the general powers granted to the Board of Directors in accordance with above Article and any other powers granted to it under these Articles, and without restricting or reducing in any way any of the above-mentioned powers, it is hereby explicitly declared that the Board of Directors shall have the following powers: |
| 43.2.1 | To appoint a person or persons (whether they be incorporated or not) to receive and hold in trust for the Company any property whatsoever that belongs to the Company or that the Company has an interest in, or for any other purpose and to execute and perform all actions, deeds and necessary activities with relation to any such trust, and to see to the remuneration of any such trustee(s). |
| 43.2.2 | To initiate, manage, defend, compromise or discontinue any and all legal proceedings on behalf of or against the Company or its officials or that pertain in any way to its affairs, and to compromise and extend the period for payment or discharge of any debt due or suits or claims by or against the Company. |
| 43.2.3 | To refer any suit or claim by or against the Company to arbitration. |
| 43.2.4 | To determine, from time to time, those authorized to sign in the Company’s name on bills of exchange, promissory notes, receipts, certificates of receipt, endorsements, checks, certificates of dividend, releases, contracts and other documents of any kind whatsoever. |
| 43.2.5 | In general and subject to the provisions of the Companies Law and these Articles, to delegate to any person, firm, company or variable group of people, the powers, authority and discretion vested in the Board of Directors. |
| 44. | Delegation of Powers. |
| 44.1 | To the extent provided under Sections 112 and 288 of the Companies Law, the Board of Directors may for any particular matter delegate any or all of its powers to committees consisting of three or more Directors as the Board of Directors may deem fit, each including at least one Preferred Director (a “Committee”), and it may from time to time revoke such delegation. The Board may not delegate authorities to committees without approval of at least one Preferred Director. Unless otherwise expressly provided by the Board of Directors in delegating powers to a Committee of the Board of Directors, such Committee shall not be empowered to further delegate powers. |
| 44.2 | Any Committee so formed shall, in the exercise of the powers so delegated, conform to any regulations that may be imposed on it by the Board of Directors. |
| 44.3 | The meetings and proceedings of any such Committee, shall be governed by the provisions herein contained for regulating the meetings of the Board of Directors, so far as the same are applicable thereto, and so far as not superseded by any regulations made by the Board of Directors under this Article. |
| 44.4 | The Board of Directors may appoint a Secretary to the Company, and may appoint officers, personnel, agents and servants, for fixed, provisional or special duties, as the Board of Directors may from time to time deem fit, and may from time to time, in their absolute discretion, suspend the service of any one or more of such persons. The Board of Directors may determine the powers and duties, as well as the salaries, of such persons and may demand security in such cases and in such amounts as it deems fit. |
| 45. | Composition. |
| 45.1 | The Board of the Company shall consist of a total of up to eight (8) members as follows: |
| 45.1.1 | A majority among the Founders (i.e., 2 of the 3 Founders) shall be entitled to appoint three (3) Directors (each such appointed Director, an “Ordinary Director” and collectively, the “Ordinary Directors”); |
| 45.1.2 | Oak may appoint one (1) Director (the “Oak Director”) for as long as Oak holds at least the Minimum Share Threshold; |
| 45.1.3 | Saro, L.P. may appoint one (1) Director (the “GF Director”) for as long as GF holds at least the Minimum Share Threshold; |
| 45.1.4 | Viola Ventures may appoint one (1) Director (the “Viola Ventures Director”) for as long as Viola Ventures holds at least the Minimum Share Threshold; |
| 45.1.5 | The GIC Entities may jointly appoint one (1) Director (the “GIC Director”, and together with the Oak Director, the GF Director and the Viola Ventures Director the “Preferred Directors”) for as long as the GIC Entities collectively hold at least the Minimum Share Threshold; |
| 45.1.6 | [RESERVED] |
| 45.1.7 | The Ordinary Directors, the Oak Director, the GF Director, the Viola Ventures Director and the GIC Director in office may, by a majority vote among them, appoint one (1) Director who shall have expertise and extensive knowledge in the Company’s field of business. |
| 45.2 | The Viola Ventures Director, the GF Director, the GIC Director and the Oak Director shall be entitled to membership in all committees of the Board. |
| 45.3 | [RESERVED] |
| 45.4 | For the avoidance of doubt, any representative serving as a director on the Board of Directors pursuant to the provisions of Article 44.1 may be designated and/or removed only by a written notice delivered to the Company (which will contain the identity of the representative director) by the party or parties authorized to make such designation, without the need for any further action including but not limited to a resolution at a General Meeting. Notwithstanding the provisions of Sections 59 and 230(a) of the Companies Law, the General Meeting of the Company shall not be entitled to appoint or remove from his office any director of the Company. |
| 45.5 | Any vacancy in a directorship shall be filled only by a person nominated by those who are entitled to appoint the director whose seat is vacant. |
| 45.6 | Notwithstanding anything to the contrary in these articles, the Company reserves the right to exclude the GIC Director from any information delivered to the Board or portion thereof and not to disclose to the GIC Director certain information, relating to proprietary commercial information of a competitor of the GIC Entities, which the Board determines in good faith, after consultation with the Company’s legal counsel, is reasonably deemed to create, or exacerbate, a conflict of interest. Prior to such determination of the Board, the Company will provide the GIC Director a high-level description of the subject matter that is the basis for the exclusion, at a level of detail that does not itself create or exacerbate a conflict of interest. This provision shall terminate upon termination of the commercial relationship between the GIC Entities and the Company. |
| 45.7 | Each of (i) Clal, (ii) SCB, (iii) New Investors Group, by the vote of a majority in interest of its members, based on their pro-rata holdings in the Company, (iv) the GIC Entities to the extent they are no longer entitled to appoint the GIC Director, (v) Oak, to the extent it is no longer entitled to appoint the Oak Director, and (vi) Saro, L.P., to the extent it is no longer entitled to appoint the GF Director, each, for as long as it holds at least 1% of the Company’s issued share capital on an as converted basis, other than SCB, that will have such right for as long as it holds at least 0.7% of the Company’s issued share capital on an as converted basis, shall have the right to appoint, remove and replace one (1) observer to the Board (each, an “Observer”) who shall be entitled to attend in a non-voting observer capacity all meetings of the Board to receive notice of such meetings and to receive any and all documentations and communications provided to the members of the Board of Directors (including for the avoidance of doubt, suggested written resolutions), as and when provided to the Board, provided that such Observer executes confidentiality undertakings in a form reasonably satisfactory to the Company, provided, however, that the Company reserves the right to exclude the Observer from any Board meeting or portion thereof, and deny the Observer access to any material given to Board members, if the Board determines that such exclusion is reasonably necessary (i) to preserve attorney-client privilege, or (ii) to avoid a conflict of interest for or with the Company. |
| 45.8 | Article 44.1.2 may not be amended without the prior written consent of Oak; Article 44.1.3 may not be amended without the prior written consent of Saro, L.P.; Article 44.1.4 may not be amended without the prior written consent of Viola Ventures; Article 44.1.5 may not be amended without the prior written consent of the GIC Entities; Article 44.1.1 may not be amended without the prior written consent of the majority of the Founders (i.e., 2 of the 3 Founders); Article 44.7 may not be amended without the prior written consent of Clal (with respect to Clal), SCB (with respect to SCB), Saro, L.P. (with respect to Saro, L.P.), Viola Ventures (with respect to Viola Ventures), the GIC Entities (with respect to the GIC Entities) , Oak (with respect to Oak) and New Investors Group (with respect to New Investors Group). This Article 44.8 may not be amended without the prior written consent of Clal (with respect to Clal), SCB (with respect to SCB), Saro, L.P. (with respect to Saro, L.P.), Viola Ventures (with respect to Viola Ventures), the GIC Entities (with respect to the GIC Entities), Oak (with respect to Oak), and New Investors Group (with respect to New Investors Group). |
| 46. | Alternate Directors. |
| 46.1 | Subject to the provisions of the Companies Law, a Director shall have the right, by written notice to the Company, to appoint a person as a substitute to act in his place, to remove the substitute and appoint another in his place and to appoint a substitute in place of a substitute whose office was vacated for any reason whatsoever (each such substitute, an “Alternate Director”). A person who is not qualified to be appointed as a Director, may not be appointed as an Alternate Director. |
| 46.2 | Any notice given to the Company as aforesaid shall become effective on the date fixed therein, upon delivery to the Company. Unless the appointing Director limits the time or scope of the appointment, the appointment is effective for all purposes until the appointing Director ceases to be a Director or terminates the appointment. |
| 46.3 | An Alternate Director shall have, subject to any instructions or limitations contained in the instrument appointing him, all the authority and powers held by the Director for whom he acts as substitute, provided, however, that he may not in turn appoint a substitute for himself (unless the instrument appointing him otherwise expressly provides), and provided further that a substitute shall have no standing at any meeting of the Board of Directors or any committee thereof at which the Director appointing him is personally present or at which the Director appointing him is not entitled to participate in accordance with applicable law. |
| 46.4 | The office of an Alternate Director shall ipso facto be vacated if he is removed by the Director appointing him, or if the office of the Director for whom he acts as substitute is vacated for any reason whatsoever, or if one of the circumstances described in Article 45 should befall the substitute. |
| 46.5 | An Alternate Director shall alone be responsible for his actions and omissions, and shall not be deemed an agent of the Director(s) who appointed him. |
| 46.6 | Every substitute shall be entitled to receive, so long as he serves as a substitute, notice of meetings of the Board of Directors and of any relevant committees. |
| 47. | Vacation of Office. |
The office of a Director shall ipso facto be vacated upon the occurrence of any of the following events:
| 47.1 | Upon his death, or, if the Director is a company—upon its winding-up; |
| 47.2 | Should he be declared to be of unsound mind; |
| 47.3 | Should he become bankrupt; |
| 47.4 | Should he resign his office by notice in writing to the Company; |
| 47.5 | He is removed from office by written notice to the Company pursuant to Article 44 above; |
| 47.6 | He is convicted of an offense as described in Article 232 of the Companies Law; |
| 47.7 | He is removed by a court of law in accordance with Article 233 of the Companies Law. |
| 48. | Qualification of Directors. |
| 48.1 | Subject to applicable law, a Director who has ceased to hold office shall be eligible for re-election or re-appointment. |
| 48.2 | A Director shall not be required to hold qualification shares. |
| 49. | Conflict of Interest; Approval of Related Party Transactions. |
| 49.1 | Subject to the provisions of the Companies Law and these Articles, the Company may enter into any contract or otherwise transact any business with any Director, or other Office Holder (as defined in the Companies Law) in which contract or business such Director or other Office Holder has a personal interest, directly or indirectly; and may enter into any contract or otherwise transact any business with any third party in which contract or business a Director or other Office Holder has a personal interest, directly or indirectly. |
| 49.2 | Unless and to the extent provided otherwise in the Companies Law, a Director or other Office Holder, shall not participate in deliberations concerning, nor vote upon a resolution approving, a transaction with the Company in which he has a personal interest. |
| 50. | Remuneration of Directors. |
| 50.1 | A Director may be paid remuneration by the Company for his services as a Director to the extent such remuneration is approved by a Shareholders Resolution and pursuant to the Companies Law. |
| 50.2 | Directors and Alternate Directors may be entitled to reimbursement from the Company for all reasonable travel, board and lodging expenses incurred in connection with performance of their duties as members of the Board of Directors of the Company (provided that the Company did not reimburse the Director for all such expenses in his capacity as an employee of the Company). |
PROCEEDINGS OF THE BOARD OF DIRECTORS
| 51. | Meetings of the Board of Directors. |
| 51.1 | The Board of Directors shall convene its meetings, and may adjourn and otherwise regulate the proceedings of such meetings, as the Board of Directors thinks fit. |
| 51.2 | In addition, the Chairman of the Board of Directors or any Director may, at any time, convene a meeting of the Board of Directors. |
| 51.3 | Notice of a meeting of the Board of Directors may be sent to all Directors at their registered addresses, by facsimile, e-mail or other reliable written form/method of transmission at least three Business Days prior to the meeting unless such notice is waived in writing by all of the Directors as to a particular meeting |
| 51.4 | Subject to all of the other provisions of these Articles concerning meetings of the Board of Directors, Directors will be entitled to participate by way of video or audio conference, so long as each participating Director can hear, and be heard by, each other participating, and the Company will cooperate, as may reasonably be required, in providing video or audio conferencing capabilities to effectuate such. |
| 51.5 | The Board of Directors may operate and adopt resolutions in writing, including by facsimile, e-mail or other electronic means, or by telephone or any other means of communication. |
| 52. | Quorum. |
| 52.1 | The quorum for a meeting of the Board and/or for any matter to be brought before the Board shall be constituted by the presence (in person, via telephone conference call, or by proxy) of a majority of the Directors then in office and entitled to participate and vote with respect thereto, which majority must include at least three (3) of the Oak Director, the GF Director, the Viola Ventures Director and the GIC Director. If a meeting is called and no quorum is present, within half an hour from the time appointed for the meeting, it shall stand adjourned to the second Business Day after the day it was originally called for, at the same time and place or such time and place as the Directors may determine. The quorum at any adjourned meeting thereof shall be constituted by the presence of the Directors holding the majority of the voting power of the Directors then in office, provided that all Directors have been served with a notice of such meeting pursuant to Articles 50.3. At an adjourned meeting of the Board the only matters to be considered shall be those matters which might have been lawfully considered at the meeting of the Board originally called if a requisite quorum had been present, and the only resolutions to be adopted are such types of resolutions which could have been adopted at the meeting of the Board originally called. |
| 52.2 | Unless and to the extent provided otherwise in the Companies Law, a Director who is an interested party in any transaction shall be counted for purposes of a quorum despite his interest but shall not be entitled to vote on or participate in the discussions with management in regard to such matter, unless otherwise permitted under the Companies Law. |
| 53. | Exercise of Powers. |
| 53.1 | Subject to Article 41, a meeting of the Board of Directors at which a quorum is present shall be competent to exercise all the authorities, powers and discretion’s for the time being vested in or exercisable by the Board of Directors. |
| 53.2 | Subject to Article 41, all resolutions of the Board will be adopted by a simple majority of the voting power of the Directors present and voting (with the Directors participating by video or audio conference, if any, being deemed present and entitled to vote) at a meeting of the Board. |
| 54. | Chairman of the Board of Directors. |
| 54.1 | The Board of Directors may elect one of its directors to be the Chairman of the Board of Directors, remove such Chairman from office and appoint another in its place. The Chairman of the Board shall take the chair at every meeting of the Board of Directors, but if there is no such Chairman, or if at any meeting he is not present within fifteen (15) minutes of the time appointed for the meeting, or if he is unwilling to take the chair, the Directors present shall choose one of their number to be the Chairman of such meeting. |
| 54.2 | Unless provided explicitly in these Articles, the office of the Chairman of a meeting of the Board of Directors, whether he be the Chairman of the Board of Directors or any other member of the Board of Directors, by itself, shall not entitle the holder thereof to any extra or casting vote. |
| 55. | Validity of Act Despite Defects. |
Subject to the provisions of the Companies Law, all acts performed bona fide at or in accordance with any meeting of the Board of Directors, or of a Committee of the Board of Directors, or by any person acting as a Director or substitute for a Director, shall, notwithstanding that it may afterwards be discovered that there was some defect in the appointment of such Directors or members of a Committee of the Board of Directors or person acting as aforesaid or any of them, or that they or any of them were disqualified, be as valid as if every such person had been duly appointed and was qualified to be a Director, substitute or a member of such a Committee, as the case may be.
GENERAL MANAGER
| 56. | Subject to Article 41, the Board of Directors may from time to time appoint, remove and determine the terms of employment of one or more persons (whether a Director or not) to be General Manager(s), Chief Executive Officer(s) and/or President(s) (or any similar function with a different title) of the Company, either for a fixed term or without any limitation as to the period for which he is or they are to hold office, and may from time to time modify or revoke such titles or (subject to any provisions of any contract between him or them and the Company) remove or dismiss him or them from office and appoint another or others in his or their place or places; provided, however, that under no circumstance shall a Founder that is an executive officer of the Company be removed unless such removal has been approved by a vote of both: (1) the other two Founders; and (2) a majority of the Board of Directors; provided, however, that a Founder that is an executive officer may be removed by a vote of a majority of the Board of Directors for cause, which term shall be understood based on the definition for such term contained in any of the employment agreements then in effect with a Founder. |
| 57. | The remuneration of a General Manager, Chief Executive Officer and/or President shall from time to time (subject to any contract between him and the Company and subject to the provisions of the Companies Law) be fixed by the Board of Directors, and may be in the form of a fixed salary or commission on dividend, profits or turnover of the Company, or of any other company the Company has an interest in, or by participation in profits or in one or more of these forms. |
| 58. | Subject to the provisions of the Companies Law and these Articles (including Article 41), the Board of Directors may from time to time entrust to and confer upon a General Manager, Chief Executive Officer and/or President for the time being such of the powers exercisable under these Articles by the Board of Directors as it may think fit, and may confer such powers for such time, and to be exercised for such objects and purposes, and upon such terms and conditions, and with such restrictions, as it thinks expedient; and it may confer such powers, either collaterally with, or to the exclusion of, and in substitution for, all or any of the powers of the Board of Directors in that behalf; and may from time to time revoke, withdraw, alter, or vary all or any of such powers. |
REGISTER OF SHAREHOLDERS
| 59. | The Company shall keep the Register and record in it the following information: |
| 59.1 | The names and addresses of the Shareholders and a list of the shares held by each one, designating each share by its number, and the amount paid or the amount to be considered as paid on the shares of each Shareholder; |
| 59.2 | The day each person was registered in the Register as a Shareholder; |
| 59.3 | The day each person ceased to be a Shareholder; |
| 59.4 | The amounts called, if any, that are due on the Shares of each Shareholder; and |
| 59.5 | Any other information required or permitted by the Companies Law or these Articles to be recorded in the Register. |
| 60. | The Register shall be kept at the head office, and aside from the times the Register is closed in accordance with the provisions of the Companies Law or these Articles, they shall be open to the inspection of any Shareholder free of charge, and of any other person at a fee the Company shall determine for each matter, during regular business hours. |
| 61. | The Register shall be closed for a period of fourteen (14) days immediately prior to an annual general meeting and during other periods, if any, that the Board of Directors shall determine from time to time, on the condition that the Register shall not be closed for a period exceeding 30 days during any one year; and on the additional condition that the Register shall not be closed unless a notice has been published in accordance with the provisions of the Companies Law, if required. |
MINUTES AND THE SEAL
| 62. | The Board of Directors shall cause minutes to be duly recorded regarding: the names of the Directors present at each meeting of the Board of Directors and of any committee of the Board of Directors; the names of the Shareholders present at each general meeting, and the proceedings and resolutions of general meetings and of meetings of the Board of Directors and Committees of the Board of Directors. Any minutes as aforesaid of a meeting of the Board of Directors, of a meeting of a Committee of the Board of Directors or of a general meeting of the Company, if purporting to be signed by the Chairman of such meeting or by the Chairman of the next succeeding meeting, shall be accepted as prima facie evidence of the matters therein recorded. |
| 63. | The Company may have one or more rubber stamps, for affixing on documents, and the Board of Directors shall provide for the safe custody of any such rubber stamp. |
| 64. | Subject to Article 41, the Board of Directors shall be entitled to authorize any person or persons (even if he or they are not Directors(s) of the Company) to act and sign on behalf of the Company, and the acts and signatures of such person or persons on behalf of the Company shall bind the Company insofar as such person or persons acted and signed within his or their powers aforesaid. |
| 65. | The Board of Directors may provide for a seal. If the Board of Directors so provides, it shall also provide for the safe custody thereof; such seal shall not be used except by the authority of the Board of Directors. |
DIVIDENDS AND RESERVE FUND
| 66. | Articles 66 to 78 below shall be subject to, and shall not derogate from, Article 7 and Article 41, to the extent applicable. |
| 67. | The Board of Directors may, from time to time, set aside, out of the profits of the Company, such sums as it thinks proper, as a reserve fund to meet contingencies, or for equalizing dividends, or for special dividends, or for repairing, improving and maintaining any of the property of the Company, and for such other purposes as the Board of Directors shall in its absolute discretion think conducive to the interests of the Company, and may invest the sums so set aside in such investments as it may think fit, and from time to time deal with and vary such investments, and dispose of all or any part thereof for the benefit of the Company, and may divide the reserve fund into such special funds as it thinks fit, and employ the reserve fund or any part thereof in the business of the Company, and that without being bound to keep the same separate from the other assets of the Company. The Board of Directors may also, without placing the same to reserve, carry forward any profits, which it deems prudent not to divide. |
| 68. | Subject to the rights of holders of Shares with limited or preferred rights as to dividends, and subject to the provisions of these Articles as to the reserve fund, all the dividends shall be paid to the Shareholders in proportion to the amount paid up or credited as paid up on account of the nominal value of the Shares held by them respectively and in respect of which such dividend is being paid, without regard to any premium paid in excess of the nominal value, if any, but if any Share is issued on terms providing that it shall rank for dividend from a particular date, such Share will rank for dividend accordingly. |
| 69. | Subject to the provisions of the Companies Law, the Board of Directors may from time to time declare such dividends as may appear to the Board of Directors to be justified by the profits of the Company and cause the Company to pay such dividends. The Board of Directors shall have the full authority to determine the time for payment of such dividends, and the record date for determining the Shareholders entitled thereto, provided such date is not prior to the date of the resolution to distribute the dividend and no Shareholder who shall be registered in the Register with respect to any Shares after the record date so determined shall be entitled to a share in any such dividend with respect to such Shares. |
| 70. | No dividend shall be paid other than out of the profits of the Company, as defined in the Companies Law, and no interest shall be paid by the Company on dividends. |
| 71. | A dividend may be paid, wholly or partly, by the distribution of specific assets, and, in particular, by distribution of paid-up Shares, debentures or debenture stock of any other company, or in any one or more such ways. |
| 72. | The Board of Directors may resolve that: any moneys, investments, or other assets forming part of the undivided profits of the Company standing to the credit of the reserve fund, or to the credit of any reserve fund for the redemption of capital, or to the credit of a reserve fund for the revaluation of real estate or other assets of the Company or any other reserve fund or investment funds or assets in the hands of the Company and available for dividends, or representing premiums received on the issue of Shares and standing to the credit of the Share premium account, be capitalized and distributed among such of the Shareholders as would be entitled to receive the same if distributed by the way of dividend and in the same proportion on the basis that they become entitled thereto as capital; and that all or any part of such capitalized fund be applied on behalf of such Shareholders in paying up in full, either at par or at such premiums as the resolution may provide, any unissued Shares or debentures or debenture stock of the Company which shall be distributed accordingly or in or towards the payment, in full or in part, of the uncalled liability on any issued Shares or debentures or debenture stock; and that such distribution or payment shall be accepted by such Shareholders in full satisfaction of their share and interest in the said capitalized sum. |
| 73. | For the purpose of giving effect to any resolution under the two (2) last preceding Articles, the Board of Directors may settle any difficulty which may arise in regard to the distribution as it thinks expedient, and, in particular, without derogating from the generality of the foregoing, may issue fractional certificates or make payment in lieu of fractional Shares in an amount determined by the Board, and may fix the value for distribution of any specific assets, and may determine that cash payments shall be made to any Shareholders upon the basis of the value so fixed, or that fractions of less than NIS 0.01 (one New Agora) in value may be disregarded in order to adjust the rights of all parties, and may vest any such cash, Shares, debentures, debenture stock or specific assets in trustees for the persons entitled to the dividend or capitalized fund against such securities as may seem expedient to the Board of Directors. Where requisite, a proper contract shall be filed in accordance with the Companies Law, and the Board of Directors may appoint any person to sign such contract on behalf of such persons entitled to the dividend or capitalized fund, and such appointment shall be effective. |
| 74. | The Board of Directors may deduct from any dividend, bonus or other amount to be paid in respect of shares held by any Shareholder, whether alone or together with another Shareholder, any sum or sums due from him and payable by him alone or together with any other person to the Company on account of calls or the like. |
| 75. | The Board of Directors may retain any dividend or other monies payable or property distributable in respect of a Share on which the Company has a lien, and may apply the same in or towards satisfaction of the debts, liabilities, or engagements in respect of which the lien exists. |
| 76. | The Board of Directors may, when paying any dividend, resolve to retain any dividend, or other monies payable or property distributable, for distribution with respect to a Share in respect of which any person is under these Articles entitled to become a Shareholder, or which any person is under these Articles entitled to transfer, until such person shall become a Shareholder in respect of such Share or shall transfer the same. |
| 77. | All unclaimed dividends or other monies payable in respect of a Share may be invested or otherwise made use of by the Board of Directors for the benefit of the Company until claimed. The payment by the Directors of any unclaimed dividend or such other monies into a separate account shall not constitute the Company a trustee in respect thereof. The principal (and only the principal) of an unclaimed dividend or such other moneys shall be, if claimed, paid to a person entitled thereto. |
| 78. | Any dividend or other monies payable in cash in respect of a Share may be paid by check or warrant sent through the post to, or left at, the registered address of the person entitled thereto or by transfer to a bank account specified by such person (or, if two or more persons are registered as joint holders of such share to the one whose name appears first in the Register), or to such person and at such address as the person entitled thereto may by writing direct. Every such check or warrant shall be made payable to the order of the person to whom it is sent, or to such person as the person entitled thereto as aforesaid may direct, and payment of the check or warrant by the banker upon whom it is drawn shall be a good discharge to the Company. |
| 79. | If several persons are registered as joint holders of any Share, any one of them may give effectual receipts for any dividend payable or property distributable, on the Share. |
BOOKS OF ACCOUNT
| 80. | The Board of Directors shall cause accurate books of account to be kept in accordance with the provisions of the Companies Law and any other applicable law. The books of account shall be kept at the Office or at any other place or places as the Board of Directors may deem fit, and they shall always be open to inspection by Directors. No Shareholder not being a Director shall have the right to inspect any account or book or document of the Company except as conferred by law or authorized by the Board of Directors or by the Company in a general meeting. |
ACCOUNTS AND AUDIT
| 81. | Once at least in every year the accounts of the Company shall be examined and the correctness of the profit and loss account and balance sheet ascertained by a duly qualified auditor. |
| 82. | The appointment, authorities, rights, salaries and duties of the auditor or auditors shall be regulated by the law in force for the time being and by the provisions of these Articles, provided, however, that in exercising its authority to fix the remuneration of the auditor(s), the Shareholders in a general meeting may, by a Shareholder Resolution, act (and in the absence of any action in connection therewith shall be deemed to have so acted), to authorize the Board of Directors to fix such remuneration subject to such criteria or standards, if any, as may be provided in such resolution, and if no such criteria or standards are so provided, such remuneration shall be fixed in an amount commensurate with the volume and nature of the services rendered by such auditor(s). |
NOTICES
| 83. | Any notice or other document may be served by the Company upon any Shareholder either personally or by sending it by prepaid mail (air mail if sent to a place outside Israel), fax or e-mail addressed to such Shareholder at his address as described in the Register or such other address (if any) as he may have designated in writing for the receipt of notices and other documents. Any notice or other document may be served by any Shareholder upon the Company by tendering the same in person to the General Manager of the Company at the Office or by sending it by prepaid registered mail (air mail if posted outside Israel) to the Company at the Office. Any such notice or other document shall be deemed to have been served on two (2) Business Days after it has been posted (seven (7) Business Days if sent to a place, or posted at a place, outside Israel), or when actually received by the addressee if sooner than two (2) Business Days or seven (7) Business Days, as the case may be, after it has been posted, or when actually tendered in person, to such Shareholder (or to the General Manager), provided, however, that notice may be sent by e-mail, facsimile or other customary method, and such notice shall be deemed to have been given the first Business Day after such e-mail, facsimile or other customary method has been sent (and sender has received electronic confirmation of receipt by the recipient) or when actually received by such Shareholder (or by the Company), whichever is earlier. If a notice is in fact, received by the addressee, it shall be deemed to have been duly served, when received, notwithstanding that it was defectively addressed or failed in some other respect, to comply with the provisions of this Article. |
| 84. | A notice may be given by the Company to the joint holders of a Share by giving notice to the joint holder named first in the Register in respect of the Share. |
| 85. | Any Shareholder whose address is not described in the Register, and who shall not have designated in writing an address for the receipt of notices, shall not be entitled to receive any notice from the Company. |
| 86. | The Company may declare that any document(s) will be delivered or be available for review at the Office or any other place designated by the Board of Directors. |
| 87. | Whenever it is required to give prior notice a specified number of days in advance or where a notice is valid for a specified period, the day immediately following service of the notice shall be included in such count or period. Where notice is given by more than one method, it will be deemed served on the earliest of such dates. |
| 88. | Subject to applicable law, any Shareholder, Director or any other person entitled to receive notice in accordance with these Articles or law, may waive notice, in advance or retroactively, in a particular case or type of cases or generally, and if so, notice will be deemed as having been duly served, and all proceedings or actions for which the notice was required will be deemed valid. |
| 89. | Any person entitled to a Share by operation of law or by transfer, transmission or otherwise, will be bound by any notice served with respect to such Shares prior to his being registered in the Register as owner of the Shares. |
| 90. | Notwithstanding anything to the contrary contained herein, the Company may give notice to any Shareholder whose address as registered in the Register is within the State of Israel, by publishing such notice in two daily newspapers in the State of Israel, and the date of such publication shall be deemed the date on which such notice has been served to such Shareholders. |
WINDING-UP
| 91. | If the Company shall be wound up, then, subject to applicable law and the rights of holders of Shares with limited or preferred rights, including, without limitation, Article 7.3.1, the assets of the Company available for distribution among the Shareholders shall be distributed to them in proportion to the amount paid up or credited as paid up on account of the nominal value of the Shares held by them respectively and in respect of which such distribution is being made, without regard to any premium paid in excess of the nominal value, if any. |
INSURANCE. INDEMNITY AND RELEASE
| 92. | Subject to the provisions of the Companies Law, including the receipt of all approvals as required therein or under any applicable law, the Company shall indemnify any Office Holder (as such term is defined in the Companies Law) to the fullest extent permitted by the Companies Law. |
| 93. | Without prejudice to the foregoing, subject to the provisions of the Companies Law including the receipt of all approvals as required therein or under any applicable law, the Company may resolve retroactively to indemnify an Office Holder with respect to the following liabilities and expenses, provided, however, that such liabilities or expenses were incurred by such Office Holder in such Office Holder’s capacity as an Office Holder of the Company: |
| 93.1 | monetary liability imposed on an Office Holder, or incurred by the Office Holder, in favor of another person pursuant to a judgment, including a judgment imposed on such Office Holder in a compromise or in an arbitration decision that was approved by a court of law. |
| 93.2 | reasonable legal expenses, including attorney’s fees, which the Office Holder incurred due to an investigation or a proceeding instituted against the Office Holder by an authority competent to administrate such an investigation or proceeding, and that was “finalized without the filing of an indictment” (as defined in Section 260(a)(1A) of the Companies Law) and “without any financial obligation imposed in lieu of criminal proceedings” (as defined in Section 260(a)(1A) of the Companies Law), or that was finalized without the filing of an indictment against the Office Holder but with financial obligation imposed on the Office Holder in lieu of criminal proceedings of an offense that does not require proof of criminal intent, or in connection with a monetary sanction. |
| 93.3 | reasonable legal expenses, including attorney’s fees, which the Office Holder incurred or with which the Office Holder was charged by a court of law, in a proceeding brought against the Office Holder, by the Company or by another on behalf of the Company, or in a criminal prosecution in which the Office Holder was acquitted, or in a criminal prosecution in which the Office Holder was convicted of an offense that does not require proof of criminal intent. |
| 93.4 | any other circumstances arising under the law in respect of which the Company may indemnify an Office Holder of the Company, and to the extent such law requires the inclusion of a provision permitting such indemnity in these Articles, then such provision is deemed to be included and incorporated herein by reference (including, without limitation, in accordance with Section 56h(b)(1) of the Securities Law (as defined below), if applicable, and 50P(b)(2) of the Israeli Restrictive Trade Practices Law, 5758-1988. |
| 93.5 | a payment which the Office Holder is obligated to make to an injured party as set forth in Section 52(54)(a)(1)(a) of the Israeli Securities Law, 1968, as amended (the “Securities Law”), if applicable, and expenses that he incurred in connection with a proceeding under Chapters H’3, H’4 or 1’1 of the Securities Law, if applicable, including reasonable legal expenses, which term includes attorney fees. |
| 94. | Subject to the provisions of the Companies Law including the receipt of all approvals as required therein or under any applicable law, the Company may undertake in advance to indemnify the Company’s Office Holders (i) for those liabilities and expenses described in Sub-Article 92.1, provided that the undertaking is limited to events that in the opinion of the Board of Directors are foreseeable in view of the Company’s activity at the time of the undertaking and limited in an amount or standard which the Board of Directors determines is reasonable under the circumstances, and (ii) for those liabilities and expenses described in Sub-Articles 92.2, through 92.5. |
| 95. | The Company shall, subject and pursuant to the provisions of the Companies Law, enter into contracts to insure the liability of Office Holders of the Company for any liabilities incurred by them arising from or as a result of any act (or omission) carried out by them as Office Holders of the Company and for which the Company may insure office holders pursuant to the Companies Law, to the maximum extent permitted by law, including in respect of one of the following: |
| (a) | a breach of duty of care to the Company or to any other person; |
| (b) | a breach of his fiduciary duty to the Company, provided that the Office Holder acted in good faith and had reasonable grounds to assume that act that resulted in such breach would not prejudice the interests of the Company; |
| (c) | a financial liability imposed on such Office Holder in favor of any other person; |
| (d) | payments to an injured party imposed on the Office Holder pursuant to Section 52ND(a)(1)(a) of the Securities Law; and |
| (e) | any other event, occurrence, matters or circumstances under any law with respect to which the Company may, or will be able to, insure an Office Holder, and to the extent such law requires the inclusion of a provision permitting such insurance in these Articles, then such provision is deemed to be included and incorporated herein by reference (including, without limitation, in accordance with 56h(b)(1) of the Securities Law, if and to the extent applicable, and Section 50P of the Israeli Restrictive Trade Practices Law, 5758-1988). |
| 96. | The Company shall, to the maximum extent permitted by law, exempt and release an Office Holder of the Company, including in advance, from and against all or part of his or her liability for monetary or other damages due to, arising or resulting from, a breach of his or her duty of care to the Company. The Directors of the Company are released and exempt from all liability as aforesaid to the maximum extent permitted by law with respect to any such breach, which has been or may be committed. |
| 97. | The provisions of Articles 91 through 95 above (a) shall apply to the maximum extent permitted by law (including the Companies Law, the Securities Law and the Israeli Restrictive Trade Practices Law, 57581988); and (b) are not intended, and shall not be interpreted, to restrict the Company in any manner in 61 respect of the procurement of insurance and/or in respect of indemnification (whether in advance or retroactively) and/or exemption (i) in connection with any person who is not an Office Holder including, without limitation, any employee, agent, consultant or contractor of the Company who is not an Office Holder, and/or (ii) in connection with any Office Holder to the extent that such insurance and/or indemnification is not specifically prohibited under law. |
| 98. | In any case where insurance of liability of an Office Holder of the Company or indemnification of such Office Holder is prohibited by any applicable law, the Company shall not insure the liability of such Office Holder of the Company, nor shall it indemnify such Office Holder. |
| 99. | Any amendment to the Companies Law and/or the Securities Law or any other applicable law adversely affecting the right of any Office Holder to be indemnified, insured or exempt pursuant to Articles 91 through 95 and any amendments to Articles 91 through 95 shall be prospective in effect, and shall not affect the Company’s obligation or ability to indemnify, insure or exempt an Office Holder for any act or omission occurring prior to such amendment, unless otherwise provided by applicable law. |
EXCLUDED OPPORTUNITIES
| 100. | The Company renounces any interest or expectancy of the Company in, or in being offered an opportunity to participate in, or in being informed about, an Excluded Opportunity. An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired, created or developed by, or which otherwise comes into the possession of, (i) any director of the Company who is not an employee of the Company or any of its subsidiaries, or (ii) any holder of Preferred Shares or any Affiliate, partner, member, director, shareholder, employee, agent or other related person of any such holder, other than someone who is an employee of the Company or any of its subsidiaries (collectively, “Covered Persons”), unless such matter, transaction or interest is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person solely in such Covered Person’s capacity as a Director or shareholder of the Company. For avoidance of doubt, a Founder shall not be deemed a Covered Person (and therefore the renouncement of the Company in this Article 99 shall not apply to him); provided, however, that the same shall not, by and of itself, impose on such Founder any obligations beyond the requirements of any applicable law or agreement with such Founders. |
MARKET STAND-OFF
| 101. | Each Shareholder hereby agrees that it will enter into a lock-up agreement as required in connection with an IPO or a SPAC Transaction as part of a Public Event pursuant to which the Shareholder shall agree, as the case may be, during the period commencing on the date of the final prospectus relating to the Company’s IPO in the case of an IPO or commencing on the date of the consummation of the initial business combination in the case of a SPAC Transaction (such date, the “Stand-Off Effective Date”), not to 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 Ordinary Shares or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Ordinary Shares held immediately prior to the Stand-Off Effective Date 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 such securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Ordinary Shares or other securities, in cash, or otherwise for a period not to exceed 180 days in the case of an IPO and for such reasonable period as negotiated in good faith by the Board of Directors in the case of a SPAC Transaction. |
It shall be understood that in the case of an IPO, the foregoing provisions shall be subject to customary carveouts, and shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, or the transfer of any shares to any trust for the direct or indirect benefit of the Shareholder or the immediate family of the Shareholder, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, and shall be applicable to the Shareholders only if all officers and directors are subject to the same restrictions and the Company uses commercially reasonable efforts to obtain a similar agreement from all shareholders individually owning more than one percent (1%) of the Company’s outstanding Ordinary Shares (after giving effect to conversion into Ordinary Shares of all outstanding Preferred Shares). The underwriters in connection with such registration are intended third party beneficiaries of this provision and shall have the right, power, and authority to enforce the provisions hereof as though they were a party hereto. Each Shareholder further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with this provision or that are necessary to give further effect thereto. Any discretionary waiver or termination of the restrictions of any or all of such agreements by the Company or the underwriters shall apply pro rata to all Shareholders subject to such agreements, based on the number of shares subject to such agreements. Notwithstanding anything herein to the contrary, this provision shall not apply to any equity securities purchased by a Shareholder in the Company’s IPO.
* * * * * *
67
Exhibit 3.2
THE COMPANIES LAW, 5759-1999
A LIMITED LIABILITY COMPANY
_________
ARTICLES OF ASSOCIATION
OF
PAGAYA TECHNOLOGIES LTD.
As Adopted on _____, 2022
Preliminary
| 1. | Definitions; Interpretation. |
(a) In these Articles, the following terms (whether or not capitalized) shall bear the meanings set forth opposite them, respectively, unless the subject or context requires otherwise.
| “Articles” | shall mean these Articles of Association, as amended from time to time. |
| “Board of Directors” | shall mean the Board of Directors of the Company. |
| “Chairperson” | shall mean the Chairperson of the Board of Directors, or the Chairperson of the General Meeting, as the context implies. |
| “Closing Date” | shall mean [●], 2022 . |
| “Companies Law” | shall mean the Israeli Companies Law, 5759-1999 and the regulations promulgated thereunder. The Companies Law shall include reference to the Companies Ordinance (New Version), 5743-1983, of the State of Israel, to the extent in effect according to the provisions thereof. |
| “Company” | shall mean Pagaya Technologies Ltd. |
| “Director(s)” | shall mean the member(s) of the Board of Directors holding office at a given time. |
| “Economic Competition Law” | shall mean the Israeli Economic Competition Law, 5748-1988 and the regulations promulgated thereunder. |
| “External Director(s)” | shall have the meaning provided for such term in the Companies Law. |
| “General Meeting” | shall mean an Annual General Meeting or Special General Meeting of the Shareholders (each as defined in Article 24 of these Articles), as the case may be. |
| “Liquidation Event” | means a liquidation, merger, capital stock exchange, reorganization, sale of all or substantially all assets or other similar transaction involving the Company upon the consummation of which holders of Ordinary Shares would be entitled to exchange their Ordinary Shares for cash, securities or other property. |
| “NIS” | shall mean New Israeli Shekels. |
| “Office” | shall mean the registered office of the Company at a given time. |
| “Office Holder” | shall have the meaning provided for such term in the Companies Law. |
| “Securities Law” | shall mean the Israeli Securities Law, 5728-1968 and the regulations promulgated thereunder. |
| Shareholder(s)” | shall mean the shareholder(s) of the Company, at a given time. |
(b) Unless the context shall otherwise require: words in the singular shall also include the plural, and vice versa; any pronoun shall include the corresponding masculine, feminine and neuter forms; the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; the words “herein”, “hereof” and “hereunder” and words of similar import refer to these Articles in their entirety and not to any part hereof; all references herein to Articles or clauses shall be deemed references to Articles or clauses of these Articles; any references to any agreement or other instrument or law, statute or regulation are to it as amended, supplemented or restated, from time to time (and, in the case of any law, to any successor provisions or re-enactment or modification thereof being in force at the time); any reference to “law” shall include any law (‘din’) as defined in the Interpretation Law, 5741-1981 and any applicable supranational, national, federal, state, local, or foreign statute or law and shall be deemed also to refer to all rules and regulations promulgated thereunder; any reference to a “day” or a number of “days” (without any explicit reference otherwise, such as to business days) shall be interpreted as a reference to a calendar day or number of calendar days; any reference to a business day or business days shall mean each calendar day other than Saturday, Sunday, and any calendar day on which commercial banks in New York, New York or Tel Aviv, Israel are authorized or required by applicable law to close; reference to a month or year means according to the Gregorian calendar; any reference to a “person” shall mean any individual, partnership, corporation, limited liability company, association, estate, any political, governmental, regulatory or similar agency or body or other legal entity; and reference to “written” or “in writing” shall include written, printed, photocopied, typed, any electronic communication (including email, facsimile, signed electronically (in Adobe PDF, DocuSign or any other format)) or produced by any visible substitute for writing, or partly one and partly another, and signed shall be construed accordingly.
(c) The captions in these Articles are for convenience only and shall not be deemed a part hereof or affect the construction or interpretation of any provision hereof.
(d) The specific provisions of these Articles shall supersede the provisions of the Companies Law to the extent permitted thereunder.
Limited Liability
| 2. | The Company is a limited liability company and each Shareholder’s liability for the Company’s debts is therefore limited (in addition to any liabilities under any contract) to the payment of the full amount (par value (if any) and premium) such Shareholder was required to pay the Company for such Shareholder’s Shares (as defined below) and which amount has not yet been paid by such Shareholder. |
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Company’s Objectives
| 3. | Objectives. |
The Company’s objectives are to carry on any business, and do any act, which is not prohibited by law.
| 4. | Donations. |
The Company may donate a reasonable amount of money (in cash or in kind, including the Company’s securities) to worthy purposes, as the Board of Directors may determine in its discretion, even if such donations are not made on the basis or within the scope of business considerations of the Company.
Share Capital
| 5. | Authorized Share Capital. |
The authorized share capital of the Company shall consist of (i) 8,000,000,000 Class A Ordinary Shares, without par value (the “Class A Shares”), and (ii) 2,000,000,000 Class B Ordinary Shares, without par value (the “Class B Shares”, and together with the Class A Shares, the “Shares” or the “Ordinary Shares”). The rights, powers and preferences of the Class A Shares and Class B Shares shall be as set forth in these Articles.
| 6. | Increase of Authorized Share Capital. |
(a) The Company may, from time to time, by a Shareholders’ resolution, whether or not all of the shares then authorized have been issued, and whether or not all of the shares theretofore issued have been called up for payment, increase its authorized share capital by increasing the number of shares it is authorized to issue by such amount, and such additional shares shall confer such rights and preferences, and shall be subject to such restrictions, as such resolution shall provide.
(b) Except to the extent otherwise provided in such resolution, any new shares included in the authorized share capital increase as aforesaid shall be subject to all of the provisions of these Articles that are applicable to shares that are included in the existing share capital.
| 7. | Special or Class Rights; Modification of Rights. |
(a) Subject to Section 8(d) below, the Company may, from time to time, by a Shareholders’ resolution, provide for shares with such preferred or deferred rights or other special rights and/or such restrictions, whether in regard to dividends, voting, repayment of share capital or otherwise, as may be stipulated in such resolution.
(b) If at any time the share capital of the Company is divided into different classes of shares, the rights attached to any class, unless otherwise provided by these Articles, may be modified or cancelled by the Company by a resolution of the General Meeting of the holders of all shares as one class, without any required separate resolution of any class of shares; provided, however, that (i) any modification to the rights attached to the Class B Shares shall require approval of Shareholders holding 100% of the then issued Class B Shares, and (ii) as long as any Class B Shares remain outstanding, any modification to (or cancellation of) any rights of the Class A Shares that is not applied in the same manner to the Class B Shares shall require approval of a majority of the Class A Shares represented and voted, in person or by proxy, in a Class Meeting convened for such purpose.
(c) The provisions of these Articles relating to General Meetings shall apply, mutatis mutandis, to any separate General Meeting of the holders of the shares of a particular class (a “Class Meeting”), it being clarified that the requisite quorum at any such separate Class Meeting shall be two or more Shareholders present in person or by proxy and holding not less than thirty-three and one-third percent (33⅓%) of the issued shares of such class, provided, however, that if such separate Class Meeting was initiated by and convened pursuant to a resolution adopted by the Board of Directors and at the time of such meeting the Company is a “foreign private issuer” under U.S. securities laws, the requisite quorum at any such separate Class Meeting shall be two or more Shareholders present in person or by proxy and holding not less than twenty five percent (25%) of the issued shares of such class; provided, however, that at all times the requisite quorum at any such separate Class Meeting of the Class B Shares shall be Shareholders present in person or by proxy and holding not less than a majority of the issued shares of such class. The above notwithstanding, any Shareholder in default of its payment obligation under Article 14 hereof shall not accounted as a Shareholder for purposes of this Article. The provisions of Article 28(c) shall apply to adjourned Class Meetings, mutatis mutandis.
| - 3 - |
(d) Unless otherwise provided by these Articles, an increase in the authorized share capital, the creation of a new class of shares, an increase in the authorized share capital of a class of shares, or the issuance of additional shares thereof out of the authorized and unissued share capital, shall not be deemed, for purposes of this Article 7, to modify or derogate or cancel the rights attached to previously issued shares of such class or of any other class; provided, however, that the creation of a new class of shares with more than one vote per share shall be considered a modification of the Class B Shares.
| 8. | Class A Shares and Class B Shares. |
Issuance
(a) From and after the effective time of these Articles, additional Class B Shares may be issued only to, and registered in the name of, (i) Gal Krubiner, Yahav Yulzari and Avital Pardo (each a “Founder” and, together, the “Founders”) and (ii) any Permitted Class B Owner (as defined below).
Voting Power
(b) Except as otherwise provided in these Articles or otherwise required by applicable law, each holder of Class A Shares shall be entitled to one (1) vote for each Class A Share held, and each holder of Class B Shares shall be entitled to ten (10) votes for each Class B Share held, in each case, as of the applicable record date set for the vote on any matter, whether the vote thereon is conducted by a show of hands, by written ballot, or by any other means. Notwithstanding anything herein to the contrary, in no event shall the aggregate voting power of a holder of Class B Shares exceed the maximum voting power permitted under applicable law without effecting a tender offer.
Identical Rights
(c) Except as otherwise expressly provided in this Article 8, the Class A Shares and Class B Shares shall have the same rights and privileges and rank equally, share ratably and be identical in all respects as to all matters, including without limitation:
(i) Dividends and Distributions. Class A Shares and Class B Shares shall be treated equally and ratably, on a per share basis with respect to any dividend or distribution paid or distributed by the Company, unless different treatment of the shares of each such class is approved in separate Class Meetings of each of such classes, and in which a majority of the shares of each such class present and voting in such meeting affirmatively vote in favor of such treatment, provided, however, that in the event a distribution is paid in the form of shares or rights to acquire shares, the holders of Class A Shares shall receive Class A Shares (or rights to acquire such shares, as the case may be) while holders of Class B Shares shall receive Class B Shares (or rights to acquire such shares, as the case may be).
(ii) Subdivision and Combination. If the Company effects a split, reverse split, subdivision or combination of the outstanding Class A Shares or Class B Shares, the outstanding shares of the other class will be subject to the same split, reverse split, subdivision or combination in the same proportion and manner, unless different treatment is approved in separate Class Meetings of each of
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(iii) Liquidation Event. Class A Shares and Class B Shares shall be treated equally, identically and ratably on a per share basis with respect to any consideration into which such Shares are converted or any consideration paid or otherwise distributed to shareholders of the Company in connection with a Liquidation Event, unless different treatment of the shares of each such class is approved in separate Class Meetings of each of such classes, and in which a majority of the shares of each such class present and voting in such meeting affirmatively vote in favor of such treatment.
Voluntary Conversion
(d) Each one Class B Share shall be convertible into one Class A Share at the option of the holder thereof, at any time, upon written notice to the Company and the Company’s transfer agent.
Automatic Conversion in Certain Events
(e) All outstanding Class B Shares owned by a Founder and by any Permitted Class B Owners affiliated with such Founder shall automatically convert into an equal number of Class A Shares (without consideration and without need for further action by the Company or the relevant Founder or Permitted Class B Owner) on the date of the earlier to occur of (i), (ii) or (iii) below (the “Trigger Conditions”):
(i)
| (1) | the earliest to occur of (a) such Founder’s employment or engagement as an officer of the Company being terminated not for Cause (as defined below), (b) such Founder’s resigning as an officer of the Company, (c) death or Permanent Disability (as defined below) of such Founder; provided, however, that if such Founder or such Permitted Class B Owner validly provides for the transfer of some or all of his, her or its Class B Shares to one or more of the other Founders or Permitted Class B Owners affiliated with the other Founders in the event of death or Permanent Disability then such Class B Shares that are transferred to another Founder or Permitted Class B Owner affiliated with the other Founders shall remain Class B Shares and shall not convert into an equal number of Class A Shares, or (d) the appointment of a receiver, trustee or similar official in bankruptcy or similar proceeding with respect to a Founder or his Class B Shares; AND |
| (2) | such Founder no longer serves as a member of the Board of Directors; |
OR
(ii) ninety (90) days following the date on which such Founder first receives notice that his employment as an officer of the Company is terminated for Cause; provided, however, that if, prior to the expiration of such ninety-day period, (a) the Board of Directors repeals its determination that such Founder was terminated for Cause or determines that the Cause had been cured, then the provisions of clause (i) above shall apply, or (b) such Founder commences legal proceedings with the competent judicial forum to determine that such determination by the Board of Directors of termination for Cause was improper or incorrect, then such Founder shall retain its Class B Shares until the earlier of (y) the issuance of a final unappealable judgment confirming the determination of the Board of Directors, or a judgment which execution had not been stayed pending an appeal, and (z) the abandonment of such proceedings or their dismissal or denial by a ruling of the relevant judicial forum on any grounds, substantive or procedural, and regardless of whether or not the Board of Directors’ determination regarding the termination for Cause is confirmed as part of such ruling; provided, that notwithstanding anything to the contrary in this Article 8(e)(ii), in the case of clauses (1) – (3) of Article 8(n)(i) below, the basis for Cause shall be deemed to not be curable, and such redemption shall be effective immediately upon written notice by the Company to such Founder;
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OR
(iii) the earlier to occur of (1) such time as the Founders and the Permitted Class B Owners first collectively hold less than 10% of the total issued and outstanding ordinary share capital of the Company, and (2) the fifteenth (15th) anniversary of the Closing Date.
Additionally, Class B Shares shall automatically convert into Class A Shares as described in Article 8(h) below.
Effect of Conversion
(f) In the event of voluntary conversion of Class B Shares to Class A Shares pursuant to Article 8(d), or automatic conversion pursuant to Article 8(e), all rights of the holder of such Class B Shares shall cease and such holder shall thereafter be treated for all purposes as having become the record holder of such number of Class A Shares into which such Class B Shares were convertible. The Class A Shares issuable upon conversion of the Class B Shares shall remain restricted shares, and all certificates or book-entries representing such shares shall bear a legend in customary form to that effect. Any proxy issued with respect to Class B Shares shall, unless otherwise stated in such proxy, continue to apply with respect to the Class A Shares into which the Class B shares have been converted. Class B Shares that are converted into Class A Shares as provided in this Article 8 shall not be reissued, and no further Class B Shares may be issued by the Company following the voluntary or automatic conversion of the last of the outstanding Class B Shares.
Protective Provisions
(g) The Company shall not, without the prior affirmative vote of 100% of the outstanding Class B Shares, voting as a separate class, in addition to any other vote required by applicable law or these Articles:
(i) directly or indirectly, whether by amendment, or through merger, recapitalization, consolidation or otherwise, amend or repeal, or adopt any provision of these Articles inconsistent with, or otherwise alter, any provision of these Articles that modifies the voting, conversion or other rights, powers, preferences, privileges or restrictions of the Class B Shares;
(ii) reclassify any outstanding Class A Shares into shares having the right to have more than one (1) vote for each share thereof, except as required by law;
(iii) issue any Class B Shares (other than Class B Shares originally issued by the Company after the Closing Date pursuant to the exercise or conversion of options or warrants that, in each case, are outstanding as of the Closing Date); or
(iv) authorize, or issue any shares of, any class or series of the Company’s share capital having the right to more than one (1) vote for each share thereof.
Transfer
(h) Any Class B Shares that are Transferred (as defined below) to any person or entity other than a Permitted Class B Owner (a “Permitted Transfer”) shall automatically upon such Transfer convert into an equal number of Class A Shares (without consideration and without need for further action by the Company or the relevant Founder or Permitted Class B Owner).
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(i) Any purported Transfer of Class B Shares in violation of this Article 8 shall be null and void. If, notwithstanding the limitations set out in this Article 8, a person shall voluntarily or involuntarily, purportedly become or attempt to become, the purported owner (the “Purported Owner”) of Class B Shares in violation of these limitations, then the Purported Owner shall not obtain any rights in and to such Class B Shares and the purported Transfer shall not be recognized by the Company’s transfer agent or recorded on the Company’s register of shareholders.
(j) Upon a determination by the Board of Directors that a person has attempted or is attempting to acquire Class B Shares, or has purportedly Transferred or acquired Class B Shares, in each case in violation of the limitations set out in this Article 8, the Board of Directors may take such action as it deems advisable to refuse to give effect to such attempted or purported transfer or acquisition on the books and records of the Company, including to institute proceedings to enjoin any such attempted or purported Transfer or acquisition, or reverse any entries or records reflecting such attempted or purported Transfer or acquisition.
(k) The Board of Directors shall have all powers necessary to implement the limitations set out in this Article 8, including the power to prohibit the Transfer of any Class B Shares in violation thereof.
(l) All certificates or book-entries representing Class B Shares shall bear a legend substantially in the following form (or in such other form as the Board of Directors may determine):
THE SECURITIES REPRESENTED BY THIS [CERTIFICATE][BOOK-ENTRY] ARE SUBJECT TO THE RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER) SET FORTH IN THE ARTICLES OF ASSOCIATION (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY AND SHALL BE PROVIDED FREE OF CHARGE TO ANY SHAREHOLDER MAKING A REQUEST THEREFOR).
No Other Rights
(m) Except for the special voting rights and protective provisions set forth herein, the Class B Shares shall bestow upon the holder(s) thereof the same rights, preferences and privileges as the Class A Shares, in accordance with Article 8(c) above. Similarly, and except for the automatic conversion provisions and the restrictions on transfer set out in this Article 8, the holders of Class B Shares shall be subject to the same prohibitions, limitations and obligations as those applicable to the holders of the Class A Shares.
Definitions
(n) For purposes of this Article 8:
(i) Termination with Cause. A termination for “Cause” shall occur thirty (30) days after written notice by the Company to a Founder (based upon the unanimous decision of the Board of Directors, other than such Founder) of a termination for Cause if such Founder shall have failed to cure or remedy such matter, if curable, within such thirty (30) day period. In the event that the basis for Cause is not curable, then such thirty (30) day cure period shall not be required, and such termination shall be effective ten (10) days after the date the Company delivers notice of such termination for Cause. “Cause” shall mean the Company’s termination of a Founder’s employment with the Company or any of its subsidiaries as a result of: (1) fraud, embezzlement or any willful act of material dishonesty by such Founder in connection with or relating to such Founder’s employment with the Company or any of its subsidiaries; (2) theft or misappropriation of property, information or other assets by such Founder in connection with such Founder’s employment with the Company or any of its subsidiaries which results in or would reasonably be expected to result in material loss, damage or injury to the Company or its subsidiaries, their goodwill, business or reputation; (3) such Founder’s conviction, guilty plea, no contest plea, or similar plea for any felony or any crime that results in or would reasonably be expected to result in material loss, damage or injury to the Company and its subsidiaries, their goodwill, business or reputation, including any crime involving moral turpitude; (4) such Founder’s use of alcohol or drugs that materially interferes with the ability of such Founder to perform such Founder’s material duties hereunder; (5) such Founder’s material breach of a material Company policy, or material breach of a Company policy that results in or would reasonably be expected to result in material loss, damage or injury to the Company and its subsidiaries, their goodwill, business or reputation, including any breach involving moral turpitude; or (6) such Founder’s material breach of any of his obligations under the employment agreement between such Founder and the Company or any of its subsidiaries, as in effect from time to time (the “Founder Employment Agreement”); provided, that, for clauses (1) - (6) above, the Company delivers written notice to such Founder of the condition giving rise to Cause within ninety (90) days after the later of such condition’s initial occurrence or the date upon which the Company first discovered or should reasonably have discovered such condition.
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(ii) “Permanent Disability” shall mean a permanent and total disability such that a Founder is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which would reasonably be expected to result in death within twelve (12) months or which has lasted or would reasonably be expected to last for a continuous period of not less than twelve (12) months as determined by a licensed medical practitioner.
(iii) “Permitted Class B Owner” shall mean any person or entity that, through contract, proxy or operation of law, has irrevocably delegated the sole and exclusive right to vote the Class B Shares held by such person or entity to a Founder. A person or entity that is a Permitted Class B Owner shall cease to be a Permitted Class B Owner upon the occurrence of any action, event or other circumstance that (A) allows any person other than a Founder to vote the Class B Shares held by such first person or entity or (B) results in the Founder who holds such voting power becoming unable to exercise such voting power (for example, because of such Founder’s death or disability).
(iv) “Transfer” of a Class B Share shall mean, any sale, assignment, transfer, conveyance, hypothecation or other transfer or disposition, whether direct or indirect, of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law (including by merger, consolidation or otherwise, and including by issuance or transfer of shares or interests of any Permitted Class B Owner which is a corporate entity), including a transfer of a Class B Share to a broker or other nominee (regardless of whether there is a corresponding change in beneficial ownership), or the transfer of, or entering into a binding agreement with respect to, Voting Control (as defined below) over such share by proxy or otherwise (other than proxy(ies), voting instruction(s) or voting agreement(s) solicited on behalf of the Board of Directors). Notwithstanding the foregoing, the pledge of Class B Shares by a shareholder that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction for so long as such shareholder continues to exercise Voting Control over such pledged shares shall not constitute a Transfer within the meaning of this Article 8. A “Transfer” shall also be deemed to have occurred with respect to a Class B Share beneficially held by the transferor, if there occurs any act or circumstance that causes such transfer to not be a permitted hereunder.
(v) “Voting Control” shall mean, with respect to a Class B Share, the exclusive power to vote or direct the voting of such share by proxy, voting agreement or otherwise.
| 9. | Consolidation, Division, Cancellation and Reduction of Share Capital. |
(a) The Company may, from time to time, by or pursuant to an authorization of a Shareholders’ resolution, and subject to applicable law:
(i) consolidate all or any part of its issued or unissued authorized share capital;
(ii) divide or sub-divide its shares (issued or unissued) or any of them and the resolution whereby any share is divided may determine that, as among the holders of the shares resulting from such subdivision, one or more of the shares may, in contrast to others, have any such preferred or deferred rights or rights of redemption or other special rights, or be subject to any such restrictions, as the Company may attach to unissued or new shares;
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(iii) cancel any authorized shares which, at the date of the adoption of such resolution, have not been issued to any person nor has the Company made any commitment, including a conditional commitment, to issue such shares, and reduce the amount of its share capital by the amount of the shares so canceled; or
(iv) reduce its share capital in any manner.
(b) With respect to any consolidation of issued shares and with respect to any other action which may result in fractional shares, the Board of Directors may settle any difficulty which may arise with regard thereto, as it deems fit, and, in connection with any such consolidation or other action which could result in fractional shares, may, without limiting its aforesaid power:
(i) determine, as to the holder of shares so consolidated, which issued shares shall be consolidated;
(ii) issue, in contemplation of or subsequent to such consolidation or other action, shares sufficient to preclude or remove fractional share holdings;
(iii) redeem such shares or fractional shares sufficient to preclude or remove fractional share holdings;
(iv) round up, round down or round to the nearest whole number, any fractional shares resulting from the consolidation or from any other action which may result in fractional shares; or
(v) cause the transfer of fractional shares by certain Shareholders to other Shareholders so as to most expediently preclude or remove any fractional shareholdings, and cause the transferees of such fractional shares to pay the transferors thereof the fair value thereof, and the Board of Directors is hereby authorized to act in connection with such transfer, as agent for the transferors and transferees of any such fractional shares, with full power of substitution, for the purposes of implementing the provisions of this sub-Article 9(b)(v).
(c) If the Company in any manner subdivides, combines or reclassifies the outstanding shares of one class of Ordinary Shares, the outstanding shares of the other class of Ordinary Shares will be subdivided, combined or reclassified in the same manner; provided, however, that shares of one such class of Ordinary Shares may be subdivided, combined or reclassified in a different or disproportionate manner if such subdivision, combination or reclassification is approved in advance by the affirmative vote (or written consent) of the holders of a majority of the outstanding Class A Shares represented in person or by proxy and voted on such matter, and the holders of 100% of the outstanding Class B Shares, each voting separately as a class.
| 10. | Issuance of Share Certificates, Replacement of Lost Certificates. |
(a) To the extent that the Board of Directors determines that all shares shall be certificated or, if the Board of Directors does not so determine, to the extent that any Shareholder requests a share certificate or the Company’s transfer agent so requires, share certificates shall be issued under the corporate seal of the Company or its written, typed or stamped name and shall bear the signature of one Director, the Company’s Chief Executive Officer, or any person or persons authorized therefor by the Board of Directors. Signatures may be affixed in any mechanical or electronic form, as the Board of Directors may prescribe.
(b) Subject to the provisions of Article 10(a), each Shareholder shall be entitled to one numbered certificate for all of the shares of any class registered in his, her or its name. Each certificate shall specify the serial numbers of the shares represented thereby and may also specify the amount paid up thereon. The Company (as determined by an officer of the Company to be designated by the Chief Executive Officer) shall not refuse a request by a Shareholder to obtain several certificates in place of one certificate, unless such request is, in the opinion of such officer, unreasonable. Where a Shareholder has sold or transferred a portion of such Shareholder’s shares, such Shareholder shall be entitled to receive a certificate in respect of such Shareholder’s remaining shares, provided that the previous certificate is delivered to the Company before the issuance of a new certificate.
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(c) A share certificate registered in the names of two or more persons shall be delivered to the person first named in the Register of Shareholders in respect of such co-ownership.
(d) A share certificate which has been defaced, lost or destroyed, may be replaced, and the Company shall issue a new certificate to replace such defaced, lost or destroyed certificate upon payment of such fee, and upon the furnishing of such evidence of ownership and such indemnity, as the Board of Directors in its discretion deems fit.
| 11. | Registered Holder. |
Except as otherwise provided in these Articles or the Companies Law, the Company shall be entitled to treat the registered holder of each share as the absolute owner thereof, and accordingly, shall not, except as ordered by a court of competent jurisdiction, or as required by the Companies Law, be obligated to recognize any equitable or other claim to, or interest in, such share on the part of any other person.
| 12. | Issuance and Repurchase of Shares. |
(a) The unissued shares from time to time shall be under the control of the Board of Directors (and, to the extent permitted by law, any Committee (as defined below) thereof), which shall have the power to issue or otherwise dispose of shares and of securities convertible or exercisable into or other rights to acquire from the Company to such persons, on such terms and conditions (including, inter alia, price, with or without premium, discount or commission, and terms relating to calls set forth in Article 14(f) hereof), and at such times, as the Board of Directors (or the Committee, as the case may be) deems fit, and the power to give to any person the option to acquire from the Company any shares or securities convertible or exercisable into or other rights to acquire from the Company on such terms and conditions (including, price, with or without premium, discount or commission), during such time as the Board of Directors (or the Committee, as the case may be) deems fit; provided, however, that this Article 12(a) shall not apply to Class B Shares.
(b) Other than with respect to the Class B Shares (unless converted in accordance with Articles 8(d) or (e) above), the Company may at any time and from time to time, subject to the Companies Law, repurchase or finance the purchase of any shares or other securities issued by the Company, in such manner and under such terms as the Board of Directors shall determine, whether from any one or more Shareholders. Such purchase shall not be deemed as payment of dividends and as such, no Shareholder will have the right to require the Company to purchase his or her shares or offer to purchase shares from any other Shareholders.
| 13. | Payment in Installments. |
If pursuant to the terms of issuance of any share, all or any portion of the price thereof shall be payable in installments, every such installment shall be paid to the Company on the due date thereof by the then registered holder(s) of the share or the person(s) then entitled thereto.
| 14. | Calls on Shares. |
(a) The Board of Directors may, from time to time, as it, in its discretion, deems fit, make calls for payment upon Shareholders in respect of any sum (including premium) which has not been paid up in respect of shares held by such Shareholders and which is not, pursuant to the terms of issuance of such shares or otherwise, payable at a fixed time, and each Shareholder shall pay the amount of every call so made upon him or her (and of each installment thereof if the same is payable in installments), to the person(s) and at the time(s) and place(s) designated by the Board of Directors, as any such times may be thereafter extended and/or such person(s) or place(s) changed. Unless otherwise stipulated in the resolution of the Board of Directors (and in the notice hereafter referred to), each payment in response to a call shall be deemed to constitute a pro rata payment on account of all the shares in respect of which such call was made.
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(b) Notice of any call for payment by a Shareholder shall be given in writing to such Shareholder not less than fourteen (14) days prior to the time of payment fixed in such notice, and shall specify the time and place of payment, and the person to whom such payment is to be made. Prior to the time for any such payment fixed in a notice of a call given to a Shareholder, the Board of Directors may in its discretion, by notice in writing to such Shareholder, revoke such call in whole or in part, extend the time fixed for payment thereof, or designate a different place of payment or person to whom payment is to be made. In the event of a call payable in installments, only one notice thereof need be given.
(c) If pursuant to the terms of issuance of a share or otherwise, an amount is made payable at a fixed time, such amount shall be payable at such time as if it were payable by virtue of a call made by the Board of Directors and for which notice was given in accordance with paragraphs (a) and (b) of this Article 14, and the provision of these Articles with regard to calls (and the non-payment thereof) shall be applicable to such amount or such installment (and the non-payment thereof).
(d) Joint holders of a share shall be jointly and severally liable to pay all calls for payment in respect of such share and all interest payable thereon.
(e) Any amount called for payment which is not paid when due shall bear interest from the date fixed for payment until actual payment thereof, at such rate (not exceeding the then prevailing debitory rate charged by leading commercial banks in Israel), and payable at such time(s) as the Board of Directors may prescribe.
(f) Upon the issuance of shares, the Board of Directors may provide for differences among the holders of such shares as to the amounts and times for payment of calls for payment in respect of such shares.
| 15. | Prepayment. |
With the approval of the Board of Directors, any Shareholder may pay to the Company any amount not yet payable in respect of his, her or its shares, and the Board of Directors may approve the payment by the Company of interest on any such amount until the same would be payable if it had not been paid in advance, at such rate and time(s) as may be approved by the Board of Directors. The Board of Directors may at any time cause the Company to repay all or any part of the money so advanced, without premium or penalty. Nothing in this Article 15 shall derogate from the right of the Board of Directors to make any call for payment before or after receipt by the Company of any such advance.
| 16. | Forfeiture and Surrender. |
(a) If any Shareholder fails to pay an amount payable by virtue of a call, installment or interest thereon as provided for in accordance herewith, on or before the day fixed for payment of the same, the Board of Directors may at any time after the day fixed for such payment, so long as such amount (or any portion thereof) or interest thereon (or any portion thereof) remains unpaid, forfeit all or any of the shares in respect of which such payment was called for. All expenses incurred by the Company in attempting to collect any such amount or interest thereon, including attorneys’ fees and costs of legal proceedings, shall be added to, and shall, for all purposes (including the accrual of interest thereon) constitute a part of, the amount payable to the Company in respect of such call.
(b) Upon the adoption of a resolution as to the forfeiture of a Shareholder’s share, the Board of Directors shall cause notice thereof to be given to such Shareholder, which notice shall state that, in the event of the failure to pay the entire amount so payable by a date specified in the notice (which date shall be not less than fourteen (14) days after the date such notice is given and which may be extended by the Board of Directors), such shares shall be ipso facto forfeited, provided, however, that, prior to such date, the Board of Directors may cancel such resolution of forfeiture, but no such cancellation shall stop the Board of Directors from adopting a further resolution of forfeiture in respect of the non-payment of the same amount.
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(c) Without derogating from Articles 52 and 56 hereof, whenever shares are forfeited as herein provided, all dividends, if any, theretofore declared in respect thereof and not actually paid shall be deemed to have been forfeited at the same time.
(d) The Company, by resolution of the Board of Directors, may accept the voluntary surrender of any share.
(e) Any share forfeited or surrendered as provided herein, shall become the property of the Company as a dormant share, and the same, subject to the provisions of these Articles, may be sold, re-issued or otherwise disposed of as the Board of Directors deems fit.
(f) Any person whose shares have been forfeited or surrendered shall cease to be a shareholder in respect of the forfeited or surrendered shares, but shall, notwithstanding, be liable to pay, and shall forthwith pay, to the Company, all calls, interest and expenses owing upon or in respect of such shares at the time of forfeiture or surrender, together with interest thereon from the time of forfeiture or surrender until actual payment, at the rate prescribed in Article 14(e) above, and the Board of Directors, in its discretion, may, but shall not be obligated to, enforce or collect the payment of such amounts, or any part thereof, as it shall deem fit. In the event of such forfeiture or surrender, the Company, by resolution of the Board of Directors, may accelerate the date(s) of payment of any or all amounts then owing to the Company by the person in question (but not yet due) in respect of all shares owned by such shareholder, solely or jointly with another.
(g) The Board of Directors may at any time, before any share so forfeited or surrendered shall have been sold, re-issued or otherwise disposed of, nullify the forfeiture or surrender on such conditions as it deems fit, but no such nullification shall stop the Board of Directors from re-exercising its powers of forfeiture pursuant to this Article 16.
| 17. | Lien. |
(a) Except to the extent the same may be waived or subordinated in writing, the Company shall have a first and paramount lien upon all the shares registered in the name of each shareholder (without regard to any equitable or other claim or interest in such shares on the part of any other person), and upon the proceeds of the sale thereof, for his or her debts, liabilities and engagements to the Company arising from any amount payable by such shareholder in respect of any unpaid or partly paid share, whether or not such debt, liability or engagement has matured. Such lien shall extend to all dividends from time to time declared or paid in respect of such share. Unless otherwise provided, the registration by the Company of a transfer of shares shall be deemed to be a waiver on the part of the Company of the lien (if any) existing on such shares immediately prior to such transfer.
(b) The Board of Directors may cause the Company to sell a share subject to such a lien when the debt, liability or engagement giving rise to such lien has matured, in such manner as the Board of Directors deems fit, but no such sale shall be made unless such debt, liability or engagement has not been satisfied within fourteen (14) days after written notice of the intention to sell shall have been served on such shareholder, his or her executors or administrators.
(c) The net proceeds of any such sale, after payment of the costs and expenses thereof or ancillary thereto, shall be applied in or toward satisfaction of the debts, liabilities or engagements of such shareholder in respect of such share (whether or not the same have matured), and the remaining proceeds (if any) shall be paid to the shareholder, his or her executors, administrators or assigns.
| 18. | Sale After Forfeiture or Surrender or For Enforcement of Lien. |
Upon any sale of a share after forfeiture or surrender or for enforcing a lien, the Board of Directors may appoint any person to execute an instrument of transfer of the share so sold and cause the purchaser’s name to be entered in the Register of Shareholders in respect of such share. The purchaser shall be registered as the shareholder and shall not be bound to see to the regularity of the sale proceedings, or to the application of the proceeds of such sale, and after his or her name has been entered in the Register of Shareholders in respect of such share, the validity of the sale shall not be impeached by any person, and the remedy of any person aggrieved by the sale shall be in damages only and against the Company exclusively.
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| 19. | Redeemable Shares. |
The Company may, subject to applicable law, issue redeemable shares or other securities and redeem the same upon terms and conditions to be set forth in a written agreement between the Company and the holder of such shares or in their terms of issuance.
Transfer of Shares
| 20. | Registration of Transfer. |
No transfer of shares shall be registered unless a proper writing or instrument of transfer (in any customary form or any other form satisfactory to the Board of Directors or an officer of the Company to be designated by the Chief Executive Officer) has been submitted to the Company (or its transfer agent), together with any share certificate(s) and such other evidence of title as the Board of Directors or an officer of the Company to be designated by the Chief Executive Officer may require. Notwithstanding anything to the contrary herein, shares registered in the name of The Depository Trust Company or its nominee shall be transferrable in accordance with the policies and procedures of The Depository Trust Company. Until the transferee has been registered in the Register of Shareholders in respect of the shares so transferred (or, in the case of shares registered in book-entry form or “street name”, until the transferee has been registered in such form with the applicable brokerage firm or other nominee), the Company may continue to regard the transferor as the owner thereof. The Board of Directors, may, from time to time, prescribe a fee for the registration of a transfer, and may approve other methods of recognizing the transfer of shares in order to facilitate the trading of the Company’s shares on the Nasdaq Stock Market or on any other stock exchange on which the Company’s shares are then listed for trading.
| 21. | Suspension of Registration. |
The Board of Directors may, in its discretion to the extent it deems necessary, close the Register of Shareholders of registration of transfers of shares for a period determined by the Board of Directors, and no registrations of transfers of shares shall be made by the Company during any such period during which the Register of Shareholders is so closed.
Transmission of Shares
| 22. | Decedents’ Shares. |
Upon the death of a Shareholder, the Company shall recognize the custodian or administrator of the estate or executor of the will, and in the absence of such, the lawful heirs of the Shareholder, as the only holders of the right for the shares of the deceased Shareholder, after receipt of evidence to the entitlement thereto, as determined by the Board of Directors or an officer of the Company to be designated by the Chief Executive Officer.
| 23. | Receivers and Liquidators. |
(a) The Company may recognize any receiver, liquidator or similar official appointed to wind-up, dissolve or otherwise liquidate a corporate Shareholder, and a trustee, manager, receiver, liquidator or similar official appointed in bankruptcy or in connection with the reorganization of, or similar proceeding with respect to a Shareholder or its properties, as being entitled to the shares registered in the name of such Shareholder, except in the case of Class B Shares, which shall be dealt with in the manner set out in Article 8(e)(i)(1).
(b) Such receiver, liquidator or similar official appointed to wind-up, dissolve or otherwise liquidate a corporate Shareholder and such trustee, manager, receiver, liquidator or similar official appointed in bankruptcy or in connection with the reorganization of, or similar proceedings with respect to a Shareholder or its properties, upon producing such evidence as the Board of Directors (or an officer of the Company to be designated by the Chief Executive Officer) may deem sufficient as to his or her authority to act in such capacity or under this Article, shall with the consent of the Board of Directors or an officer of the Company to be designated by the Chief Executive Officer (which the Board of Directors or such officer may grant or refuse in its discretion), be registered as a Shareholder in respect of such shares, or may, subject to the regulations as to transfer herein contained, transfer such shares, in each case except for the Class B Shares, which shall be dealt with in the manner set out in Article 8(e)(i)(1).
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General Meetings
| 24. | General Meetings. |
(a) An annual General Meeting (“Annual General Meeting”) shall be held every calendar year at such time and at such place, either within or outside of the State of Israel, as may be determined by the Board of Directors, and in compliance with any time limitations imposed by applicable law or stock exchange rules and regulations.
(b) All General Meetings other than Annual General Meetings shall be called “Special General Meetings”. The Board of Directors may, at its discretion, convene a Special General Meeting at such time and place, within or outside of the State of Israel, as may be determined by the Board of Directors.
(c) If so determined by the Board of Directors, an Annual General Meeting or a Special General Meeting may be held through the use of any means of communication approved by the Board of Directors, provided all of the participating Shareholders can hear each other simultaneously. A resolution approved by use of means of communications as aforesaid, shall be deemed to be a resolution lawfully adopted at such general meeting and a Shareholder shall be deemed present in person at such general meeting if attending such meeting through the means of communication used at such meeting.
| 25. | Record Date for General Meeting. |
Notwithstanding any provision of these Articles to the contrary, and to allow the Company to determine the Shareholders entitled to notice of or to vote at any General Meeting or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or grant of any rights, or entitled to exercise any rights in respect of or to take or be the subject of any other action, the Board of Directors may fix a record date for the General Meeting, which shall not be more than the maximum period and not less than the minimum period permitted by law. A determination of Shareholders of record entitled to notice of or to vote at a General Meeting shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.
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| 26. | Shareholder Proposal Request. |
(a) Any Shareholder or Shareholders holding at least the required percentage under the Companies Law of the voting rights of the Company which entitles such Shareholder(s) to require the Company to include a matter on the agenda of a General Meeting (the “Proposing Shareholder(s)”) may request, subject to the Companies Law, that the Board of Directors include a matter on the agenda of a General Meeting to be held in the future, provided that the Board of Directors determines that the matter is appropriate to be considered at a General Meeting (a “Proposal Request”). In order for the Board of Directors to consider a Proposal Request and whether to include the matter stated therein in the agenda of a General Meeting, notice of the Proposal Request must be timely delivered in accordance with applicable law and stock exchange rules and regulations, and the Proposal Request must comply with the requirements of these Articles (including this Article 26) and any applicable law and stock exchange rules and regulations. The Proposal Request must be in writing, signed by all of the Proposing Shareholder(s) making such request, delivered, either in person or by registered mail, postage prepaid, and addressed to the Secretary of the Company (the “Secretary”) or, in the absence thereof, to the Chief Executive Officer of the Company (the “Chief Executive Officer”)). To be considered timely, a Proposal Request must be received within the time periods prescribed by applicable law and any stock exchange rules and regulations. The announcement of an adjournment or postponement of a General Meeting shall not commence a new time period (or extend any time period) for the delivery of a Proposal Request as described above. In addition to any information required to be included in accordance with applicable law or any stock exchange rules and regulations, a Proposal Request must include the following: (i) the name, address, telephone number, fax number and email address of the Proposing Shareholder (or each Proposing Shareholder, as the case may be) and, if an entity, the name(s) of the person(s) that controls or manages such entity; (ii) the number of Shares held by the Proposing Shareholder(s), directly or indirectly (and, if any of such Shares are held indirectly, an explanation of how they are held and by whom), which shall be in such number no less than as is required to qualify as a Proposing Shareholder, accompanied by evidence satisfactory to the Company of the record holding of such Shares by the Proposing Shareholder(s) as of the date of the Proposal Request; (iii) the matter requested to be included on the agenda of a General Meeting, all information related to such matter, the reason that such matter is proposed to be brought before the General Meeting, the complete text of the resolution that the Proposing Shareholder proposes to be voted upon at the General Meeting, and a representation that the Proposing Shareholder(s) intend to appear in person or by proxy at the meeting; (iv) a description of all arrangements or understandings between the Proposing Shareholders and any other person(s) (naming such person or persons) in connection with the matter that is requested to be included on the agenda and a declaration signed by all Proposing Shareholder(s) of whether any of them has a personal interest in the matter and, if so, a description in reasonable detail of such personal interest; (v) a description of all Derivative Transactions (as defined below) by each Proposing Shareholder(s) during the previous twelve (12) month period, including the date of the transactions and the class, series and number of securities involved in, and the material economic terms of, such Derivative Transactions; and (vi) a declaration that all of the information that is required under the Companies Law and any other applicable law and stock exchange rules and regulations to be provided to the Company in connection with such matter, if any, has been provided to the Company. The Board of Directors, may, in its discretion, to the extent it deems necessary, request that the Proposing Shareholder(s) provide additional information necessary so as to include a matter in the agenda of a General Meeting, as the Board of Directors may reasonably require.
A “Derivative Transaction” means any agreement, arrangement, interest or understanding entered into by, or on behalf or for the benefit of, any Proposing Shareholder or any of its affiliates or associates, whether of record or beneficial: (1) the value of which is derived in whole or in part from the value of any class or series of shares or other securities of the Company, (2) which otherwise provides any direct or indirect opportunity to gain or share in any gain derived from a change in the value of securities of the Company, (3) the effect or intent of which is to mitigate loss, manage risk or benefit of security value or price changes, or (4) which provides the right to vote or increase or decrease the voting power of, such Proposing Shareholder, or any of its affiliates or associates, with respect to any shares or other securities of the Company, which agreement, arrangement, interest or understanding may include any option, warrant, debt position, note, bond, convertible security, swap, stock appreciation right, short position, profit interest, hedge, right to dividends, voting agreement, performance-related fee or arrangement to borrow or lend shares (whether or not subject to payment, settlement, exercise or conversion in any such class or series), and any proportionate interest of such Proposing Shareholder in the securities of the Company held by any general or limited partnership, or any limited liability company, of which such Proposing Shareholder is, directly or indirectly, a general partner or managing member.
(b) The information required pursuant to this Article shall be updated prior to the last date for submittal of Proposal Requests for the General Meeting in accordance with applicable law and stock exchange rules and regulations.
(c) The provisions of Articles 26(a) and 26(b) shall apply, mutatis mutandis, to any matter to be included on the agenda of a Special General Meeting which is convened pursuant to a request of a Shareholder duly delivered to the Company in accordance with the Companies Law.
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(d) Notwithstanding anything to the contrary herein, this Article 26 may be amended, replaced or suspended only by a resolution adopted at a General Meeting by (i) so long as Class B Shares remain outstanding, a majority of the total voting power of the Shareholders and (ii) if no Class B Shares remain outstanding, a supermajority of at least seventy-five percent (75%) of the total voting power of the Shareholders.
| 27. | Notice of General Meetings; Omission to Give Notice. |
(a) The Company is not required to give notice of a General Meeting, subject to any mandatory provision of the Companies Law.
(b) The accidental omission to give notice of a General Meeting to any Shareholder, or the non-receipt of notice sent to such Shareholder, shall not invalidate the proceedings at such meeting or any resolution adopted thereat.
(c) No Shareholder present, in person or by proxy, at any time during a General Meeting shall be entitled to seek the cancellation or invalidation of any proceedings or resolutions adopted at such General Meeting on account of any defect in the notice of such meeting relating to the time or the place thereof, or any item acted upon at such meeting.
(d) In addition to any places at which the Company may make available for review by Shareholders the full text of the proposed resolutions to be adopted at a General Meeting, as required by the Companies Law, the Company may add additional places for Shareholders to review such proposed resolutions, including an internet site.
Proceedings at General Meetings
| 28. | Quorum. |
(a) No business shall be transacted at a General Meeting, or at any adjournment thereof, unless the quorum required under these Articles for such General Meeting or such adjourned meeting, as the case may be, is present when the meeting proceeds to business.
(b) In the absence of contrary provisions in these Articles, the requisite quorum for any General Meeting shall be two or more Shareholders (not in default in payment of any sum referred to in Article 14 hereof) present in person or by proxy and holding shares conferring in the aggregate at least thirty-three and one-third percent (33⅓%) of the voting power of the Company, provided, however, that with respect to any General Meeting that was initiated by and convened pursuant to a resolution adopted by the Board of Directors and at the time of such General Meeting the Company is a “foreign private issuer” under U.S. securities laws, the requisite quorum shall be two or more Shareholders (not in default in payment of any sum referred to in Article 14 hereof) present in person or by proxy and holding shares conferring in the aggregate at least twenty five percent (25%) of the voting power of the Company. For the purpose of determining the quorum present at a certain General Meeting, a proxy may be deemed to be two (2) or more Shareholders pursuant to the number of Shareholders represented by the proxy holder. Notwithstanding the foregoing, a quorum for any General Meeting shall also require the presence in person or by proxy of at least one Shareholder holding Class B Shares if such shares are outstanding.
(c) If within half an hour from the time appointed for the meeting a quorum is not present, then without any further notice the meeting shall be adjourned either (i) to the same day in the next week, at the same time and place, (ii) to such day and at such time and place as indicated in the notice of such meeting, or (iii) to such day and at such time and place as the Chairperson of the General Meeting shall determine (which may be earlier or later than the date pursuant to clause (i) above). No business shall be transacted at any adjourned meeting except business which might lawfully have been transacted at the meeting as originally called. At such adjourned meeting, if the original meeting was convened upon the request of a Shareholder in accordance with the Companies Law, one or more Shareholders, present in person or by proxy, and holding the number of shares required for making such request, shall constitute a quorum, but in any other case any Shareholder (not in default as aforesaid) present in person or by proxy, shall constitute a quorum.
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| 29. | Chairperson of General Meeting. |
The Chairperson shall preside as Chairperson of every General Meeting. If at any meeting the Chairperson is not present within fifteen (15) minutes after the time fixed for holding the meeting or is unwilling or unable to act as Chairperson, any of the following may preside as Chairperson of the meeting (and in the following order): a Director designated by the Board of Directors, the Chief Executive Officer, the Chief Financial Officer, the General Counsel, the Secretary or any person designated by any of the foregoing. If at any such meeting none of the foregoing persons is present or all are unwilling or unable to act as Chairperson, the Shareholders present (in person or by proxy) shall choose a Shareholder or its proxy present at the meeting to be Chairperson. The office of Chairperson shall not, by itself, entitle the holder thereof to vote at any General Meeting nor shall it entitle such holder to a second or casting vote (without derogating, however, from the rights of such Chairperson to vote as a Shareholder or proxy of a Shareholder if, in fact, he or she is also a Shareholder or such proxy).
| 30. | Adoption of Resolutions at General Meetings. |
(a) Except as required by the Companies Law or these Articles, including Article 40 below, a resolution of the Shareholders shall be adopted if approved by the holders of a simple majority of the voting power represented at the General Meeting in person or by proxy and voting thereon, as one class, and disregarding abstentions from the count of the voting power present and voting. Without limiting the generality of the foregoing, a resolution with respect to a matter or action for which the Companies Law prescribes a higher majority or pursuant to which a provision requiring a higher majority would have been deemed to have been incorporated into these Articles, but for which the Companies Law allows these Articles to provide otherwise (including, Sections 327 and 24 of the Companies Law), shall be adopted by a simple majority of the voting power represented at the General Meeting in person or by proxy and voting thereon, as one class, and disregarding abstentions from the count of the voting power present and voting.
(b) Every question submitted to a General Meeting shall be decided by a show of hands, but the Chairperson or other person chairing the General Meeting may determine that a resolution shall be decided by a written ballot. A written ballot may be implemented before the proposed resolution is voted upon or immediately after the declaration by the Chairperson of the results of the vote by a show of hands. If a vote by written ballot is taken after such declaration, the results of the vote by a show of hands shall be of no effect, and the proposed resolution shall be decided by such written ballot.
(c) A defect in convening or conducting a General Meeting other than with respect to the existence of a quorum, including a defect resulting from the non-fulfillment of any provision or condition set forth in the Companies Law or these Articles, including with regard to the manner of convening or conducting the General Meeting, shall not disqualify any resolution passed at the General Meeting and shall not affect the discussions or decisions which took place thereat.
(d) A declaration by the Chairperson or other person chairing the General Meeting that a resolution has been carried unanimously, or carried by a particular majority, or rejected, and an entry to that effect in the minute book of the Company, shall be prima facie evidence of the fact without proof of the number or proportion of the votes recorded in favor of or against such resolution.
| 31. | Power to Adjourn. |
A General Meeting, the consideration of any matter on its agenda, or the resolution on any matter on its agenda, may be postponed or adjourned, from time to time and from place to place: (i) by the Chairperson or other person chairing the General Meeting at which a quorum is present (and he shall do so if directed by the General Meeting, with the consent of the holders of a majority of the voting power represented in person or by proxy and voting on the question of adjournment), but no business shall be transacted at any such adjourned meeting except business which might lawfully have been transacted at the meeting as originally called, or a matter on its agenda with respect to which no resolution was adopted at the meeting originally called; or (ii) by the Board of Directors (whether prior to or at a General Meeting); provided that the Board of Directors may adjourn or postpone a meeting only with the unanimous consent of all members of the Board of Directors, and, in the case of an Annual General Meeting, only to the extent that such adjournment would not delay the meeting beyond any time limitation imposed by applicable law or stock exchange rules and regulations.
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| 32. | Voting Power. |
Subject to the provisions of Article 33(a) and to any provision hereof conferring special rights as to voting, or restricting the right to vote:
(a) except as otherwise provided in these Articles or otherwise required by the Companies Law, and except in the event of a Class Meeting, any Shareholder holding both Class A Shares and Class B Shares may at all times vote both classes of shares on all matters (including the election of Directors); and
(b) each Shareholder of Class A Shares shall be entitled to one (1) vote for each Class A Share held as of the applicable record date on any matter whether the vote thereon is conducted by a show of hands, by written ballot, or by any other means, and each Shareholder of Class B Shares shall be entitled to ten (10) votes for each Class B Share held as of the applicable record date on any matter whether the vote thereon is conducted by a show of hands, by written ballot, or by any other means.
| 33. | Voting Rights. |
(a) No Shareholder shall be entitled to vote at any General Meeting (or be counted as a part of the quorum thereat), unless all calls then payable by him, her or its in respect of his or her shares in the Company have been paid.
(b) A company or other corporate body being a Shareholder may duly authorize any person to be its representative at any meeting of the Company or to execute or deliver a proxy on its behalf. Any person so authorized shall be entitled to exercise on behalf of such Shareholder all the power, which the Shareholder could have exercised if it were an individual. Upon the request of the Chairperson or other person chairing the General Meeting, written evidence of such authorization (in form reasonably acceptable to the Chairperson) shall be delivered to him or her.
(c) Any Shareholder entitled to vote may vote either in person or by proxy (who need not be a Shareholder), or, if the Shareholder is a company or other corporate body, by representative authorized pursuant to Article (b) above.
(d) If two (2) or more persons are registered as joint holders of any share, the vote of the senior who tenders a vote, in person or by proxy, shall be accepted to the exclusion of the vote(s) of the other joint holder(s). For the purpose of this Article 33(d), seniority shall be determined by the order of registration of the joint holders in the Register of Shareholders.
(e) If a Shareholder is a minor, under protection, bankrupt or legally incompetent, or in the case of a corporation, is in receivership or liquidation, it may, subject to all other provisions of these Articles and any documents or records required to be provided under these Articles, vote through his, her or its trustees, receiver, liquidator, natural guardian or another legal guardian, as the case may be, and the persons listed above may vote in person or by proxy.
Proxies
| 34. | Instrument of Appointment. |
(a) An instrument appointing a proxy shall be in writing and shall be substantially in the following form:
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| “I | of | ||
| (Name of Shareholder) | (Address of Shareholder) | ||
| Being a shareholder of Pagaya Technologies Ltd. hereby appoints | |||
| of | |||
| (Name of Proxy) | (Address of Proxy) | ||
| as my proxy to vote for me and on my behalf at the General Meeting of the Company to be held on the ___ day of _______, _______ and at any adjournment(s) thereof. | |||
| Signed this ____ day of ___________, ______. | |||
| (Signature of Appointor)” | |||
or in any usual or common form or in such other form as may be approved by the Board of Directors. Such proxy shall be duly signed by the appointor of such person's duly authorized attorney, or, if such appointor is a company or other corporate body, in the manner in which it signs documents which binds it together with a certificate of an attorney with regard to the authority of the signatories.
(b) Subject to the Companies Law, the original instrument appointing a proxy or a copy thereof certified by an attorney (and the power of attorney or other authority, if any, under which such instrument has been signed) shall be delivered to the Company (at its Office, at its principal place of business, or at the offices of its registrar or transfer agent, or at such place as notice of the meeting may specify) not less than forty eight (48) hours (or such shorter period as the notice shall specify) before the time fixed for such meeting. Notwithstanding the above, the Chairperson shall have the right to waive the time requirement provided above with respect to all instruments of proxies and to accept instruments of proxy until the beginning of a General Meeting, as long as such waiver is consistently applied. A document appointing a proxy shall be valid for every adjourned meeting of the General Meeting to which the document relates.
| 35. | Effect of Death of Appointor of Transfer of Share and or Revocation of Appointment. |
(a) A vote cast in accordance with an instrument appointing a proxy shall be valid notwithstanding the prior death or bankruptcy of the appointing Shareholder (or of his or her attorney-in-fact, if any, who signed such instrument), or the transfer of the share in respect of which the vote is cast, unless written notice of such matters shall have been received by the Company or by the Chairperson of such meeting prior to such vote being cast.
(b) Subject to the Companies Law, an instrument appointing a proxy shall be deemed revoked (i) upon receipt by the Company or the Chairperson, subsequent to receipt by the Company of such instrument, of written notice signed by the person signing such instrument or by the Shareholder appointing such proxy canceling the appointment thereunder (or the authority pursuant to which such instrument was signed) or of an instrument appointing a different proxy (and such other documents, if any, required under Article 34(b) for such new appointment), provided such notice of cancellation or instrument appointing a different proxy were so received at the place and within the time for delivery of the instrument revoked thereby as referred to in Article 34(b) hereof, or (ii) if the appointing Shareholder is present in person at the meeting for which such instrument of proxy was delivered, upon receipt by the Chairperson of such meeting of written notice from such Shareholder of the revocation of such appointment, or if and when such Shareholder votes at such meeting. A vote cast in accordance with an instrument appointing a proxy shall be valid notwithstanding the revocation or purported cancellation of the appointment, or the presence in person or vote of the appointing Shareholder at a meeting for which it was rendered, unless such instrument of appointment was deemed revoked in accordance with the foregoing provisions of this Article 35(b) at or prior to the time such vote was cast.
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Board of Directors
| 36. | Powers of the Board of Directors. |
(a) The Board of Directors may exercise all such powers and do all such acts and things as the Board of Directors is authorized by law or as the Company is authorized to exercise and do and are not hereby or by law required to be exercised or done by the General Meeting or by a specific committee of the Board of Directors (where the establishment of such committee is mandatory under applicable law). The authority conferred on the Board of Directors by this Article 36 shall be subject to the provisions of the Companies Law, these Articles and any regulation or resolution consistent with these Articles adopted from time to time at a General Meeting, provided, however, that no such regulation or resolution shall invalidate any prior act done by or pursuant to a decision of the Board of Directors which would have been valid if such regulation or resolution had not been adopted.
(b) Without limiting the generality of the foregoing, the Board of Directors may, from time to time, set aside any amount(s) out of the profits of the Company as a reserve or reserves for any purpose(s) which the Board of Directors, in its discretion, shall deem fit, including capitalization and distribution of bonus shares, and may invest any sum so set aside in any manner and from time to time deal with and vary such investments and dispose of all or any part thereof, and employ any such reserve or any part thereof in the business of the Company without being bound to keep the same separate from other assets of the Company, and may subdivide or re-designate any reserve or cancel the same or apply the funds therein for another purpose, all as the Board of Directors may from time to time think fit.
| 37. | Exercise of Powers of the Board of Directors. |
(a) A meeting of the Board of Directors at which a quorum is present in accordance with Article 46 shall be competent to exercise all the authorities, powers and discretion vested in or exercisable by the Board of Directors.
(b) Unless otherwise set forth herein, a resolution proposed at any meeting of the Board of Directors shall be deemed adopted if approved by a majority of the Directors present, entitled to vote and voting thereon when such resolution is put to a vote.
(c) The Board of Directors may adopt resolutions, without convening a meeting of the Board of Directors, in writing or in any other manner permitted by the Companies Law.
| 38. | Delegation of Powers. |
(a) The Board of Directors may, subject to the provisions of the Companies Law (or shall, where required by the Companies Law), delegate any or all of its powers to committees (in these Articles referred to as a “Committee of the Board of Directors” or “Committee”), each consisting of one or more persons who are Directors, and it may from time to time revoke such delegation or alter the composition of any such Committee, in each case subject to the provisions of the Companies Law. Any Committee so formed shall, in the exercise of the powers so delegated, conform to any regulations imposed on it by the Board of Directors, subject to applicable law or any stock exchange rules or regulations. No regulation imposed by the Board of Directors on any Committee and no resolution of the Board of Directors shall invalidate any prior act done or pursuant to a resolution by the Committee which would have been valid if such regulation or resolution of the Board of Directors had not been adopted. The meetings and proceedings of any such Committee of the Board of Directors shall, mutatis mutandis, be governed by the provisions herein contained for regulating the meetings of the Board of Directors, to the extent not superseded by any regulations adopted by the Board of Directors. Unless otherwise expressly prohibited by the Board of Directors, in delegating powers to a Committee of the Board of Directors, such Committee shall be empowered to further delegate such powers to a sub-committee of Directors or to an individual Director.
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(b) The Board of Directors may from time to time appoint a Secretary, as well as officers, agents, employees and independent contractors, as the Board of Directors deems fit, and may terminate the service of any such person. The Board of Directors may, subject to the provisions of the Companies Law, determine the powers and duties, as well as the salaries and compensation, of all such persons.
(c) The Board of Directors may from time to time, by power of attorney or otherwise, appoint any person, company, firm or body of persons to be the attorney or attorneys of the Company at law or in fact for such purposes(s) and with such powers, authorities and discretions, and for such period and subject to such conditions, as it deems fit, and any such power of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board of Directors deems fit, and may also authorize any such attorney to delegate all or any of the powers, authorities and discretions vested in him, her or it.
| 39. | Number of Directors. |
(a) The Board of Directors shall consist of such number of Directors (not less than three (3) nor more than ten (10), including the External Directors if any are required to be elected) as may be fixed from time to time by resolution of the General Meeting.
(b) Notwithstanding anything to the contrary herein, this Article 39 may be amended or replaced only by a resolution adopted at a General Meeting by (i) so long as Class B Shares remain outstanding, a majority of the total voting power of the Shareholders and (ii) if no Class B Shares remain outstanding, a supermajority of at least seventy-five percent (75%) of the total voting power of the Shareholders.
| 40. | Election and Removal of Directors. |
(a) The Directors, excluding the External Directors if any are required to be elected, shall be classified, with respect to the term for which they each severally hold office, into three classes, as nearly equal in number as practicable, hereby designated as Class I, Class II and Class III (each, a “Class”). The Board of Directors may assign members of the Board of Directors already in office to such classes at the time such classification becomes effective.
The term of office (i) of the initial Class I directors shall expire at the Annual General Meeting to be held during the first calendar year following the year in which the Closing takes place, and when their successors are elected and qualified, (ii) of the initial Class II directors shall expire at the first Annual General Meeting following the Annual General Meeting referred to in clause (i) above and when their successors are elected and qualified, and (iii) of the initial Class III directors shall expire at the first Annual General Meeting following the Annual General Meeting referred to in clause (ii) above and when their successors are elected and qualified.
(b) At each Annual General Meeting, commencing with the Annual General Meeting to be held in the first calendar year following the year in which the Closing takes place, each Nominee or Alternate Nominee (each as defined below) elected to replace the Directors of a Class whose term shall have expired at such Annual General Meeting shall be elected to hold office until the third Annual General Meeting next succeeding his or her election and until his or her respective successor shall have been elected and qualified. Notwithstanding anything to the contrary, each Director shall serve until his or her successor is elected and qualified or until such earlier time as such Director’s office is vacated.
(c) If the number of Directors, excluding External Directors, if any are required to be elected, that comprises the Board of Directors is hereafter changed by the Board of Directors, any newly created directorships or decrease in directorships shall be so apportioned by the Board of Directors among the classes as to make all classes as nearly equal in number as is practicable, provided that no decrease in the number of Directors constituting the Board of Directors shall shorten the term of any incumbent Director.
(d) Prior to every General Meeting at which Directors are to be elected, and subject to clauses (a) and (h) of this Article, the Board of Directors (or a Committee thereof) shall select, by a resolution adopted by a majority of the Board of Directors (or such Committee), a number of persons to be proposed to the Shareholders for election as Directors at such General Meeting (the “Nominees”).
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(e) Any Proposing Shareholder requesting to include on the agenda of a General Meeting a nomination of a person to be proposed to the Shareholders for election as Director (such person, an “Alternate Nominee”), may so request, provided that it complies with this Article 40(e), Article 26 and applicable law. A Proposal Request relating to an Alternate Nominee is deemed to be a matter that is appropriate to be considered only at an Annual General Meeting. In addition to any information required to be included in accordance with applicable law, such a Proposal Request shall include information required pursuant to Article 26, and shall also set forth: (i) the name, address, telephone number, fax number and email address of the Alternate Nominee and all citizenships and residencies of the Alternate Nominee; (ii) a description of all arrangements, relations or understandings during the past three (3) years, and any other material relationships, between the Proposing Shareholder(s) or any of its affiliates and each Alternate Nominee; (iii) a declaration signed by the Alternate Nominee that he or she consents to be named in the Company’s notices and proxy materials and on the Company’s proxy card relating to the General Meeting, if provided or published, and that he or she, if elected, consents to serve on the Board of Directors and to be named in the Company’s disclosures and filings; (iv) a declaration signed by each Alternate Nominee as required under the Companies Law and any other applicable law and stock exchange rules and regulations for the appointment of such an Alternate Nominee and an undertaking that all of the information that is required under law and stock exchange rules and regulations to be provided to the Company in connection with such an appointment has been provided (including, information in respect of the Alternate Nominee as would be provided in response to the applicable disclosure requirements under Form 20-F or any other applicable form prescribed by the U.S. Securities and Exchange Commission (the “SEC”)); (v) a declaration made by the Alternate Nominee of whether he or she meets the criteria for an independent director and, if applicable, External Director under any applicable law, regulation or stock exchange rules and regulations, and if not, then an explanation of why not; and (vi) any other information required at the time of submission of the Proposal Request by applicable law, regulations or stock exchange rules. In addition, the Proposing Shareholder(s) and each Alternate Nominee shall promptly provide any other information reasonably requested by the Company, including a duly completed director and officer questionnaire, in such form as may be provided by the Company, with respect to each Alternate Nominee. The Board of Directors may refuse to acknowledge the nomination of any person not made in compliance with the foregoing. The Company shall be entitled to publish any information provided by a Proposing Shareholder or Alternate Nominee pursuant to this Article 40(e) and Article 26, and the Proposing Shareholder and Alternate Nominee shall be responsible for the accuracy and completeness thereof.
(f) The Nominees or Alternate Nominees shall be elected by a resolution adopted at the General Meeting at which they are subject to election.
(g) Notwithstanding anything to the contrary herein, this Article 40 and Article 43(e) may be amended or replaced only by a resolution adopted at a General Meeting by (i) so long as any Class B Shares remain outstanding, a majority of the total voting power of the Shareholders and (ii) if no Class B Shares remain outstanding, a supermajority of at least seventy-five percent (75%) of the total voting power of the Shares, provided that no amendment or replacement of this Article 40 or Article 43(e) below shall shorten the term of any incumbent Director.
(h) Notwithstanding anything to the contrary in these Articles, the nomination, election, qualification, removal or dismissal of External Directors, if so elected, shall comply with the applicable provisions set forth in the Companies Law.
| 41. | Commencement of Directorship. |
Without derogating from Article 40, the term of office of a Director shall commence as of the date of his or her appointment or election, or on a later date if so specified in his or her appointment or election.
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| 42. | Continuing Directors in the Event of Vacancies. |
The Board of Directors (and, if so determined by the Board of Directors, the General Meeting) may at any time and from time to time appoint any person as a Director to fill a vacancy (whether such vacancy is due to a Director no longer serving or due to the number of Directors serving being less than the maximum number stated in Article 39 hereof). In the event of one or more such vacancies in the Board of Directors, the continuing Directors may continue to act in every matter, provided, however, that if the number of Directors serving is less than the minimum number provided for pursuant to Article 39 hereof, they may act only in an emergency or to fill the office of a Director which has become vacant up to a number equal to the minimum number provided for pursuant to Article 39 hereof, or in order to call a General Meeting for the purpose of electing Directors to fill any or all vacancies. The office of a Director that was appointed by the Board of Directors to fill any vacancy shall only be for the remaining period of time during which the Director whose service has ended was filled would have held office. Notwithstanding anything to the contrary herein, this Article 42 may be amended, replaced or suspended only by a resolution adopted at a General Meeting by (i) so long as any Class B Shares remain outstanding, a majority of the total voting power of the Shareholders and (ii) if no Class B Shares remain outstanding, a supermajority of at least seventy-five percent (75%) of the total voting power of the Shareholders.
| 43. | Vacation of Office. |
The office of a Director shall be vacated and he shall be dismissed or removed:
(a) ipso facto, upon his or her death;
(b) if he or she is prevented by applicable law or any stock exchange rules or regulations from serving as a Director;
(c) if the Board of Directors determines that due to his or her mental or physical state he or she is unable to serve as a Director;
(d) if his or her directorship expires pursuant to these Articles and/or applicable law;
(e) by a resolution adopted at a General Meeting by (i) so long as any Class B Shares remain outstanding, a majority of the total voting power of the Shareholders and (ii) if no Class B Shares remain outstanding, a supermajority of at least seventy-five percent (75%) of the total voting power of the Shares (with such removal becoming effective on the date fixed in such resolution), provided that no such resolution shall shorten the term of an incumbent Director who was elected under the staggered board composition pursuant to Article 40;
(f) by his or her written resignation, such resignation becoming effective on the date fixed therein, or upon the delivery thereof to the Company, whichever is later; or
(g) with respect to an External Director, if so elected, and notwithstanding anything to the contrary herein, only pursuant to applicable law.
| 44. | Conflict of Interests; Approval of Related Party Transactions. |
(a) Subject to the provisions of applicable law and these Articles, no Director shall be disqualified by virtue of his or her office from holding any office or place of profit in the Company or in any company in which the Company shall be a shareholder or otherwise interested, or from contracting with the Company as vendor, purchaser or otherwise, nor shall any such contract, or any contract or arrangement entered into by or on behalf of the Company in which any Director shall be in any way interested, be avoided, nor, other than as required under the Companies Law, shall any Director be liable to account to the Company for any profit arising from any such office or place of profit or realized by any such contract or arrangement by reason only of such Director’s holding that office or of the fiduciary relations thereby established, but the nature of his or her interest, as well as any material fact or document, must be disclosed by him or her at the meeting of the Board of Directors at which the contract or arrangement is first considered, if his or her interest then exists, or, in any other case, at no later than the first meeting of the Board of Directors after the acquisition of his or her interest.
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(b) Subject to the Companies Law and these Articles, a transaction between the Company and an Office Holder, and a transaction between the Company and another entity in which an Office Holder has a personal interest, in each case, which is not an Extraordinary Transaction (as defined by the Companies Law), shall require only approval by the Board of Directors or a Committee of the Board of Directors. Such authorization, as well as the actual approval, may be for a particular transaction or more generally for specific type of transactions.
Proceedings of the Board of Directors
| 45. | Meetings. |
(a) The Board of Directors may meet and adjourn its meetings and otherwise regulate such meetings and proceedings as the Board of Directors deems fit.
(b) A meeting of the Board of Directors shall be convened by the Secretary (or, in the absence thereof, by the Chief Executive Officer) upon instruction of the Chairperson or upon a request of at least two (2) Directors which is submitted to the Chairperson or in any event that such meeting is required by the provisions of the Companies Law. In the event that the Chairperson does not instruct the Secretary (or, in the absence thereof, by the Chief Executive Officer) to convene a meeting upon a request of at least two (2) Directors within seven (7) days of such request, then such two Directors may convene a meeting of the Board of Directors. Any meeting of the Board of Directors shall be convened upon not less than two (2) days’ prior notice, unless such notice is waived in writing by all of the Directors as to a particular meeting or by their attendance at such meeting or unless the matters to be discussed at such meeting are of such urgency and importance that notice is reasonably determined by the Chairperson as ought to be waived or shortened under the circumstances.
(c) Notice of any such meeting shall be given in writing (including by email), unless the urgency of such meeting is reasonably determined by the Chairperson to require that notice be given orally, by telephone or by such other means of delivery as the Chairperson may deem appropriate under the circumstances.
(d) Notwithstanding anything to the contrary herein, failure to deliver notice to a Director of any such meeting in the manner required hereby may be waived by such Director, and a meeting shall be deemed to have been duly convened notwithstanding such defective notice if such failure or defect is waived prior to action being taken at such meeting, by all Directors entitled to participate at such meeting to whom notice was not duly given as aforesaid. Without derogating from the foregoing, no Director present at any time during a meeting of the Board of Directors shall be entitled to seek the cancellation or invalidation of any proceedings or resolutions adopted at such meeting on account of any defect in the notice of such meeting relating to the date, time or the place thereof or the convening of the meeting.
| 46. | Quorum. |
Until otherwise unanimously decided by the Board of Directors, a quorum at a meeting of the Board of Directors shall be constituted by the presence in person or by any means of communication of a majority of the Directors then in office who are lawfully entitled to participate and vote in the meeting. No business shall be transacted at a meeting of the Board of Directors unless the requisite quorum is present (in person or by any means of communication on the condition that all participating Directors can hear each other simultaneously) when the meeting proceeds to business. If within thirty (30) minutes from the time appointed for a meeting of the Board of Directors a quorum is not present, the meeting shall stand adjourned at the same place and time forty-eight (48) hours thereafter unless the Chairperson has determined that there is such urgency and importance that a shorter period is required under the circumstances. If an adjourned meeting is convened in accordance with the foregoing and a quorum is not present within thirty (30) minutes of the announced time, the requisite quorum at such adjourned meeting shall be any two (2) Directors who are lawfully entitled to participate in the meeting and who are present at such adjourned meeting. At an adjourned meeting of the Board of Directors the only matters to be considered shall be those matters which might have been lawfully considered at the meeting of the Board of Directors originally called if a requisite quorum had been present, and the only resolutions to be adopted are such types of resolutions which could have been adopted at the meeting of the Board of Directors originally called.
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| 47. | Chairperson of the Board of Directors. |
The Board of Directors shall, from time to time, elect one of its members to be the Chairperson of the Board of Directors, remove such Chairperson from office and appoint in his or her place. The Chairperson shall preside at every meeting of the Board of Directors, but if there is no such Chairperson, or if at any meeting he or she is not present within fifteen (15) minutes of the time fixed for the meeting or if he or she is unwilling to take the chair, the Directors present shall choose one of the Directors present at the meeting to be the Chairperson of such meeting. The office of Chairperson of the Board of Directors shall not, by itself, entitle the holder to a second or casting vote.
| 48. | Validity of Acts Despite Defects. |
All acts done or transacted at any meeting of the Board of Directors, or of a Committee of the Board of Directors, or by any person(s) acting as Director(s), shall, notwithstanding that it may afterwards be discovered that there was some defect in the appointment of the participants in such meeting or any of them or any person(s) acting as aforesaid, or that they or any of them were disqualified, be as valid as if there were no such defect or disqualification, except if the defect was a failure to meet the required quorum, in which case, said act shall not be valid.
Chief Executive Officer; Officers who are Founders
| 49. | Chief Executive Officer; Officers who are Founders. |
(a) The Board of Directors shall from time to time appoint one or more persons, whether or not Directors, as Chief Executive Officer who shall have the powers and authorities set forth in the Companies Law, and may confer upon such person(s), and from time to time modify or revoke, such titles and such duties and authorities of the Board of Directors as the Board of Directors may deem fit, subject to such limitations and restrictions as the Board of Directors may from time to time prescribe. Such appointment(s) may be either for a fixed term or without any limitation of time, and the Board of Directors may from time to time (subject to any additional approvals required under, and the provisions of, the Companies Law and of any contract between any such person and the Company) fix their salaries and compensation, remove or dismiss them from office and appoint another or others in his, her or their place or places.
(b) Until the third anniversary of the Closing Date, the termination of any of the Founders as an executive of the Company, whether or not for Cause, shall require the approval of a supermajority of at least seventy-five percent (75%) of the Directors then in office; thereafter, the termination of any of the Founders as an executive of the Company shall require a decision of the Board of Directors adopted in accordance with Article 37(b).
Minutes
| 50. | Minutes. |
Any minutes of the General Meeting or the Board of Directors or any Committee thereof, if purporting to be signed by the Chairperson of the General Meeting, the Board of Directors or a Committee thereof, as the case may be, or by the Chairperson of the next succeeding General Meeting, meeting of the Board of Directors or meeting of a Committee, as the case may be, shall constitute prima facie evidence of the matters recorded therein.
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Dividends
| 51. | Declaration of Dividends. |
The Board of Directors may from time to time declare, and cause the Company to pay dividends (or make other “distributions” within the meaning of the Companies Law) as permitted by the Companies Law. The Board of Directors shall determine the time for payment of such dividends and the record date for determining the Shareholders entitled thereto.
| 52. | Amount Payable by Way of Dividends. |
Subject to the provisions of these Articles and subject to the rights or conditions attached at that time to any share in the capital of the Company granting preferential, special or deferred rights or not granting any rights with respect to dividends, any dividend paid by the Company shall be allocated among the Shareholders (not in default in payment of any sum referred to in Article 14 hereof) entitled thereto in proportion to their respective holdings of the issued and outstanding Class A Shares and Class B Shares in respect of which such dividends are being paid, treating all such shares on a pari passu basis for such purpose.
| 53. | Interest. |
No dividend shall carry interest as against the Company.
| 54. | Payment in Specie. |
If so declared by the Board of Directors, a dividend declared in accordance with Article 51 may be paid, in whole or in part, by the distribution of specific assets of the Company or by distribution of paid up shares, debentures or other securities of the Company or of any other companies, or in any combination thereof, in each case, the fair value of which shall be determined by the Board of Directors in good faith.
| 55. | Implementation of Powers. |
The Board of Directors may settle, as it deems fit, any difficulty arising with regard to the distribution of dividends, bonus shares or otherwise, and in particular, to issue certificates for fractions of shares and sell such fractions of shares in order to pay their consideration to those entitled thereto, or to set the value for the distribution of certain assets and to determine that cash payments shall be paid to the Shareholders on the basis of such value, or that fractions whose value is less than $0.01 shall not be taken into account. The Board of Directors may instruct to pay cash or convey these certain assets to a trustee in favor of those people who are entitled to a dividend, as the Board of Directors shall deem appropriate.
| 56. | Deductions from Dividends. |
The Board of Directors may deduct from any dividend or other moneys payable to any Shareholder in respect of a share any and all sums of money then payable by him, her or it to the Company on account of calls or otherwise in respect of shares of the Company and/or on account of any other matter of transaction whatsoever.
| 57. | Retention of Dividends. |
(a) The Board of Directors may retain any dividend or other moneys payable or property distributable in respect of a share on which the Company has a lien, and may apply the same in or toward satisfaction of the debts, liabilities, or engagements in respect of which the lien exists.
(b) The Board of Directors may retain any dividend or other moneys payable or property distributable in respect of a share in respect of which any person is, under Articles 22 or 23, entitled to become a Shareholder, or which any person is, under said Articles, entitled to transfer, until such person shall become a Shareholder in respect of such share or shall transfer the same.
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| 58. | Unclaimed Dividends. |
All unclaimed dividends or other moneys payable in respect of a share may be invested or otherwise made use of by the Board of Directors for the benefit of the Company until claimed. The payment of any unclaimed dividend or such other moneys into a separate account shall not constitute the Company a trustee in respect thereof, and any dividend unclaimed after a period of one (1) year (or such other period determined by the Board of Directors) from the date of declaration of such dividend, and any such other moneys unclaimed after a like period from the date the same were payable, shall be forfeited and shall revert to the Company, provided, however, that the Board of Directors may, at its discretion, cause the Company to pay any such dividend or such other moneys, or any part thereof, to a person who would have been entitled thereto had the same not reverted to the Company. The principal (and only the principal) of any unclaimed dividend of such other moneys shall be if claimed, paid to a person entitled thereto.
| 59. | Mechanics of Payment. |
Any dividend or other moneys payable in cash in respect of a share, less the tax required to be withheld pursuant to applicable law, may, as determined by the Board of Directors in its discretion, be paid by check sent through the post to, or left at, the registered address of the person entitled thereto or by transfer to a bank account specified by such person (or, if two or more persons are registered as joint holders of such share or are entitled jointly thereto in consequence of the death or bankruptcy of the holder or otherwise, to any one of such persons or his or her bank account or the person who the Company may then recognize as the owner thereof or entitled thereto under Article 22 or 23 hereof, as applicable, or such person’s bank account), or to such person and at such other address as the person entitled thereto may by writing direct, or in any other manner the Board of Directors deems appropriate. Every such check or other method of payment shall be made payable to the order of the person to whom it is sent, or to such person as the person entitled thereto as aforesaid may direct, and payment of the check by the banker upon whom it is drawn shall be a good discharge to the Company. Every such check shall be sent at the risk of the person entitled to the money represented thereby.
Accounts
| 60. | Books of Account. |
The Company's books of account shall be kept at the Office, or at such other place or places as the Board of Directors may deem fit, and they shall always be open to inspection by all Directors. No Shareholder, not being a Director, shall have any right to inspect any account or book or other similar document of the Company, except as explicitly conferred by applicable law or authorized by the Board of Directors. The Company shall make copies of its annual financial statements available for inspection by the Shareholders at the principal offices of the Company. The Company shall not be required to send copies of its annual financial statements to the Shareholders.
| 61. | Auditors. |
The appointment, authorities, rights and duties of the auditor(s) of the Company, shall be regulated by applicable law, provided, however, that in exercising its authority to fix the remuneration of the auditor(s), the Shareholders in General Meeting may act (and in the absence of any action in connection therewith shall be deemed to have so acted) to authorize the Board of Directors (with right of delegation to a Committee thereof or to management) to fix such remuneration subject to such criteria or standards, and if no such criteria or standards are so provided, such remuneration shall be fixed in an amount commensurate with the volume and nature of the services rendered by such auditor(s). The General Meeting may, if so recommended by the Board of Directors, appoint the auditors for a period that may extend until the third Annual General Meeting after the Annual General Meeting in which the auditors were appointed.
| 62. | Fiscal Year. |
The fiscal year of the Company shall be the 12 month period ending on December 31 of each calendar year.
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Supplementary Registers
| 63. | Supplementary Registers. |
Subject to and in accordance with the provisions of Sections 138 and 139 of the Companies Law, the Company may cause supplementary registers to be kept in any place outside Israel as the Board of Directors may deem fit, and, subject to all applicable requirements of law, the Board of Directors may from time to time adopt such rules and procedures as it may deem fit in connection with the keeping of such branch registers.
Exemption, Indemnity and Insurance
| 64. | Insurance. |
Subject to the provisions of the Companies Law with regard to such matters, the Company may enter into a contract for the insurance of the liability, in whole or in part, of any of its Office Holders imposed on such Office Holder due to an act performed by or an omission of the Office Holder in the Office Holder’s capacity as an Office Holder of the Company arising from any matter permitted by law, including the following:
(a) a breach of duty of care to the Company or to any other person;
(b) a breach of his or her duty of loyalty to the Company, provided that the Office Holder acted in good faith and had reasonable grounds to assume that act that resulted in such breach would not prejudice the interests of the Company;
(c) a financial liability imposed on such Office Holder in favor of any other person; and
(d) any other event, occurrence, matters or circumstances under any law with respect to which the Company may, or will be able to, insure an Office Holder, and to the extent such law requires the inclusion of a provision permitting such insurance in these Articles, then such provision is deemed to be included and incorporated herein by reference (including in accordance with Section 56h(b)(1) of the Securities Law, if and to the extent applicable, and Section 50P of the Economic Competition Law).
| 65. | Indemnity. |
(a) Subject to the provisions of the Companies Law, the Company may retroactively indemnify an Office Holder to the maximum extent permitted under applicable law, including with respect to the following liabilities and expenses, provided that such liabilities or expenses were imposed on such Office Holder or incurred by such Office Holder due to an act performed by or an omission of the Office Holder in such Office Holder’s capacity as an Office Holder:
(i) a financial liability imposed on an Office Holder in favor of another person by any court judgment, including a judgment given as a result of a settlement or an arbitrator’s award which has been confirmed by a court;
(ii) reasonable litigation expenses, including reasonable legal fees, expended by the Office Holder as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, or in connection with a financial sanction, provided that (1) no indictment (as defined in the Companies Law) was filed against such Office Holder as a result of such investigation or proceeding; and (2) no financial liability in lieu of a criminal proceeding (as defined in the Companies Law) was imposed upon him or her as a result of such investigation or proceeding or if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent;
(iii) reasonable litigation costs, including reasonable legal fees, expended by an Office Holder or which were imposed on an Office Holder by a court in proceedings filed against the Office Holder by the Company or in its name or by any other person or in a criminal charge in respect of which the Office Holder was acquitted or in a criminal charge in respect of which the Office Holder was convicted for an offence which did not require proof of criminal intent; and
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(iv) any other event, occurrence, matter or circumstance under any law with respect to which the Company may, or will be able to, indemnify an Office Holder, and to the extent such law requires the inclusion of a provision permitting such indemnity in these Articles, then such provision is deemed to be included and incorporated herein by reference (including in accordance with Section 56H(b)(1) of the Securities Law, if and to the extent applicable, and Section 50P(b)(2) of the Economic Competition Law).
(b) Subject to the provisions of the Companies Law and any other applicable law, the Company may undertake to indemnify an Office Holder, in advance, with respect to those liabilities and expenses described in the following Articles:
(i) Sub-Article 65(a)(i), provided that the undertaking to indemnify is limited to, and sets forth, (a) such events which the Directors shall deem to be foreseeable in light of the operations of the Company at the time that the undertaking to indemnify is made, and (b) such amounts or criteria which the Directors may, at the time of the giving of such undertaking to indemnify, deem to be reasonable under the circumstances; and
(ii) Sub-Articles 65(a)(ii), 65(a)(iii) and 65(a)(iv).
| 66. | Exemption. |
Subject to the provisions of the Companies Law, the Company may, to the maximum extent permitted by law, exempt and release, in advance, any Office Holder from any liability for damages arising out of a breach of a duty of care.
| 67. | General. |
(a) Any amendment to the Companies Law or any other applicable law adversely affecting the right of any Office Holder to be indemnified, insured or exempt pursuant to Articles 64 to 66 and any amendments to Articles 64 to 66 shall be prospective in effect, and shall not affect the Company’s obligation or ability to indemnify, insure or exempt an Office Holder for any act or omission occurring prior to such amendment, unless otherwise provided by applicable law.
(b) The provisions of Articles 64 to 66: (i) shall apply to the maximum extent permitted by law (including, the Companies Law, the Securities Law and the Economic Competition Law); and (ii) are not intended, and shall not be interpreted so as to restrict the Company, in any manner, in respect of the procurement of insurance and/or in respect of indemnification (whether in advance or retroactively) and/or exemption, in favor of any person who is not an Office Holder, including any employee, agent, consultant or contractor of the Company who is not an Office Holder; and/or any Office Holder to the extent that such insurance and/or indemnification is not specifically prohibited under law.
Lock-Up
| 68. | Lock-Up. |
Notwithstanding anything to the contrary herein, and subject only to the exceptions set forth in Article 69 and the Amended and Restated Registration Rights Agreement dated as of [l], 2022 , other than with the written consent of the Company, no Holder shall be entitled to Transfer any Lock-Up Shares or any instruments exercisable or exchangeable for, or convertible into, such Lock-Up Shares until the end of the Lock-Up Period.
For the purposes of this Article 68 and Article 69:
“Company Equity Holders” means each of the shareholders of the Company as of immediately prior to the effective time of the Merger contemplated by the Merger Agreement.
“Holder” means (i) each of the Company Equity Holders, and (ii) SPAC Sponsor.
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“Liquidation Event” means a liquidation, merger, capital stock exchange, reorganization, sale of all or substantially all assets or other similar transaction involving the Company upon the consummation of which holders of Ordinary Shares would be entitled to exchange their Ordinary Shares for cash, securities or other property.
“Lock-Up Period” means
| (i) | with respect to the Company Equity Holders and their Permitted Transferees, the period beginning on the Closing Date and ending (A) with respect to 50% of the Ordinary Shares held by such Company Equity Holder on the Closing Date, on the earlier of (1) the date that is six (6) months following the Closing Date and (2) the date on which the VWAP equals or exceeds $12.50 for any twenty (20) Trading Days within any thirty (30) consecutive Trading Day period commencing on the Closing Date, and (B) with respect to the remaining 50% of the Ordinary Shares held by such Company Equity Holder on the Closing Date, on the earlier of (1) the date that is twelve (12) months following the Closing Date and (2) the date on which the VWAP equals or exceeds $12.50 for any twenty (20) Trading Days within any thirty (30) consecutive Trading Day period commencing on the Closing Date, and |
| (ii) | with respect to SPAC Sponsor and its Permitted Transferees, the period beginning on the Closing Date and ending on the earlier of (A) the date that is twelve (12) months following the Closing Date and (B) the date on which the VWAP equals or exceeds $12.50 for any twenty (20) Trading Days within any thirty (30) consecutive Trading Day period; |
provided, however, that the Lock-Up Period shall not be lifted pursuant to clause (i)(A)(2) above prior to the date that is ninety (90) days following the Closing Date, and shall not be lifted pursuant to clause (i)(B)(2) or clause (ii)(B) above prior to the date that is one hundred and eighty (180) days following the Closing Date.
“Lock-Up Shares” means (i) with respect to the Company Equity Holders and their Permitted Transferees, the Company Ordinary Shares held by such Company Equity Holders as of immediately following the Stock Split and the Conversion (as each such term is defined in the Merger Agreement), and (ii) with respect to SPAC Sponsor and its Permitted Transferees, (A) the Ordinary Shares issuable to SPAC Sponsor as Merger Consideration (as such term is defined in the Merger Agreement) under the Merger Agreement in respect of the 7,187,500 shares of SPAC Class B Stock (as defined in the Merger Agreement) that it holds, (B) the Company Warrants issuable to SPAC Sponsor as Merger Consideration in respect of the Private Placement Warrants (as defined in the Merger Agreement), and (C) any Ordinary Shares issuable to SPAC Sponsor upon exercise of such Company Warrants mentioned in the preceding Clause (B). In furtherance of the foregoing, Ordinary Shares issued to any affiliate of the SPAC Sponsor in accordance with any subscription agreement between such affiliate and the Company shall not be Lock-Up Shares.
“Merger Agreement” means the Agreement and Plan of Merger, made and entered into as of September 15, 2021, by and among the Company, Rigel Merger Sub Inc. and EJF Acquisition Corp.
“Permitted Transferee” means (subject to compliance with Article 69): (i) the members of a Holder’s immediate family (for purposes of this Article 68 and Article 69, “immediate family” means with respect to any natural person, any of the following: such person’s spouse or domestic partner, the siblings of such person and his or her spouse or domestic partner, and the direct descendants and ascendants (including adopted and step children and parents) of such person and his or her spouses or domestic partners and siblings), (ii) any entities controlled by, controlling or under common control with such Holder, (iii) any trust for the direct or indirect benefit of Holder or the immediate family of Holder, (iv) if Holder is a trust, the trustor or beneficiary of such trust or to the estate of a beneficiary of such trust, and (v) if Holder is an entity, any direct or indirect controlling partners, members or equity holders of Holder, any affiliate (as defined in Rule 405 promulgated under the Securities Act) of Holder or any related investment funds or vehicles controlled or managed by such persons or entities or their respective affiliates.
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“SPAC Sponsor” means Wilson Boulevard LLC, a Delaware limited liability company.
“Trading Day” means any day on which the Ordinary Shares are tradeable on the principal securities exchange or securities market on which Ordinary Shares are then traded.
“Transfer” shall mean, directly or indirectly, the (i) sale or assignment of, offer to sell, contract or agreement to sell, hypothecation, pledge, grant of any option to purchase or other disposition of or agreement to dispose of or establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the U.S. Securities Exchange Act of 1934 (the “Exchange Act”), with respect to Lock-Up Shares, (ii) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of, or any other derivative transaction with respect to, Lock-Up Shares, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) public announcement of any intention to effect any transaction specified in clause (i) or (ii). Notwithstanding the foregoing, the pledge of Lock-Up Shares by a Holder that creates a mere security interest in such Lock-Up Shares pursuant to a bona fide loan or indebtedness transaction for so long as such Holder continues to exercise the power (whether exclusive or shared) to vote or direct the voting of such Lock-Up Shares by proxy, voting agreement or otherwise, over such pledged Lock-Up Shares shall not constitute a Transfer within the meaning of these Articles. Additionally, notwithstanding anything herein to the contrary, nothing herein shall prevent the establishment of a 10b5-1 trading plan that complies with Rule 10b5-1 under the Exchange Act (a “10b5-1 Trading Plan”) or the amendment of an existing 10b5-1 Trading Plan during the Lock-Up Period so long as there are no sales of Lock-Up Shares under any such newly established or amended 10b5-1 Trading Plan during the Lock-Up Period.
“VWAP” means, on any Trading Day on or after the Closing Date, the volume weighted average of the trading prices of the Ordinary Shares on the principal securities exchange or securities market on which Ordinary Shares are then traded or quoted for purchase and sale (as reported by Bloomberg L.P. or, if not reported therein, in another authoritative source selected by the Company); provided that if there shall occur any change in the outstanding Ordinary Shares as a result of any reclassification, recapitalization, stock split or combination, exchange or readjustment of shares, or any stock dividend, the VWAP shall be equitably adjusted to reflect such change.
| 69. | Permitted Transfers. |
(a) Notwithstanding anything to the contrary set forth in these Articles, the lock-up restrictions set forth in Article 68 shall not apply to a Transfer of any or all of the Lock-Up Shares held by a Holder (i) to any Permitted Transferee of such Holder, (ii) by will or intestate succession upon the death of such Holder, (iii) by operation of law or pursuant to a court order or to a spouse upon divorce, as required by settlement, order or decree, or as required by a domestic relations settlement, order or decree; (iv) in connection with a Liquidation Event or (v) to any of the Founders or to entities directly or indirectly wholly owned by (or in the case of a trust solely for the benefit of) any of the Founders; provided, that in the case of clauses (i), (ii), (iii) or (v), the transferee shall receive and hold the Lock-Up Shares subject to the provisions of these Articles applicable to the transferring Holder, and there shall be no further Transfer of such Lock-Up Shares except in accordance with the terms of Article 68 and this Article 69. For the avoidance of doubt, the lock-up restrictions set forth in Article 68 shall not apply to the exercise of any options or warrants to purchase Ordinary Shares (which exercises may be effected on a cashless basis to the extent the instruments representing such options or warrants permit exercises on a cashless basis), but shall apply to the Ordinary Shares received upon such exercise.
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(b) If any Transfer is made or attempted in violation of or contrary to the terms of these Articles (a “Prohibited Transfer”), such purported Prohibited Transfer shall be null and void ab initio, and the Company shall refuse to recognize any such purported transferee of the Lock-Up Shares as one of the Company’s equity holders for any purpose. In order to enforce this Article 69(b), the Company may impose stop-transfer instructions with respect to the Lock-Up Shares of a transferring Holder until the end of the Lock-Up Period, except in compliance with the restrictions set forth in these Articles.
(c) If, between the Closing Date and a Liquidation Event, the outstanding Ordinary Shares shall have been changed into a different number of shares or a different class, by reason of any stock dividend, subdivision, reclassification, recapitalization, split, combination or exchange of shares, or any similar transaction affecting the outstanding Ordinary Shares, then any number, value (including dollar value) or amount contained herein which is based upon the number of Ordinary Shares will be equitably adjusted for such dividend, subdivision, reclassification, recapitalization, split, combination or exchange of shares, or any similar transaction. Any adjustment under this Article 69(c) shall become effective at the date and time that such stock dividend, subdivision, reclassification, recapitalization, split, combination or exchange of shares, or any similar transaction became effective. For the avoidance of doubt, no change of units or shares pursuant to the transactions contemplated by the Merger Agreement shall constitute a stock dividend, subdivision, reclassification, recapitalization, split, combination or exchange of shares, or similar transaction requiring an equitable adjustment.
(d) The restrictions set forth in Article 68 and this Article 69 shall not limit the rights of a Holder to exercise such Holder’s rights as a shareholder of the Company during the Lock-Up Period, including the right to vote any Lock-Up Shares.
Winding Up
| 70. | Winding Up. |
If the Company is wound up, then, subject to applicable law and to the rights of the holders of shares with special rights upon winding up, the assets of the Company available for distribution among the Shareholders shall be distributed to them in proportion to the number of issued and outstanding Class A Shares and/or Class B Shares held by each Shareholder, treating all such shares on a pari passu basis for such purpose.
Notices
| 71. | Notices. |
(a) Any written notice or other document may be served by the Company upon any Shareholder either personally, by facsimile, email or other electronic transmission, or by sending it by prepaid mail (airmail if sent internationally) addressed to such Shareholder at his or her address as described in the Register of Shareholders or such other address as the Shareholder may have designated in writing for the receipt of notices and other documents.
(b) Any written notice or other document may be served by any Shareholder upon the Company by tendering the same in person to the Secretary or the Chief Executive Officer at the principal office of the Company, by facsimile transmission, email or other electronic transmission, or by sending it by prepaid registered mail (airmail if posted outside Israel) to the Company at its Office.
(c) Any such notice or other document shall be deemed to have been served:
(i) in the case of mailing, forty-eight (48) hours after it has been posted, or when actually received by the addressee if sooner than forty-eight hours after it has been posted, or
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(ii) in the case of overnight air courier, on the next business day following the day sent, with receipt confirmed by the courier, or when actually received by the addressee if sooner than three business days after it has been sent;
(iii) in the case of personal delivery, when actually tendered in person, to such addressee;
(iv) in the case of facsimile, email or other electronic transmission, on the first business day (during normal business hours in place of addressee) on which the sender receives automatic electronic confirmation by the addressee’s facsimile machine that such notice was received by the addressee or delivery confirmation from the addressee’s email or other communication server.
(d) If a notice is, in fact, received by the addressee, it shall be deemed to have been duly served, when received, notwithstanding that it was defectively addressed or failed, in some other respect, to comply with the provisions of this Article 71.
(e) All notices to be given to the Shareholders shall, with respect to any share to which persons are jointly entitled, be given to whichever of such persons is named first in the Register of Shareholders, and any notice so given shall be sufficient notice to the holders of such share.
(f) Any Shareholder whose address is not described in the Register of Shareholders, and who shall not have designated in writing an address for the receipt of notices, shall not be entitled to receive any notice from the Company.
(g) Notwithstanding anything to the contrary contained herein, notice by the Company of a General Meeting, containing the information required by applicable law and these Articles to be set forth therein, which is published, within the time otherwise required for giving notice of such meeting, in either or several of the following manners (as applicable) shall be deemed to be notice of such meeting duly given, for the purposes of these Articles, to any Shareholder whose address as registered in the Register of Shareholders (or as designated in writing for the receipt of notices and other documents) is located either inside or outside the State of Israel:
(i) if the Company’s shares are then listed for trading on a national securities exchange in the United States or quoted in an over-the-counter market in the United States, publication of notice of a General Meeting pursuant to a report or a schedule filed with, or furnished to, the SEC pursuant to the Exchange Act; and/or
(ii) on the Company’s internet site.
(h) The mailing or publication date and the record date and/or date of the meeting (as applicable) shall be counted among the days comprising any notice period under the Companies Law and the regulations thereunder.
(i) To the extent permitted by the Companies Law or any regulations promulgated thereunder, the Company will not be required to deliver notices of General Meetings to Shareholders who are registered in the Company’s Register of Shareholders, and to whom the Company would otherwise have been required to deliver such notices if not for this Article 71(i).
Amendment
| 72. | Amendment. |
Any amendment of these Articles shall require the approval of the General Meeting in accordance with these Articles.
| - 33 - |
Forum for Adjudication of Disputes
| 73. | Forum for Adjudication of Disputes. |
(a) Unless the Company consents in writing to the selection of an alternative forum, with respect to any causes of action arising under the U.S. Securities Act of 1933 or the Securities and Exchange Act of 1934, each as amended, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the U.S. Securities Act of 1933 or the Securities and Exchange Act of 1934, each as amended; and (b) unless the Company consents in writing to the selection of an alternative forum, the competent courts in Tel Aviv, Israel shall be the exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company to the Company or the Shareholders, or (iii) any action asserting a claim arising pursuant to any provision of these Articles, the Companies Law or the Securities Law (for the avoidance of doubt, this clause (b) does not apply to causes of action arising out of the U.S. Securities Act of 1933 or the Securities and Exchange Act of 1934, each as amended, such causes of action to be under the jurisdiction of the federal district courts of the United States of America as provided in clause (a)). Any person or entity purchasing or otherwise acquiring or holding any interest in shares of the Company shall be deemed to have notice of and consented to these provisions.
* * *
| - 34 - |
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NUMBER
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SHARES
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SEE REVERSE FOR CERTAIN DEFINITIONS
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CUSIP [ ]
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Dated:
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Authorized Signatory
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Transfer Agent
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TEN COM
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—
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as tenants in common
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UNIF GIFT MIN ACT
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—
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_________ Custodian ________
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|||||||
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—
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(Cust)
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(Minor)
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||||||||||
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TEN ENT
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—
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as tenants by the entireties
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||||||||||
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JT TEN
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—
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as joint tenants with right of
survivorship and not as tenants in common
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under Uniform Gifts to Minors Act
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(State)
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||||||||||||
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Dated:
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||
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Notice: The signature(s) to this assignment must correspond with the name as written upon the face of the certificate in every particular, without alteration or enlargement or any change whatever.
|
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THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE
17Ad-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (OR ANY SUCCESSOR RULE).
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PAGAYA TECHNOLOGIES LTD.
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By:
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Name:
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Title:
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CONTINENTAL STOCK TRANSFER & TRUST COMPANY,
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as Warrant Agent
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By:
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Name:
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Title:
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Date: ____________, 202__
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Signature
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(Address)
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(Tax Identification Number)
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Pagaya Technologies Ltd.
Azrieli Sarona Bldg, 54th Floor
121 Derech Menachem Begin, Tel-Aviv, Israel 6701203
|
||
| Attention: |
Gal Krubiner
Richmond Glasgow
|
|
| Phone: |
+972 (3) 715 0920 | |
| Email: |
gal@pagaya-inv.com
richmond@pagaya.com
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|
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Pagaya US Holding Company LLC
90 Park Ave, New York, NY 10016
|
||
| Attention: |
Gal Krubiner
Richmond Glasgow
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|
| Phone: |
646-710-7714 | |
| Email: |
gal@pagaya-inv.com
richmond@pagaya.com
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| and | ||
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Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West
New York, NY 10001
|
||
| Attention: |
Jeffrey A. Brill
Maxim Mayer-Cesiano
B. Chase Wink
|
|
| Telephone: |
+1-212-735-3000 | |
| Email: |
jeffrey.brill@skadden.com
maxim.mayercesiano@skadden.com
b.chase.wink@skadden.com
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and
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||
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Goldfarb Seligman & Co.
98 Yigal Alon Street
Tel-Aviv
6789141
Israel
|
||
| Attention: |
Aaron M. Lampert
Sharon Gazit
|
|
| Phone: |
+972-3-608-9999 | |
| Email: |
aaron.lampert@goldfarb.com
sharon.gazit@goldfarb.com”
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PAGAYA TECHNOLOGIES LTD.
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By:
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| Name: | |||
| Title: | |||
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By:
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| Name: | |||
| Title: | |||
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EJF ACQUISITION CORP.
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By:
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| Name: [•] |
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| Title: [•] |
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CONTINENTAL STOCK TRANSFER & TRUST COMPANY
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By:
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| Name: [•] |
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| Title: [•] |
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| | | PAGAYA TECHNOLOGIES LTD. | |||||||
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| | | By: | | | |||||
| | | | | Name: | | | |||
| | | | | Title: | | | |||
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| | | Shareholders: | | ||||||
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| | | | | Name: | | | |||
| | | | | Address: | | | |||
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| | | EJF ACQUISITION CORP. | |||||||
| | | | | | | ||||
| | | By: | | | |||||
| | | Name: | | | |||||
| | | Title: | | | |||||
| | | Address: | | | |||||
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| | | WILSON BOULEVARD LLC | |||||||
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| | | By: | | | |||||
| | | Name: | | | |||||
| | | Title: | | | |||||
| | | Address: | | | |||||
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![]() |
TEL AVIV
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ZURICH
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WWW.GOLDFARB.COM
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Ampa Tower, 98 Yigal Alon St.
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14 Mittelstrasse
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Tel Aviv 6789141, Israel
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Zurich 8008, Switzerland
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Tel +972 (3) 608-9999
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Tel +41 (44) 818 08 00
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Fax +972 (3) 608-9909
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Fax +41 (44) 818 08 01
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INFO@GOLDFARB.COM
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ZURICH@GOLDFARB.COM
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May 18 , 2022
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Pagaya Technologies Ltd.
Azrieli Sarona Bldg, 54th Floor
121 Derech Menachem Begin
Tel-Aviv 6701203, Israel
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Sincerely,
|
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| /s/ Goldfarb Seligman & Co. | |
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Goldfarb Seligman & Co.
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Skadden, Arps, Slate, Meagher & Flom llp
|
FIRM/AFFILIATE OFFICES
-----------
BOSTON
CHICAGO
HOUSTON
LOS ANGELES
PALO ALTO
WASHINGTON, D.C.
WILMINGTON
-----------
BEIJING
BRUSSELS
FRANKFURT
HONG KONG
LONDON
MOSCOW
MUNICH
PARIS
SÃO PAULO
SEOUL
SHANGHAI
SINGAPORE
TOKYO
TORONTO
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ONE MANHATTAN WEST
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NEW YORK, NY 10001-8602
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TEL: (212) 735-3000
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FAX: (212) 735-2000
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www.skadden.com
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| May 18, 2022 |
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RE:
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Pagaya Technologies Ltd.
|
|
|
Registration Statement on Form F-4
|
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Very truly yours,
|
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| /s/ Skadden, Arps, Slate, Meagher & Flom LLP | |
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Skadden, Arps, Slate, Meagher & Flom LLP
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Pagaya Technologies Ltd.
90 Park Ave,
New York, NY 10016
|
|
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Attention:
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Gal Krubiner
Richmond Glasgow
|
|
Email:
|
gal@pagaya-inv.com
richmond@pagaya.com
|
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Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West New York, New York 10001 |
|
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Attention:
|
Andrea Nicolas
Jeffrey Brill Maxim Mayer-Cesiano B. Chase Wink
|
|
Email:
|
andrea.nicolas@skadden.com
jeffrey.brill@skadden.com maxim.mayercesiano@skadden.com b.chase.wink@skadden.com
|
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Goldfarb Seligman & Co., Law Offices
Ampa Tower, 98 Yigal Alon Street,
Tel Aviv 6789141, Israel
|
|
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Attention:
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Sharon Gazit, Adv.
Aaron M. Lampert, Adv.
|
|
Email:
|
sharon.gazit@goldfarb.com
aaron.lampert@goldfarb.com
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Name of Investor:
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State/Country of Formation or Domicile:
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||||
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By:
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|||||
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Name:
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|||||
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Title:
|
|||||
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Name in which the Subscription Shares are to be registered (if different):
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Date: ________, 2021
|
||||
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Investor’s EIN:
|
|||||
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Entity Type (e.g., corporation, partnership, trust, etc.):
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|||||
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Business Address-Street:
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Mailing Address-Street (if different):
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||||
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City, State, Zip:
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City, State, Zip:
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||||
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Attn:
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Attn:
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Telephone No.:
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Telephone No.:
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||||
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Facsimile No.:
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Facsimile No.:
|
||||
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Number of Shares subscribed for:
|
|||||
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Aggregate Subscription Amount: $[●]
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Price Per Share: $10.00
|
||||
|
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PAGAYA TECHNOLOGIES LTD.
|
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|
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By:
|
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Name:
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Title:
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By:
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Name:
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Title:
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| A. |
QUALIFIED INSTITUTIONAL BUYER STATUS
(Please check the applicable subparagraphs): |
| ☐ |
We are a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act).
|
| ☐ |
We are an “institutional account” as defined by FINRA Rule 4512(c).
|
| B. |
INSTITUTIONAL ACCREDITED INVESTOR STATUS
(Please check the applicable subparagraphs): |
| 1. | ☐ | We are an institutional “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act), and have marked and initialed the appropriate box on the following page indicating the provision under which we qualify as an “accredited investor.” |
| 2. | ☐ | We are not a natural person. |
| 3. | ☐ | We are an “institutional account” as defined by FINRA Rule 4512(c). |
| ☐ |
Any bank, registered broker or dealer, insurance company, registered investment company, business development company, or small business investment company;
|
| ☐ |
Any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of
$5,000,000;
|
| ☐ |
Any employee benefit plan, within the meaning of the Employee Retirement Income Security Act of 1974, if a bank, insurance company, or registered investment advisor makes the investment decisions, or if the plan has total assets in
excess of $5,000,000;
|
| ☐ |
Any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of
$5,000,000;
|
| ☐ |
Any trust with assets in excess of $5,000,000, not formed to acquire the securities offered, whose purchase is directed by a sophisticated person;
|
| ☐ |
Any revocable trust where all of the grantors are “accredited investors”; or
|
| ☐ |
Any entity in which all of the equity owners are “accredited investors”.
|
| C. |
QUALIFIED ISRAELI INVESTOR STATUS (for Israeli investors only – please check the applicable box):
|
| 1. |
Are you an investor in one of the categories listed in the First Addendum to the Israeli Securities Law, 5728-1968 (the “Securities Law”), and listed below, such an investor being referred to in
this Questionnaire as a “Qualified Israeli Investor”?
|
| ☐ Yes |
☐ No
|
| 2. |
Please specify the category listed in the First Addendum to the Israeli Securities Law, to which you belong, by completing below.
|
| ☐ |
A joint investment fund or the manager of such a fund within the meaning of the Joint Investments in Trust Law, 5754-1994;
|
| ☐ |
A provident fund or the manager of such a fund within the meaning of the Control of Financial Services Law (Provident Funds), 5765-2005;
|
| ☐ |
An insurance company as defined in the Supervision of Insurance Business Law, 5741-1981;
|
| ☐ |
A banking corporation or a supporting corporation within the meaning of the Banking (Licensing) Law, 5741-1981, with the exception of a joint services company, purchasing for their own account or for the accounts of clients who are
Qualified Israeli Investors or who are otherwise listed in Section 15A(b) of the Securities Law (collectively, “Exempt Investors”);
|
| ☐ |
A licensed portfolio manager within the meaning of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, 5755-1995 (“Investment Advice Law”), purchasing
for its own account or for the accounts of clients who are Exempt Investors;
|
| ☐ |
A licensed investment advisor or a licensed investment marketer within the meaning of the Investment Advice Law, purchasing for its own account;
|
| ☐ |
A member of the Tel Aviv Stock Exchange, purchasing for its own account or for the accounts of clients who are Exempt Investors;
|
| ☐ |
An underwriter that satisfies the criteria prescribed in Section 56(c) of the Israeli Securities Law, 5728-1968, purchasing for its own account;
|
| ☐ |
A venture capital fund (defined for this purpose as an entity whose principal activity is investing in entities that are engaged primarily in research and development, or in the manufacture of innovative products and processes, with an
unusually high investment risk);
|
| ☐ |
An entity that is wholly owned by Exempt Investors;
|
| ☐ |
An entity, except for an entity that was incorporated for the purpose of investing in securities in a specific offering, whose shareholders equity exceeds NIS 50 million; or
|
| ☐ |
An individual who fulfills at least one of the following criteria (note: you must provide confirmation from your certified public accountant regarding the criterion you satisfy):
|
| (a) |
the aggregate value of Liquid Assets owned by such investor exceeds NIS 8,095,444;
|
| (b) |
such investor’s annual income in each of the previous two years exceeds NIS 1,214,317, or the annual income of the Family Unit to which such investor belongs, for the same period, exceeds NIS 1,821,475; or
|
| (c) |
the total value of such investor’s Liquid Assets exceeds NIS 5,059,652 and such investor’s annual income in each of the previous two years exceeds NIS 607,158, or the annual income of such investor’s Family Unit for the same period
exceeds NIS 910,737;
|
| 1. |
Organizational documents (charters, articles of incorporation, etc.) of the Investor or the certificate of an authorized officer with material excerpts of same as agreed by the Company.
|
| 2. |
Names of ultimate beneficial owners holding 10% or more of the Investor’s beneficial ownership (“UBOs”), if applicable to the Investor.
|
| 3. |
Passport/national ID of natural person UBOs, if applicable to the Investor.
|
|
Name
|
Title
|
Signature
|
|
Gal Krubiner
|
CEO
|
|
|
Avital Pardo
|
CTO
|
|
|
Yahav Yulzari
|
CRO
|
|
|
Michael Kurlander
|
CFO
|
|
|
Richmond Glasgow
|
GC
|
Exhibit 10.9
PAGAYA TECHNOLOGIES LTD.
2016 EQUITY INCENTIVE PLAN
| 1. | Purposes of the Plan |
The purposes of this Equity Incentive Plan are to attract and retain the best available personnel, to provide additional incentive to Employees, Directors and Consultants and to promote the success of the business of the Company and its Subsidiaries. Awards granted under this Plan may be 102 Options, 3(i) Options, Awards of Restricted Stock, Awards of Restricted Stock Units, Incentive Stock Options, Nonstatutory Stock Options or any combination of the foregoing, as determined by the Administrator at the time of grant.
| 2. | Definitions |
As used herein, the following definitions shall apply:
| 2.1. | “Affiliate” means any “employing company” within the meaning of Section 102(a) of the Ordinance. |
| 2.2. | “Administrator” means the Board or any of its Committees as shall be administrating the Plan in accordance with Section 4 hereof. |
| 2.3. | “Applicable Laws” means the requirements relating to the administration of stock option plans under Israeli and U.S. state corporate laws, Israeli and U.S. federal and state securities laws, the Code, the Ordinance, any stock exchange or quotation system on which the Shares are listed or quoted and the applicable laws of any other country or jurisdiction that may apply to Awards which are granted under the Plan. |
| 2.4. | “Articles” means the Articles of Association of the Company, as amended or restated from time to time. |
| 2.5. | “Award” means any 102 Options, 3(i) Options, awards of Restricted Stock, awards of Restricted Stock Units, Incentive Stock Options, Nonstatutory Stock Options or any combination of the foregoing, which are granted under the Plan. |
| 2.6. | “Award Agreement” means, with respect to each Award, the applicable signed written agreement between the Company and the Participant setting forth the terms and conditions of an individual Award granted under the plan. |
| 2.7. | “Board” means the Board of Directors of the Company. |
| 2.8. | “Code” means the Internal Revenue Code of 1986, as amended from time to time. |
| 2.9. | “Cause” shall have the meaning ascribed to it in the applicable employment or consulting agreement of Participant. In the absence of such definition, “Cause” shall mean any of the following: (i) the Participant’s theft, dishonesty, or falsification of any Company documents or records; (ii) the Participant’s improper use or disclosure of the Company’s confidential or proprietary information; (iii) any action by the Participant which has a detrimental effect on the Company’s reputation or business; (iv) the Participant’s failure or inability to perform any reasonable assigned duties after written notice from the Company of, and a reasonable opportunity to cure, such failure or inability; (v) any material breach of the Participant of any employment agreement between the Participant and the Company, which breach is not cured within thirty (30) days pursuant to the terms of such agreement; or (vi) the Participant’s conviction (including any plea of guilty) of any criminal act which impairs the Participant’s ability to perform his or her duties with the Company. For purposes of the definition of Cause, with respect to a Participant employed by or providing services to a Parent or Subsidiary of the Company, the term “Company” shall also include the Parent or Subsidiary employing or engaging the services of the Participant. |
| 2.10. | “Committee” means a committee of Directors appointed by the Board in accordance with Section 4 hereof. |
| 2.11. | “Company” means Pagaya Technologies Ltd., an Israeli company. |
| 2.12. | “Consultant” means any person who is engaged by the Company or any Parent or Subsidiary to render consulting or advisory services to such entity, including any employees of such person and including a non-Employee Director of the Company or any Parent or Subsidiary thereof. A Participant shall not cease to be a Consultant in case of any temporary interruption in such person’s availability to provide services to the Company, its Parent, any Subsidiary, or any successor, which has been authorized in writing by the engaging company (or by the Parent or Subsidiary) prior to its commencement. |
| 2.13. | “Controlling Shareholder” shall have the meaning ascribed to it in Section 32(i) of the Ordinance. |
| 2.14. | “Director” means a member of the Board of Directors of the Company or any Parent or Subsidiary. |
| 2.15. | “Eligible Recipient” means an Employee or Consultant. |
| 2.16. | “Employee” means any person, including Officers and Directors, employed by the Company, or any Parent or Subsidiary of the Company, with or without payment. Subject to the provisions of any Applicable Law, a Participant shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company (or by the Parent or Subsidiary that employs the person) or (ii) transfers between locations of the Company (or the Parent or Subsidiary that employs the person) or between the Company, its Parent, any Subsidiary, or any successor. |
| 2.17. | “Exchange Act” means the Securities Exchange Act of 1934, as amended. |
| 2.18. | “Employing Company” shall have the meaning ascribed to it in Section 102(a) of the Ordinance. |
| 2.19. | “Exercise Price” means the per share price at which a holder of an Award may purchase Shares issuable upon exercise of the Award. |
| 2.20. | “Fair Market Value” means, as of any date, the value of Shares determined as follows: |
| (i) | If the Shares are listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such 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 the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable (if the Shares are listed or quoted on more than one established stock exchange or national market system, the Administrator shall determine the appropriate exchange or system); |
| (ii) | If the Shares are regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Shares on the last market trading day prior to the day of determination; or |
| (iii) | In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Administrator. |
| 2.21. | “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. |
| 2.22. | “IPO” means the consummation of the initial public offering of the Company’s Ordinary Shares. |
| 2.23. | “Israeli Employee” means a person who is a resident of the state of Israel or who is deemed to be a resident of the state of Israel for tax purposes, and who is an Employee or an Office Holder (“Nose Missra”) of the Company, or any Parent or Subsidiary of the Company, in each case excluding a person who is a Controlling Shareholder prior to the issuance of the relevant Award or as a result thereof. |
| 2.24. | “Israeli Non-Employee” means a person who is a resident of the state of Israel or who is deemed to be a resident of the state of Israel for tax purposes, and who is (i) a Consultant, who is not an Employee, or (ii) a Controlling shareholder (whether or not an employee of the Company or any Parent or Subsidiary thereof) prior to the issuance of the relevant Option or as a result thereof. |
| 2.25. | “ITA” means the Israeli Income Tax Authorities. |
| 2.26. | “Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock Option. |
| 2.27. | “Officer” or “Office Holder” shall have the meaning ascribed to it in the Israeli Companies Law, 5759-1999, as amended from time to time. |
| 2.28. | “Non-Trustee 102 Option” means an Option granted to an Employee pursuant to Section 102(c) of the Ordinance, which is not required to be held in trust by a Trustee. |
| 2.29. | “Option” means a stock option granted pursuant to the Plan (including 102 Options, 3(i) Options, Incentive Stock Options and Nonstatutory Stock Options). |
| 2.30. | “Option Exchange Program” means a program whereby outstanding Options are exchanged for Options with a lower Exercise Price. |
| 2.31. | “Ordinance” means the Israeli Income Tax Ordinance (New Version), 1961, as amended, the rules promulgated thereunder, or any law or regulations which shall replace the Ordinance or Sections 3(i) or 102 promulgated thereunder. |
| 2.32. | “Parent” means a company, whether now or hereafter existing, to which the Company is a Subsidiary. |
| 2.33. | “Participant” means any Eligible Recipient selected by the Administrator, pursuant to the Administrator’s authority in Section 4 below, to receive grants of Options, Restricted Stock, Restricted Stock Units or any combination of the foregoing. |
| 2.34. | “Plan” means this 2016 Equity Incentive Plan. |
| 2.35. | “Restricted Stock” means Shares subject to certain restrictions granted pursuant to Section 18 below. |
| 2.36. | “Restricted Stock Unit” means a right granted under and subject to restrictions pursuant to Section 19 below. |
| 2.37. | “Share” means an Ordinary Share of the Company, having a nominal value of NIS 0. 01, as may be adjusted in accordance with Section 21 below. |
| 2.38. | “Section 102” means section 102 of the Ordinance and any regulations, rules, orders or procedures promulgated thereunder as now in effect or as amended or replaced from time to time. |
| 2.39. | “Subsidiary” means any company, whether now or hereafter existing, other than the first company, in an unbroken chain of companies, if each of the companies (other than the last company) in the unbroken chain, owns shares possessing more than fifty percent (50%) of the total combined voting power of all classes of shares in one of the other companies in such chain. |
| 2.40. | “Successor Company” means a successor corporation in a Transaction or any parent or Affiliate thereof, as determined by the Administrator in its discretion. |
| 2.41. | “Transaction” means: (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 or substantially 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; or (iv) such other transaction or set of circumstances that is determined by the Administrator, in its discretion, to be a Transaction subject to the provisions of Section 21.4 below; excluding (a) any of the above transactions in clauses (i) through (iv) with a wholly-owned subsidiary (directly or indirectly) of the Company for the purpose of reincorporating the Company in another jurisdiction, (b) any of the above transactions in clauses (i) through (iii) if the Administrator determines that such transaction should be excluded from the definition hereof and the applicability of Section 21.4 below, (c) any of the above transactions in clauses (i) through (iv) in which shareholders of the Company prior to the transaction will maintain more than fifty percent (50%) of the voting power of the resulting or surviving entity after the transaction (provided, however, that shares of the resulting or surviving entity held by shareholders of the Company acquired by means other than the exchange or conversion of the shares of the Company shall not be used in determining if the shareholders of the Company own more than fifty percent (50%) of the voting power of the resulting or surviving entity (or its parent), but shall be used for determining the total outstanding voting power of the resulting or surviving entity); (d) any of the above transactions in clauses (i) through (iv) in connection with an issuance of securities by the Company as part of a transaction financing. |
| 2.42. | “Trustee” means any person or entity appointed by the Company, any of its Parents or any of its Subsidiaries, as applicable, and approved by the ITA, to serve as a trustee, all in accordance with the provisions of Section 102(a) of the Ordinance. |
| 2.43. | “Trustee 102 Option” means an Option granted pursuant to the rules set in Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of the Participant. |
| 2.44. | “102 Option” means an Option granted under the rules of Section 102 of the Ordinance, as amended, or any law or regulations, which shall replace Section 102. |
| 2.45. | “102 Capital Gain Options (102 CGO)” means a Trustee 102 Option elected and designated by the Employing Company to qualify for capital gain tax treatment in accordance with the provisions of Section 102(b)(2) of the Ordinance. |
| 2.46. | “102 Ordinary Income Option (102 OIO)” means a Trustee 102 Option elected and designated by the Employing Company to qualify for ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the Ordinance. |
| 2.47. | “3(i) Option” means an Option granted under the rules of Section 3(i) of the Ordinance, as amended, or any law or regulations, which shall replace Section 3(i). |
| 3. | Shares Subject to the Plan |
Subject to the provisions of Section 21 of the Plan, the aggregate number of Shares reserved and available for grant of Awards under the Plan is 111,111 or such other number of Shares as the Board shall determine from time to time. The Shares may be authorized but unissued, or reacquired Shares. Such Shares may consist, in whole or in part, of authorized and unissued shares or treasury shares.
If and to the extent that an Option expires, terminates or is canceled or forfeited for any reason without having been exercised in full, the Shares associated with that portion of that Option which was not exercised will again become available for grant under the Plan. Similarly, if and to the extent an Award of Restricted Stock or Restricted Stock Units is canceled or forfeited for any reason, the Shares subject to that Award will again become available for grant under the Plan. Shares withheld in settlement of a tax withholding obligation associated with an Award, or in satisfaction of the Exercise Price payable upon exercise of an Award, will again become available for grant under the Plan. If any Award or portion thereof is settled for cash, the Shares attributable for such cash settlement will again become available for grant.
| 4. | Administration of the Plan |
| 4.1. | Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws. Notwithstanding the above, the Board shall automatically have residual authority if no Committee shall be constituted or if such Committee shall cease to operate for any reason. |
| 4.2. | Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities and compliance with all Applicable Laws, the Administrator shall have the full power and authority at its sole discretion, from time to time and at any time: |
| (i) | To determine whether and to what extent Awards are to be granted hereunder to Participants; |
| (ii) | To determine and/or amend the Exercise Price of the Awards; |
| (iii) | To determine and/or amend the vesting schedule of the Awards; |
| (iv) | To determine and/or amend the terms of payment for the Shares; |
| (v) | To select the Eligible Recipients to whom Awards may from time to time be granted hereunder; |
| (vi) | To determine the number of Shares to be covered by each Award granted hereunder; |
| (vii) | To approve forms of agreement for use under the Plan; |
| (viii) | To determine the terms and conditions of any Award granted hereunder. Such terms and conditions shall include, but shall not be limited to, the Exercise Price, the time or times and the extent to which the Awards may be exercised (which may be based on performance criteria), any vesting acceleration (whether or not in connection with a Transaction) or waiver of forfeiture restrictions, and any restriction or limitation regarding any Award or the Shares relating thereto, based in each case on such factors as the Administrator, at its sole discretion, shall determine; |
| (ix) | To determine the Fair Market Value of the shares covered by each Award; |
| (x) | To make an election as to the type of 102 Option; |
| (xi) | To establish, add, cancel, amend or otherwise alter any restrictions, terms or conditions of any Award or Shares subject to any Award (including, without limitation, change the vesting terms, or accelerate the vesting periods, or add acceleration provisions with respect to, any Award granted hereunder); |
| (xii) | To prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws; |
| (xiii) | To authorize conversion or substitution under the Plan of any or all Awards and to cancel or suspend Awards, as necessary, provided the material interests of the Participants are not harmed; |
| (xiv) | To construe and interpret the terms of the Plan and Awards granted pursuant to the Plan; |
| (xv) | To alter, revise or otherwise adjust the terms of the Plan and the Award Agreement, as may be required pursuant to any applicable laws of local or foreign jurisdictions; |
All the abovementioned powers and actions may be taken by the Administrator at the date of grant of the Award and/or at any time thereafter.
| 4.3. | In the event of a tie vote with respect to any matter brought before the Administrator, such matter shall be presented to the Board and the decision of the Board shall be final with respect to such matter. |
| 4.4. | Neither the Trustee nor any member of the Board or the Committee shall be liable to the Company or to any Participant, for any action or determination taken or made in good faith as a Committee member in the course of administrating the Plan. Each member of the Board or the Committee shall be indemnified and held harmless by the Company or by any Participant against any cost or expense (including counsel fees) reasonably incurred by him, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the Plan unless arising out of such member’s own fraud or bad faith, all to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the member may have as a director or otherwise under the Company’s charter documents, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. |
| 4.5. | Effect of Administrator’s Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Participants. |
| 5. | Term of Plan |
| 5.1. | The Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless sooner terminated under Section 23 below. |
| 5.2. | 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. |
| 6. | Eligibility |
Awards may be granted to Participants and to persons to whom offers of employment or engagement as Employees or Consultants have been extended.
| 7. | Options to Non Israeli Participants |
| 7.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Nonstatutory Stock Options may be granted to non-Israeli Employees and non-Israeli Consultants and Incentive Stock Options may be granted only to non-Israeli Employees. |
| 7.2. | Each Option granted to non Israeli Participants shall be designated in the Award Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option, unless the Administrator determines otherwise at any time and subject to Applicable Laws. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, then unless the Administrator determines otherwise at any time and subject to the requirements of any applicable law, such options shall be treated as Nonstatutory Stock Options. For purposes of this Section, Incentive Stock Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the option with respect to such Shares is granted. |
| 8. | Options to Israeli Participants |
| 8.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Israeli Employees may be granted only 102 Options and Israeli Non-Employees may be granted only 3(i) Options. In each case, such options shall be subject to the terms and conditions of the Ordinance. |
| 8.2. | The Employing Company may designate 102 Options granted to Israeli Employees pursuant to Section 102 as Non-Trustee 102 Options or as Trustee 102 Options. |
| 9. | Trustee 102 Options |
| 9.1. | Options granted pursuant to this Section 9 are intended to constitute Trustee 102 Options and are subject to the provisions of Section 102 and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to options under a different tax law or regulation. |
| 9.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options may be granted only to Israeli Employees. |
| 9.3. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options shall be classified as either 102 CGO or 102 OIO, subject to the terms and conditions of Section 102 and the provisions of the Plan. |
| 9.4. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, no Trustee 102 Options may be granted under this Plan, unless the Employing Company’s election of the type of Trustee 102 Options granted to Israeli Employees, 102 CGO or 102 OIO (the “Election”), is appropriately filed with the ITA. |
| 9.5. | After making an Election, unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Company may grant only the type of Trustee 102 Options it has elected (i.e. 102 CGO or 102 OIO), and the Election shall apply to all grants to Participants of Trustee 102 Options until such Election is changed pursuant to the provisions of Section 102(g) of the Ordinance. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Employing Company may change such Election only after the passage of at least one year following the end of the year during which the applicable Employing Company first granted Trustee 102 Options in accordance with the previous Election. |
| 9.6. | For the avoidance of doubt, such Election shall not prevent the Company from granting Non-Trustee 102 Options or 3(i) Options simultaneously with the grant of Trustee 102 Options. |
| 9.7. | The grant of Trustee 102 Options shall be conditioned upon the approval (or the deemed approval pursuant to the provisions of section 102(a) of the Ordinance) of the Plan and the Trustee by the ITA. |
| 9.8. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options may be granted only after the passage of thirty (30) days (or a shorter period as and if approved by the ITA) following the delivery by the appropriate Employing Company to the ITA of a request for approval of the Plan and the Trustee according to Section 102, as mentioned in section 9.4 above. |
| 9.9. | Notwithstanding the foregoing paragraph, if within ninety (90) days of delivery of the abovementioned request, the appropriate ITA officer notifies the Employing Company of his or her decision not to approve the Plan or the Trustee, the Options that were intended to be granted as a Trustee 102 Options shall be deemed to be Non-Trustee 102 Options, unless otherwise determined by the ITA officer. |
| 9.10. | Anything herein to the contrary notwithstanding, all Trustee 102 Options granted under this Plan shall be granted or issued to a Trustee. The Trustee shall hold each such Trustee 102 Option, all Shares issued upon exercise thereof, and all other securities received following any exercise or realization of rights, including bonus shares, in trust for the benefit of the Participant in respect of whom such Option was granted. All certificates representing Options or Shares issued to the Trustee under the Plan shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Options or Shares are released from the trust. |
| 9.11. | With respect to 102 CGO and 102 OIO, the Options or Shares issued upon the exercise thereof and all rights related to them, including bonus shares, will be held by the Trustee for such period of time as required under Section 102 (currently, at least 24 months (in case of a 102 CGO) and 12 months (in case of a 102 OIO), from the date on which such Option was issued and deposited with the Trustee) or a shorter period as approved by the ITA (hereinafter, the “Holding Period”), under the terms set forth in Section 102. |
| 9.12. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, in accordance with Section 102, the Participant shall not sell, cause the release from trust, or otherwise dispose of, any Trustee 102 Option, any Share issued upon the exercise thereof, or any rights related to them, including bonus shares, until the end of the applicable Holding Period. Notwithstanding the foregoing but without derogating from the provisions of the Plan and the terms and conditions set forth in the Award Agreement, if any such sale, release, or disposition occurs during the Holding Period, then the provision of Section 102, relating to non-compliance with the Holding Period, will apply and all sanctions under Section 102 shall be borne by the Participant. |
| 9.13. | Anything herein to the contrary notwithstanding, the Trustee shall not release any Options which were not already exercised into Shares by the Participant, nor release any Shares issued upon exercise of the Trustee 102 Options or rights related thereto, including bonus shares, prior to the full payment of the Exercise Price and Participant’s tax liability arising from the Trustee 102 Options which were granted to him or her. |
| 9.14. | In the event that a stock split shall be effected or bonus shares shall be issued on account of the Shares which have been issued for the Participant’s benefit, such new split or bonus shares shall be transferred by the Company to the Trustee to hold for such Participant’s benefit. |
| 9.15. | The validity of any order given to the Trustee by a Participant shall be subject to the approval of the Company. The Company shall render its decision regarding orders given by any Participant to the Trustee within a reasonable period of time. The Company shall not be required to approve any order which is incomplete, is not in accordance with the provisions of this Plan and the relevant Award Agreement or which the Company believes should not be executed for any reasonable reason. The Company shall notify the Participant of the reason for not approving his/her order. Approval by the Company of any order given to the Trustee by a Participant shall not constitute proof of the Company’s recognition of any right of such Participant. |
| 9.16. | Without derogating from the aforementioned, the Administrator shall have the authority to determine the specific procedures and conditions of the trusteeship with the Trustee in a separate agreement between the Company and the Trustee. |
| 9.17. | In the event that the requirements for the Trustee 102 Options are not met, then the Trustee 102 Options shall be regarded as Non-Trustee 102 Options. |
| 9.18. | Upon receipt of a Trustee 102 Option, the Participant will sign an Award Agreement under which such Participant will agree to be subject to the trust agreement between the Company and/or its Subsidiaries and the Trustee, stating, inter alia, that the Trustee will be released from any liability in respect of any action or decision duly taken and executed in good faith in relation to this Appendix, or any Trustee 102 Option or Share issued to him or her thereunder. |
| 10. | Fair Market Value For Israeli Tax Purposes |
Without derogating from Section 2.20 and solely for the purpose of determining the tax liability pursuant to Section 102(b)(3) of the Ordinance, if at the date of grant of a 102 CGO the Company’s shares are listed on any established stock exchange or a national market system, or if the Company’s shares are registered for trading within ninety (90) days following the date of grant of the 102 CGO, the fair market value of the Shares at the date of grant shall be determined in accordance with the average value of the Company’s shares on the thirty (30) trading days preceding the date of grant or on the thirty (30) trading days following the date of registration for trading, as applicable, unless the Administrator determines otherwise at any time and subject to Applicable Laws.
| 11. | Integration of Section 102 and Tax Assessing Officer’s Permit |
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, with respect to Trustee 102 Options, the provisions of the Plan and the Award Agreement shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s permit (to the extent that such permit is issued) (the “Permit”), and said provisions and Permit shall be deemed an integral part of the Plan and the Award Agreement.
| 12. | Non-Trustee 102 Options |
| 12.1. | Options granted pursuant to this Section 12 are intended to constitute Non-Trustee 102 Options and are subject to the provisions of Section 102 and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to Options granted under a different tax law or regulations. |
| 12.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Non-Trustee 102 Options may be granted only to Israeli Employees. |
| 12.3. | Non-Trustee 102 Options shall be granted pursuant to the Plan may be issued directly to the Israeli Employee or to a trustee appointed by the Administrator in his\its sole discretion. In the event that the Administrator determines that Non-Trustee 102 Options, and Shares issued upon the exercise thereof, shall be deposited with a trustee, the provisions of Sections 9.10, 9.13, and 9.17 hereof shall apply, mutatis mutandis. |
| 12.4. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, in the event that an Israeli Employee who was granted a Non-Trustee 102 Option is an employee of the Company, or any Parent or Subsidiary thereof, such employee will be obligated to provide his employer, upon the termination of his employment for any reason, with a security or guarantee to cover any future tax obligation resulting from the grant, exercise or disposition of the Option or the Shares issuable upon the exercise thereof, in the form satisfactory to such employer in the latter’s sole discretion. |
| 13. | 3(i) Options |
| 13.1. | Options granted pursuant to this Section 13 are intended to constitute 3(i) Options and are subject to the provisions of Section 3(i) of the Ordinance and the general terms and conditions specified in the Plan, except for provisions of the Plan applying to Options granted under a different tax law or regulations. |
| 13.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, 3(i) Options may be granted only to Israeli or foreigners Non-Employees. |
| 13.3. | 3(i) Options that shall be granted pursuant to the Plan may be issued directly to the Israeli and foreigners Non-Employee or to a trustee appointed by the Administrator in his\its sole discretion. In the event that the Administrator determines that 3(i) Options, and Shares issued upon the exercise thereof, shall be deposited with a trustee, the provisions of Sections 9.10, 9.13, and 9.17 hereof shall apply, mutatis mutandis. |
| 14. | General Provisions |
| 14.1. | Term of Option. The expiration date of the term of each Option shall be stated in the Award Agreement (the “Expiration Date”); provided, however, that in no event the term of any Option shall be more than ten (10) years from the date of grant thereof. Each unexercised Option shall automatically expire and shall no longer be exercisable immediately upon the earlier of: (i) the Expiration Date of such Option (as set forth in the applicable Award Agreement), or (ii) at the time at which such Option otherwise expires pursuant to the terms of the Plan. |
| 14.2. | Option Exercise Price and Consideration |
| (i) | The per share Exercise Price for the Shares to be issued upon exercise of an Option shall be such price as is determined by the Administrator at any time at its sole and absolute discretion, subject to any Applicable Laws. |
| (ii) | The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator at the time of grant and/or at any time thereafter, subject to any Applicable Law. Such consideration may consist of (1) cash; (2) check; (3) previously acquired Shares based on the Fair Market Value of the Shares on the date the Option is exercised; (4) a cashless exercise method, whereby the Option’s Exercise Price will not be due in cash and where the number of Shares issued upon such exercise will be equal to: (A) the product of (i) the number of Shares as to which the Option is then being exercised, and (ii) the excess, if any, of (a) the then current Fair Market Value per Share over (b) the Option Exercise Price, divided by (B) the then current Fair Market Value per Share; (5) any combination of the foregoing methods of payment; or (6) any other method as shall be determined by the Administrator at its sole discretion. |
| 14.3. | Manner of Exercising the Option |
| (i) | Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms hereof, at such times and under such conditions as determined by the Administrator and set forth in the Award Agreement and in accordance with the requirements of Section 102 of the Ordinance, if applicable. |
| (ii) | In the event of any conflict between the terms and conditions of an Award Agreement and the terms hereof, the terms hereof shall control, unless explicitly provided otherwise in the Award Agreement. |
| (iii) | Unless the Administrator provides otherwise at any time, vesting of Options granted hereunder shall be ceased during any unpaid leave of absence. |
| (iv) | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, an Option shall be deemed exercised when the Company receives: (i) written notice of exercise (in accordance with the Award Agreement) from the person entitled to exercise the Option and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Award Agreement and the Plan. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Shares issued upon exercise of an Option (excluding Shares underlying a 102 Option, which Shares shall be issued in the name of the Trustee) shall be issued in the name of the Participant or, if requested by the Participant, in the name of the Participant and his or her spouse. |
| (v) | Until the applicable Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to such Shares, notwithstanding the exercise of the Option, nor shall the Participants be deemed to be a class of shareholders or creditors of the Company for the purpose of the operation of sections 350 and 351 of the Israeli Companies Law, 5759-1999 or any successor to such sections. |
| (vi) | The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right, including without limitation, in connection with rights offering, for which the record date is prior to the date the Shares are issued, except as provided in Section 21 hereof. |
| (vii) | Exercise of an Option in any manner shall result in a decrease in the number of Shares thereafter available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. |
| (viii) | An Option may not be exercised for fractional shares. |
| (ix) | Until the consummation of an IPO, and unless explicitly provided otherwise in the Award Agreement, any Shares acquired upon the exercise of Options shall be voted by an irrevocable proxy, substantially in the form attached hereto as Schedule A (or any other form approved by the Board) (the “Proxy”), according to which, the Participant irrevocably appoints the chairman of the Board, or any other person designated for such purpose by the Board, as his/her proxy with respect to the Shares acquired upon the exercise of Options (the “Proxy Holder”). The Proxy will be signed and delivered to the Company by the Participant concurrently with the execution of the Participant’s Award Agreement. |
| (x) | The Proxy Holder shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him/her, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the voting of such Proxy, unless arising out of such Proxy Holder’s own fraud or willful misconduct, to the extent permitted by Applicable Law. Such indemnification shall be in addition to any rights of indemnification the Proxy Holder may have (if any) as a director or otherwise under the Articles, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. Without derogating from the above, with respect to 102 Options, such shares shall be voted in accordance with the provisions of Section 102 and any rules, regulations or orders promulgated thereunder. |
| 15. | Non-Transferability of Options |
| 15.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant. |
| 15.2. | Without derogating from the foregoing and unless the Administrator determines otherwise at any time and subject to Applicable Laws, for as long as Options or Shares purchased upon the exercise thereof are held by the Trustee on behalf of the Participant, all rights of the Participant with respect to such Options and Shares shall be personal, and may not be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution. |
| 15.3. | Without derogating from the inherent power of the shareholders of the Company to alter or modify the rights of the Company’s shares, the Administrator may impose on any Participant such additional restrictions on the transfer of Shares as the Administrator may determine at the time that Options are granted to the Participant or as may be agreed to by the Administrator and the Participant following purchase of said Shares upon exercise of such Options under this Plan or upon termination of the Participant’s employment or service with the Company. Such additional restrictions shall be included in the Award Agreement entered into between the Company and the Participant, or, upon agreement of the Participants, or in this Plan. |
| 16. | Rights and Restrictions Attaching to the Shares |
| 16.1. | Equal Rights. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Shares shall have equal rights for all intents and purposes as the rights attached to Shares of the Company according to the Articles, subject also to the provisions of this Plan and the Award Agreement. Any change to Articles which modify rights attaching to the Company’s shares shall also apply to the Awards and the Shares. The provisions of the Plan shall remain applicable, with the necessary modifications arising from any such amendment. The grant of Awards or the issuance of Shares under this Plan shall not entitle any Participant to receive any compensation in the event of any change to the Company’s capital. |
| 16.2. | Dividend Rights. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, all Shares issued upon the exercise of Options granted under the Plan, shall entitle the Participant thereof, or the Trustee for the benefit of Participant, subject to any applicable taxation on distribution of dividends and, when applicable, subject to the provisions of Section 102, to receive dividends with respect thereto in accordance with the Articles, provided, however, that Participant, or the Trustee for the benefit of Participant, shall have no right to dividends or distribution or other right, including without limitation in connection with rights offering, with respect to Shares for which the record date is prior to the date on which the Participant shall have become the holder of record. |
| 16.3. | Transfer of Shares. Without derogating from the provisions of the Plan and the terms and conditions set forth in the Award Agreement or the Articles, until the consummation of an IPO and unless the Administrator determines otherwise at any time, prior to any transfer of any Shares acquired upon the exercise of Options to a transferee (the “Transferred Shares”) and as a condition to the transfer of the Transferred Shares (if and to the extent the Transferred Share were subject to a Proxy), such transferee shall execute an irrevocable proxy substantially in the form of the Proxy, appointing the chairman of the Board, or any other person designated for such purpose by the Board, as such transferee’s proxy with respect to the Transferred Shares. |
| 17. | Termination of Relationship as an Employee or as a Consultant |
| 17.1. | Subject to the provisions of Sections 17.4 and 17.5 below, if a Participant ceases to be an Employee or a Consultant, such Participant may exercise his or her Option within such additional period of time beyond the date of such termination as is specified in the applicable Award Agreement (solely to the extent that the Option is vested on the date of such termination), but in no event later than the Expiration Date of such Option (for the purpose of this Section 17.1 the “Extended Period”). In the absence of a specified Extended Period in the Award Agreement and unless the Administrator determines otherwise at any time, the Option (solely to the extent that the Option is vested on the date of such termination) shall remain exercisable for, and the Extended Period shall be deemed to be, three (3) months following the Participant’s termination (but in no event later than the Expiration Date of such Option). If, on the date of termination, the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall automatically revert to the Plan and shall no longer be exercisable. If, after termination of engagement with the Company, the Participant does not exercise the vested portion of his or her Option within the Extended Period, the Option shall forthwith terminate, and the Shares covered by such Option shall automatically revert to the Plan. For the avoidance of doubt, Awards granted hereunder shall not continue to vest during the Extended Period thereof. |
| 17.2. | At any time, including following the date on which an Award is granted the Administrator, at its sole and absolute discretion and without such act constituting a precedent in respect of any other Participant, shall be entitled to extend the period during which the Participant shall be entitled to exercise his\her vested Options, by a period to be fixed by the Administrator. |
| 17.3. | Anything in this Plan to the contrary notwithstanding, but subject to the provisions of section 102 of the Ordinance and the tax regulations thereto, if a Participant ceases to be an Employee or a Consultant of the Company or any Parent or Subsidiary thereof, but continues to be employed or provide services to the Company or any other Parent or Subsidiary thereof, such Participant will be deemed for the purpose of this Section 17 to have continuously remained an Employee or a Consultant of the Company (as applicable) during such term, and his/her Awards shall vest pursuant to their original terms. Notwithstanding anything to the contrary hereinabove, unless the Administrator determines otherwise at any time and subject to Applicable Laws, if termination of Participant is for Cause, the entire unexercised Option (whether vested or not) shall ipso facto terminate and the Shares covered by such Option shall automatically revert to the Plan. |
| 17.4. | Retirement. If a Participant should retire, he/she may, subject to the approval of the Administrator (at its sole discretion), continue to enjoy such rights, if any, with respect to his/her Awards under the Plan and on such terms and conditions, with such limitations and subject to such requirements as the Administrator, at its sole discretion, may determine at the time of such retirement or at any time theretofore. |
| 17.5. | Death or Disability of Participant. If Participant’s engagement with the Company as an Employee or a Consultant is terminated as a result of the Participant’s death or inability to substantially perform the ordinary functions of his/her position in the Company by reason of any medically diagnosed physical or mental impairment, permanent disability or chronic illness, which last for a continuous period of nine (9) months or more (“Disability”), the Participant (or, if the Participant died, the Participant’s estate or any person who acquired the right to exercise the Option by bequest or inheritance) may exercise his or her Option within such additional period of time thereafter as is specified in the Award Agreement (which period shall be of at least six (6) months) (and with respect to Options, to the extent the Option is vested on the date of such termination), but in no event later than the Expiration Date of the such Option (for the purpose of this Section 17.5 the “Extended Period”). A determination of any Disability will be made by a physician reasonably acceptable to the Company. In the absence of a specified Extended Period in the Award Agreement, the Option, to the extent it is vested on the date of such termination, shall remain exercisable for, and the Extended Period shall be deemed to be, twelve (12) months following the Participant’s termination, or any longer period determined by the Administrator (but in no event later than the Expiration Date of such Option). If, on the date of termination, the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall automatically revert to the Plan and shall no longer be exercisable. If, after termination, the vested portion of the Participant’s Option are not exercised within the applicable Extended Period, the Option shall forthwith terminate, and the Shares covered by such Option shall automatically revert to the Plan. For the avoidance of doubt, the Awards granted hereunder shall not continue to vest during the Extended Period. |
| 18. | Restricted Stock |
| 18.1. | Awards of Restricted Stock may be issued either alone or in addition to other Awards granted under the Plan (including, without limitation, under Section 102). The Administrator shall determine, at its sole discretion, the Eligible Recipients to whom, and the time or times at which, Awards of Restricted Stock shall be made, the number of Shares to be awarded, the Exercise Price, if any, to be paid by the Participant for the acquisition of Restricted Stock, the Restricted Period (as defined in Section 18.3(i) below) and all other conditions of the Awards of Restricted Stock. The Administrator may also condition the grant of the Award of Restricted Stock upon the exercise of Options, or upon such other criteria as the Administrator may determine, at its sole discretion. The provisions of the Awards of Restricted Stock need not be the same with respect to each Participant. |
| 18.2. | Awards and Certificates |
| (i) | The prospective recipient of Awards of Restricted Stock shall not have any rights with respect to any such Award, unless and until such recipient has executed an Award Agreement evidencing the Award (a “Restricted Stock Award Agreement”) and delivered a fully executed copy thereof to the Company, within a period of sixty (60) days (or such other period as the Administrator may specify at any time) after the Award date and has otherwise complied with the applicable terms and conditions of such Award. |
| (ii) | Except as otherwise provided below in Section (iii), (a) each Participant who is granted an Award of Restricted Stock shall be issued a share certificate in respect of such Shares of Restricted Stock, and (b) such certificate shall be registered in the name of the Participant (or, if so determined by the Administrator or required under any Applicable Law – such certificate shall be registered in the name of the Trustee), and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to any such Award. |
| (iii) | The Company may require that the share certificates evidencing Restricted Stock granted hereunder be held in the custody of the Company until the restrictions thereon shall have lapsed, and that, as a condition of any Award of Restricted Stock, the Participant shall have delivered a stock power, endorsed in blank, relating to the Shares covered by such Award. |
| 18.3. | Restrictions and Conditions |
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Awards of Restricted Stock granted pursuant to this Section 18 shall be subject to the following restrictions and conditions:
| (i) | Subject to the provisions of the Plan and the Restricted Stock Award Agreement governing any such Award, during such period as may be set by the Administrator commencing on the date of grant (the “Restricted Period”), the Participant shall not be permitted to sell, transfer, pledge, assign or otherwise dispose Shares of Restricted Stock awarded under the Plan; provided, however, that the Administrator may at any time and at its sole discretion, provide for the lapse of such restrictions in installments and may accelerate or waive such restrictions in whole or in part based on such factors and such circumstances as the Administrator may determine, at its sole discretion, including, but not limited to, the attainment of certain performance related goals, the Participant’s termination of employment or service as a director, consultant or advisor to the Company, any Subsidiary or Affiliate, the Participant’s death or Disability or the occurrence of a Transaction. |
| (ii) | Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, once the Participant has been issued a certificate or certificates for Restricted Stock or the Restricted Stock has been issued in the Participant’s name by book-entry registration, the Participant will have, with respect to the Restricted Stock, the right to vote the Shares, but will not have the right to receive any cash distributions or dividends prior to the lapse of the Restriction Period. If any cash distributions or dividends are payable with respect to the Restricted Stock, the Administrator, in its sole discretion, may require the cash distributions or dividends to be subjected to the same Restriction Period as is applicable to the Restricted Stock with respect to which such amounts are paid, or, if the Administrator so determines, to allocate such cash distributions or dividends among all other eligible shareholders, or to reinvest such cash distributions or dividends in additional Restricted Stock to the extent Shares are available under Section 3 of the Plan. If the Administrator determines that cash distributions or dividends shall be payable with respect to the Restricted Stock, such dividends shall be paid or distributed at the end of the Restriction Period and a Participant shall not be entitled to interest with respect to any such dividends or distributions subjected to the Restriction Period. Unless otherwise determined by the Administrator at any time subject to Applicable Laws, any distributions or dividends paid in the form of securities with respect to Restricted Stock will be subject to the same terms and conditions as the Restricted Stock with respect to which they were paid, including, without limitation, the same Restriction Period. |
| (iii) | Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, if a Participant’s service or employment with the Company, its Subsidiary or Parent terminates prior to the expiration of the applicable Restriction Period, the Participant’s Restricted Stock and any associated dividends, if any, that then remain subject to forfeiture will then be forfeited automatically. Upon forfeiture of Restricted Stock, the Participant shall have no further rights with respect to such Restricted Stock. |
| (iv) | In the event that Awards of Restricted Stock are granted to Israeli Employees, such grant shall be subject to the provisions of Section 102 and the provisions of Sections 8, 9, 10, 11, 12, and 14 hereof shall apply to such Award, mutatis mutandis. |
| 19. | Restricted Stock Units |
Subject to the other terms of the Plan, the Administrator may grant Restricted Stock Units to Eligible Recipients, either alone or in addition to other Awards granted under the Plan, (including under Section 102) and may at any time, in its sole and absolute discretion, impose conditions on such units as it may deem appropriate, including, without limitation, continued employment or service of the Participant or the attainment of specified individual or corporate performance goals. Each Restricted Stock Unit shall be evidenced by an Award Agreement in the form that is approved by the Administrator.
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, each Restricted Stock Unit will represent a right to receive from the Company, upon fulfillment of any applicable conditions, one Share. All other terms governing Restricted Stock Units, such as vesting, time and form of payment and termination of units shall be set forth in the applicable Award Agreement. The terms governing the Restricted Stock Units need not be the same with respect to each Participant. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Participant shall not have any shareholder rights with respect to the Shares subject to a Restricted Stock Unit Award until that Award vests and any Shares are actually issued thereunder. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, a Participant will not be permitted to sell, transfer, pledge, assign or otherwise encumber Restricted Stock Units awarded under the Plan. Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, if a Participant’s service with the Company, its Subsidiary or Parent terminates prior to the Restricted Stock Unit Award vesting, the Participant’s Restricted Stock Units that then remain subject to forfeiture will then be forfeited automatically. Upon forfeiture of Restricted Stock Units, the Participant shall have no further rights with respect to such Restricted Stock Units.
| 20. | [Reserved] |
| 21. | Adjustments |
| 21.1. | Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of Shares covered by each outstanding Award, and the number of Shares which have been authorized for issuance under the Plan but as to which no Awards have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Award, as well as the Exercise Price of Shares covered by each such outstanding Award, may be proportionately adjusted upon any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend (if so determined by the Board upon the issuance of such stock dividend), combination or reclassification of the Shares, or any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company. The conversion of any convertible securities of the Company shall not be deemed to have been effected without receipt of consideration. Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Award. |
| 21.2. | Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, any or all outstanding Awards will terminate immediately prior to the consummation of such proposed action. The Administrator may, in the exercise of its sole discretion in such instances, declare that any Award shall terminate as of such other date fixed by the Administrator and give each Participant the right to exercise his\her Award as to all or any part of the Shares, including Shares as to which the Award would not otherwise be exercisable. |
| 21.3. | Changes to Plan. The Administrator shall be entitled, from time to time, to update and/or change the terms of this Plan, in whole or in part, at its sole discretion, provided that in the Board’s opinion such a change shall not materially derogate from the terms of vested Awards or Shares issued under this Plan. The Board shall be entitled to terminate this Plan at any time provided such termination does not materially affect the rights of any Participant with respect to vested Awards. |
| 21.4. | Transaction. Without derogating from the Administrator’s general authority and power under this Plan, in the event of a Transaction the following shall occur, without the Participant’s consent and action and without any prior notice requirement: |
| 21.4.1 | Unless otherwise determined by the Administrator in its sole and absolute discretion, any Award then outstanding shall be assumed or be substituted by the Company, or by a Successor Company, under terms as determined by the Administrator or the terms of this Plan applied by the Successor Company to such assumed or substituted Awards; |
For the purposes of this Section 21.4.1, the Award shall be considered assumed or substituted if, following a Transaction, the Award confers on the holder thereof the right to purchase or receive, for each Share underlying an Award immediately prior to the Transaction, 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 Transaction for each Share held on the effective date of the Transaction (and if holders were offered a choice or several types of consideration, the type of consideration as determined by the Administrator), or (ii) regardless of the consideration received by the holders of Shares in the Transaction, solely shares or any type of Awards (or their equivalent) of the Successor Company at a value to be determined by the Administrator 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 Administrator. Any of the above consideration referred to clauses (i) and (ii) may be subject to vesting, expiration and other terms as determined by the Administrator in its discretion and may differ from the vesting, expiration and other terms applying on the Awards immediately prior to the Transaction. The foregoing shall not limit the Administrator’s authority to determine, in its sole discretion and in compliance with all Applicable Laws, that in lieu of such assumption or substitution of Awards for Awards of the Successor Company, such Award will be substituted for any other type of asset or property, including as set forth in Section 21.4.2 hereunder.
| 21.4.2 | Regardless of whether or not Awards are assumed or substituted, the Administrator may (but shall not be obligated to), in its sole discretion: |
| (a) | provide for any Participant to have the right to exercise the Award in respect of Shares covered by the Award which would otherwise be exercisable or vested, under such terms and conditions as the Administrator shall determine, and the cancellation of all unexercised and unvested Awards upon or immediately prior to the closing of the Transaction, unless the Administrator provides for the Participant to have the right to exercise the Award; and/or |
| (b) | provide 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 Administrator shall determine; and/or |
| (c) | provide for the cancellation of each outstanding Award at or immediately prior to the closing of such Transaction, and payment to the Participant of an amount in cash, shares of the Company, the acquirer or of a corporation or other business entity which is a party to the Transaction or other property, as determined by the Administrator to be fair in the circumstances, and subject to such terms and conditions as determined by the Administrator. The Administrator shall have full authority to select the method for determining the payment (being the Black-Scholes model or any other method). The Administrator’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. |
| 21.4.3 | The Administrator may determine that any payments made in respect of Awards shall be (i) subject to vesting terms substantially identical to those that applied to the canceled Award immediately prior to the Transaction; and/or (ii) made or delayed to the same extent that payment of consideration to the holders of the Shares in connection with the Transaction is made or delayed as a result of escrows, indemnification, earn outs, holdbacks or any other contingencies; and the terms and conditions applying to the payment made to the Participants, including participation in escrow, indemnification, releases, earn-outs, holdbacks or any other contingencies. |
| 21.4.4 | Notwithstanding the foregoing, in the event of a Transaction, the Administrator may determine, in its sole discretion that upon completion of such Transaction the terms of any Award be otherwise amended, modified or terminated, as the Administrator shall deem in good faith to be appropriate and without any liability to the Company or any Affiliate, Parent or Subsidiary thereof, and to their respective its 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. |
| 21.4.5 | Neither the authorities and powers of the Administrator under this Section 21.4, nor the exercise or implementation thereof, shall (i) be restricted or limited in any way by any adverse consequences (tax or otherwise) that may result to any holder of an Award, and (ii) as, inter alia, being a feature of the Award upon its grant, be deemed to constitute a change or an amendment of the rights of such holder under this Plan, nor shall any such adverse consequences (as well as any adverse tax consequences that may result from any tax ruling or other approval or determination of any relevant tax authority) be deemed to constitute a change or an amendment of the rights of such holder under this Plan, and may be effected without consent of any Participant and without any liability to the Company or its Affiliates and to their respective its officers, directors, employees and representatives and the respective successors and assigns of any of the foregoing. The Administrator needs not take the same action with respect to all Awards or with respect to all Eligible Recipients. The Administrator may take different actions with respect to the vested and unvested portions of an Award. The Administrator may determine an amount or type of consideration to be received or distributed in a Transaction which may differ as among the Participants, and as between the Participants and any other holders of shares of the Company. |
| 21.4.6 | The Administrator’s determinations pursuant to this Section 21.4 shall be conclusive and binding on all Participants. |
| 21.4.7 | If determined by the Administrator, the Participants shall be subject to the definitive agreement(s) in connection with the Transaction 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 Administrator. Each Participant shall execute such separate agreement(s) or instruments as may be requested by the Company, the Successor Company or the acquirer in connection with such in such Transaction 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. |
| 21.5. | Anything herein to the contrary notwithstanding and unless otherwise determined by the Administrator, in its sole and absolute discretion, if prior to the completion of the IPO, all or substantially all of the shares of the Company (determined without taking into account the shares issued or issuable under this Plan) are to be sold (whether under the Articles or any other contract by which the shareholders of the Company are bound or pursuant to any applicable law) to any third party, whether or not related to or affiliated with the Company or its shareholders, each Participant shall be obliged to sell the Shares such Participant purchased under the Plan, in accordance with the instructions then issued by the Administrator whose determination shall be final. |
| 22. | Time of Granting Awards |
Unless explicitly determined otherwise by the Administrator, the date of grant of an Award shall be, for all purposes, the later of (i) the date on which the Administrator makes the determination granting such Award, or (ii) the commencement date of the Participant’s engagement with the Company or any Parent or Subsidiary thereof (whether as an Employee, Consultant or Director). Notice of the determination shall be given to each Participant to whom an Award is so granted within a reasonable time after the date of such grant.
| 23. | Amendment and Termination of the Plan |
| 23.1. | Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan. |
| 23.2. | Shareholders Approval. The Board shall obtain shareholders approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws. |
| 23.3. | Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. Termination of the Plan shall not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination. |
| 24. | Conditions Upon Issuance of Shares |
| 24.1. | Legal Compliance. Shares shall not be issued pursuant to the exercise of an Award granted hereunder unless the exercise of such Award and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. |
| 24.2. | Investment Representations. The Administrator may require each Participant acquiring Shares to represent and warrant that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such representation is required. |
| 24.3. | Market Stand-Off. In connection with any public offering of the Company’s equity securities, pursuant to an effective registration statement, for such period as the Company or its underwriters may request (such period not to exceed one hundred and eighty (180) days following the date of the applicable offering), the Participant shall not, directly or indirectly, sell, make any short sale of, loan, hypothecate, pledge, offer, grant or sell any option or other contract for the purchase of, purchase any option or other contract for the sale of, or otherwise dispose of or transfer, or agree to engage in any of the foregoing transactions with respect to, any Shares acquired under this Plan without the prior written consent of the Company or its underwriters. |
| 25. | Rights as a Shareholder; Voting and Dividends |
| 25.1. | Without derogating from other provisions of the Plan, including Section 18.3(ii) above and unless otherwise determined by the Administrator at any time, subject to Applicable Laws, a Participant shall have no rights as a shareholder of the Company with respect to any Shares covered by the Award until the date of the issuance of a share certificate to the Participant for such Shares. In the case of 102 Option or 3(i) Option (if such Options are being held by a Trustee), the Trustee shall have no rights as a shareholder of the Company with respect to any Shares covered by such Award until the date of the issuance of a share certificate to the Trustee for such Shares for the Participant’s benefit, and the Participant shall have no rights as a shareholder of the Company with respect to any Shares covered by the Award until the date of the release of such Shares from the Trustee to the Participant and the issuance of a share certificate to the Participant for such Shares. Unless otherwise determined by the Administrator at any time and subject to Applicable Laws, no adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distribution of other rights, including without limitation in connection with any rights offering, for which the record date is prior to the date such share certificate is issued. |
| 25.2. | 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. |
| 26. | No Right for Continuing Relationship |
Neither the Plan nor any Award shall confer upon any Participant any right with respect to continuing the Participant’s relationship as an Employee or as a Consultant with the Company, nor shall it interfere in any way with his or her right or the Company’s right to terminate such relationship at any time, with or without Cause.
| 27. | Inability to Obtain Authority |
The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to 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.
| 28. | Default |
A Participant shall be deemed to be in default under this Plan, including the Award Agreement, in the event that the Participant fails to pay any sum or perform any obligation provided for in the Plan, in a timely fashion or in a manner required. Any default under this Plan not cured within ten (10) days after the Company gives written notice of such default to Participant shall entitle the Company to exercise any and all remedies and rights against the defaulting Participant contained in any and all of the documents comprising this Plan or provided under Applicable Law.
| 29. | Notices |
All notices and elections sent to the Company by a Participant shall be in writing and delivered in person or by certified mail to the CEO of the Company at the principal office of the Company. All notices given by the Company to a Participant under the Plan shall be in writing and delivered in person or by certified mail to the Participant’s address as reflected in the Company’s records. All notices will be deemed delivered within seven (7) days of their dispatch by certified mail, postage prepaid.
| 30. | Reservation of Shares |
At all time during the term of this Plan, the Company shall reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.
| 31. | Miscellaneous |
| 31.1. | Any tax consequences arising from the grant or exercise of any Awards or from the payment for, or the sale of or other disposition of, Shares covered thereby or from any other event or act (whether of the Participant, the Trustee, or the Company or its Subsidiaries) hereunder, shall be borne solely by the Participant. The Company, its Parents, subsidiaries and the Trustee shall be entitled to withhold taxes according to the requirements of any Applicable Laws, rules and regulations, including withholding taxes at source and particularly regulation 7(b) of the Income Tax Regulations (tax benefits on the issuance of shares to employees) 2003. Furthermore, the Participant shall agree to indemnify the Company or Subsidiary that employs the Participant 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 the necessity to withhold, or to have withheld, any such tax from any payment made to the Participant. The Company may exercise such indemnification by deducting the Tax subject to indemnification from Participant’s salaries or remunerations. Except as otherwise required by law, the Company and the Trustee shall not be obligated to exercise any Awards on behalf of a Participant, or to release any share certificate, until all tax consequences arising from the exercise of such Awards are resolved in a manner reasonably acceptable to the Company and the Trustee, and all required payments in connection with the exercise of the Award, or the sale of the Shares, have been fully paid by the Employee. |
| 31.2. | The ramifications of any future modification of any Applicable Law regarding the taxation of Awards and/or Shares granted to Participants shall apply to the Participants accordingly and such Participants shall bear the full cost thereof, unless such modified laws expressly provide otherwise. For the avoidance of doubt, should the applicability of such taxing arrangements to this Plan or to securities issued in the framework thereof be stipulated by an application by the Company or by the Trustee that same shall apply, the Company shall be entitled to decide, at its absolute discretion, whether to apply such taxing arrangements and to instruct the Trustee to act accordingly. |
| 31.3. | Governing Law and Jurisdiction. This Plan shall be governed by and construed and enforced in accordance with the laws of the State of Israel, without giving effect to the principles of conflict of laws. The competent courts of Tel-Aviv, Israel shall have exclusive jurisdiction in any matters pertaining to the Plan. |
| 31.4. | Conflicts. This Plan (together with the Award Agreements signed by the Company and the Participant) supersedes all of the agreements and/or understandings existing prior to the date of the grant of Awards to an Participant between the Company, or any of its Affiliates, and such Participant in connection with issuance of capital shares of the Company or options for capital shares of the Company to such Participant, other than any written option agreement entered into pursuant to a different stock option plan approved by the Board. Any representation and/or promise and/or undertaking made and/or given by the Company and/or by any of its Affiliates or by any person on their behalf, which have not been expressed herein, shall have no force and effect. For the removal of doubt, it is hereby clarified that in the event of any contradiction between the terms set forth in this Plan and the terms of any Award Agreement, or in a Participant’s employment or services agreement, the terms of this Plan shall prevail, unless explicitly provided otherwise in the Award Agreement. |
| 32. | Multiple Agreements |
The terms of each Award may differ from other Awards granted, whether concurrent with, prior to or following its grant under this Plan . No Participant or other person shall have any claim to be granted Awards and there is no obligation for uniformity of treatment of Participants, or holders or beneficiaries of Awards. The terms and conditions of Awards and the Administrator’s determinations and interpretations with respect to them need not be the same with respect to each Participant (whether or not such Participants are similarly situated and whether or not the Awards are granted at the same time or at any other time).
Schedule A
PROXY
I, the undersigned, as record holder of the securities of Pagaya Technologies Ltd. (the “Company”) described below, hereby irrevocably appoint the chairman of the Company’s Board of Directors, or any other person designated for such purpose by the Company’s Board of Directors (the “Proxy Holder”), as my proxy instead of myself and on my behalf, with respect to any and all aspects of my shareholdings in the Company in virtue of the shares granted to me pursuant to the Company’s 2016 Equity Incentive Plan (including, without limitation and for the sake of clarification, any shares issued to me upon exercise of any option granted to me under the Company’s 2016 Equity Incentive Plan) (the “Shares”), including, without limiting the foregoing generality: (i) receiving any notices that the Company may deliver to its shareholders, pursuant to the Articles of Association of the Company (as amended from time to time), any shareholders agreement, applicable law or otherwise, (ii) attending all meetings of the shareholders of the Company and voting such Shares at any meeting of the shareholders of the Company (and at any postponements or adjournments thereof) and waiving all minimum notice requirements for such meetings of shareholders, (iii) executing any consents or dissents in writing without a meeting of the shareholders of the Company to any corporate action thereof, (iv) waiving any preemptive right, right of first refusal, right of first offer, co-sale right or any other similar right or restriction to which I will be entitled by virtue of the Shares, (v) giving or withholding consent or agreement to any matter which requires my consent or agreement in my capacity as a shareholder of the Company (whether such is required under the Articles of Association of the Company (as amended from time to time), any agreement to which I am a party as a shareholder or otherwise), and/or (vi) joining in making a request to convene a general meeting or class meeting of the shareholders of the Company or to otherwise exercise any and all powers and authorities vested within me in my capacity as a shareholder of the Company (in each of the foregoing cases, to the fullest extent that I will be entitled to act so, and in the same manner and with the same effect as if the undersigned were personally present at any such meeting or voting such Shares or personally acting on any matters submitted to shareholders for approval or consent).
The Shares shall be voted by the Proxy Holder in the same proportion as the votes of the other shareholders of the Company.
This proxy is irrevocable to the maximum extent allowed by applicable laws and it will remain in full force and effect until the consummation of an IPO (as defined in the Company’s 2016 Equity Incentive Plan), upon which it will automatically terminate.
The Proxy Holder will have the full power of substitution and revocation. All authority herein conferred shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.
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27
Exhibit 10.10
PAGAYA TECHNOLOGIES LTD.
2016 EQUITY INCENTIVE PLAN
STOCK OPTION SUB-PLAN FOR UNITED STATES PERSONS
| 1. | Introduction |
1.1 Pursuant to Section 4.2(xii) of the PAGAYA TECHNOLOGIES LTD. 2016 EQUITY INCENTIVE PLAN (the “Plan”), which Plan was adopted by the Board on May 10, 2016, the provisions set forth herein are made applicable to Options granted under this sub-plan (this “U.S. Sub-Plan”) of the Plan to Eligible Persons residing in the United States of America or whose primary place of performing services for the Company is located in the United States of America (“U.S. Eligible Persons”).
1.2 Except as expressly set forth herein to the contrary, all of the terms and conditions of the Plan shall apply to Options granted under the Plan to U.S. Eligible Persons.
1.3 The Company intends that securities issued under the Plan to U.S. Eligible Persons be exempt from requirements of registration and qualification of such securities pursuant the exemptions afforded by Rule 701 promulgated under the Securities Act and any applicable exemptions under applicable United States state securities laws, and the Plan shall be so construed. Further, the Company intends that Options granted under the Plan to U.S. Eligible Persons be exempt from or comply with Section 409A of the U.S. Code (including any amendments or replacements of such section), and the Plan shall be so construed.
| 2. | Definitions |
2.1 Except as set forth in Section 2.2, capitalized terms used in this U.S. Sub-Plan but not defined herein shall have the meanings set forth in the Plan.
2.2 Whenever used herein, the following terms shall have their respective meanings set forth below:
(a) “Consultant” has the meaning as defined in the Plan, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from offering or selling securities to such person pursuant to the Plan in reliance on either the exemption from registration provided by Rule 701 under the Securities Act or, if the Company is required to file reports pursuant to Section 13 or 15(d) of the Exchange Act, registration on a Form S-8 Registration Statement under the Securities Act.
(b) “Employee” has the meaning as defined in the Plan, provided that, with respect to any Incentive Stock Option granted to such an individual, the individual is considered an employee for purposes of Section 422 of the U.S. Code.
(c) “Fair Market Value” has the meaning as defined in the Plan, provided that any good faith determination by the Administrator in the absence of an established market for the Shares shall be made without regard to any restriction other than a restriction which, by its terms, will never lapse, and in a manner consistent with the requirements of Section 409A of the Code.
(d) “Insider” means an Officer, a Director or other person whose transactions in Shares are subject to Section 16 of the Exchange Act.
(e) “Rule 16b-3” means Rule 16b-3 under the Exchange Act, as amended from time to time, or any successor rule or regulation.
(f) “Securities Act” means the United States Securities Act of 1933, as amended.
(g) “Ten Percent Shareholder” means a person who, at the time an Option is granted to such person, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company within the meaning of Section 422(b)(6) of the Code.
| 3. | Option Terms. |
3.1 Options may be granted under the U.S. Sub-Plan only to Employees, Consultants and Directors.
3.2 The exercise price per Share for each Option granted under the U.S. Sub-Plan shall be not less than the Fair Market Value of a Share on the date of grant of the Option.
3.3 Incentive Stock Options shall be subject to the following additional limitations:
(a) The maximum aggregate number of Shares that may be issued under the U.S. Sub-Plan pursuant to the exercise of Incentive Stock Options is one hundred eleven thousand one hundred eleven (111,111) Shares (the “ISO Share Limit”).
(b) An Incentive Stock Option may be granted only to an individual who, on the date of grant, is an Employee.
(c) To the extent that Options designated as Incentive Stock Options (granted under all stock plans of the Company, including the Plan) become exercisable by a Participant for the first time during any calendar year for Shares having a Fair Market Value greater than One Hundred Thousand Dollars ($100,000), the portions of such Options that exceed such amount shall be treated as Nonstatutory Stock Options in accordance with Section 7.2 of the Plan. If an Option is treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section, the Participant may designate which portion of such Option the Participant is exercising. In the absence of such designation, the Participant shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Upon exercise of the Option, Shares issued pursuant to each such portion shall be separately identified.
(d) The exercise price per Share for an Incentive Stock Option granted to a Ten Percent Shareholder shall be not less than one hundred ten percent (110%) of the Fair Market Value of a Share on the date of grant of the Option.
(e) No Incentive Stock Option may be granted more than ten (10) years after the date the Plan was adopted by the Board.
(f) No Incentive Stock Option shall be exercisable more than ten (10) years after the date of grant of such Option. No Incentive Stock Option granted to a Ten Percent Shareholder shall be exercisable more than five (5) years after the date of grant of such Option.
(g) During the lifetime of the Participant, an Incentive Stock Option shall be exercisable only by the Participant or the Participant’s guardian or legal representative. An Incentive Stock Option shall not be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Participant or the Participant’s beneficiary, except transfer by will or by the laws of descent and distribution.
| 4. | Tax Withholding. |
4.1 The Company may require a Participant, through payroll withholding, cash payment or otherwise, to make adequate provision for, United States federal, state, local and non-U.S. taxes (including any social insurance), if any, required by law to be withheld by the Company with respect to an Option or the Shares acquired pursuant thereto. The Company shall have no obligation to deliver Shares until the Company’s tax withholding obligations have been satisfied by the Participant.
4.2 The Company shall have the right, but not the obligation, to deduct from the Shares issuable to a Participant upon the exercise of an Option, or to accept from the Participant the tender of, a number of whole Shares having a Fair Market Value, as determined by the Company, equal to all or any part of the tax withholding obligations of the Company. After and IPO and subject to compliance with all applicable requirements of applicable securities laws, the Company may require a Participant to direct a broker, upon the exercise of an Option, to sell a portion of the Shares subject to the Option determined by the Board in its discretion to be sufficient to cover the tax withholding obligations of the Company and to remit an amount equal to such tax withholding obligations to the Company in cash.
| 5. | Compliance With U.S. Securities And Other Applicable Law. |
5.1 The grant of Options and the issuance of Shares upon exercise of Options shall be subject to compliance with all applicable requirements of United States federal and state law with respect to such securities and the requirements of any stock exchange or market system upon which the Shares may then be listed. In addition, no Option may be exercised or Shares issued pursuant to an Option unless (a) a registration statement under the Securities Act shall at the time of such exercise or issuance be in effect with respect to the Shares issuable pursuant to the Option or (b) in the opinion of legal counsel to the Company, the Shares issuable pursuant to the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to 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. As a condition to issuance of any Share, the Company may require the Participant 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.
5.2 With respect to participation by Insiders in the Plan, at any time that any class of equity security of the Company is registered pursuant to Section 12 of the Exchange Act, the Plan shall be administered in compliance with the requirements, if any, of Rule 16b-3.
5.3 No Option granted to an Employee who is a non-exempt employee for purposes of the United States Fair Labor Standards Act of 1938, as amended, shall become exercisable until at least six (6) months following the date of grant of such Option (except in the event of such Employee’s death or Disability, or as otherwise permitted by the United States Worker Economic Opportunity Act).
5.4 To the extent permitted by the Board, in its discretion, and set forth in the Award Agreement evidencing such Option, a Nonstatutory Stock Option may be assignable or transferable only in compliance with the applicable limitations, if any, described in Rule 701 under the Securities Act and the General Instructions to Form S-8 Registration Statement under the Securities Act.
5.5 At least annually, copies of the Company’s balance sheet and income statement for the just completed fiscal year shall be made available to each U.S. Eligible Person holding Options or Shares acquired upon the exercise of an Option; provided, however, that this requirement shall not apply if all offers and sales of securities pursuant to the U.S. Sub-Plan comply with all applicable conditions of Rule 701 under the Securities Act. The Company shall not be required to provide such information to persons whose duties in connection with the Company assure them access to equivalent information. The Company shall deliver to each Participant such disclosures as are required in accordance with Rule 701 under the Securities Act.
| 6. | Amendment Of U.S. Sub-plan. |
6.1 The Board may amend the U.S. Sub-Plan at any time. However, without the approval of the Company’s shareholders, no such amendment shall (a) increase the ISO Share Limit, (b) change the class of persons eligible to receive Incentive Stock Options, or (c) make any other change that would require approval of the Shareholders under any Applicable Law, including the rules of any stock exchange or quotation system upon which the Shares may then be listed or quoted.
| 7. | Shareholder Approval |
7.1 The U.S. Sub-Plan shall be submitted for approval by the Company’s shareholders during the period beginning twelve (12) months before and ending twelve (12) months after the date of adoption thereof by the Board. Incentive Stock Options granted prior to Shareholder approval of the U.S. Sub-Plan shall become exercisable no earlier than the date of Shareholder approval of the U.S. Sub-Plan, and such Options shall become Nonstatutory Stock Options if such Shareholder approval is not received in the manner described in the preceding sentence.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies that the foregoing sets forth the additional provisions of the Pagaya Technologies Ltd. 2016 Equity Incentive Plan applicable to grants to U.S. Eligible Persons, as duly adopted by the Board on May 9th, 2018.
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/s/ Gal Krubiner |
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| Secretary | |
| Gal Krubiner |
5
Exhibit 10.11
PAGAYA TECHNOLOGIES LTD.
2021 EQUITY INCENTIVE PLAN
| 1. | Purposes of the Plan |
The purposes of this Equity Incentive Plan are to attract and retain the best available personnel, to provide additional incentive to Employees, Directors and Consultants and to promote the success of the business of the Company and its Subsidiaries. Awards granted under this Plan may be 102 Options, 3(i) Options, Awards of Restricted Stock, Awards of Restricted Stock Units, Incentive Stock Options, Nonstatutory Stock Options or any combination of the foregoing, as determined by the Administrator at the time of grant.
| 2. | Definitions |
As used herein, the following definitions shall apply:
| 2.1. | “Affiliate” means any “employing company” within the meaning of Section 102(a) of the Ordinance. |
| 2.2. | “Administrator” means the Board or any of its Committees as shall be administrating the Plan in accordance with Section 4 hereof. |
| 2.3. | “Applicable Laws” means the requirements relating to the administration of stock option plans under Israeli and U.S. state corporate laws, Israeli and U.S. federal and state securities laws, the Code, the Ordinance, any stock exchange or quotation system on which the Shares are listed or quoted and the applicable laws of any other country or jurisdiction that may apply to Awards which are granted under the Plan. |
| 2.4. | “Articles” means the Articles of Association of the Company, as amended or restated from time to time. |
| 2.5. | “Award” means any 102 Options, 3(i) Options, awards of Restricted Stock, awards of Restricted Stock Units, Incentive Stock Options, Nonstatutory Stock Options or any combination of the foregoing, which are granted under the Plan. |
| 2.6. | “Award Agreement” means, with respect to each Award, the applicable signed written agreement between the Company and the Participant setting forth the terms and conditions of an individual Award granted under the plan. |
| 2.7. | “Board” means the Board of Directors of the Company. |
| 2.8. | “Code” means the Internal Revenue Code of 1986, as amended from time to time. |
| 2.9. | “Cause” shall have the meaning ascribed to it in the applicable employment or consulting agreement of Participant. In the absence of such definition, “Cause” shall mean any of the following: (i) the Participant’s theft, dishonesty, or falsification of any Company documents or records; (ii) the Participant’s improper use or disclosure of the Company’s confidential or proprietary information; (iii) any action by the Participant which has a detrimental effect on the Company’s reputation or business; (iv) the Participant’s failure or inability to perform any reasonable assigned duties after written notice from the Company of, and a reasonable opportunity to cure, such failure or inability; (v) any material breach of the Participant of any employment agreement between the Participant and the Company, which breach is not cured within thirty (30) days pursuant to the terms of such agreement; or (vi) the Participant’s conviction (including any plea of guilty) of any criminal act which impairs the Participant’s ability to perform his or her duties with the Company. For purposes of the definition of Cause, with respect to a Participant employed by or providing services to a Parent or Subsidiary of the Company, the term “Company” shall also include the Parent or Subsidiary employing or engaging the services of the Participant. |
| 2.10. | “Committee” means a committee of Directors appointed by the Board in accordance with Section 4 hereof. |
| 2.11. | “Company” means Pagaya Technologies Ltd., an Israeli company. |
| 2.12. | “Consultant” means any person who is engaged by the Company or any Parent or Subsidiary to render consulting or advisory services to such entity, including any employees of such person and including a non-Employee Director of the Company or any Parent or Subsidiary thereof. A Participant shall not cease to be a Consultant in case of any temporary interruption in such person’s availability to provide services to the Company, its Parent, any Subsidiary, or any successor, which has been authorized in writing by the engaging company (or by the Parent or Subsidiary) prior to its commencement. |
| 2.13. | “Controlling Shareholder” shall have the meaning ascribed to it in Section 32(i) of the Ordinance. |
| 2.14. | “Director” means a member of the Board of Directors of the Company or any Parent or Subsidiary. |
| 2.15. | “Eligible Recipient” means an Employee or Consultant. |
| 2.16. | “Employee” means any person, including Officers and Directors, employed by the Company, or any Parent or Subsidiary of the Company, with or without payment. Subject to the provisions of any Applicable Law, a Participant shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company (or by the Parent or Subsidiary that employs the person) or (ii) transfers between locations of the Company (or the Parent or Subsidiary that employs the person) or between the Company, its Parent, any Subsidiary, or any successor. |
| 2.17. | “Exchange Act” means the Securities Exchange Act of 1934, as amended. |
| 2.18. | “Employing Company” shall have the meaning ascribed to it in Section 102(a) of the Ordinance. |
| 2.19. | “Exercise Price” means the per share price at which a holder of an Award may purchase Shares issuable upon exercise of the Award. |
| 2.20. | “Fair Market Value” means, as of any date, the value of Shares determined as follows: |
| (i) | If the Shares are listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such 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 the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable (if the Shares are listed or quoted on more than one established stock exchange or national market system, the Administrator shall determine the appropriate exchange or system); |
| (ii) | If the Shares are regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Shares on the last market trading day prior to the day of determination; or |
| (iii) | In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Administrator. |
| 2.21. | “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. |
| 2.22. | “IPO” means the consummation of the initial public offering of the Company’s Ordinary Shares. |
| 2.23. | “Israeli Employee” means a person who is a resident of the state of Israel or who is deemed to be a resident of the state of Israel for tax purposes, and who is an Employee or an Office Holder (“Nose Missra”) of the Company, or any Parent or Subsidiary of the Company, in each case excluding a person who is a Controlling Shareholder prior to the issuance of the relevant Award or as a result thereof. |
| 2.24. | “Israeli Non-Employee” means a person who is a resident of the state of Israel or who is deemed to be a resident of the state of Israel for tax purposes, and who is (i) a Consultant, who is not an Employee, or (ii) a Controlling shareholder (whether or not an employee of the Company or any Parent or Subsidiary thereof) prior to the issuance of the relevant Option or as a result thereof. |
| 2.25. | “ITA” means the Israeli Income Tax Authorities. |
| 2.26. | “Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock Option. |
| 2.27. | “Officer” or “Office Holder” shall have the meaning ascribed to it in the Israeli Companies Law, 5759-1999, as amended from time to time. |
| 2.28. | “Non-Trustee 102 Option” means an Option granted to an Employee pursuant to Section 102(c) of the Ordinance, which is not required to be held in trust by a Trustee. |
| 2.29. | “Option” means a stock option granted pursuant to the Plan (including 102 Options, 3(i) Options, Incentive Stock Options and Nonstatutory Stock Options). |
| 2.30. | “Option Exchange Program” means a program whereby outstanding Options are exchanged for Options with a lower Exercise Price. |
| 2.31. | “Ordinance” means the Israeli Income Tax Ordinance (New Version), 1961, as amended, the rules promulgated thereunder, or any law or regulations which shall replace the Ordinance or Sections 3(i) or 102 promulgated thereunder. |
| 2.32. | “Parent” means a company, whether now or hereafter existing, to which the Company is a Subsidiary. |
| 2.33. | “Participant” means any Eligible Recipient selected by the Administrator, pursuant to the Administrator’s authority in Section 4 below, to receive grants of Options, Restricted Stock, Restricted Stock Units or any combination of the foregoing. |
| 2.34. | “Plan” means this 2021 Equity Incentive Plan. |
| 2.35. | “Restricted Stock” means Shares subject to certain restrictions granted pursuant to Section 18 below. |
| 2.36. | “Restricted Stock Unit” means a right granted under and subject to restrictions pursuant to Section 19 below. |
| 2.37. | “Share” means an Ordinary Share of the Company, having a nominal value of NIS 0. 01, as may be adjusted in accordance with Section 21 below. |
| 2.38. | “Section 102” means section 102 of the Ordinance and any regulations, rules, orders or procedures promulgated thereunder as now in effect or as amended or replaced from time to time. |
| 2.39. | “Subsidiary” means any company, whether now or hereafter existing, other than the first company, in an unbroken chain of companies, if each of the companies (other than the last company) in the unbroken chain, owns shares possessing more than fifty percent (50%) of the total combined voting power of all classes of shares in one of the other companies in such chain. |
| 2.40. | “Successor Company” means a successor corporation in a Transaction or any parent or Affiliate thereof, as determined by the Administrator in its discretion. |
| 2.41. | “Transaction” means: (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 or substantially 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; or (iv) such other transaction or set of circumstances that is determined by the Administrator, in its discretion, to be a Transaction subject to the provisions of Section 21.4 below; excluding (a) any of the above transactions in clauses (i) through (iv) with a wholly-owned subsidiary (directly or indirectly) of the Company for the purpose of reincorporating the Company in another jurisdiction, (b) any of the above transactions in clauses (i) through (iii) if the Administrator determines that such transaction should be excluded from the definition hereof and the applicability of Section 21.4 below, (c) any of the above transactions in clauses (i) through (iv) in which shareholders of the Company prior to the transaction will maintain more than fifty percent (50%) of the voting power of the resulting or surviving entity after the transaction (provided, however, that shares of the resulting or surviving entity held by shareholders of the Company acquired by means other than the exchange or conversion of the shares of the Company shall not be used in determining if the shareholders of the Company own more than fifty percent (50%) of the voting power of the resulting or surviving entity (or its parent), but shall be used for determining the total outstanding voting power of the resulting or surviving entity); (d) any of the above transactions in clauses (i) through (iv) in connection with an issuance of securities by the Company as part of a transaction financing. |
| 2.42. | “Trustee” means any person or entity appointed by the Company, any of its Parents or any of its Subsidiaries, as applicable, and approved by the ITA, to serve as a trustee, all in accordance with the provisions of Section 102(a) of the Ordinance. |
| 2.43. | “Trustee 102 Option” means an Option granted pursuant to the rules set in Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of the Participant. |
| 2.44. | “102 Option” means an Option granted under the rules of Section 102 of the Ordinance, as amended, or any law or regulations, which shall replace Section 102. |
| 2.45. | “102 Capital Gain Options (102 CGO)” means a Trustee 102 Option elected and designated by the Employing Company to qualify for capital gain tax treatment in accordance with the provisions of Section 102(b)(2) of the Ordinance. |
| 2.46. | “102 Ordinary Income Option (102 OIO)” means a Trustee 102 Option elected and designated by the Employing Company to qualify for ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the Ordinance. |
| 2.47. | “3(i) Option” means an Option granted under the rules of Section 3(i) of the Ordinance, as amended, or any law or regulations, which shall replace Section 3(i). |
| 3. | Shares Subject to the Plan |
Subject to the provisions of Section 21 of the Plan, the aggregate number of Shares reserved and available for grant of Awards under the Plan is 111,111 or such other number of Shares as the Board shall determine from time to time. The Shares may be authorized but unissued, or reacquired Shares. Such Shares may consist, in whole or in part, of authorized and unissued shares or treasury shares.
If and to the extent that an Option expires, terminates or is canceled or forfeited for any reason without having been exercised in full, the Shares associated with that portion of that Option which was not exercised will again become available for grant under the Plan. Similarly, if and to the extent an Award of Restricted Stock or Restricted Stock Units is canceled or forfeited for any reason, the Shares subject to that Award will again become available for grant under the Plan. Shares withheld in settlement of a tax withholding obligation associated with an Award, or in satisfaction of the Exercise Price payable upon exercise of an Award, will again become available for grant under the Plan. If any Award or portion thereof is settled for cash, the Shares attributable for such cash settlement will again become available for grant.
| 4. | Administration of the Plan |
| 4.1. | Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws. Notwithstanding the above, the Board shall automatically have residual authority if no Committee shall be constituted or if such Committee shall cease to operate for any reason. |
| 4.2. | Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities and compliance with all Applicable Laws, the Administrator shall have the full power and authority at its sole discretion, from time to time and at any time: |
| (i) | To determine whether and to what extent Awards are to be granted hereunder to Participants; |
| (ii) | To determine and/or amend the Exercise Price of the Awards; |
| (iii) | To determine and/or amend the vesting schedule of the Awards; |
| (iv) | To determine and/or amend the terms of payment for the Shares; |
| (v) | To select the Eligible Recipients to whom Awards may from time to time be granted hereunder; |
| (vi) | To determine the number of Shares to be covered by each Award granted hereunder; |
| (vii) | To approve forms of agreement for use under the Plan; |
| (viii) | To determine the terms and conditions of any Award granted hereunder. Such terms and conditions shall include, but shall not be limited to, the Exercise Price, the time or times and the extent to which the Awards may be exercised (which may be based on performance criteria), any vesting acceleration (whether or not in connection with a Transaction) or waiver of forfeiture restrictions, and any restriction or limitation regarding any Award or the Shares relating thereto, based in each case on such factors as the Administrator, at its sole discretion, shall determine; |
| (ix) | To determine the Fair Market Value of the shares covered by each Award; |
| (x) | To make an election as to the type of 102 Option; |
| (xi) | To establish, add, cancel, amend or otherwise alter any restrictions, terms or conditions of any Award or Shares subject to any Award (including, without limitation, change the vesting terms, or accelerate the vesting periods, or add acceleration provisions with respect to, any Award granted hereunder); |
| (xii) | To prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws; |
| (xiii) | To authorize conversion or substitution under the Plan of any or all Awards and to cancel or suspend Awards, as necessary, provided the material interests of the Participants are not harmed; |
| (xiv) | To construe and interpret the terms of the Plan and Awards granted pursuant to the Plan; |
| (xv) | To alter, revise or otherwise adjust the terms of the Plan and the Award Agreement, as may be required pursuant to any applicable laws of local or foreign jurisdictions; |
All the abovementioned powers and actions may be taken by the Administrator at the date of grant of the Award and/or at any time thereafter.
| 4.3. | In the event of a tie vote with respect to any matter brought before the Administrator, such matter shall be presented to the Board and the decision of the Board shall be final with respect to such matter. |
| 4.4. | Neither the Trustee nor any member of the Board or the Committee shall be liable to the Company or to any Participant, for any action or determination taken or made in good faith as a Committee member in the course of administrating the Plan. Each member of the Board or the Committee shall be indemnified and held harmless by the Company or by any Participant against any cost or expense (including counsel fees) reasonably incurred by him, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the Plan unless arising out of such member’s own fraud or bad faith, all to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the member may have as a director or otherwise under the Company’s charter documents, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. |
| 4.5. | Effect of Administrator’s Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Participants. |
| 5. | Term of Plan |
| 5.1. | The Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless sooner terminated under Section 23 below. |
| 5.2. | 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. |
| 6. | Eligibility |
Awards may be granted to Participants and to persons to whom offers of employment or engagement as Employees or Consultants have been extended.
| 7. | Options to Non Israeli Participants |
| 7.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Nonstatutory Stock Options may be granted to non-Israeli Employees and non-Israeli Consultants and Incentive Stock Options may be granted only to non-Israeli Employees. |
| 7.2. | Each Option granted to non Israeli Participants shall be designated in the Award Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option, unless the Administrator determines otherwise at any time and subject to Applicable Laws. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, then unless the Administrator determines otherwise at any time and subject to the requirements of any applicable law, such options shall be treated as Nonstatutory Stock Options. For purposes of this Section, Incentive Stock Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the option with respect to such Shares is granted. |
| 8. | Options to Israeli Participants |
| 8.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Israeli Employees may be granted only 102 Options and Israeli Non-Employees may be granted only 3(i) Options. In each case, such options shall be subject to the terms and conditions of the Ordinance. |
| 8.2. | The Employing Company may designate 102 Options granted to Israeli Employees pursuant to Section 102 as Non-Trustee 102 Options or as Trustee 102 Options. |
| 9. | Trustee 102 Options |
| 9.1. | Options granted pursuant to this Section 9 are intended to constitute Trustee 102 Options and are subject to the provisions of Section 102 and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to options under a different tax law or regulation. |
| 9.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options may be granted only to Israeli Employees. |
| 9.3. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options shall be classified as either 102 CGO or 102 OIO, subject to the terms and conditions of Section 102 and the provisions of the Plan. |
| 9.4. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, no Trustee 102 Options may be granted under this Plan, unless the Employing Company’s election of the type of Trustee 102 Options granted to Israeli Employees, 102 CGO or 102 OIO (the “Election”), is appropriately filed with the ITA. |
| 9.5. | After making an Election, unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Company may grant only the type of Trustee 102 Options it has elected (i.e. 102 CGO or 102 OIO), and the Election shall apply to all grants to Participants of Trustee 102 Options until such Election is changed pursuant to the provisions of Section 102(g) of the Ordinance. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Employing Company may change such Election only after the passage of at least one year following the end of the year during which the applicable Employing Company first granted Trustee 102 Options in accordance with the previous Election. |
| 9.6. | For the avoidance of doubt, such Election shall not prevent the Company from granting Non-Trustee 102 Options or 3(i) Options simultaneously with the grant of Trustee 102 Options. |
| 9.7. | The grant of Trustee 102 Options shall be conditioned upon the approval (or the deemed approval pursuant to the provisions of section 102(a) of the Ordinance) of the Plan and the Trustee by the ITA. |
| 9.8. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Trustee 102 Options may be granted only after the passage of thirty (30) days (or a shorter period as and if approved by the ITA) following the delivery by the appropriate Employing Company to the ITA of a request for approval of the Plan and the Trustee according to Section 102, as mentioned in section 9.4 above. |
| 9.9. | Notwithstanding the foregoing paragraph, if within ninety (90) days of delivery of the abovementioned request, the appropriate ITA officer notifies the Employing Company of his or her decision not to approve the Plan or the Trustee, the Options that were intended to be granted as a Trustee 102 Options shall be deemed to be Non-Trustee 102 Options, unless otherwise determined by the ITA officer. |
| 9.10. | Anything herein to the contrary notwithstanding, all Trustee 102 Options granted under this Plan shall be granted or issued to a Trustee. The Trustee shall hold each such Trustee 102 Option, all Shares issued upon exercise thereof, and all other securities received following any exercise or realization of rights, including bonus shares, in trust for the benefit of the Participant in respect of whom such Option was granted. All certificates representing Options or Shares issued to the Trustee under the Plan shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Options or Shares are released from the trust. |
| 9.11. | With respect to 102 CGO and 102 OIO, the Options or Shares issued upon the exercise thereof and all rights related to them, including bonus shares, will be held by the Trustee for such period of time as required under Section 102 (currently, at least 24 months (in case of a 102 CGO) and 12 months (in case of a 102 OIO), from the date on which such Option was issued and deposited with the Trustee) or a shorter period as approved by the ITA (hereinafter, the “Holding Period”), under the terms set forth in Section 102. |
| 9.12. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, in accordance with Section 102, the Participant shall not sell, cause the release from trust, or otherwise dispose of, any Trustee 102 Option, any Share issued upon the exercise thereof, or any rights related to them, including bonus shares, until the end of the applicable Holding Period. Notwithstanding the foregoing but without derogating from the provisions of the Plan and the terms and conditions set forth in the Award Agreement, if any such sale, release, or disposition occurs during the Holding Period, then the provision of Section 102, relating to non-compliance with the Holding Period, will apply and all sanctions under Section 102 shall be borne by the Participant. |
| 9.13. | Anything herein to the contrary notwithstanding, the Trustee shall not release any Options which were not already exercised into Shares by the Participant, nor release any Shares issued upon exercise of the Trustee 102 Options or rights related thereto, including bonus shares, prior to the full payment of the Exercise Price and Participant’s tax liability arising from the Trustee 102 Options which were granted to him or her. |
| 9.14. | In the event that a stock split shall be effected or bonus shares shall be issued on account of the Shares which have been issued for the Participant’s benefit, such new split or bonus shares shall be transferred by the Company to the Trustee to hold for such Participant’s benefit. |
| 9.15. | The validity of any order given to the Trustee by a Participant shall be subject to the approval of the Company. The Company shall render its decision regarding orders given by any Participant to the Trustee within a reasonable period of time. The Company shall not be required to approve any order which is incomplete, is not in accordance with the provisions of this Plan and the relevant Award Agreement or which the Company believes should not be executed for any reasonable reason. The Company shall notify the Participant of the reason for not approving his/her order. Approval by the Company of any order given to the Trustee by a Participant shall not constitute proof of the Company’s recognition of any right of such Participant. |
| 9.16. | Without derogating from the aforementioned, the Administrator shall have the authority to determine the specific procedures and conditions of the trusteeship with the Trustee in a separate agreement between the Company and the Trustee. |
| 9.17. | In the event that the requirements for the Trustee 102 Options are not met, then the Trustee 102 Options shall be regarded as Non-Trustee 102 Options. |
| 9.18. | Upon receipt of a Trustee 102 Option, the Participant will sign an Award Agreement under which such Participant will agree to be subject to the trust agreement between the Company and/or its Subsidiaries and the Trustee, stating, inter alia, that the Trustee will be released from any liability in respect of any action or decision duly taken and executed in good faith in relation to this Appendix, or any Trustee 102 Option or Share issued to him or her thereunder. |
| 10. | Fair Market Value For Israeli Tax Purposes |
Without derogating from Section 2.20 and solely for the purpose of determining the tax liability pursuant to Section 102(b)(3) of the Ordinance, if at the date of grant of a 102 CGO the Company’s shares are listed on any established stock exchange or a national market system, or if the Company’s shares are registered for trading within ninety (90) days following the date of grant of the 102 CGO, the fair market value of the Shares at the date of grant shall be determined in accordance with the average value of the Company’s shares on the thirty (30) trading days preceding the date of grant or on the thirty (30) trading days following the date of registration for trading, as applicable, unless the Administrator determines otherwise at any time and subject to Applicable Laws.
| 11. | Integration of Section 102 and Tax Assessing Officer’s Permit |
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, with respect to Trustee 102 Options, the provisions of the Plan and the Award Agreement shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s permit (to the extent that such permit is issued) (the “Permit”), and said provisions and Permit shall be deemed an integral part of the Plan and the Award Agreement.
| 12. | Non-Trustee 102 Options |
| 12.1. | Options granted pursuant to this Section 12 are intended to constitute Non-Trustee 102 Options and are subject to the provisions of Section 102 and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to Options granted under a different tax law or regulations. |
| 12.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Non-Trustee 102 Options may be granted only to Israeli Employees. |
| 12.3. | Non-Trustee 102 Options shall be granted pursuant to the Plan may be issued directly to the Israeli Employee or to a trustee appointed by the Administrator in his\its sole discretion. In the event that the Administrator determines that Non-Trustee 102 Options, and Shares issued upon the exercise thereof, shall be deposited with a trustee, the provisions of Sections 9.10, 9.13, and 9.17 hereof shall apply, mutatis mutandis. |
| 12.4. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, in the event that an Israeli Employee who was granted a Non-Trustee 102 Option is an employee of the Company, or any Parent or Subsidiary thereof, such employee will be obligated to provide his employer, upon the termination of his employment for any reason, with a security or guarantee to cover any future tax obligation resulting from the grant, exercise or disposition of the Option or the Shares issuable upon the exercise thereof, in the form satisfactory to such employer in the latter’s sole discretion. |
| 13. | 3(i) Options |
| 13.1. | Options granted pursuant to this Section 13 are intended to constitute 3(i) Options and are subject to the provisions of Section 3(i) of the Ordinance and the general terms and conditions specified in the Plan, except for provisions of the Plan applying to Options granted under a different tax law or regulations. |
| 13.2. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, 3(i) Options may be granted only to Israeli or foreigners Non-Employees. |
| 13.3. | 3(i) Options that shall be granted pursuant to the Plan may be issued directly to the Israeli and foreigners Non-Employee or to a trustee appointed by the Administrator in his\its sole discretion. In the event that the Administrator determines that 3(i) Options, and Shares issued upon the exercise thereof, shall be deposited with a trustee, the provisions of Sections 9.10, 9.13, and 9.17 hereof shall apply, mutatis mutandis. |
| 14. | General Provisions |
| 14.1. | Term of Option. The expiration date of the term of each Option shall be stated in the Award Agreement (the “Expiration Date”); provided, however, that in no event the term of any Option shall be more than ten (10) years from the date of grant thereof. Each unexercised Option shall automatically expire and shall no longer be exercisable immediately upon the earlier of: (i) the Expiration Date of such Option (as set forth in the applicable Award Agreement), or (ii) at the time at which such Option otherwise expires pursuant to the terms of the Plan. |
| 14.2. | Option Exercise Price and Consideration |
| (i) | The per share Exercise Price for the Shares to be issued upon exercise of an Option shall be such price as is determined by the Administrator at any time at its sole and absolute discretion, subject to any Applicable Laws. |
| (ii) | The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator at the time of grant and/or at any time thereafter, subject to any Applicable Law. Such consideration may consist of (1) cash; (2) check; (3) previously acquired Shares based on the Fair Market Value of the Shares on the date the Option is exercised; (4) a cashless exercise method, whereby the Option’s Exercise Price will not be due in cash and where the number of Shares issued upon such exercise will be equal to: (A) the product of (i) the number of Shares as to which the Option is then being exercised, and (ii) the excess, if any, of (a) the then current Fair Market Value per Share over (b) the Option Exercise Price, divided by (B) the then current Fair Market Value per Share; (5) any combination of the foregoing methods of payment; or (6) any other method as shall be determined by the Administrator at its sole discretion. |
| 14.3. | Manner of Exercising the Option |
| (i) | Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms hereof, at such times and under such conditions as determined by the Administrator and set forth in the Award Agreement and in accordance with the requirements of Section 102 of the Ordinance, if applicable. |
| (ii) | In the event of any conflict between the terms and conditions of an Award Agreement and the terms hereof, the terms hereof shall control, unless explicitly provided otherwise in the Award Agreement. |
| (iii) | Unless the Administrator provides otherwise at any time, vesting of Options granted hereunder shall be ceased during any unpaid leave of absence. |
| (iv) | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, an Option shall be deemed exercised when the Company receives: (i) written notice of exercise (in accordance with the Award Agreement) from the person entitled to exercise the Option and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Award Agreement and the Plan. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Shares issued upon exercise of an Option (excluding Shares underlying a 102 Option, which Shares shall be issued in the name of the Trustee) shall be issued in the name of the Participant or, if requested by the Participant, in the name of the Participant and his or her spouse. |
| (v) | Until the applicable Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to such Shares, notwithstanding the exercise of the Option, nor shall the Participants be deemed to be a class of shareholders or creditors of the Company for the purpose of the operation of sections 350 and 351 of the Israeli Companies Law, 5759-1999 or any successor to such sections. |
| (vi) | The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right, including without limitation, in connection with rights offering, for which the record date is prior to the date the Shares are issued, except as provided in Section 21 hereof. |
| (vii) | Exercise of an Option in any manner shall result in a decrease in the number of Shares thereafter available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. |
| (viii) | An Option may not be exercised for fractional shares. |
| (ix) | Until the consummation of an IPO, and unless explicitly provided otherwise in the Award Agreement, any Shares acquired upon the exercise of Options shall be voted by an irrevocable proxy, substantially in the form attached hereto as Schedule A (or any other form approved by the Board) (the “Proxy”), according to which, the Participant irrevocably appoints the chairman of the Board, or any other person designated for such purpose by the Board, as his/her proxy with respect to the Shares acquired upon the exercise of Options (the “Proxy Holder”). The Proxy will be signed and delivered to the Company by the Participant concurrently with the execution of the Participant’s Award Agreement. |
| (x) | The Proxy Holder shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him/her, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the voting of such Proxy, unless arising out of such Proxy Holder’s own fraud or willful misconduct, to the extent permitted by Applicable Law. Such indemnification shall be in addition to any rights of indemnification the Proxy Holder may have (if any) as a director or otherwise under the Articles, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. Without derogating from the above, with respect to 102 Options, such shares shall be voted in accordance with the provisions of Section 102 and any rules, regulations or orders promulgated thereunder. |
| 15. | Non-Transferability of Options |
| 15.1. | Unless the Administrator determines otherwise at any time and subject to Applicable Laws, Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant. |
| 15.2. | Without derogating from the foregoing and unless the Administrator determines otherwise at any time and subject to Applicable Laws, for as long as Options or Shares purchased upon the exercise thereof are held by the Trustee on behalf of the Participant, all rights of the Participant with respect to such Options and Shares shall be personal, and may not be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution. |
| 15.3. | Without derogating from the inherent power of the shareholders of the Company to alter or modify the rights of the Company’s shares, the Administrator may impose on any Participant such additional restrictions on the transfer of Shares as the Administrator may determine at the time that Options are granted to the Participant or as may be agreed to by the Administrator and the Participant following purchase of said Shares upon exercise of such Options under this Plan or upon termination of the Participant’s employment or service with the Company. Such additional restrictions shall be included in the Award Agreement entered into between the Company and the Participant, or, upon agreement of the Participants, or in this Plan. |
| 16. | Rights and Restrictions Attaching to the Shares |
| 16.1. | Equal Rights. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Shares shall have equal rights for all intents and purposes as the rights attached to Shares of the Company according to the Articles, subject also to the provisions of this Plan and the Award Agreement. Any change to Articles which modify rights attaching to the Company’s shares shall also apply to the Awards and the Shares. The provisions of the Plan shall remain applicable, with the necessary modifications arising from any such amendment. The grant of Awards or the issuance of Shares under this Plan shall not entitle any Participant to receive any compensation in the event of any change to the Company’s capital. |
| 16.2. | Dividend Rights. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, all Shares issued upon the exercise of Options granted under the Plan, shall entitle the Participant thereof, or the Trustee for the benefit of Participant, subject to any applicable taxation on distribution of dividends and, when applicable, subject to the provisions of Section 102, to receive dividends with respect thereto in accordance with the Articles, provided, however, that Participant, or the Trustee for the benefit of Participant, shall have no right to dividends or distribution or other right, including without limitation in connection with rights offering, with respect to Shares for which the record date is prior to the date on which the Participant shall have become the holder of record. |
| 16.3. | Transfer of Shares. Without derogating from the provisions of the Plan and the terms and conditions set forth in the Award Agreement or the Articles, until the consummation of an IPO and unless the Administrator determines otherwise at any time, prior to any transfer of any Shares acquired upon the exercise of Options to a transferee (the “Transferred Shares”) and as a condition to the transfer of the Transferred Shares (if and to the extent the Transferred Share were subject to a Proxy), such transferee shall execute an irrevocable proxy substantially in the form of the Proxy, appointing the chairman of the Board, or any other person designated for such purpose by the Board, as such transferee’s proxy with respect to the Transferred Shares. |
| 17. | Termination of Relationship as an Employee or as a Consultant |
| 17.1. | Subject to the provisions of Sections 17.4 and 17.5 below, if a Participant ceases to be an Employee or a Consultant, such Participant may exercise his or her Option within such additional period of time beyond the date of such termination as is specified in the applicable Award Agreement (solely to the extent that the Option is vested on the date of such termination), but in no event later than the Expiration Date of such Option (for the purpose of this Section 17.1 the “Extended Period”). In the absence of a specified Extended Period in the Award Agreement and unless the Administrator determines otherwise at any time, the Option (solely to the extent that the Option is vested on the date of such termination) shall remain exercisable for, and the Extended Period shall be deemed to be, three (3) months following the Participant’s termination (but in no event later than the Expiration Date of such Option). If, on the date of termination, the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall automatically revert to the Plan and shall no longer be exercisable. If, after termination of engagement with the Company, the Participant does not exercise the vested portion of his or her Option within the Extended Period, the Option shall forthwith terminate, and the Shares covered by such Option shall automatically revert to the Plan. For the avoidance of doubt, Awards granted hereunder shall not continue to vest during the Extended Period thereof. |
| 17.2. | At any time, including following the date on which an Award is granted the Administrator, at its sole and absolute discretion and without such act constituting a precedent in respect of any other Participant, shall be entitled to extend the period during which the Participant shall be entitled to exercise his\her vested Options, by a period to be fixed by the Administrator. |
| 17.3. | Anything in this Plan to the contrary notwithstanding, but subject to the provisions of section 102 of the Ordinance and the tax regulations thereto, if a Participant ceases to be an Employee or a Consultant of the Company or any Parent or Subsidiary thereof, but continues to be employed or provide services to the Company or any other Parent or Subsidiary thereof, such Participant will be deemed for the purpose of this Section 17 to have continuously remained an Employee or a Consultant of the Company (as applicable) during such term, and his/her Awards shall vest pursuant to their original terms. Notwithstanding anything to the contrary hereinabove, unless the Administrator determines otherwise at any time and subject to Applicable Laws, if termination of Participant is for Cause, the entire unexercised Option (whether vested or not) shall ipso facto terminate and the Shares covered by such Option shall automatically revert to the Plan. |
| 17.4. | Retirement. If a Participant should retire, he/she may, subject to the approval of the Administrator (at its sole discretion), continue to enjoy such rights, if any, with respect to his/her Awards under the Plan and on such terms and conditions, with such limitations and subject to such requirements as the Administrator, at its sole discretion, may determine at the time of such retirement or at any time theretofore. |
| 17.5. | Death or Disability of Participant. If Participant’s engagement with the Company as an Employee or a Consultant is terminated as a result of the Participant’s death or inability to substantially perform the ordinary functions of his/her position in the Company by reason of any medically diagnosed physical or mental impairment, permanent disability or chronic illness, which last for a continuous period of nine (9) months or more (“Disability”), the Participant (or, if the Participant died, the Participant’s estate or any person who acquired the right to exercise the Option by bequest or inheritance) may exercise his or her Option within such additional period of time thereafter as is specified in the Award Agreement (which period shall be of at least six (6) months) (and with respect to Options, to the extent the Option is vested on the date of such termination), but in no event later than the Expiration Date of the such Option (for the purpose of this Section 17.5 the “Extended Period”). A determination of any Disability will be made by a physician reasonably acceptable to the Company. In the absence of a specified Extended Period in the Award Agreement, the Option, to the extent it is vested on the date of such termination, shall remain exercisable for, and the Extended Period shall be deemed to be, twelve (12) months following the Participant’s termination, or any longer period determined by the Administrator (but in no event later than the Expiration Date of such Option). If, on the date of termination, the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall automatically revert to the Plan and shall no longer be exercisable. If, after termination, the vested portion of the Participant’s Option are not exercised within the applicable Extended Period, the Option shall forthwith terminate, and the Shares covered by such Option shall automatically revert to the Plan. For the avoidance of doubt, the Awards granted hereunder shall not continue to vest during the Extended Period. |
| 18. | Restricted Stock |
| 18.1. | Awards of Restricted Stock may be issued either alone or in addition to other Awards granted under the Plan (including, without limitation, under Section 102). The Administrator shall determine, at its sole discretion, the Eligible Recipients to whom, and the time or times at which, Awards of Restricted Stock shall be made, the number of Shares to be awarded, the Exercise Price, if any, to be paid by the Participant for the acquisition of Restricted Stock, the Restricted Period (as defined in Section 18.3(i) below) and all other conditions of the Awards of Restricted Stock. The Administrator may also condition the grant of the Award of Restricted Stock upon the exercise of Options, or upon such other criteria as the Administrator may determine, at its sole discretion. The provisions of the Awards of Restricted Stock need not be the same with respect to each Participant. |
| 18.2. | Awards and Certificates |
| (i) | The prospective recipient of Awards of Restricted Stock shall not have any rights with respect to any such Award, unless and until such recipient has executed an Award Agreement evidencing the Award (a “Restricted Stock Award Agreement”) and delivered a fully executed copy thereof to the Company, within a period of sixty (60) days (or such other period as the Administrator may specify at any time) after the Award date and has otherwise complied with the applicable terms and conditions of such Award. |
| (ii) | Except as otherwise provided below in Section (iii), (a) each Participant who is granted an Award of Restricted Stock shall be issued a share certificate in respect of such Shares of Restricted Stock, and (b) such certificate shall be registered in the name of the Participant (or, if so determined by the Administrator or required under any Applicable Law – such certificate shall be registered in the name of the Trustee), and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to any such Award. |
| (iii) | The Company may require that the share certificates evidencing Restricted Stock granted hereunder be held in the custody of the Company until the restrictions thereon shall have lapsed, and that, as a condition of any Award of Restricted Stock, the Participant shall have delivered a stock power, endorsed in blank, relating to the Shares covered by such Award. |
| 18.3. | Restrictions and Conditions |
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Awards of Restricted Stock granted pursuant to this Section 18 shall be subject to the following restrictions and conditions:
| (i) | Subject to the provisions of the Plan and the Restricted Stock Award Agreement governing any such Award, during such period as may be set by the Administrator commencing on the date of grant (the “Restricted Period”), the Participant shall not be permitted to sell, transfer, pledge, assign or otherwise dispose Shares of Restricted Stock awarded under the Plan; provided, however, that the Administrator may at any time and at its sole discretion, provide for the lapse of such restrictions in installments and may accelerate or waive such restrictions in whole or in part based on such factors and such circumstances as the Administrator may determine, at its sole discretion, including, but not limited to, the attainment of certain performance related goals, the Participant’s termination of employment or service as a director, consultant or advisor to the Company, any Subsidiary or Affiliate, the Participant’s death or Disability or the occurrence of a Transaction. |
| (ii) | Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, once the Participant has been issued a certificate or certificates for Restricted Stock or the Restricted Stock has been issued in the Participant’s name by book-entry registration, the Participant will have, with respect to the Restricted Stock, the right to vote the Shares, but will not have the right to receive any cash distributions or dividends prior to the lapse of the Restriction Period. If any cash distributions or dividends are payable with respect to the Restricted Stock, the Administrator, in its sole discretion, may require the cash distributions or dividends to be subjected to the same Restriction Period as is applicable to the Restricted Stock with respect to which such amounts are paid, or, if the Administrator so determines, to allocate such cash distributions or dividends among all other eligible shareholders, or to reinvest such cash distributions or dividends in additional Restricted Stock to the extent Shares are available under Section 3 of the Plan. If the Administrator determines that cash distributions or dividends shall be payable with respect to the Restricted Stock, such dividends shall be paid or distributed at the end of the Restriction Period and a Participant shall not be entitled to interest with respect to any such dividends or distributions subjected to the Restriction Period. Unless otherwise determined by the Administrator at any time subject to Applicable Laws, any distributions or dividends paid in the form of securities with respect to Restricted Stock will be subject to the same terms and conditions as the Restricted Stock with respect to which they were paid, including, without limitation, the same Restriction Period. |
| (iii) | Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, if a Participant’s service or employment with the Company, its Subsidiary or Parent terminates prior to the expiration of the applicable Restriction Period, the Participant’s Restricted Stock and any associated dividends, if any, that then remain subject to forfeiture will then be forfeited automatically. Upon forfeiture of Restricted Stock, the Participant shall have no further rights with respect to such Restricted Stock. |
| (iv) | In the event that Awards of Restricted Stock are granted to Israeli Employees, such grant shall be subject to the provisions of Section 102 and the provisions of Sections 8, 9, 10, 11, 12, and 14 hereof shall apply to such Award, mutatis mutandis. |
| 19. | Restricted Stock Units |
Subject to the other terms of the Plan, the Administrator may grant Restricted Stock Units to Eligible Recipients, either alone or in addition to other Awards granted under the Plan, (including under Section 102) and may at any time, in its sole and absolute discretion, impose conditions on such units as it may deem appropriate, including, without limitation, continued employment or service of the Participant or the attainment of specified individual or corporate performance goals. Each Restricted Stock Unit shall be evidenced by an Award Agreement in the form that is approved by the Administrator.
Unless the Administrator determines otherwise at any time and subject to Applicable Laws, each Restricted Stock Unit will represent a right to receive from the Company, upon fulfillment of any applicable conditions, one Share. All other terms governing Restricted Stock Units, such as vesting, time and form of payment and termination of units shall be set forth in the applicable Award Agreement. The terms governing the Restricted Stock Units need not be the same with respect to each Participant. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, the Participant shall not have any shareholder rights with respect to the Shares subject to a Restricted Stock Unit Award until that Award vests and any Shares are actually issued thereunder. Unless the Administrator determines otherwise at any time and subject to Applicable Laws, a Participant will not be permitted to sell, transfer, pledge, assign or otherwise encumber Restricted Stock Units awarded under the Plan. Subject to the provisions of the applicable Award Agreement or as otherwise determined by the Administrator at any time, if a Participant’s service with the Company, its Subsidiary or Parent terminates prior to the Restricted Stock Unit Award vesting, the Participant’s Restricted Stock Units that then remain subject to forfeiture will then be forfeited automatically. Upon forfeiture of Restricted Stock Units, the Participant shall have no further rights with respect to such Restricted Stock Units.
| 20. | [Reserved] |
| 21. | Adjustments |
| 21.1. | Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of Shares covered by each outstanding Award, and the number of Shares which have been authorized for issuance under the Plan but as to which no Awards have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Award, as well as the Exercise Price of Shares covered by each such outstanding Award, may be proportionately adjusted upon any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend (if so determined by the Board upon the issuance of such stock dividend), combination or reclassification of the Shares, or any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company. The conversion of any convertible securities of the Company shall not be deemed to have been effected without receipt of consideration. Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Award. |
| 21.2. | Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, any or all outstanding Awards will terminate immediately prior to the consummation of such proposed action. The Administrator may, in the exercise of its sole discretion in such instances, declare that any Award shall terminate as of such other date fixed by the Administrator and give each Participant the right to exercise his\her Award as to all or any part of the Shares, including Shares as to which the Award would not otherwise be exercisable. |
| 21.3. | Changes to Plan. The Administrator shall be entitled, from time to time, to update and/or change the terms of this Plan, in whole or in part, at its sole discretion, provided that in the Board’s opinion such a change shall not materially derogate from the terms of vested Awards or Shares issued under this Plan. The Board shall be entitled to terminate this Plan at any time provided such termination does not materially affect the rights of any Participant with respect to vested Awards. |
| 21.4. | Transaction. Without derogating from the Administrator’s general authority and power under this Plan, in the event of a Transaction the following shall occur, without the Participant’s consent and action and without any prior notice requirement: |
| 21.4.1 | Unless otherwise determined by the Administrator in its sole and absolute discretion, any Award then outstanding shall be assumed or be substituted by the Company, or by a Successor Company, under terms as determined by the Administrator or the terms of this Plan applied by the Successor Company to such assumed or substituted Awards; |
For the purposes of this Section 21.4.1, the Award shall be considered assumed or substituted if, following a Transaction, the Award confers on the holder thereof the right to purchase or receive, for each Share underlying an Award immediately prior to the Transaction, 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 Transaction for each Share held on the effective date of the Transaction (and if holders were offered a choice or several types of consideration, the type of consideration as determined by the Administrator), or (ii) regardless of the consideration received by the holders of Shares in the Transaction, solely shares or any type of Awards (or their equivalent) of the Successor Company at a value to be determined by the Administrator 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 Administrator. Any of the above consideration referred to clauses (i) and (ii) may be subject to vesting, expiration and other terms as determined by the Administrator in its discretion and may differ from the vesting, expiration and other terms applying on the Awards immediately prior to the Transaction. The foregoing shall not limit the Administrator’s authority to determine, in its sole discretion and in compliance with all Applicable Laws, that in lieu of such assumption or substitution of Awards for Awards of the Successor Company, such Award will be substituted for any other type of asset or property, including as set forth in Section 21.4.2 hereunder.
| 21.4.2 | Regardless of whether or not Awards are assumed or substituted, the Administrator may (but shall not be obligated to), in its sole discretion: |
| (a) | provide for any Participant to have the right to exercise the Award in respect of Shares covered by the Award which would otherwise be exercisable or vested, under such terms and conditions as the Administrator shall determine, and the cancellation of all unexercised and unvested Awards upon or immediately prior to the closing of the Transaction, unless the Administrator provides for the Participant to have the right to exercise the Award; and/or |
| (b) | provide 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 Administrator shall determine; and/or |
| (c) | provide for the cancellation of each outstanding Award at or immediately prior to the closing of such Transaction, and payment to the Participant of an amount in cash, shares of the Company, the acquirer or of a corporation or other business entity which is a party to the Transaction or other property, as determined by the Administrator to be fair in the circumstances, and subject to such terms and conditions as determined by the Administrator. The Administrator shall have full authority to select the method for determining the payment (being the Black-Scholes model or any other method). The Administrator’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. |
| 21.4.3 | The Administrator may determine that any payments made in respect of Awards shall be (i) subject to vesting terms substantially identical to those that applied to the canceled Award immediately prior to the Transaction; and/or (ii) made or delayed to the same extent that payment of consideration to the holders of the Shares in connection with the Transaction is made or delayed as a result of escrows, indemnification, earn outs, holdbacks or any other contingencies; and the terms and conditions applying to the payment made to the Participants, including participation in escrow, indemnification, releases, earn-outs, holdbacks or any other contingencies. |
| 21.4.4 | Notwithstanding the foregoing, in the event of a Transaction, the Administrator may determine, in its sole discretion that upon completion of such Transaction the terms of any Award be otherwise amended, modified or terminated, as the Administrator shall deem in good faith to be appropriate and without any liability to the Company or any Affiliate, Parent or Subsidiary thereof, and to their respective its 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. |
| 21.4.5 | Neither the authorities and powers of the Administrator under this Section 21.4, nor the exercise or implementation thereof, shall (i) be restricted or limited in any way by any adverse consequences (tax or otherwise) that may result to any holder of an Award, and (ii) as, inter alia, being a feature of the Award upon its grant, be deemed to constitute a change or an amendment of the rights of such holder under this Plan, nor shall any such adverse consequences (as well as any adverse tax consequences that may result from any tax ruling or other approval or determination of any relevant tax authority) be deemed to constitute a change or an amendment of the rights of such holder under this Plan, and may be effected without consent of any Participant and without any liability to the Company or its Affiliates and to their respective its officers, directors, employees and representatives and the respective successors and assigns of any of the foregoing. The Administrator needs not take the same action with respect to all Awards or with respect to all Eligible Recipients. The Administrator may take different actions with respect to the vested and unvested portions of an Award. The Administrator may determine an amount or type of consideration to be received or distributed in a Transaction which may differ as among the Participants, and as between the Participants and any other holders of shares of the Company. |
| 21.4.6 | The Administrator’s determinations pursuant to this Section 21.4 shall be conclusive and binding on all Participants. |
| 21.4.7 | If determined by the Administrator, the Participants shall be subject to the definitive agreement(s) in connection with the Transaction 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 Administrator. Each Participant shall execute such separate agreement(s) or instruments as may be requested by the Company, the Successor Company or the acquirer in connection with such in such Transaction 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. |
| 21.5. | Anything herein to the contrary notwithstanding and unless otherwise determined by the Administrator, in its sole and absolute discretion, if prior to the completion of the IPO, all or substantially all of the shares of the Company (determined without taking into account the shares issued or issuable under this Plan) are to be sold (whether under the Articles or any other contract by which the shareholders of the Company are bound or pursuant to any applicable law) to any third party, whether or not related to or affiliated with the Company or its shareholders, each Participant shall be obliged to sell the Shares such Participant purchased under the Plan, in accordance with the instructions then issued by the Administrator whose determination shall be final. |
| 22. | Time of Granting Awards |
Unless explicitly determined otherwise by the Administrator, the date of grant of an Award shall be, for all purposes, the later of (i) the date on which the Administrator makes the determination granting such Award, or (ii) the commencement date of the Participant’s engagement with the Company or any Parent or Subsidiary thereof (whether as an Employee, Consultant or Director). Notice of the determination shall be given to each Participant to whom an Award is so granted within a reasonable time after the date of such grant.
| 23. | Amendment and Termination of the Plan |
| 23.1. | Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan. |
| 23.2. | Shareholders Approval. The Board shall obtain shareholders approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws. |
| 23.3. | Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. Termination of the Plan shall not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination. |
| 24. | Conditions Upon Issuance of Shares |
| 24.1. | Legal Compliance. Shares shall not be issued pursuant to the exercise of an Award granted hereunder unless the exercise of such Award and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. |
| 24.2. | Investment Representations. The Administrator may require each Participant acquiring Shares to represent and warrant that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such representation is required. |
| 24.3. | Market Stand-Off. In connection with any public offering of the Company’s equity securities, pursuant to an effective registration statement, for such period as the Company or its underwriters may request (such period not to exceed one hundred and eighty (180) days following the date of the applicable offering), the Participant shall not, directly or indirectly, sell, make any short sale of, loan, hypothecate, pledge, offer, grant or sell any option or other contract for the purchase of, purchase any option or other contract for the sale of, or otherwise dispose of or transfer, or agree to engage in any of the foregoing transactions with respect to, any Shares acquired under this Plan without the prior written consent of the Company or its underwriters. |
| 25. | Rights as a Shareholder; Voting and Dividends |
| 25.1. | Without derogating from other provisions of the Plan, including Section 18.3(ii) above and unless otherwise determined by the Administrator at any time, subject to Applicable Laws, a Participant shall have no rights as a shareholder of the Company with respect to any Shares covered by the Award until the date of the issuance of a share certificate to the Participant for such Shares. In the case of 102 Option or 3(i) Option (if such Options are being held by a Trustee), the Trustee shall have no rights as a shareholder of the Company with respect to any Shares covered by such Award until the date of the issuance of a share certificate to the Trustee for such Shares for the Participant’s benefit, and the Participant shall have no rights as a shareholder of the Company with respect to any Shares covered by the Award until the date of the release of such Shares from the Trustee to the Participant and the issuance of a share certificate to the Participant for such Shares. Unless otherwise determined by the Administrator at any time and subject to Applicable Laws, no adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distribution of other rights, including without limitation in connection with any rights offering, for which the record date is prior to the date such share certificate is issued. |
| 25.2. | 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. |
| 26. | No Right for Continuing Relationship |
Neither the Plan nor any Award shall confer upon any Participant any right with respect to continuing the Participant’s relationship as an Employee or as a Consultant with the Company, nor shall it interfere in any way with his or her right or the Company’s right to terminate such relationship at any time, with or without Cause.
| 27. | Inability to Obtain Authority |
The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to 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.
| 28. | Default |
A Participant shall be deemed to be in default under this Plan, including the Award Agreement, in the event that the Participant fails to pay any sum or perform any obligation provided for in the Plan, in a timely fashion or in a manner required. Any default under this Plan not cured within ten (10) days after the Company gives written notice of such default to Participant shall entitle the Company to exercise any and all remedies and rights against the defaulting Participant contained in any and all of the documents comprising this Plan or provided under Applicable Law.
| 29. | Notices |
All notices and elections sent to the Company by a Participant shall be in writing and delivered in person or by certified mail to the CEO of the Company at the principal office of the Company. All notices given by the Company to a Participant under the Plan shall be in writing and delivered in person or by certified mail to the Participant’s address as reflected in the Company’s records. All notices will be deemed delivered within seven (7) days of their dispatch by certified mail, postage prepaid.
| 30. | Reservation of Shares |
At all time during the term of this Plan, the Company shall reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.
| 31. | Miscellaneous |
| 31.1. | Any tax consequences arising from the grant or exercise of any Awards or from the payment for, or the sale of or other disposition of, Shares covered thereby or from any other event or act (whether of the Participant, the Trustee, or the Company or its Subsidiaries) hereunder, shall be borne solely by the Participant. The Company, its Parents, subsidiaries and the Trustee shall be entitled to withhold taxes according to the requirements of any Applicable Laws, rules and regulations, including withholding taxes at source and particularly regulation 7(b) of the Income Tax Regulations (tax benefits on the issuance of shares to employees) 2003. Furthermore, the Participant shall agree to indemnify the Company or Subsidiary that employs the Participant 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 the necessity to withhold, or to have withheld, any such tax from any payment made to the Participant. The Company may exercise such indemnification by deducting the Tax subject to indemnification from Participant’s salaries or remunerations. Except as otherwise required by law, the Company and the Trustee shall not be obligated to exercise any Awards on behalf of a Participant, or to release any share certificate, until all tax consequences arising from the exercise of such Awards are resolved in a manner reasonably acceptable to the Company and the Trustee, and all required payments in connection with the exercise of the Award, or the sale of the Shares, have been fully paid by the Employee. |
| 31.2. | The ramifications of any future modification of any Applicable Law regarding the taxation of Awards and/or Shares granted to Participants shall apply to the Participants accordingly and such Participants shall bear the full cost thereof, unless such modified laws expressly provide otherwise. For the avoidance of doubt, should the applicability of such taxing arrangements to this Plan or to securities issued in the framework thereof be stipulated by an application by the Company or by the Trustee that same shall apply, the Company shall be entitled to decide, at its absolute discretion, whether to apply such taxing arrangements and to instruct the Trustee to act accordingly. |
| 31.3. | Governing Law and Jurisdiction. This Plan shall be governed by and construed and enforced in accordance with the laws of the State of Israel, without giving effect to the principles of conflict of laws. The competent courts of Tel-Aviv, Israel shall have exclusive jurisdiction in any matters pertaining to the Plan. |
| 31.4. | Conflicts. This Plan (together with the Award Agreements signed by the Company and the Participant) supersedes all of the agreements and/or understandings existing prior to the date of the grant of Awards to an Participant between the Company, or any of its Affiliates, and such Participant in connection with issuance of capital shares of the Company or options for capital shares of the Company to such Participant, other than any written option agreement entered into pursuant to a different stock option plan approved by the Board. Any representation and/or promise and/or undertaking made and/or given by the Company and/or by any of its Affiliates or by any person on their behalf, which have not been expressed herein, shall have no force and effect. For the removal of doubt, it is hereby clarified that in the event of any contradiction between the terms set forth in this Plan and the terms of any Award Agreement, or in a Participant’s employment or services agreement, the terms of this Plan shall prevail, unless explicitly provided otherwise in the Award Agreement. |
| 32. | Multiple Agreements |
The terms of each Award may differ from other Awards granted, whether concurrent with, prior to or following its grant under this Plan . No Participant or other person shall have any claim to be granted Awards and there is no obligation for uniformity of treatment of Participants, or holders or beneficiaries of Awards. The terms and conditions of Awards and the Administrator’s determinations and interpretations with respect to them need not be the same with respect to each Participant (whether or not such Participants are similarly situated and whether or not the Awards are granted at the same time or at any other time).
Schedule A
PROXY
I, the undersigned, as record holder of the securities of Pagaya Technologies Ltd. (the “Company”) described below, hereby irrevocably appoint the chairman of the Company’s Board of Directors, or any other person designated for such purpose by the Company’s Board of Directors (the “Proxy Holder”), as my proxy instead of myself and on my behalf, with respect to any and all aspects of my shareholdings in the Company in virtue of the shares granted to me pursuant to the Company’s 2021 Equity Incentive Plan (including, without limitation and for the sake of clarification, any shares issued to me upon exercise of any option granted to me under the Company’s 2021 Equity Incentive Plan) (the “Shares”), including, without limiting the foregoing generality: (i) receiving any notices that the Company may deliver to its shareholders, pursuant to the Articles of Association of the Company (as amended from time to time), any shareholders agreement, applicable law or otherwise, (ii) attending all meetings of the shareholders of the Company and voting such Shares at any meeting of the shareholders of the Company (and at any postponements or adjournments thereof) and waiving all minimum notice requirements for such meetings of shareholders, (iii) executing any consents or dissents in writing without a meeting of the shareholders of the Company to any corporate action thereof, (iv) waiving any preemptive right, right of first refusal, right of first offer, co-sale right or any other similar right or restriction to which I will be entitled by virtue of the Shares, (v) giving or withholding consent or agreement to any matter which requires my consent or agreement in my capacity as a shareholder of the Company (whether such is required under the Articles of Association of the Company (as amended from time to time), any agreement to which I am a party as a shareholder or otherwise), and/or (vi) joining in making a request to convene a general meeting or class meeting of the shareholders of the Company or to otherwise exercise any and all powers and authorities vested within me in my capacity as a shareholder of the Company (in each of the foregoing cases, to the fullest extent that I will be entitled to act so, and in the same manner and with the same effect as if the undersigned were personally present at any such meeting or voting such Shares or personally acting on any matters submitted to shareholders for approval or consent).
The Shares shall be voted by the Proxy Holder in the same proportion as the votes of the other shareholders of the Company.
This proxy is irrevocable to the maximum extent allowed by applicable laws and it will remain in full force and effect until the consummation of an IPO (as defined in the Company’s 2021 Equity Incentive Plan), upon which it will automatically terminate.
The Proxy Holder will have the full power of substitution and revocation. All authority herein conferred shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.
| Name | Date | |
| Signature |
26
Exhibit 10.12
PAGAYA TECHNOLOGIES LTD.
2021 EQUITY INCENTIVE PLAN
STOCK OPTION SUB-PLAN FOR UNITED STATES PERSONS
| 1. | Introduction |
1.1 Pursuant to Section 4.2(xii) of the PAGAYA TECHNOLOGIES LTD. 2021 EQUITY INCENTIVE PLAN (the “Plan”), which Plan was adopted by the Board on March [_], 2021, the provisions set forth herein are made applicable to Options granted under this sub-plan (this “U.S. Sub-Plan”) of the Plan to Eligible Persons residing in the United States of America or whose primary place of performing services for the Company is located in the United States of America (“U.S. Eligible Persons”).
1.2 Except as expressly set forth herein to the contrary, all of the terms and conditions of the Plan shall apply to Options granted under the Plan to U.S. Eligible Persons.
1.3 The Company intends that securities issued under the Plan to U.S. Eligible Persons be exempt from requirements of registration and qualification of such securities pursuant the exemptions afforded by Rule 701 promulgated under the Securities Act and any applicable exemptions under applicable United States state securities laws, and the Plan shall be so construed. Further, the Company intends that Options granted under the Plan to U.S. Eligible Persons be exempt from or comply with Section 409A of the U.S. Code (including any amendments or replacements of such section), and the Plan shall be so construed.
| 2. | Definitions |
2.1 Except as set forth in Section 2.2, capitalized terms used in this U.S. Sub-Plan but not defined herein shall have the meanings set forth in the Plan.
2.2 Whenever used herein, the following terms shall have their respective meanings set forth below:
(a) “Consultant” has the meaning as defined in the Plan, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from offering or selling securities to such person pursuant to the Plan in reliance on either the exemption from registration provided by Rule 701 under the Securities Act or, if the Company is required to file reports pursuant to Section 13 or 15(d) of the Exchange Act, registration on a Form S-8 Registration Statement under the Securities Act.
(b) “Employee” has the meaning as defined in the Plan, provided that, with respect to any Incentive Stock Option granted to such an individual, the individual is considered an employee for purposes of Section 422 of the U.S. Code.
(c) “Fair Market Value” has the meaning as defined in the Plan, provided that any good faith determination by the Administrator in the absence of an established market for the Shares shall be made without regard to any restriction other than a restriction which, by its terms, will never lapse, and in a manner consistent with the requirements of Section 409A of the Code.
(d) “Insider” means an Officer, a Director or other person whose transactions in Shares are subject to Section 16 of the Exchange Act.
(e) “Rule I6b-3” means Rule 16b-3 under the Exchange Act, as amended from time to time, or any successor rule or regulation.
(f) “Securities Act” means the United States Securities Act of 1933, as amended.
(g) “Ten Percent Shareholder” means a person who, at the time an Option is granted to such person, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company within the meaning of Section 422(b)(6) of the Code.
| 3. | Option Terms. |
3.1 Options may be granted under the U.S. Sub-Plan only to Employees, Consultants and Directors.
3.2 The exercise price per Share for each Option granted under the U.S. Sub-Plan shall be not less than the Fair Market Value of a Share on the date of grant of the Option.
3.3 Incentive Stock Options shall be subject to the following additional limitations:
(a) The maximum aggregate number of Shares that may be issued under the U.S. Sub-Plan pursuant to the exercise of Incentive Stock Options is one hundred eleven thousand one hundred eleven (111,111) Shares (the “ISO Share Limit”).
(b) An Incentive Stock Option may be granted only to an individual who, on the date of grant, is an Employee.
(c) To the extent that Options designated as Incentive Stock Options (granted under all stock plans of the Company, including the Plan) become exercisable by a Participant for the first time during any calendar year for Shares having a Fair Market Value greater than One Hundred Thousand Dollars ($100,000), the portions of such Options that exceed such amount shall be treated as Nonstatutory Stock Options in accordance with Section 7.2 of the Plan. If an Option is treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section, the Participant may designate which portion of such Option the Participant is exercising. In the absence of such designation, the Participant shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Upon exercise of the Option, Shares issued pursuant to each such portion shall be separately identified.
(d) The exercise price per Share for an Incentive Stock Option granted to a Ten Percent Shareholder shall be not less than one hundred ten percent (110%) of the Fair Market Value of a Share on the date of grant of the Option.
(e) No Incentive Stock Option may be granted more than ten (10) years after the date the Plan was adopted by the Board.
(f) No Incentive Stock Option shall be exercisable more than ten (10) years after the date of grant of such Option. No Incentive Stock Option granted to a Ten Percent Shareholder shall be exercisable more than five (5) years after the date of grant of such Option.
(g) During the lifetime of the Participant, an Incentive Stock Option shall be exercisable only by the Participant or the Participant’s guardian or legal representative. An Incentive Stock Option shall not be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Participant or the Participant’s beneficiary, except transfer by will or by the laws of descent and distribution.
| 4. | Tax Withholding. |
4.1 The Company may require a Participant, through payroll withholding, cash payment or otherwise, to make adequate provision for, United States federal, state, local and non-U.S. taxes (including any social insurance), if any, required by law to be withheld by the Company with respect to an Option or the Shares acquired pursuant thereto. The Company shall have no obligation to deliver Shares until the Company’s tax withholding obligations have been satisfied by the Participant.
4.2 The Company shall have the right, but not the obligation, to deduct from the Shares issuable to a Participant upon the exercise of an Option, or to accept from the Participant the tender of, a number of whole Shares having a Fair Market Value, as determined by the Company, equal to all or any part of the tax withholding obligations of the Company. After and IPO and subject to compliance with all applicable requirements of applicable securities laws, the Company may require a Participant to direct a broker, upon the exercise of an Option, to sell a portion of the Shares subject to the Option determined by the Board in its discretion to be sufficient to cover the tax withholding obligations of the Company and to remit an amount equal to such tax withholding obligations to the Company in cash.
| 5. | Compliance with U.S. Securities and Other Applicable Law. |
5.1 The grant of Options and the issuance of Shares upon exercise of Options shall be subject to compliance with all applicable requirements of United States federal and state law’ with respect to such securities and the requirements of any stock exchange or market system upon which the Shares may then be listed. In addition, no Option may be exercised or Shares issued pursuant to an Option unless (a) a registration statement under the Securities Act shall at the time of such exercise or issuance be in effect with respect to the Shares issuable pursuant to the Option or (b) in the opinion of legal counsel to the Company, the Shares issuable pursuant to the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to 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. As a condition to issuance of any Share, the Company may require the Participant 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.
5.2 With respect to participation by Insiders in the Plan, at any time that any class of equity security of the Company is registered pursuant to Section 12 of the Exchange Act, the Plan shall be administered in compliance with the requirements, if any, of Rule 16b-3.
5.3 No Option granted to an Employee who is a non-exempt employee for purposes of the United States Fair Labor Standards Act of 1938, as amended, shall become exercisable until at least six (6) months following the date of grant of such Option (except in the event of such Employee’s death or Disability, or as otherwise permitted by the United States Worker Economic Opportunity Act).
5.4 To the extent permitted by the Board, in its discretion, and set forth in the Award Agreement evidencing such Option, a Nonstatutory Stock Option may be assignable or transferable only in compliance with the applicable limitations, if any, described in Rule 701 under the Securities Act and the General Instructions to Form S-8 Registration Statement under the Securities Act.
5.5 At least annually, copies of the Company’s balance sheet and income statement for the just completed fiscal year shall be made available to each U.S. Eligible Person holding Options or Shares acquired upon the exercise of an Option; provided, however, that this requirement shall not apply if all offers and sales of securities pursuant to the U.S. Sub-Plan comply with all applicable conditions of Rule 701 under the Securities Act. The Company shall not be required to provide such information to persons whose duties in connection with the Company assure them access to equivalent information. The Company shall deliver to each Participant such disclosures as are required in accordance with Rule 701 under the Securities Act.
| 6. | Amendment of U.S. Sub-Plan. |
6.1 The Board may amend the U.S. Sub-Plan at any time. However, without the approval of the Company’s shareholders, no such amendment shall (a) increase the ISO Share Limit, (b) change the class of persons eligible to receive Incentive Stock Options, or (c) make any other change that would require approval of the Shareholders under any Applicable Law, including the rules of any stock exchange or quotation system upon which the Shares may then be listed or quoted.
| 7. | Shareholder Approval |
7.1 The U.S. Sub-Plan shall be submitted for approval by the Company’s shareholders during the period beginning twelve (12) months before and ending twelve (12) months after the date of adoption thereof by the Board. Incentive Stock Options granted prior to Shareholder approval of the U.S. Sub-Plan shall become exercisable no earlier than the date of Shareholder approval of the U.S. Sub-Plan, and such Options shall become Nonstatutory Stock Options if such Shareholder approval is not received in the manner described in the preceding sentence.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies that the foregoing sets forth the additional provisions of the Pagaya Technologies Ltd. 2021 Equity Incentive Plan applicable to grants to U.S. Eligible Persons, as du)y adopted by the Board on March [__], 2021
Secretary
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(a)
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“Administrator” means the Board, or, if and to the extent the Board does not administer the Plan, the Committee in
accordance with Section 3 hereof.
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(b)
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“Affiliate” means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by,
or is under common control with, the Person specified.
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(c)
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“Articles of Association” means the articles of association of the Company, as may be amended and/or restated from time to
time.
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(d)
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“Award” means any Option, Share Appreciation Right, Restricted Share, Restricted Share Unit, Share Bonus or Other
Share-Based Award under the Plan.
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(e)
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“Award Agreement” means any written agreement, contract or other instrument or document evidencing an Award, including
through electronic medium, which shall contain such terms and conditions with respect to an Award as the Administrator shall determine, consistent with the Plan. Each Participant who is granted an Award shall enter into an Award Agreement
with the Company, containing such terms and conditions as the Administrator shall determine, in its sole discretion.
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(f)
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“Base Price” has the meaning set forth in Section 8(b) hereof.
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(g)
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“Beneficial Owner” (or any variant thereof) has the meaning defined in Rule 13d- 3 under the Exchange Act.
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(h)
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“Board” means the Board of Directors of the Company.
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(i)
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“By-Laws” means the by-laws of the Company, if any, as may be amended and/or restated from time to time.
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(j)
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“Cause” has the meaning assigned to such term in the Award Agreement or in any individual employment, service or severance
agreement with the Participant or, if any such agreement does not define “Cause,” Cause means (i) the commission of an act of fraud or dishonesty by the Participant in the course of the Participant’s employment or service; (ii) the
indictment of, or conviction of, or entering of a plea of nolo contendere by, the Participant for a crime constituting a felony or in respect of any act of fraud or dishonesty; (iii) the commission of an act by the Participant which would
make the Participant or the Company (including any of its Subsidiaries or Affiliates) subject to being enjoined, suspended, barred or otherwise disciplined for violation of federal or state securities laws, rules or regulations, including
a statutory disqualification; (iv) gross negligence or willful misconduct in connection with the Participant’s performance of his or her duties in connection with the Participant’s employment by or service to the Company (including any
Subsidiary or Affiliate for whom the Participant may be employed by or providing services to at the time) or the Participant’s failure to comply with any of the restrictive covenants to which the
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(k)
|
“Change in Capitalization” means any (i) merger, consolidation, reclassification, recapitalization, spin-off, spin-out,
repurchase or other reorganization or corporate transaction or event; (ii) special or extraordinary dividend or other extraordinary distribution (whether in the form of cash, Ordinary Share, or other property), share split, reverse share
split, subdivision or consolidation; (iii) combination or exchange of shares; or (iv) other change in corporate structure, which, in any such case, the Administrator determines, in its sole discretion, affects the Ordinary Share such that
an adjustment pursuant to Section 5 hereof is appropriate.
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(l)
|
“Change in Control” means, unless otherwise defined in an Award Agreement, an event set forth in any one of the following
paragraphs shall have occurred:
|
|
(1)
|
any Person (or any group of Persons acting together which would constitute a “group” for purposes of Section 13(d) of the Exchange
Act) is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its Affiliates)
representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in clause (I) of
paragraph (2) below;
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(2)
|
there is consummated a merger or consolidation of the Company or any direct or indirect Subsidiary with any other corporation or
other entity, other than (I) a merger or consolidation (A) which results in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or any parent thereof), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary,
more than fifty percent (50%) of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation and (B) immediately following which the
individuals who comprise the Board immediately prior thereto constitute at least a majority of the board of directors of the Company, the entity surviving such merger or consolidation or, if the Company or the entity surviving such merger
or consolidation is then a subsidiary, the ultimate parent thereof, or (II) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its Affiliates) representing fifty percent (50%) or more of the
combined voting power of the Company’s then outstanding securities;
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(3)
|
the shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an
agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets, other than (A) a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least fifty
percent (50%) of the combined voting power of the voting securities of which are owned by shareholders of the Company following the completion of such transaction in substantially the same proportions as their ownership of the Company
immediately prior to such sale or (B) a sale or disposition of all or substantially all of the Company’s assets immediately following
|
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(4)
|
the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who,
on the date hereof, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s shareholders was approved or recommended by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors on the date hereof or whose appointment, election or nomination for election was previously so approved or recommended.
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(m)
|
“Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.
|
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(n)
|
“Committee” means any committee or subcommittee the Board may appoint to administer the Plan. Subject to the discretion of
the Board and to the provisions of applicable law, the Committee shall be composed entirely of individuals who meet the qualifications of (i) a “non-employee director” within the meaning of Rule 16b-3 and (ii) any other qualifications
required by the applicable share exchange on which the Ordinary Shares is traded. If at any time or to any extent the Board shall not administer the Plan, then the functions of the Administrator specified in the Plan shall be exercised by
the Committee. Except as otherwise provided in the Articles of Association or By-Laws, any action of the Committee with respect to the administration of the Plan shall be taken by a majority vote at a meeting at which a quorum is duly
constituted or unanimous written consent of the Committee’s members.
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(o)
|
“Company” means Pagaya Technologies Ltd., an Israeli corporation (or any successor company, except as the term “Company” is
used in the definition of “Change in Control” above).
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(p)
|
“Consultant” means any person, including an advisor, who is (i) engaged by the Company or an Affiliate to render consulting
or advisory services and is compensated for such services, or (ii) serving as a member of the board of directors of an Affiliate and is compensated for such services. However, service solely as a Non-Employee Director and/or Employee, or
payment of a fee for such service, shall not cause a Non-Employee Director or Employee to be considered a “Consultant” for purposes of the Plan.
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(q)
|
“Disability” has the meaning assigned to such term in the Award Agreement or in any individual employment, service or
severance agreement with the Participant or, if any such agreement does not define “Disability,” Disability means, with respect to any Participant, that such Participant, as determined by the Administrator in its sole discretion, is
(i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than
twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving
income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company or an Affiliate thereof.
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(r)
|
“Effective Date” has the meaning set forth in Section 17 hereof.
|
|
(s)
|
“Eligible Recipient” means an officer, Employee, Non-Employee Director, or Consultant who has been selected as an eligible
participant by the Administrator; provided, however, to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, an Eligible Recipient of an Option or a Share Appreciation
Right means an officer, Employee, Non-Employee Director or Consultant with respect to whom the Company is an “eligible issuer of service recipient share” within the meaning of Section 409A of the Code.
|
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(t)
|
“Employee” means any person employed by the Company or an Affiliate.
|
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(u)
|
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.
|
|
(v)
|
“Exercise Price” means, with respect to any Option, the per share price at which a holder of such Option may purchase
Ordinary Share issuable upon the exercise of such Option.
|
|
(w)
|
“Fair Market Value” of Ordinary Share or another security as of a particular date shall mean the fair market value as
determined by the Administrator in its sole discretion; provided, however, (i) if the Ordinary Share or other security is admitted to trading on a national securities exchange, the fair market value on any date shall be
the closing sale price reported on the day prior to such date, or if no shares were traded on such date, on the last preceding date for which there was a sale of an Ordinary Share or other security on such exchange, or (ii) if the
Ordinary Share or other security is then traded in an over-the-counter market, the fair market value on any date shall be the average of the closing bid and asked prices for such Ordinary Share or other security in such over-the-counter
market for the last preceding date on which there was a sale of such Ordinary Share or other security in such market.
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|
(x)
|
“Free Standing Right” has the meaning set forth in Section 8(a) hereof.
|
|
(y)
|
“Good Reason” has the meaning assigned to such term in the Award Agreement or in any individual employment, service or
severance agreement with the Participant; provided that if no such agreement exists or if such agreement does not define “Good Reason,” Good Reason and any provision of the Plan that refers to Good Reason shall not be applicable
to such Participant.
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|
(z)
|
“ISO” means an Option intended to be and designated as an “incentive stock option” within the meaning of Section 422 of the
Code.
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|
(aa)
|
“Non-Employee Directors” means a member of a Board who either (i) is not a current employee or officer of the Company or an
Affiliate, does not receive compensation, either directly or indirectly, from the Company or an Affiliate for services rendered as a consultant or in any capacity other than as a member of a Board (except for an amount as to which
disclosure would not be required under Item 404(a) of Regulation S-K promulgated pursuant to the Securities Act (“Regulation S-K”)), does not possess an interest in any other transaction for which disclosure would be required under
Item 404(a) of Regulation S-K, and is not engaged in a business relationship for which disclosure would be required pursuant to Item 404(b) of Regulation S-K; or (ii) is otherwise considered a “non-employee director” for purposes of Rule
16b-3.
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|
(bb)
|
“Nonqualified Stock Option” means an Option that is not designated as an ISO.
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(cc)
|
“Option” means an option to purchase Ordinary Share granted pursuant to Section 7 hereof. The term “Option” as used in the
Plan includes the terms “Nonqualified Stock Option” and “ISO.”
|
|
(dd)
|
“Ordinary Share” means an ordinary share, without par value per share, of the Company.
|
|
(ee)
|
“Other Share-Based Award” means an Award granted pursuant to Section 10 hereof.
|
|
(ff)
|
“Participant” means any Eligible Recipient selected by the Administrator, pursuant to the Administrator’s authority
provided for in Section 3 hereof, to receive grants of Awards, and, upon his or her death, his or her successors, heirs, executors and administrators, as the case may be.
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|
(gg)
|
“Performance Goals” means performance goals based on criteria selected by the Administrator in its sole discretion,
including, without limitation, one or more of the following criteria: (i) earnings, including one or more of operating income, net operating income, earnings before or after taxes, earnings before or after interest, depreciation,
amortization, adjusted EBITDA, economic earnings, or
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(hh)
|
“Person” has the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d)
thereof.
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|
(ii)
|
“Plan” has the meaning set forth in Section 1 hereof.
|
|
(jj)
|
“Related Right” has the meaning set forth in Section 8(a) hereof.
|
|
(kk)
|
“Restricted Share” means Shares granted pursuant to Section 9 hereof subject to certain restrictions that lapse at the end
of a specified period or periods.
|
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(ll)
|
“Restricted Share Unit” means the right, granted pursuant to Section 9 hereof, to receive Shares equal to the Fair Market
Value of a Share subject to certain restrictions that lapse at the end of a specified period or periods.
|
|
(mm)
|
“Rule 16b-3” has the meaning set forth in Section 3(a) hereof.
|
|
(nn)
|
“Share Appreciation Right” means the right to receive, upon exercise of the right, the applicable amounts as described in
Section 8 hereof.
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(oo)
|
“Share Bonus” means a bonus payable in fully vested Ordinary Shares granted pursuant to Section 11 hereof.
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(pp)
|
“Shares” means Ordinary Shares reserved for issuance under the Plan, as adjusted pursuant to the Plan, and any successor
(pursuant to a merger, consolidation or other reorganization) security.
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(qq)
|
“Subsidiary” means, with respect to any Person, as of any date of determination, any other Person as to which such first
Person owns or otherwise controls, directly or indirectly, more than 50% of the voting shares or other similar interests or a sole general partner interest or managing member or similar interest of such other Person.
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(rr)
|
“Transfer” has the meaning set forth in Section 15 hereof.
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(a)
|
The Plan shall be administered by the Administrator and shall be administered in accordance with the requirements of applicable
law and Rule 16b-3 under the Exchange Act (“Rule 16b-3”), to the extent applicable.
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(b)
|
Pursuant to the terms of the Plan and subject to the conditions and requirements under applicable law, the Administrator, subject,
in the case of any Committee, to any restrictions on the authority delegated to it by the Board, shall have the power and authority, without limitation:
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|
(1)
|
to select those Eligible Recipients who shall be Participants;
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|
(2)
|
to determine whether and to what extent Awards are to be granted hereunder to Participants;
|
|
(3)
|
to determine the number of Shares to be covered by each Award granted hereunder;
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|
(4)
|
to determine the terms and conditions, not inconsistent with the terms of the Plan, of each Award granted hereunder (including,
but not limited to, (i) the restrictions applicable to Restricted Share or Restricted Share Units and the conditions under which restrictions applicable to such Restricted Share or Restricted Share Units shall lapse, (ii) the Performance
Goals and periods applicable to Awards, (iii) the Exercise Price of each Option and the Base Price of each Share Appreciation Right, (iv) the vesting schedule applicable to each Award, (v) the number of Shares or amount of cash or other
property subject to each Award and (vi) subject to the requirements of Section 409A of the Code (to the extent applicable), any amendments to the terms and conditions of outstanding Awards, including, but not limited to, extending the
exercise period of such Awards and accelerating the vesting schedule of such Awards);
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(5)
|
to determine the terms and conditions, not inconsistent with the terms of the Plan, which shall govern all written instruments
evidencing Awards;
|
|
(6)
|
to determine the Fair Market Value in accordance with the terms of the Plan;
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|
(7)
|
to determine the duration and purpose of leaves of absence which may be granted to a Participant without constituting termination
of the Participant’s employment or service for purposes of Awards granted under the Plan;
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(8)
|
to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time
deem advisable;
|
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(9)
|
to prescribe, amend and rescind rules and regulations relating to sub- plans established for the purpose of satisfying applicable
foreign laws or qualifying for favorable tax treatment under applicable foreign laws, which rules and regulations may be set forth in an appendix or appendices to the Plan; and
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|
(10)
|
to construe and interpret the terms and provisions of the Plan and any Award issued under the Plan (and any Award Agreement
relating thereto), and to otherwise supervise the administration of the Plan and to exercise all powers and authorities either specifically granted under the Plan or necessary and advisable in the administration of the Plan.
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(c)
|
All decisions made by the Administrator pursuant to the provisions of the Plan shall be final, conclusive and binding on all
Persons, including the Company and the Participants. No member of the Board or the Committee, nor any officer or employee of the Company or any Subsidiary thereof acting on behalf of the Board or the Committee, shall be personally liable
for any action, omission, determination, or interpretation taken or made in good faith with respect to the Plan, and all members of the Board or the Committee and each and any officer or employee of the Company and of any Subsidiary
thereof acting on their behalf shall, to the maximum extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, omission, determination or interpretation.
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(d)
|
The Administrator may, in its sole discretion, delegate its authority, in whole or in part, under this Section 3 (including, but
not limited to, its authority to grant Awards under the Plan, other than its
|
|
(a)
|
The number of Ordinary Shares reserved for issuance under the Plan shall be [•]1 authorized but unissued shares (the “Share
Reserve”) (subject to adjustment as provided Section 5); provided, however the Share Reserve will automatically increase on January 1st of each calendar year (each, an “Evergreen Date”), prior to
the tenth (10th) anniversary of the Effective Date, in an amount equal to the lesser of (i) five (5) % of the total number of Ordinary Shares outstanding on December 31st of the calendar year immediately preceding
the applicable Evergreen Date and (ii) a number of Ordinary Shares determined by the Board. No more than [•]2 Ordinary Shares reserved for issuance under the Plan pursuant to this Section 4(a) (subject to adjustment as provided
in Section 5 hereof) may be granted under the Plan as ISOs.
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(b)
|
Shares issued under the Plan may, in whole or in part, be authorized but unissued Shares or Shares that shall have been or may be
reacquired by the Company in the open market, in private transactions or otherwise. If any Shares subject to an Award are forfeited, cancelled, exchanged or surrendered or if an Award otherwise terminates or expires without a distribution
of Shares to the Participant, the Shares with respect to such Award shall, to the extent of any such forfeiture, cancellation, exchange, surrender, termination or expiration, again be available for Awards under the Plan. Notwithstanding
the foregoing, Shares that are exchanged by a Participant or withheld by the Company as full or partial payment in connection with the exercise of any Option or Share Appreciation Right under the Plan or the payment of any purchase price
with respect to any other Award under the Plan, as well as any Shares exchanged by a Participant or withheld by the Company or any Subsidiary to satisfy the tax withholding obligations related to any Award under the Plan, shall not be
available for subsequent Awards under the Plan, and notwithstanding that a Share Appreciation Right is settled by the delivery of a net number of Ordinary Shares, the full number of Ordinary Shares underlying such Share Appreciation Right
shall not be available for subsequent Awards under the Plan. In addition, (i) to the extent an Award is denominated in Ordinary Shares, but paid or settled in cash, the number of Ordinary Shares with respect to which such payment or
settlement is made shall again be available for grants of Awards pursuant to the Plan and (ii) Ordinary Shares underlying Awards that can only be settled in cash shall not be counted against the aggregate number of Ordinary Shares
available for Awards under the Plan.
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|
(a)
|
In the event of any Change in Capitalization (including a Change in Control), an equitable substitution or proportionate
adjustment shall be made, in each case, as may be determined by the Administrator, in its sole discretion, in (i) the aggregate number of Ordinary Shares reserved for issuance under the Plan, (ii) the kind and number of securities subject
to, and the Exercise Price or Base Price of, any outstanding Options and Share Appreciation Rights granted under the Plan, (iii) the kind, number and purchase price of Ordinary Shares, or the amount of cash or amount or type of other
property, subject to outstanding Restricted Share, Restricted Share Units, Share Bonuses and Other Share-Based Awards granted under the Plan or (iv) the Performance Goals and performance periods applicable to any Awards granted under the
Plan; provided, however, that any fractional shares resulting from the adjustment shall be eliminated. Such other equitable substitutions or adjustments shall be made as may be determined by the Administrator, in its sole
discretion.
|
|
(b)
|
Without limiting the generality of the foregoing, in connection with a Change in Capitalization (including a Change in Control),
the Administrator may provide, in its sole discretion, but subject in all events to the requirements of Section 409A of the Code as may be applicable, for the cancellation of any outstanding Award in exchange for payment in cash or other
property having an aggregate Fair Market Value equal to the Fair Market Value of the Ordinary Shares, cash or other property covered by
|
|
1
|
Note to Draft: To be 10% of the total outstanding number of Ordinary Shares as of immediately
after Closing, post-conversion and post-money, calculated on a fully-diluted basis including all equity awards, warrants and other convertible securities outstanding as of such time.
|
|
2
|
Note to Draft: To be 10% of the total outstanding number of Ordinary Shares as of immediately
after Closing, post-conversion and post-money, calculated on a fully-diluted basis including all equity awards, warrants and other convertible securities outstanding as of such time.
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|
(c)
|
In connection with a Change in Control, the Administrator may provide or may set forth in an Award Agreement, in its sole
discretion, that any outstanding Award shall become vested and exercisable in full or in part and any restrictions thereupon shall lapse, including in connection with a Participant’s termination of service with the Company and its
Subsidiaries following a Change in Control; provided that the Administrator may determine to treat outstanding Awards differently and shall not be obligated to treat all Awards in the same manner.
|
|
(d)
|
The determinations made by the Administrator or the Board, as applicable, pursuant to this Section 5 shall be final, binding and
conclusive.
|
|
(a)
|
General. Each Participant who is granted an Option shall enter into an Award Agreement with the Company, containing such
terms and conditions as the Administrator shall determine, in its sole discretion, which Award Agreement shall set forth, among other things, the Exercise Price of the Option, the term of the Option and provisions regarding exercisability
of the Option, and whether the Option is intended to be an ISO or a Nonqualified Stock Option (and in the event the Award Agreement has no such designation, the Option shall be a Nonqualified Stock Option). The provisions of each Option
need not be the same with respect to each Participant. More than one Option may be granted to the same Participant and be outstanding concurrently hereunder. Options granted under the Plan shall be subject to the terms and conditions set
forth in this Section 7 and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Administrator shall deem desirable and set forth in the applicable Award Agreement.
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|
(b)
|
Exercise Price. The Exercise Price of Shares purchasable under an Option shall be determined by the Administrator in its
sole discretion at the time of grant, but, except as provided in the applicable Award Agreement, in no event shall the exercise price of an Option which is intended to be an ISO or a Nonqualified Stock Option be less than one hundred
percent (100%) of the Fair Market Value of the related Ordinary Shares on the date of grant.
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|
(c)
|
Option Term. The maximum term of each Option shall be fixed by the Administrator, but no Option shall be exercisable more
than ten (10) years after the date such Option is granted. Each Option’s term is subject to earlier expiration pursuant to the applicable provisions in the Plan and the Award Agreement.
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|
(d)
|
Exercisability. Each Option shall be exercisable at such time or times and subject to such terms and conditions, including
the attainment of Performance Goals, as shall be determined by the Administrator in the applicable Award Agreement. The Administrator may also provide that any Option shall be exercisable only in installments, and the Administrator may
waive such installment exercise provisions at any time, in whole or in part, based on such factors as the Administrator may determine in its sole discretion. Notwithstanding anything to the contrary contained herein, an Option may not be
exercised for a fraction of a share.
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|
(e)
|
Method of Exercise. Options may be exercised in whole or in part by giving written notice of exercise to the Company
specifying the number of whole Shares to be purchased, accompanied by payment in full of the aggregate Exercise Price of the Shares so purchased in cash or its equivalent, as determined by the Administrator. Subject to compliance with
applicable law, and subject to the Administrator’s ability in its sole discretion to limit the following, the Company may accept payment with respect to any Option or category of Options, in whole or in part (i) by means of consideration
received under any cashless exercise procedure approved by the Administrator (including the withholding of Shares
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|
(f)
|
ISOs. The terms and conditions of ISOs granted hereunder shall be subject to the provisions of Section 422 of the Code and
the terms, conditions, limitations and administrative procedures established by the Administrator from time to time in accordance with the Plan. At the discretion of the Administrator, ISOs may be granted only to an employee of the
Company, its “parent corporation” (as such term is defined in Section 424(e) of the Code) or a Subsidiary of the Company.
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|
(i)
|
ISO Grants to 10% Shareholders. Notwithstanding anything to the contrary in the Plan, if an ISO is granted to a Participant
who owns shares representing more than ten percent (10%) of the voting power of all classes of shares of the Company, its “parent corporation” (as such term is defined in Section 424(e) of the Code) or a Subsidiary of the Company, the
term of the ISO shall not exceed five (5) years from the time of grant of such ISO and the Exercise Price shall be at least one hundred and ten percent (110%) of the Fair Market Value of the Shares on the date of grant.
|
|
(ii)
|
$100,000 Per Year Limitation For ISOs. To the extent the aggregate Fair Market Value (determined on the date of grant) of
the Shares for which ISOs are exercisable for the first time by any Participant during any calendar year (under all plans of the Company) exceeds $100,000, such excess ISOs shall be treated as Nonqualified Stock Options.
|
|
(iii)
|
Disqualifying Dispositions. Each Participant awarded an ISO under the Plan shall notify the Company in writing immediately
after the date the Participant makes a “disqualifying disposition” of any Share acquired pursuant to the exercise of such ISO. A “disqualifying disposition” is any disposition (including any sale) of such Shares before the later of
(i) two years after the date of grant of the ISO and (ii) one year after the date the Participant acquired the Shares by exercising the ISO. The Company may, if determined by the Administrator and in accordance with procedures established
by it, retain possession of any Shares acquired pursuant to the exercise of an ISO as agent for the applicable Participant until the end of the period described in the preceding sentence, subject to complying with any instructions from
such Participant as to the sale of such Shares.
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|
(g)
|
Rights as Shareholder. Except as provided in the applicable Award Agreement, a Participant shall have no rights to
dividends, dividend equivalents or distributions or any other rights of a shareholder with respect to the Shares subject to an Option until the Participant has given written notice of the exercise thereof, has paid in full for such Shares
and has satisfied the requirements of Section 14 hereof.
|
|
(h)
|
Termination of Employment or Service. In the event of the termination of employment or service with the Company and all
Affiliates thereof of a Participant who has been granted one or more Options, such vested Options shall be exercisable at such time or times and subject to such terms and conditions as set forth in the Award Agreement; provided, however,
that the Administrator is entitled, at any time and its sole and absolute discretion, to extend the period during which a Participant shall be entitled to exercise their vested Options.
|
|
(i)
|
Other Change in Employment or Service Status. An Option shall be affected, both with regard to vesting schedule and
termination, by leaves of absence, including unpaid and un- protected leaves of absence, changes from full-time to part-time employment, partial Disability or other changes in the employment status or service status of a Participant. Such
aforementioned determinations of employment status or service status, as applicable, shall be made, subject to compliance with applicable law, in the sole discretion of the Administrator. In the event of the death of a Participant who has
been granted one or more Options, such Options shall be assigned the vesting schedule as set forth in the Award Agreement. In the absence of a specified provision in the Award Agreement pertaining to accelerated vesting upon a
Participant’s death, the vesting of such Options shall be accelerated for a
|
|
(j)
|
In the absence of a specified period in the Award Agreement and unless the Administrator determines otherwise at any time, such
vested Options shall remain exercisable following a Participant’s termination of employment or service for a period determined based on the Participant’s tenure at the Company, as follows: (i) one (1) year for any Participant whose
employment is terminated (x) by the Company other than for Cause, (y) due to the Participant’s death or Disability or (z) by the Participant with Good Reason and whose termination occurs two (2) years or more after the commencement of
that Participant’s employment or service (but, in each case, in no event later than the Expiration Date of such Options) and (ii) ninety (90) days for any Participant whose termination occurs in any other circumstance. If, after
termination of engagement with the Company, the Participant does not exercise the vested portion of their Options within the prescribed period, such Options shall terminate, and the Shares covered by such Options shall automatically
revert to the Plan. If, on the date of termination, the Participant is not vested as to all of their Options, the Shares covered by the unvested portion of the Options shall automatically revert to the Plan and shall not be exercisable.
For the avoidance of doubt, the Options granted hereunder shall not continue to vest following the termination of employment or service. Notwithstanding anything in the foregoing to the contrary, in the event the Participant's termination
of employment or service is for Cause, all Options held by such Participant, whether or not vested, shall immediately be forfeited as of the date of termination.
|
|
(a)
|
General. Share Appreciation Rights may be granted either alone (“Free Standing Rights”) or in conjunction
with all or part of any Option granted under the Plan (“Related Rights”). Related Rights may be granted either at or after the time of the grant of such Option. The Administrator shall determine the Eligible Recipients to
whom, and the time or times at which, grants of Share Appreciation Rights shall be made, the number of Shares to be awarded, the Base Price, and all other conditions of Share Appreciation Rights. Notwithstanding the foregoing, no Related
Right may be granted for more Shares than are subject to the Option to which it relates. The provisions of Share Appreciation Rights need not be the same with respect to each Participant. Share Appreciation Rights granted under the Plan
shall be subject to the following terms and conditions set forth in this Section 8 and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Administrator shall deem desirable, as set
forth in the applicable Award Agreement.
|
|
(b)
|
Base Price. Except as provided in the applicable Award Agreement, each Share Appreciation Right shall be granted with a
base price that is not less than one hundred percent (100%) of the Fair Market Value of the related Ordinary Shares on the date of grant (such amount, the “Base Price”).
|
|
(c)
|
Rights as Shareholder. Except as provided in the applicable Award Agreement, a Participant shall have no rights to
dividends, dividend equivalents or distributions or any other rights of a shareholder with respect to the Shares, if any, subject to a Share Appreciation Right until the Participant has given written notice of the exercise thereof and has
satisfied the requirements of Section 14 hereof.
|
|
(d)
|
Exercisability.
|
|
(1)
|
Share Appreciation Rights that are Free Standing Rights shall be exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Administrator in the applicable Award Agreement.
|
|
(2)
|
Share Appreciation Rights that are Related Rights shall be exercisable only at such time or times and to the extent that the
Options to which they relate shall be exercisable in accordance with the provisions of Section 7 hereof and this Section 8.
|
|
(e)
|
Consideration Upon Exercise.
|
|
(1)
|
Upon the exercise of a Free Standing Right, the Participant shall be entitled to receive up to, but
|
|
(2)
|
A Related Right may be exercised by a Participant by surrendering the applicable portion of the related Option. Upon such exercise
and surrender, the Participant shall be entitled to receive up to, but not more than, that number of Shares equal in value to (i) the excess of the Fair Market Value of an Ordinary Share as of the date of exercise over the Exercise Price
specified in the related Option, multiplied by (ii) the number of Shares in respect of which the Related Right is being exercised. Options which have been so surrendered, in whole or in part, shall no longer be exercisable to the extent
the Related Rights have been so exercised.
|
|
(3)
|
Notwithstanding the foregoing, the Administrator may determine to settle the exercise of a Share Appreciation Right in cash (or in
any combination of Shares and cash), to the extent set forth in the Award Agreement.
|
|
(f)
|
Termination of Employment or Service.
|
|
(1)
|
In the event of the termination of employment or service with the Company and all Affiliates thereof of a Participant who has been
granted one or more Free Standing Rights, such rights shall be exercisable at such time or times and subject to such terms and conditions as set forth in the Award Agreement.
|
|
(2)
|
In the event of the termination of employment or service with the Company and all Affiliates thereof of a Participant who has been
granted one or more Related Rights, such rights shall be exercisable at such time or times and subject to such terms and conditions as set forth in the related Options.
|
|
(g)
|
Term.
|
|
(1)
|
The term of each Free Standing Right shall be fixed by the Administrator, but no Free Standing Right shall be exercisable more
than ten (10) years after the date such right is granted.
|
|
(2)
|
The term of each Related Right shall be the term of the Option to which it relates, but no Related Right shall be exercisable more
than ten (10) years after the date such right is granted.
|
|
(h)
|
Other Change in Employment or Service Status. Share Appreciation Rights shall be affected, both with regard to vesting
schedule and termination, by leaves of absence, including unpaid and un-protected leaves of absence, changes from full-time to part-time employment, partial Disability or other changes in the employment status or service status of a
Participant, in the discretion of the Administrator.
|
|
(a)
|
General. Restricted Share and Restricted Share Units may be issued under the Plan. The Administrator shall determine the
Eligible Recipients to whom, and the time or times at which, Restricted Share or Restricted Share Units shall be made; the number of Shares to be awarded; the price, if any, to be paid by the Participant for the acquisition of Restricted
Share or Restricted Share Units; the period of time prior to which Restricted Share or Restricted Share Units become vested and free of restrictions on Transfer (the “Restricted Period”); the Performance Goals (if any); and all
other conditions of the Restricted Share and Restricted Share Units. If the restrictions, Performance Goals and/or conditions established by the Administrator are not attained, a Participant shall forfeit his or her Restricted Share or
Restricted Share Units, in accordance with the terms of the grant. The provisions of Restricted Share or Restricted Share Units need not be the same with respect to each Participant.
|
|
(b)
|
Awards and Certificates.
|
|
(1)
|
Except as otherwise provided in Section 9(b)(3) hereof, (i) each Participant who is granted an Award of Restricted Share may, in
the Company’s sole discretion, be issued a Share certificate in respect of such Restricted Share; and (ii) any such certificate so issued shall be registered in the name of the Participant, and shall bear an appropriate legend referring
to the terms, conditions, and restrictions applicable to any such Award. The Company may require that the Share
|
|
(2)
|
With respect to an Award of Restricted Share Units to be settled in Shares, at the expiration of the Restricted Period, share
certificates in respect of the Ordinary Shares underlying such Restricted Share Units may, in the Company’s sole discretion, be delivered to the Participant, or his or her legal representative, in a number equal to the number of Ordinary
Shares underlying the Award of Restricted Share Units.
|
|
(3)
|
Notwithstanding anything in the Plan to the contrary, any Restricted Share or Restricted Share Units to be settled in Shares (at
the expiration of the Restricted Period) may, in the Company’s sole discretion, be issued in uncertificated form.
|
|
(4)
|
Further, notwithstanding anything in the Plan to the contrary, with respect to Restricted Share Units, at the expiration of the
Restricted Period, Shares (either in certificated or uncertificated form) or cash, as applicable, shall promptly be issued to the Participant, unless otherwise deferred in accordance with procedures established by the Company in
accordance with Section 409A of the Code, and such issuance or payment shall in any event be made no later than March 15th of the calendar year following the year of vesting or within such other period as is required to avoid accelerated
taxation and/or tax penalties under Section 409A of the Code.
|
|
(c)
|
Restrictions and Conditions. The Restricted Share and Restricted Share Units granted pursuant to this Section 9 shall be
subject to the following restrictions and conditions and any additional restrictions or conditions as determined by the Administrator at the time of grant or, subject to Section 409A of the Code where applicable, thereafter:
|
|
(1)
|
The Award Agreement may provide for the lapse of restrictions in installments and may accelerate or waive such restrictions in
whole or in part based on such factors and such circumstances as set forth in the Award Agreement, including, but not limited to, the attainment of certain performance related goals, the Participant’s termination of employment or service
with the Company or any Affiliate thereof, or the Participant’s death or Disability.
|
|
(2)
|
Except as provided in the applicable Award Agreement, the Participant shall generally have the rights of a shareholder of the
Company with respect to shares of Restricted Share during the Restricted Period, including the right to vote such shares and to receive any dividends declared with respect to such shares; provided, however, that except as
provided in the applicable Award Agreement, any dividends declared during the Restricted Period with respect to such shares shall only become payable if (and to the extent) the underlying Restricted Shares vest. Except as provided in the
applicable Award Agreement, the Participant shall generally not have the rights of a shareholder with respect to Ordinary Shares subject to Restricted Share Units during the Restricted Period; provided, however, that,
subject to Section 409A of the Code, an amount equal to any dividends declared during the Restricted Period with respect to the number of Ordinary Shares covered by Restricted Share Units may, to the extent set forth in an Award
Agreement, be provided to the Participant at the time (and to the extent) that Ordinary Shares in respect of the related Restricted Share Units are delivered to the Participant.
|
|
(d)
|
Termination of Employment or Service. The rights of Participants granted Restricted Share or Restricted Share Units upon
termination of employment or service with the Company and all Affiliates thereof for any reason during the Restricted Period shall be set forth in the Award Agreement.
|
|
(e)
|
Other Change in Employment or Service Status. The vesting of a Restricted Share or Restricted Share Unit may be suspended
and/or an award may be terminated due to leaves of absence, including unpaid and un-protected leaves of absence, changes from full-time to part-time employment, partial Disability or other changes in the employment status or service
status of a Participant, in the discretion of the Administrator. In the event of the death of a Participant who has been granted one or more Restricted
|
|
(f)
|
Form of Settlement. The Administrator reserves the right in its sole discretion to provide (either at or after the grant
thereof) that any Restricted Share Unit represents the right to receive the amount of cash per unit that is determined by the Administrator in connection with the Award, to the extent set forth in the Award Agreement.
|
|
(a)
|
Notwithstanding anything herein to the contrary, the obligation of the Company to sell or deliver Ordinary Shares with respect to
any Award granted under the Plan shall be subject to all applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining
|
|
(b)
|
Each Award is subject to the requirement that, if at any time the Administrator determines that the listing, registration or
qualification of Ordinary Shares issuable pursuant to the Plan is required by any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body is necessary or desirable as a
condition of, or in connection with, the grant of an Award or the issuance of Ordinary Shares, no such Award shall be granted or payment made or Ordinary Share issued, in whole or in part, unless such listing, registration, qualification,
consent or approval has been effected or obtained free of any conditions not acceptable to the Administrator.
|
|
(c)
|
In the event that the disposition of Ordinary Share acquired pursuant to the Plan is not covered by a then current registration
statement under the Securities Act and is not otherwise exempt from such registration, such Ordinary Share shall be restricted against transfer to the extent required by the Securities Act or regulations thereunder, and the Administrator
may require a Participant receiving Ordinary Share pursuant to the Plan, as a condition precedent to receipt of such Ordinary Share, to represent to the Company in writing that the Ordinary Share acquired by such Participant is acquired
for investment only and not with a view to distribution.
|
|
(a)
|
Each Award granted under the Plan shall be subject to any applicable recoupment terms and conditions as set forth in the Award
Agreement and/or applicable recoupment policy maintained by the Company or any of its Affiliates as in effect from time to time. In the event of the termination of a Participant’s employment or service for Cause, as defined herein, the
Administrator has the authority, in its sole and
|
|
(b)
|
Notwithstanding any other provisions in this Plan, any Award which is subject to recovery under any law, government regulation or
stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement (or any policy adopted by the Company
pursuant to any such law, government regulation or stock exchange listing requirement).
|
| WHEREAS, |
at the request of Pagaya Technologies Ltd. (“Pagaya”), you served in the past, are currently serving or will serve in the future as an “Office Holder” (“nosse misra”) of Pagaya, as such term is defined in Section 1 of the Israeli Companies Law, 5759-1999 (the “Companies Law”); and
|
| WHEREAS, |
both Pagaya and you recognize the increased risk of litigation and other claims being asserted against Office Holders of companies and that highly competent persons have become more reluctant to serve corporations
as directors and officers or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification against inordinate risks of claims and actions against them arising out of their service to, and
activities on behalf of, companies; and
|
| WHEREAS, |
Pagaya has determined that (i) the increased difficulty in attracting and retaining competent persons is detrimental to the best interests of Pagaya’s shareholders and that Pagaya should act to assure such persons
that there will be increased certainty of such protection in the future, and (ii) it is reasonable, prudent and necessary for Pagaya to contractually obligate itself to indemnify, and to advance expenses on behalf of, such persons to the
fullest extent permitted by applicable law, so that they will serve or continue to serve Pagaya free from undue concern that they will not be so indemnified; and
|
| WHEREAS, |
Article 65 of Pagaya’s Articles of Association provides that Pagaya may indemnify its Office Holders to the maximum extent permitted by applicable law, and Article 66 of Pagaya’s Articles of Association provides
that Pagaya may exculpate its Office Holders to the maximum extent permitted by applicable law; and
|
| WHEREAS, |
in recognition of your need for substantial protection against personal liability in order to assure your continued service to Pagaya in an effective manner and, in part, in order to provide you with specific
contractual assurance that the indemnification, insurance and exculpation afforded by Pagaya’s Articles of Association will be available to you, Pagaya wishes to undertake in this Indemnification, Insurance and Exculpation Undertaking (this “Undertaking”) to indemnify you and to advance expenses to you to the maximum extent permitted by applicable law and as set forth in this
Undertaking and provide for insurance and exculpation of you as set forth in this Undertaking; and
|
| WHEREAS, |
on May [●], 2022, Pagaya’s shareholders in general meeting approved the issuance of this Undertaking;
|
| THEREFORE, |
Pagaya hereby confirms to you that:
|
| I. |
Indemnification
|
| a. |
Financial liability imposed on you in favor of any person pursuant to a judgment, including a judgment rendered in the context of a settlement or an arbitration award confirmed by a court. For purposes
of Section 1 of this Undertaking, the term “person” shall include a natural person, firm, partnership, joint venture, trust, company, corporation, limited liability entity, unincorporated organization,
estate, government, municipality, or any political, governmental, regulatory or similar agency or body.
|
| b. |
Reasonable litigation expenses, including attorneys’ fees, incurred by you as a result of an investigation or any proceeding instituted against you by an authority that is authorized to conduct an investigation or
proceeding, and that was concluded without the filing of an indictment against you in a matter in which a criminal investigation has been instigated and without there being imposed on you a financial obligation in lieu of a criminal
proceeding, or that was concluded without the filing of an indictment against you in a matter in which a criminal investigation has been instigated but with the imposition of a financial obligation in lieu of a criminal proceeding with
respect to an offense that does not require proof of mens rea, or in connection with a financial sanction. In this paragraph:
|
| i. |
“conclusion of a proceeding without the filing of an indictment in a matter in which a criminal investigation has been instigated” – shall have the meaning specified in
Section 260(a)(1A) of the Companies Law;
|
| ii. |
“financial obligation in lieu of a criminal proceeding” – a financial liability imposed by applicable law in lieu of a criminal proceeding, including an administrative fine under the Administrative Offenses Law,
5746-1985, a fine for an offense categorized as a fine-bearing offense under the provisions of the Criminal Procedure Law, a financial sanction or a penalty;
|
| c. |
Reasonable litigation expenses, including attorneys’ fees, incurred by you, or assessed against you by a court, in a proceeding instituted against you by Pagaya or on its behalf or by another person, or in a
criminal charge from which you are acquitted or in which you are convicted of an offense that does not require proof of mens rea.
|
| d. |
Expenses incurred by you in connection with a proceeding pursuant to Article D of Chapter Four of Part Nine of the Companies Law, as amended from time to time, including reasonable litigation expenses, and including
attorneys’ fees.
|
| e. |
Expenses incurred by you in connection with a proceeding under the Israeli Economic Competition Law, 5748-1988, which is conducted with respect to you, including reasonable litigation expenses, and including
attorneys’ fees.
|
| f. |
Any other liability or other expense for which it is permitted or will be permitted by applicable law to indemnify you, including in accordance with Section 56h(b)(1) of the Israeli Securities Law,
5728-1968.
|
| a. |
actions or omissions deriving from Pagaya being public or traded on a stock exchange, or relating to an offer to the public or the public or private issuance of securities of Pagaya by Pagaya or by a shareholder,
whether such liabilities and expenses relate to the securities laws of the United States, of Israel or of any other jurisdiction;
|
| b. |
any claims that matters that were required to be included in public disclosures were not disclosed as required by applicable law, whether such liabilities and expenses relate to the securities laws of the United
States, of Israel or of any other jurisdiction;
|
| c. |
your actions or omissions in a Corporate Capacity relating to the operations and management of Pagaya;
|
| d. |
actions or omissions in connection with investments Pagaya makes in other entities, whether before or after the investment is made, for the purpose of entering into, effecting, developing, monitoring and supervising
the transaction;
|
| e. |
actions or omissions relating to the purchase or sale of companies, legal entities or their assets, their splitting or merging;
|
| f. |
any sale, purchase or holding of marketable securities, or other investments for or on behalf of Pagaya;
|
| g. |
actions or omissions relating to patents, trademarks, copyrights and other intellectual property of Pagaya, including their protection, including by registration
or assertion of rights to intellectual property and the defense of claims relating thereof;
|
| h. |
actions or omissions relating to Pagaya’s labor relations or Pagaya’s commercial relationships, including with employees, independent contractors, customers, suppliers and other service providers;
|
| i. |
any “Transaction” as defined in Section 1 of the Companies Law;
|
| j. |
actions or omissions relating to the distribution of dividends or repurchase of shares or returns of capital or loans of Pagaya;
|
| k. |
actions or omissions relating to tender offers, including actions relating to delivery of opinions in relation thereto, of Pagaya;
|
| l. |
actions or omissions relating to a merger or restructuring of Pagaya;
|
| m. |
actions or omissions relating to environmental matters;
|
| n. |
actions or omissions in connection with any restrictive trade practice or monopolies of Pagaya;
|
| o. |
actions or omissions in connection with an affiliated company;
|
| p. |
actions or omissions in connection with the testing of products developed by Pagaya or in connection with the distribution, sale, license and use of such products;
|
| q. |
actions or omissions in connection with the preparation and approval of financial or tax statements of Pagaya, including any action, consent or approval related to or arising from the foregoing,
including engagement of or execution of certificates for the benefit of third parties related to the financial statements;
|
| r. |
management of Pagaya’s bank accounts, including money management, foreign currency deposits, securities, loans and credit facilities, credit cards, bank guarantees, letters of credit, consultation agreements concerning investments
including with portfolio managers, hedging transactions, options, futures, and the like;
|
| s. |
actions or omissions taken pursuant to or in accordance with the policies and procedures of Pagaya, whether such policies and procedures are published or not;
|
| t. |
representations and warranties made in good faith in connection with the business of Pagaya;
|
| u. |
any claim or demand made by any lenders or other creditors or for monies borrowed by, or other indebtedness of Pagaya;
|
| v. |
any claim or demand made directly or indirectly in connection with complete or partial failure by Pagaya, or its respective directors, officers and employees, to pay, report, keep applicable records or otherwise, any state, municipal or
foreign taxes or other mandatory payments of any nature whatsoever, including income, sales, use, transfer, excise, value added, registration, severance, stamp, occupation, customs, duties, real property, personal property, capital stock,
social security, unemployment, disability, payroll or employee withholding or other withholding, including any interest, penalty or addition thereto, whether disputed or not;
|
| w. |
claims in connection with laws and regulations regarding invasion of privacy, including with respect to databases, and laws and regulations in regard of slander;
|
| x. |
claims by any third party suffering any personal injury or any property damage to business or personal property through any act or omission attributed to Pagaya, or its employees, agents or other persons acting or allegedly acting on their
behalf, including failure to make proper safety arrangements for Pagaya or its employees and liabilities arising from any accidental or continuous damage or harm to Pagaya’s employees, its contractors, its guests and visitors as a result of
an accidental or continuous event, or employment conditions, permanent or temporary, in Pagaya’s offices;
|
| y. |
claims relating to participation or non-participation at Pagaya’s board meetings, or bona fide expression of opinion or voting or abstention from voting at such board meetings including, in each case, any committee thereof, as well as
expression of any opinion publicly in connection with service as an Office Holder;
|
| z. |
violations of or failure to comply with securities laws, and any regulations or other rules promulgated thereunder, of any jurisdiction, including claims under the U.S. Securities Act of 1933, as amended, or the U.S. Securities Exchange
Act of 1934, as amended, or under the Israeli Securities Law, 5728-1968, fraudulent disclosure claims, failure to comply with any securities authority or any stock exchange disclosure or other rules and any other claims relating to
relationships with investors, debt holders, shareholders, optionholders, holders of any other equity or debt instrument of Pagaya, and otherwise with the investment community (including any such claims relating to merger, change in control,
issuances of securities, restructuring, spin out, spin off, divestiture, recapitalization or any other transaction relating to the corporate structure or organization of Pagaya); claims relating to or arising out of financing arrangements,
any breach of financial covenants or other obligations towards investors, lenders or debt holders, class actions, violations of laws requiring Pagaya to obtain regulatory and governmental licenses, permits and authorizations in any
jurisdiction, including in connection with disclosure, offering or other transaction related documents; actions taken in connection with the issuance, purchase, holding or disposition of any type of securities of Pagaya, including the grant
of options, warrants or other rights to purchase any of the same or any offering of Pagaya’s securities (whether on behalf of Pagaya or on behalf of any holders of securities of Pagaya) to private investors, underwriters, resellers or to the
public, and listing of such securities, or the offer by Pagaya to purchase securities from the public or from private investors or other holders, and any undertakings, representations, warranties and other obligations related to any of the
foregoing or to Pagaya’s status as a public company or as an issuer of securities; and
|
| aa. |
any administrative, regulatory or judicial actions, orders, decrees, suits, demands, demand letters, directives, claims, liens, investigations, proceedings or notices of noncompliance or violation by any governmental or regulatory entity
or authority or any other person alleging the failure to comply with any statute, law, ordinance, rule, regulation, order or decree of any governmental entity applicable to Pagaya or any of its businesses, assets or operations, or the terms
and conditions of any operating certificate or licensing agreement.
|
| a. |
breach of the duty of loyalty, unless you acted in good faith and had a reasonable basis to assume that such action would not prejudice the best interests of Pagaya;
|
| b. |
intentional or reckless breach of the duty of care, but specifically excluding negligence;
|
| c. |
an action taken with the intention to unlawfully gain personal profit; or
|
| d. |
any fine, civil fine, financial sanction or penalty imposed on you.
|
| a. |
The maximum aggregate amount of indemnification to be paid by Pagaya to all Office Holders who are entitled to indemnification, whether in advance or retroactively, according to all the indemnification
undertakings that Pagaya will grant to the Office Holders (including indemnification undertakings granted to Office Holders of its direct and indirect subsidiaries), if and to the extent it will grant the same, shall not exceed, in the
aggregate, the greater of (i) 25% of shareholders’ equity (as reported in Pagaya’s last published consolidated financial statements, as of the date of each payment in respect of the indemnification undertakings), (ii) US$100 million, (iii) 10% of the total market capitalization of Pagaya (calculated as the average closing price of Pagaya’s ordinary shares over the 30 trading days prior to the date of each payment in respect of the
indemnification undertakings multiplied by the total number of issued and outstanding shares of Pagaya as of the date of each payment), and (iv) in connection with or arising out of a public offering of Pagaya’s securities, the aggregate
amount of proceeds from the sale of, or value exchanged in relation to, such securities by Pagaya and/or any shareholder in such offering (the “Maximum Indemnification Amount”).
|
| b. |
If the total of the amounts for which all Office Holders are entitled to indemnification exceeds the Maximum Indemnification Amount, each relevant Office Holder, including you, will receive indemnification based on
the ratio between the amount for which such Office Holder is liable and the aggregate amount for which all Office Holders are liable with respect to such matter.
|
| c. |
In the event that you receive indemnification from an insurer in accordance with a directors and officers liability insurance policy with respect to a matter that is the subject of indemnification, the
indemnification shall be granted in the amount of the difference between the indemnification due to the Office Holder according to this Undertaking for such indemnification, and the amount received from the insurer in respect of such matter,
provided that the indemnification amount to which Pagaya has committed does not exceed the Maximum Indemnification Amount. In the event that you receive indemnification from the insurer as stated, Pagaya’s liability shall not be reduced
according to this Undertaking and the amounts of the total indemnification may be beyond the amounts received from the insurance company up to the Maximum Indemnification Amount.
|
| a. |
You shall notify Pagaya of any judicial or administrative proceeding (“Legal Proceeding”) that may be initiated
against you, and of any suspicion or threat that any such Legal Proceeding may be initiated against you, promptly after you first become aware of it, and you shall forward to Pagaya or to whomever is designated by Pagaya, without delay, any
document you receive in connection with such proceeding. The failure to so notify Pagaya shall not relieve Pagaya of any obligation which it may have to the you under this Undertaking, or otherwise, unless and only to the extent
that such failure or delay materially prejudices Pagaya.
|
| b. |
Pagaya shall be entitled to assume your legal defense of such Legal Proceeding or to turn over such defense to any counsel selected by Pagaya for this purpose.
|
| c. |
Pagaya or such counsel shall be exclusively entitled to conduct your legal defense and to conclude such proceeding as they deem fit. At the request of Pagaya, you shall sign any document authorizing Pagaya or such
counsel to handle your defense in such proceeding and to represent you in all matters related thereto, in accordance with the above. Pagaya shall not be liable to indemnify you under this Undertaking for any amounts or expenses paid in
connection with a settlement of any action, claim or otherwise, effected by you without Pagaya’s prior written consent.
|
| d. |
If Pagaya acts in accordance with the provisions of subsection (c) above and you enable it to do so, Pagaya will cover all the other expenses and payments that are involved so that you will not be required to pay or
finance them yourself, without this detracting from the indemnification to which you are entitled pursuant to this Undertaking.
|
| e. |
You shall fully cooperate with Pagaya or any such counsel as may be required of you by any of them as part of their dealing with such Legal Proceeding, provided that Pagaya will cover all expenses involved so that
you will not be required to pay or finance them yourself.
|
| 6. |
Legal Proceeding Involving Pagaya. Pagaya may, from time to time, ask you to participate in or otherwise assist in a Legal Proceeding brought by, against
or otherwise involving Pagaya. In such case, Pagaya will advance or promptly reimburse your reasonable expenses incurred in connection with your participation or assistance in such Legal Proceeding, subject to such guidelines and procedures
as may be established by Pagaya from time to time. Pagaya’s obligations under this Section 6 shall not be subject to the provisions or limitations of Sections 1 through 5 above.
|
| II. |
Insurance
|
| III. |
Exculpation
|
| IV. |
Validity of the Undertaking
|
| V. |
Miscellaneous
|
|
|
Sincerely,
|
|
|
|
|
|
|
|
Pagaya Technologies Ltd.
|
|
|
I agree to the conditions of the above
Indemnification, Insurance and Exculpation Undertaking
|
|
|
|
|
|
Signature of the Recipient of the
Indemnification, Insurance and Exculpation Undertaking
|
|
|
|
|
|
|
|
Page
|
||
|
ARTICLE I DEFINITIONS
|
1
|
|
|
SECTION 1.01.
|
Defined Terms
|
1
|
|
SECTION 1.02.
|
Classification of Loans and Borrowings
|
28
|
|
SECTION 1.03.
|
Terms Generally
|
29
|
|
SECTION 1.04.
|
Accounting Terms; GAAP; Pro Forma Calculations
|
29
|
|
SECTION 1.05.
|
Interest Rates; Benchmark Notification
|
30
|
|
SECTION 1.06.
|
[Reserved]
|
30
|
|
SECTION 1.07.
|
Divisions
|
30
|
|
ARTICLE II THE CREDITS
|
30
|
|
|
SECTION 2.01.
|
Commitments
|
30
|
|
SECTION 2.02.
|
Loans and Borrowings
|
31
|
|
SECTION 2.03.
|
Requests for Revolving Borrowings
|
31
|
|
SECTION 2.04.
|
[Reserved]
|
32
|
|
SECTION 2.05.
|
[Reserved]
|
32
|
|
SECTION 2.06.
|
[Reserved]
|
32
|
|
SECTION 2.07.
|
Funding of Borrowings
|
32
|
|
SECTION 2.08.
|
Interest Elections
|
32
|
|
SECTION 2.09.
|
Termination and Reduction of Commitments
|
33
|
|
SECTION 2.10.
|
Repayment of Loans; Evidence of Debt
|
34
|
|
SECTION 2.11.
|
Prepayment of Loans
|
34
|
|
SECTION 2.12.
|
Fees
|
35
|
|
SECTION 2.13.
|
Interest
|
35
|
|
SECTION 2.14.
|
Alternate Rate of Interest
|
36
|
|
SECTION 2.15.
|
Increased Costs
|
38
|
|
SECTION 2.16.
|
Break Funding Payments
|
40
|
|
SECTION 2.17.
|
Taxes
|
40
|
|
SECTION 2.18.
|
Payments Generally; Allocations of Proceeds; Pro Rata Treatment; Sharing of Setoffs
|
44 |
|
SECTION 2.19.
|
Mitigation Obligations; Replacement of Lenders
|
46
|
|
SECTION 2.20.
|
[Reserved]
|
46
|
|
SECTION 2.21.
|
Defaulting Lenders
|
47
|
|
ARTICLE III REPRESENTATIONS AND WARRANTIES
|
47
|
|
|
SECTION 3.01.
|
Organization; Powers; Subsidiaries
|
47
|
|
SECTION 3.02.
|
Authorization; Enforceability
|
48
|
|
SECTION 3.03.
|
Governmental Approvals; No Conflicts
|
48
|
|
SECTION 3.04.
|
Financial Condition; No Material Adverse Change
|
48
|
|
SECTION 3.05.
|
Properties
|
48
|
|
SECTION 3.06.
|
Litigation and Environmental Matters
|
49
|
|
SECTION 3.07.
|
Compliance with Laws and Agreements
|
49
|
|
SECTION 3.08.
|
Investment Company Status
|
49
|
|
SECTION 3.09.
|
Taxes
|
49
|
|
SECTION 3.10.
|
ERISA
|
49
|
|
SECTION 3.11.
|
Disclosure
|
49
|
|
SECTION 3.12.
|
Liens
|
50
|
|
SECTION 3.13.
|
No Default
|
50
|
|
Page
|
||
|
SECTION 3.14.
|
Solvency
|
50
|
|
SECTION 3.15.
|
Insurance
|
50
|
|
SECTION 3.16.
|
[Reserved]
|
50
|
|
SECTION 3.17.
|
Anti-Corruption Laws and Sanctions
|
50
|
|
SECTION 3.18.
|
Affected Financial Institutions
|
50
|
|
SECTION 3.19.
|
Plan Assets; Prohibited Transactions
|
50
|
|
SECTION 3.20.
|
Margin Regulations
|
51
|
|
SECTION 3.21.
|
Breaching Company
|
51
|
|
SECTION 3.22.
|
IIA and Investment Center
|
51
|
|
ARTICLE IV CONDITIONS
|
51
|
|
|
SECTION 4.01.
|
Effective Date
|
51
|
|
SECTION 4.02.
|
Each Credit Event
|
52
|
|
ARTICLE V AFFIRMATIVE COVENANTS
|
53
|
|
|
SECTION 5.01.
|
Financial Statements and Other Information
|
53
|
|
SECTION 5.02.
|
Notices of Material Events
|
55
|
|
SECTION 5.03.
|
Existence; Conduct of Business
|
55
|
|
SECTION 5.04.
|
Payment of Taxes
|
55
|
|
SECTION 5.05.
|
Maintenance of Properties; Insurance
|
56
|
|
SECTION 5.06.
|
Books and Records; Inspection Rights
|
56
|
|
SECTION 5.07.
|
Compliance with Laws
|
56
|
|
SECTION 5.08.
|
Use of Proceeds
|
57
|
|
SECTION 5.09.
|
Maintenance of Collateral Account
|
57
|
|
SECTION 5.10.
|
Post-Closing Obligations
|
57
|
|
SECTION 5.11.
|
Grants
|
57
|
|
ARTICLE VI NEGATIVE COVENANTS
|
57
|
|
|
SECTION 6.01.
|
Indebtedness
|
57
|
|
SECTION 6.02.
|
Liens
|
59
|
|
SECTION 6.03.
|
Fundamental Changes
|
62
|
|
SECTION 6.04.
|
Dispositions
|
63
|
|
SECTION 6.05.
|
Investments, Loans, Advances, Guarantees and Acquisitions
|
64
|
|
SECTION 6.06.
|
Swap Agreements
|
66
|
|
SECTION 6.07.
|
Transactions with Affiliates
|
66
|
|
SECTION 6.08.
|
Restricted Payments
|
67
|
|
SECTION 6.09.
|
Restrictive Agreements
|
68
|
|
SECTION 6.10.
|
Subordinated Indebtedness and Amendments to Subordinated Indebtedness Documents
|
68
|
|
SECTION 6.11.
|
Sale and Leaseback Transactions
|
69
|
|
SECTION 6.12.
|
Financial Covenants
|
69
|
|
ARTICLE VII EVENTS OF DEFAULT
|
69
|
|
|
SECTION 7.01.
|
Events of Default
|
69
|
|
SECTION 7.02.
|
Remedies Upon an Event of Default
|
71
|
|
SECTION 7.03.
|
Application of Payments
|
73
|
|
Page
|
||
|
ARTICLE VIII THE ADMINISTRATIVE AGENT
|
73
|
|
|
SECTION 8.01.
|
Authorization and Action
|
73
|
|
SECTION 8.02.
|
Administrative Agent’s Reliance, Limitation of Liability, Etc
|
76
|
|
SECTION 8.03.
|
Posting of Communications
|
77
|
|
SECTION 8.04.
|
The Administrative Agent Individually
|
78
|
|
SECTION 8.05.
|
Successor Administrative Agent
|
78
|
|
SECTION 8.06.
|
Acknowledgements of Lenders
|
79
|
|
SECTION 8.07.
|
Collateral Matters.
|
81
|
|
SECTION 8.08.
|
Credit Bidding
|
83
|
|
SECTION 8.09.
|
Certain ERISA Matters
|
83
|
|
ARTICLE IX MISCELLANEOUS
|
84
|
|
|
SECTION 9.01.
|
Notices
|
84
|
|
SECTION 9.02.
|
Waivers; Amendments
|
85
|
|
SECTION 9.03.
|
Expenses; Limitation of Liability; Indemnity, Etc
|
88
|
|
SECTION 9.04.
|
Successors and Assigns
|
90
|
|
SECTION 9.05.
|
Survival
|
93
|
|
SECTION 9.06.
|
Counterparts; Integration; Effectiveness; Electronic Execution
|
94
|
|
SECTION 9.07.
|
Severability
|
94
|
|
SECTION 9.08.
|
Right of Setoff
|
94
|
|
SECTION 9.09.
|
Governing Law; Jurisdiction; Consent to Service of Process
|
95
|
|
SECTION 9.10.
|
WAIVER OF JURY TRIAL
|
95
|
|
SECTION 9.11.
|
Headings
|
96
|
|
SECTION 9.12.
|
Confidentiality
|
96
|
|
SECTION 9.13.
|
USA PATRIOT Act
|
97
|
|
SECTION 9.14.
|
[Reserved]
|
97
|
|
SECTION 9.15.
|
Appointment for Perfection
|
97
|
|
SECTION 9.16.
|
Interest Rate Limitation
|
97
|
|
SECTION 9.17.
|
No Fiduciary Duty, etc
|
97
|
|
SECTION 9.18.
|
Acknowledgement and Consent to Bail-In of Affected Financial Institutions
|
98
|
|
SECTION 9.19.
|
Acknowledgement Regarding Any Supported QFCs
|
99
|
|
SECTION 9.20.
|
Judgment Currency
|
99
|
|
ARTICLE X CONSENT TO DE-SPAC TRANSACTION AND THE RESTRUCTURING
|
100
|
|
| |
Page |
|
SCHEDULES:
|
|
|
Schedule 2.01 – Commitments
|
|
|
Schedule 6.01 – Existing Indebtedness
|
|
|
Schedule 6.02 – Existing Liens
|
|
|
Schedule 6.05 – Existing Investments
|
|
|
Schedule 6.07 – Transaction with Affiliates
|
|
|
Schedule 6.09 – Restrictive Agreements
|
|
|
EXHIBITS:
|
|
|
Exhibit A – Assignment and Assumption
|
|
|
Exhibit B – Form of Monthly Compliance Certificate
|
|
|
Exhibit C – Compliance Certificate
|
|
|
Exhibit D – [Reserved]
|
|
|
Exhibit E – List of Closing Documents
|
|
|
Exhibit F – Form of Prepayment Notice
|
|
|
Exhibit G-1 – Form of Borrowing Request
|
|
|
Exhibit G-2 – Form of Interest Election Request
|
|
|
Exhibit H – Form of Note
|
|
PAGAYA TECHNOLOGIES LTD.,
as the Borrower
|
||
|
By
|
/s/ Gal Krubiner
|
|
|
Name: Gal Krubiner
|
||
|
Title: Chief Executive Officer
|
||
|
By
|
/s/ Michael Kurlander
|
|
|
Name: Michael Kurlander
|
||
|
Title: Chief Financial Officer
|
|
JPMORGAN CHASE BANK, N.A., individually as a Lender and as Administrative Agent
|
||
|
By
|
/s/ Stephanie Lis
|
|
|
Name: Stephanie Lis
|
||
|
Title: Authorized Officer
|
||
|
Bank Leumi Le-Israel B.M., as a Lender
|
||
|
By
|
/s/ Delia Pekelman
|
|
|
Name: Delia Pekelman
|
||
|
Title: Deputy Head
|
|
By
|
/s/ Moran Aizikovich
|
|
|
Name: Moran Aizikovich
|
||
|
Title: Relationship Manager
|
|
Bank Leumi USA, as a Lender
|
||
|
By
|
/s/ Daniel Lorberbaum
|
|
|
Name: Daniel Lorberbaum
|
||
|
Title: AVP
|
||
|
By
|
/s/ Tal Shpaizer
|
|
|
Name: Tal Shpaizer
|
||
|
Title: SVP
|
|
Barclays Bank PLC, as a Lender
|
||
|
By
|
/s/ Evan Moriarty
|
|
|
Name: Evan Moriarty
|
||
|
Title: Vice President
|
||
|
HSBC Bank USA, National Association, as a Lender
|
||
|
By
|
/s/ Kyle O’Reilly
|
|
|
Name: Kyle O’Reilly
|
||
|
Title: Vice President #23203
|
||
| Schedule 2.01 |
Commitments
|
| Schedule 6.01 |
Existing Indebtedness
|
| Schedule 6.02 |
Existing Liens
|
| Schedule 6.05 |
Existing Investments
|
| Schedule 6.07 |
Transactions with Affiliates
|
| Schedule 6.09 |
Restrictive Agreements
|
|
Lenders
|
Revolving Credit Commitment
|
|
JPMorgan Chase Bank, N.A.
|
$40,000,000.00
|
|
Bank Leumi Le-Israel B.M.
|
$30,000,000.00
|
|
Bank Leumi USA
|
$30,000,000.00
|
|
Barclays Bank PLC
|
$30,000,000.00
|
|
HSBC Bank USA, National Association
|
$20,000,000.00
|
|
Total
|
$150,000,000.00
|
| 1. |
Pagaya US Holding Company LLC (“PUSHC”), through its indirect subsidiary RRRR Structured Holdings Repo Seller LLC (the “Repo Seller”), has financed $****** of retained notes from two securitization transactions through a
structured repurchase facility. The notes were retained by PUSHC to comply with its obligations under the U.S. risk retention rule. PUSHC has guaranteed the obligations of the Repo Seller to comply with its obligations under the U.S. risk
retention rule.
|
| 1. |
Pledge #4, Secured Amount: ILS ******, created 15 May 2019, registered: 22 Aug 2019, Pledged Asset: Deposit and Account #****** with Bank Leumi Branch #864.
|
| 2. |
Pledge #5, Secured Amount: ILS ******, created 5 Feb 2020, registered: 17 Feb 2020, Pledged Asset: Deposit and Account #****** with Bank Leumi Branch #864.
|
| 3. |
Pledge #6, Secured Amount: ILS ******, created 29 Oct 2020, registered: 16 Nov 2020, Pledged Asset: Deposit and Account #****** with Bank Leumi Branch #864.
|
| 4. |
Pledge #7, Secured Amount: ILS ******, created 2 May 2021, registered: 27 May 2021, Pledged Asset: Deposit and Account #****** with Bank Leumi Branch #864.
|
| 5. |
Pledge #8, Secured Amount: ILS ******, created 17 Aug 2021, registered: 25 Aug 2021, Pledged Asset: Deposit and Account #****** with Bank Leumi Branch #864.
|
|
1.
|
Assignor:
|
|
|
2.
|
Assignee:
|
|
| [and is an Affiliate/Approved Fund of [identify Lender]1] |
||
|
3.
|
Borrower(s):
|
Pagaya Technologies Ltd.
|
|
4.
|
Administrative Agent:
|
JPMorgan Chase Bank, N.A., as the administrative agent under the Credit Agreement
|
|
5.
|
Credit Agreement:
|
The Credit Agreement, dated as of December 23, 2021, among Pagaya Technologies Ltd., the Lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and the other agents
parties thereto
|
|
Aggregate Amount of
Commitment/Loans for
all Lenders
|
Amount of
Commitment/Loans
Assigned
|
Percentage
Assigned of
Commitment/Loans2
|
|
$
|
$
|
%
|
|
$
|
$
|
%
|
|
$
|
$
|
%
|
|
ASSIGNOR
|
||
|
[NAME OF ASSIGNOR]
|
||
|
By:
|
||
|
Title:
|
||
|
ASSIGNEE
|
||
|
[NAME OF ASSIGNEE]
|
||
|
By:
|
||
|
Title:
|
||
|
Consented to and Accepted:
|
||
|
JPMORGAN CHASE BANK, N.A., as
|
||
|
Administrative Agent
|
||
|
By:
|
||
|
Title:
|
||
|
[Consented to:
|
||
|
PAGAYA TECHNOLOGIES LTD.
|
||
|
By:
|
||
|
Title: ]3
|
||
|
I
|
Cash
|
$_____________
|
|
|
|
|
|
|
Plus
|
|
|
II
|
Cash Equivalents (to the extent owned by the Borrower or any of its Subsidiaries), equals the sum of:
|
$_____________
|
|
|
(a) direct obligations (or certificates representing an interest in such obligations) issued by, or unconditionally guaranteed by, the
government of the United States (including, in each case, any agency or instrumentality thereof), as the case may be, the payment of which is backed by the full faith and credit of the United States, and which are not callable or
redeemable at the issuer’s option
|
$_____________
|
|
|
(b) overnight bank deposits, time deposit accounts, certificates of deposit, banker’s acceptances and money market deposits with maturities (and
similar instruments) of 12 months or less from the date of acquisition issued by a bank or trust company which is organized under, or authorized to operate as a bank or trust company under, the Laws of the United States or any state
thereof; provided that such bank or trust company has capital, surplus and
undivided profits aggregating in excess of $250,000,000 (or the foreign currency equivalent thereof) and whose long-term debt is rated (i) in the case of any such institution that is, as of the Effective Date, a Lender hereunder, Baa-2 or
higher by Moody’s or BBB or higher by S&P or the equivalent rating category of another internationally recognized rating agency or (ii) in all other cases, A-1 or higher by Moody’s or A+ or higher by S&P or the equivalent rating
category of another internationally recognized rating agency
|
$_____________
|
|
|
(c) commercial paper having one of the two highest ratings obtainable from Moody’s or S&P and, in each case, maturing within one year after
the date of acquisition
|
$_____________
|
|
|
(d) marketable short-term money market and similar funds (including such funds investing a portion of their assets in municipal securities)
having a rating of at least P‑1 or A‑1 from either Moody’s or S&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical
rating agency selected by the Borrower)
|
$_____________
|
|
|
(e) repurchase obligations with a term of not more than 30 days for underlying Investments of the types described in clauses (a) and (b) above entered into with any financial institution meeting the qualifications specified in clause (b) above
|
$_____________
|
|
|
(f) Investments, classified in accordance with GAAP as “current assets” of the Borrower or any of its Subsidiaries, in money market investment
programs, which are administered by financial institutions having capital of at least $250,000,000 (or the foreign currency equivalent thereof), and the portfolios of which are limited such that at least 95% of such investments are of the
character, quality and maturity described in clauses (a) through (e) above
|
$_____________
|
|
|
(g) (x) such local currencies in those countries in which the Borrower or any of its Subsidiaries transacts business from time to time in the
ordinary course of business and (y) investments of comparable tenor and credit quality to those described in the foregoing clauses (a) through (g) denominated in Euros or pound sterling or any other foreign currency customarily utilized in countries in which the Borrower or any of its Subsidiaries transacts
business from time to time in the ordinary course of business
|
$_____________
|
|
|
|
|
|
|
Plus
|
|
|
III
|
To the extent not duplicative of any item set forth in (II) above, Cash and Cash Equivalents on deposit in the Collateral Account in excess of
the Cash Collateral Amount5
|
$_____________
|
|
|
|
|
|
|
Less
|
|
|
IV
|
Cash and Cash Equivalents subject to any Lien (other than Liens of the type described in clause (h) of the definition of “Permitted Encumbrances”6)
|
$_____________
|
|
|
|
|
|
|
Adjusted Cash + Cash Equivalents (I + II + III – IV):
|
$_____________7
|
|
Very truly yours,
|
||
|
PAGAYA TECHNOLOGIES LTD.,
|
||
|
as the Borrower
|
||
|
By:
|
||
|
Name:
|
||
|
Title: Chief Financial Officer
|
||
| 1) |
To my knowledge, [no Default has occurred and is continuing.][a Default has occurred and is continuing. [Specify details thereof and any actions taken or proposed to be taken with respect thereto.]]
|
| 2) |
Set forth in Annex I hereto are reasonably detailed calculations demonstrating whether the Borrower is in compliance with Sections 6.12(a) and (c) of the Credit Agreement.
|
| 3) |
[There have been no changes to the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in such certification.][The following change(s) to the Beneficial Ownership Certification
have resulted in a change to the list of beneficial owners identified in such certification: ___________.]
|
|
Very truly yours,
|
||
|
PAGAYA TECHNOLOGIES LTD.,
|
||
|
as the Borrower
|
||
|
By:
|
||
|
Name:
|
||
|
Title: Chief Financial Officer
|
||
| 1. |
Credit Agreement (the “Credit Agreement”) by and among Pagaya Technologies Ltd., a company organized under the laws of Israel (the “Borrower”), the institutions from time to time parties
thereto as Lenders (the “Lenders”) and JPMorgan Chase Bank, N.A., in its capacity as Administrative Agent for itself and the other Lenders (the “Administrative Agent”), evidencing a revolving credit facility to the
Borrower from the Lenders in an aggregate principal amount of $150,000,000.
|
| 2. |
Notes executed by the Borrower in favor of each of the Lenders, if any, which has requested a note pursuant to Section 2.10(e) of the Credit Agreement.
|
| 3. |
Certificate of the Secretary or an Assistant Secretary of the Borrower certifying (i) that there have been no changes in the Certificate of Incorporation or other charter document of such Loan Party, as attached
thereto and as certified as of a recent date by the Secretary of State (or analogous governmental entity) of the jurisdiction of its organization, since the date of the certification thereof by such governmental entity, (ii) the By-Laws
or other applicable organizational document, as attached thereto, of the Borrower as in effect on the date of such certification, (iii) resolutions of the Board of Directors or other governing body of the Borrower authorizing the
execution, delivery and performance of each Loan Document and (iv) the names and true signatures of the incumbent officers of the Borrower authorized to sign the Loan Documents to which it is a party, and authorized to request a Borrowing
under the Credit Agreement.
|
| 4. |
Good Standing Certificate (or analogous documentation if applicable) for the Borrower from the Secretary of State (or analogous governmental entity) of the jurisdiction of its organization, to the extent
generally available in such jurisdiction.
|
| 5. |
Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Borrower.
|
| 6. |
Opinion of Goldfarb Seligman & Co., local Israel counsel for the Borrower.
|
| 7. |
A certificate, dated the Effective Date and signed by an authorized person of the Borrower, certifying (i) that the representations and warranties contained in Article III of the Credit Agreement are true and correct in all
material respects as of such date, except to the extent that such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material
respects on and as of such earlier date (or, if qualified by “materiality”, “Material Adverse Effect” or similar language, in all respects (after giving effect to such qualification)) and (ii) that no Default or Event of Default has
occurred and is continuing as of such date.
|
| I. | Cash collateral balance at date of notice: | __________________________ |
| II. |
Loan balance after giving effect to prepayment: __________________________
|
| III. | x 110% | __________________________ |
| IV. |
Requested cash collateral transfer (I. – II.) __________________________]13
|
|
Very truly yours,
|
||
|
PAGAYA TECHNOLOGIES LTD.,
|
||
|
as the Borrower
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
| 1. |
Aggregate principal amount of Borrowing:14 __________
|
| 2. |
Date of Borrowing15 (which shall be a Business Day): __________
|
| 3. |
Type of Borrowing (ABR, Term Benchmark or RFR): __________
|
| 4. |
Interest Period and the last day thereof (if a Term Benchmark Borrowing):16 __________
|
| 5. |
Location and number of the Borrower’s account or any other account agreed upon by the Administrative Agent and the Borrower to which proceeds of Borrowing are to be disbursed: __________
|
| 6. |
Cash collateral balance required:
|
| Loan balance prior to borrowing request: |
__________________________
|
| Requested borrowing: |
__________________________
|
| Adjusted loan balance: |
__________________________
|
| Additional cash collateral required: |
__________________________
|
|
Very truly yours,
|
||
|
PAGAYA TECHNOLOGIES LTD.,
|
||
|
as the Borrower
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
| 1. |
List date, Type, principal amount and Interest Period (if applicable) of existing Borrowing: __________
|
| 2. |
Aggregate principal amount of resulting Borrowing: __________
|
| 3. |
Effective date of interest election (which shall be a Business Day): __________
|
| 4. |
Type of Borrowing (ABR, Term Benchmark or RFR): __________
|
| 5. |
Interest Period and the last day thereof (if a Term Benchmark Borrowing):17 __________
|
|
Very truly yours,
|
||
|
PAGAYA TECHNOLOGIES LTD.,
|
||
|
as Borrower
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
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PAGAYA TECHNOLOGIES LTD.
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By:
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Name:
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Title:
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(a)
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The Administrative Agent (or its counsel) shall have received (i) from each party hereto a counterpart of this Amendment signed on behalf of such party (which, subject to Section 9.06 of the Existing
Credit Agreement, may include any Electronic Signatures transmitted by telecopy, emailed .pdf, or any other electronic means that reproduces an image of an actual executed signature page) and (ii) a duly executed copy of the fee letter
between the Borrower and the Augmenting Lender (the “Fee Letter”).
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(b)
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The Administrative Agent shall have received a certificate, dated the Amendment Effective Date and signed by an authorized person of the Borrower, certifying (i) that the representations and warranties contained in Article III of the
Credit Agreement are true and correct in all material respects as of such date, except to the extent that such representations and warranties specifically relate to an earlier date, in which case such representations and warranties
shall have been true and correct in all material respects on and as of such earlier date (or, if qualified by “materiality”, “Material Adverse Effect” or similar language, in all respects (after giving effect to such qualification)) and
(ii) that no Default or Event of Default has occurred and is continuing as of such date.
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(c)
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The Administrative Agent shall have received, (i) at least five (5) days prior to the Amendment Effective Date, all documentation and other information regarding the Borrower in connection with applicable
“know your customer” and anti-money laundering rules and regulations, including the Patriot Act, to the extent (I) requested by the Augmenting Lender in writing of the Borrower at least ten (10) days prior to the Amendment Effective
Date and (II) not previously delivered to the Administrative Agent and (ii) to the extent the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, at least five (5) days prior to the Amendment
Effective Date, to the extent (I) requested by the Augmenting Lender in a written notice to the Borrower at least ten (10) days prior to the Amendment Effective Date and (II) not previously delivered to the Administrative Agent, a
Beneficial Ownership Certification in relation to the Borrower shall have received such Beneficial Ownership Certification (provided that, upon the execution and delivery by such Augmenting Lender of its signature page to this
Amendment, the condition set forth in this clause (b) shall be deemed to be satisfied).
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(d)
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The Augmenting Lender shall have received all fees and other amounts due and payable to the Augmenting Lender under the Fee Letter on or prior to the Amendment Effective Date, including, to the extent
invoiced at least one (1) Business Day prior to the Amendment Effective Date, reimbursement or payment of all reasonable and documented out-of-pocket expenses required to be reimbursed or paid by the Borrower under the Credit Agreement.
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SILICON VALLEY BANK
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By:
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/s/ Jonathan Wolter
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Name:
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Jonathan Wolter
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Title:
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Managing Director
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By:
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/s/ Gal Krubiner
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Name:
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Gal Krubiner
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Title:
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Chief Executive Officer
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By:
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/s/ Michael Kurlander
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Name:
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Michael Kurlander
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Title:
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Chief Financial Officer
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By:
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/s/ Stephanie Lis
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Name:
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Stephanie Lis
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Title:
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Authorized Officer
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| 1. |
General
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| • |
advancement of the Company’s objectives and its financial goals, for the short-term and also with a long-term view;
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| • |
creating appropriate incentives for Executive Officers taking into account, inter alia, specific divisions or regions of the Company and the Company’s risk management practices;
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| • |
creating alignment between the Executive Officers’ interests and the interests of Shareholders;
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| • |
the Company’s size and the nature of its activities and markets;
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| • |
the Company’s competitive environment. The compensation of an Executive Officer will be determined after giving consideration to the terms offered to comparable executive officers in Comparable Companies (as defined below), to the extent
such information is readily available, in order to offer competitive terms and attract and retain competent and capable Executive Officers. The applicable benchmark will be determined such that the compensation of Executive Officers serving
in roles having responsibility over global operations will generally be compared to global roles, and Executive Officers serving in particular localities will generally be compared to roles in such localities. In addition, in order to attract
or retain unique talents that are considered by the Company as such, the compensation may exceed the aforementioned levels;
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| • |
the Executive Officers’ contributions to achieving the Company’s goals, to maximizing its profits and to maximizing the Company’s value, all with a long-term view and according to the various Executive Officers’ positions; and
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| • |
recruitment and retention of high-quality personnel.
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| A. |
Fixed components: Base salary,1 and may include a signing bonus, retention bonus, or a relocation bonus as well as
severance payments (retirement payment, non-competition payment or any other benefit that is given to an Executive Officer with respect to the cessation of his or her service or employment with the Company or its affiliates).
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| B. |
Variable cash components: Different types of cash bonuses, which may include annual bonuses and special bonuses.
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| C. |
Variable equity components: Stock options, shares, restricted shares, restricted share units (“RSUs”), and the like, which are issued in the framework of
equity-based award plans that have been adopted or will be adopted in the future by the Company.
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| D. |
Insurance, exculpation and indemnification: Directors and officers liability insurance (both during the ordinary course of business as well as with respect to one-time runoff events), release from
liability for Directors and Executive Officers, in advance or retroactively, and grant of an undertaking to indemnify the Director or Executive Officer in advance and retroactively.
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| 2. |
Principles for Determining Compensation
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| 2.1 |
his or her education, qualifications, expertise, professional experience, and achievements;
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| 2.2 |
his or her position, fields of responsibility, and expected contributions to achieving the Company’s goals, as well as any additional duties and positions with the Company and its affiliates;
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| 2.3 |
his or her existing and prior compensation arrangements with the Company or its affiliates, or prior employers, to the extent not prohibited by applicable law and best practices;
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| 2.4 |
the terms of compensation of executives in the Company and its affiliates at the same level;
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| 2.5 |
in the Compensation Committee’s discretion, a comparison may be made to the compensation for comparably situated executives in the relevant market, geographical location and region of activity, and the employment or compensation practices
in the industry and/or the relevant geographical location, region of activity or jurisdiction;
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| 2.6 |
his or her past performance and expected contribution to the Company’s future growth and profitability;
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| 2.7 |
the ratio between the compensation of the Executive Officer or Director and that of other employees of the Company and its affiliates; and
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| 2.8 |
any requirements prescribed by applicable law (including, for purposes of this Policy, applicable securities laws and stock exchange regulations) from time to time.
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| 3. |
Ratio Between Fixed and Variable Components; Intra-Company Compensation Ratio
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| 3.1 |
In setting the compensation of an Executive Officer, the Company will attempt to balance the mix of fixed components and variable components in order to, among other things, appropriately incentivize the Executive Officer to meet the
Company’s short and long-term goals while considering, among others, the Company’s risk management policies. To that end, the ratio between variable components out of the total compensation that the Company targets under this Policy, measured
on an annual basis is 95%.
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| 3.2 |
In the process of establishing this Policy, the Board has examined the ratio between overall compensation of each Executive Officer and the average and median salaries of the other employees (including contractors and temporary employment
agency contractors), as well as the possible ramifications of such ratio on the work environment in the Company, in order to ensure, among other things, that levels of executive compensation will not have a negative impact on the positive
work relations in the Company.
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| 4. |
The Fixed Compensation Component
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| 4.1 |
Base Salary
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| 4.1.1 |
The annual gross salary of the Executive Officers will be determined by the Compensation Committee, the Board, and, for the Chief Executive Officer of the Company (the “CEO”), the general meeting of
Shareholders if required by applicable law. The approved annual gross salary may include a mechanism for salary updates and currency conversion calculations.
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| 4.1.2 |
In determining the Executive Officer’s salary, the members of the Compensation Committee and Board may take into consideration the recommendation of the CEO, if relevant, the salaries of Executive Officers in the same position of other
publicly listed companies similar in size or character to the Company (the “Comparable Companies”), as well as the Company’s financial performance and the Executive Officer’s contribution to the
Company.
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| 4.1.3 |
In addition, the Executive Officer will be entitled to reimbursement for reasonable expenses actually paid in the context of his or her duties, upon presentation of receipts, all in accordance with Company practice. There is no cap on such
reimbursement.
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| 4.1.4 |
Notwithstanding any other provision of this Policy, the CEO may approve an amendment to the terms of service or employment (whether fixed or variable) of Executive Officers reporting to him or her (who is not also a member of the Board);
provided that (i) such amendment is not material, (ii) such amendment is consistent with the provisions of this Policy, and (iii) the aggregate effect of such amendment during the term of this Policy does not exceed three (3) months of such
Executive Officer’s salary for the applicable year. Such an immaterial amendment so approved by the CEO in accordance with this Section shall be reported to the Compensation Committee at its first meeting following such approval, and shall be
in compliance with this Policy.
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| 4.2 |
Benefits
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| 4.2.1 |
The Company shall be entitled to grant Executive Officers benefits as specified below, which shall be determined taking into account the terms customary in the market for Executive Officers in similar positions and in accordance with the
Company’s policies or those of the applicable affiliate, such as: (a) pension arrangements (including an arrangement according to the Severance Pay Law, 5723-1963) or a defined benefit plan; (b) disability insurance; (c) health insurance; (d)
contributions to an advanced study fund; (e) vacation days; (f) convalescence pay; (g) sick days; or (h) taxation gross up. In addition, Executive Officers employed outside of Israel may receive other similar, comparable or customary
benefits as applicable in the relevant jurisdiction in which he or she is employed.
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| 4.2.2 |
The Company or an applicable affiliate may offer additional benefits to Executive Officers, including mobile phones, mobile computers, Internet connection, other telecommunication and electronic devices and communication expenses, company
cars and travel benefits, housing allowance, newspaper subscriptions, participation in the cost of professional conferences, professional literature, professional liability insurance, periodic medical examinations, holiday and special
occasion gifts, academic and professional studies, and grossing up the value of the imputed benefit for tax purposes. The grant of registration rights to an Executive Officer shall not be deemed an employment benefit for any purpose.
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| 4.2.3 |
In the event of relocation or repatriation of an Executive Officer to another country or state, such Executive Officer may receive
benefits including reimbursement for reasonable out-of-pocket payments, whether one time or ongoing, such as moving expenses, housing allowance, car allowance, and home leave visits.
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| 4.3 |
Signing Bonus, Retention Bonus and Relocation Bonus
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| 4.3.1 |
The Company or an applicable affiliate shall be entitled, under circumstances to be approved by the Compensation Committee and the Board, to offer an Executive Officer a signing bonus, a retention bonus, or a bonus for relocation, all
subject to obtaining the approvals required by applicable law.
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| 4.3.2 |
In the event of hiring a new Executive Officer, the Compensation Committee and the Board may elect to pay a signing bonus. The maximum cash signing bonus payable to an Executive Officer shall not exceed twelve (12) months of such Executive
Officer’s salary. The Company shall be entitled to determine, on the date the signing bonus is granted and at the discretion of the Compensation Committee and the Board, that the Executive Officer will be required to return all or part of the
signing bonus to the Company or an applicable affiliate to the extent that he or she does not complete a minimum term of service with the Company or its affiliates.
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| 4.3.3 |
A bonus for relocation may be granted in the event an Executive Officer is relocated to a different country or state in order to work for the Company or any of its affiliates. The total bonus for relocation will not exceed the sum of the
employer’s cost for twelve (12) months of such Executive Officer’s salary and additional or related benefits in each case for the relevant year, and may be paid in cash or as share-based compensation, at the discretion of the Compensation
Committee and the Board. The above limitation excludes any reimbursement of expenses incurred by the Executive Officer in connection with such relocation as set forth in Section 4.2.3 above. The Company or its applicable affiliate shall be
entitled to determine on the date the relocation bonus is granted and at the discretion of the Compensation Committee and the Board, that the Executive Officer will be required to return all or part of the relocation bonus to the Company or
its applicable affiliate to the extent that he or she does not complete a minimum term of service with the Company or an affiliate.
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| 4.3.4 |
The total retention bonus shall not exceed the sum of the employer’s cost for twelve (12) months of such Executive Officer’s salary and additional or related benefits for the relevant year. The Company or its applicable affiliate shall be
entitled to determine, on the date the retention bonus is granted and at the discretion of the Compensation Committee and the Board, that the Executive Officer will be required to return all or part of the signing bonus to the Company or its
applicable affiliate to the extent that he or she does not complete a minimum additional term of service with the Company or its affiliates.
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| 4.4 |
Severance Pay and Retirement Payments
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| 4.4.1 |
In any event of a termination of an employment or service relationship (other than in the event of the termination of an Executive Officer under circumstances which, in the opinion of the Compensation Committee and the Board, grant the
Company or its applicable affiliate the right to terminate his or her employment without severance pay under applicable law), the Executive Officer will be entitled to severance pay to the extent required by applicable law or, alternatively,
to the amount of the payments deposited on his or her behalf with respect to severance pay into a provident fund, a pension fund or similar fund (e.g., in accordance with the provisions of Section 14 of the Israeli Severance Pay Law,
5763-1963) and, in the case of an Executive Officer whose terms of employment or service are not governed by Israeli law, the severance normally allocated in the Executive Officer’s home country, all in the discretion of the Company and its
affiliates and according to the provisions stipulated in the employment or service agreement. Such severance payments may be subject to any applicable severance plans of the Company or its affiliates, if any.
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| 4.4.2 |
Notwithstanding the above, the Company and its affiliates shall be entitled to stipulate in an employment or service agreement with an Executive Officer (whether on the date the employment or service agreement is executed or in the context
of an amendment to the employment or service agreement or a settlement agreement) a higher amount of severance pay than that which is due to the Executive Officer by applicable law, up to a cap equal to the employer’s cost for twenty four (24) months of such Executive Officer’s salary and additional or related benefits for the relevant year (which shall include all non-equity payments in accordance with Sections 4 and 5 of this
Policy) above the foregoing severance amounts, which will be determined taking into consideration, among other things, the Executive Officer’s role, position, and the number of years of his or her employment or service with the Company or its
affiliates.
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| 4.5 |
Advance Notice and Adaptation or Transition Period
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| 4.5.1 |
The Company and its affiliates shall be entitled to give an Executive Officer a period of advance notice of termination of up to twelve (12) months. The Company and its affiliates shall be entitled to waive the services of an Executive
Officer during the advance notice period, in whole or in part; provided that it continues to make all of the payments and provide all benefits he or she is due under his or her employment or service agreement and applicable law.
Alternatively, the Company and its affiliates shall be entitled to terminate such Executive Officer’s employment or service without advance notice; provided however, that the Company or the appliable affiliate may pay the Executive Officer
upon the termination of his or her employment or service, payments equal to the payments he or she is owed in lieu of the advance notice period (and, without limitation salary, vacation days and all payments and benefits he or she is due
under the relevant employment or service agreement and applicable law).
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| 4.5.2 |
The Company and its affiliates will be entitled to grant an Executive Officer monetary and/or equity bonuses with respect to the advance notice period (including in the event of payment in lieu of the advance notice period) and that the
advance notice period (including in the event of payment in lieu of the advance notice period) will count toward the vesting of equity compensation, to the extent it has been granted him or her.
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| 4.5.3 |
The Company and its affiliates may provide an additional adaptation or transition period during which an Executive Officer will be entitled to up to twelve (12) months of continued base salary and benefits (which shall include all
non-equity payments in accordance with Sections 4 and 5 of this Policy). Such transition amount may also be paid as a one-time bonus. Additionally, the Company and its affiliates may determine that the Executive Officer’s equity shall not
expire and continue to vest during such period. In this regard, the Compensation Committee and Board shall take into consideration the Executive Officer’s term of employment or service, the Executive Officer’s compensation during employment
or service with the Company and its affiliates, the Company’s performance during such period, and the contribution of the Executive Officer in achieving the Company’s goals and the circumstances of termination.
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| 4.5.4 |
Upon death of an Executive Officer or Director, any payment accrued to him (including bonus and/or equity) may be paid to his or her heirs.
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| 4.6 |
Payment upon a Change of Control and a Cap for all payments due to termination of Service
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| 4.6.1 |
In the case of any retirement or termination upon a transaction involving a “Change of Control” (as determined by the Board), the non-equity payments will be subject to the limitations specified in Section 4.8.1 below, except that, instead
of twenty four (24) months, the limit shall be thirty six (36) months.
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| 4.7 |
Non-solicitation or Non-compete Arrangements
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| 4.7.1 |
Non-solicitation or non-compete undertakings by an Executive Officer, and payment in consideration for such undertakings, shall not exceed twenty four (24) months of such Executive Officer’s salary.
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| 4.8 |
Cap for Payments Upon Termination of Service
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| 4.8.1 |
All non-equity payments due as a result of an Executive Officer’s termination of service shall, in no event, exceed the sum of the employer’s cost for twenty four (24) months of such Executive Officer’s salary, and additional or related
benefits for the specific year of the relevant Executive Officer, which shall include all non-equity payments in accordance with Sections 4 and 5 of this Policy (in addition to any mandatory payment or period under applicable law).
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| 5. |
The Variable Cash Component – Bonuses, Special Bonuses and Commissions
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| 5.1 |
Targets for an annual cash bonus (“Annual Bonus”) for an Executive Officer.
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| 5.1.1 |
Company Targets – Company indicators are economic indicators for the Company’s performance, and may include, but are not limited to, one or more of the following: (a) the Company’s share price or the
Company’s value, on the stock exchange on which it is traded; (b) the Company’s revenues from sales; (c) operating income/loss;2 (d) revenues from the sales of
specific Company products and services; (e) revenues from sales of the Company’s products in a particular territory/market; (f) gross profit; (g) net income/loss; (h) EBITDA; (i) execution of agreements with strategic partners; (j) growth of
the Company’s head count; and (k) development of products and services. The weight that may be given to one or more Company targets is up to 100%. Company targets will be calculated on the basis of the information in the Company’s audited
consolidated financial statements or as otherwise determined appropriate by the Compensation Committee and the Board.
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| 5.1.2 |
Individual Targets – Indicators that will be determined in relation to each Executive Officer, in accordance with such Executive Officer’s position and the Company’s budget, and which may include,
but are not limited to, as applicable to the relevant organizational departments, one or more of the following: meeting targets for development; breaking into new markets; meeting expense targets; meeting financing targets; closing
distribution transactions; client satisfaction index; employee satisfaction index; regulatory filings and approvals according to plan; meeting the number of launches of new products and services; raising capital (including by means of a
public offering); meeting success targets for customer training and marketing events; and meeting supply targets.
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| 5.1.3 |
Supervisor’s Evaluation – Performance evaluation by the Board (in relation to the CEO) or by the CEO (in relation to all other Executive Officers who report to
the CEO and are not members of the Board). The evaluation may address criteria that are not financial, including the long-term contribution of the Executive Officer and his or her long-term performance and other non-measurable criteria. Non-measurable criteria that may be considered include, among others: contribution to the Company’s business; profitability and stability; the need to attract or retain an Executive Officer with skills, know-how or unique expertise; the responsibility imposed on an Executive Officer; changes that occurred in the responsibility imposed on an Executive Officer during the year; performance satisfaction, including assessing the degree of involvement of an Executive Officer and devotion of efforts in the performance of his or her duties;
assessment of the ability of an Executive Officer to work in coordination and cooperation with other employees; and contribution to an appropriate control environment and ethical environment.
For the CEO, the scope of this discretionary component may be up to three (3) months’ salary. For other Executive Officers, the scope of this component may be up to 100% of the total target Annual Bonus, if so determined by the Compensation
Committee and the Board.
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| 5.2 |
The Compensation Committee and the Board (with respect to the CEO) or the CEO (with respect to Executive Officers reporting to him or her who are not also members of the Board) will determine the Company and individual targets for each
respective year. The Compensation Committee and the Board, or the CEO, as set forth above, may condition the entitlement to an Annual Bonus on meeting one or more targets.
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| 5.3 |
Specifics of the targets in each measurement category as well as the relative weight of each of the measurement categories will be determined individually for each Executive Officer (to the extent that targets are determined for each
Executive Officer, as noted above), and may be based on the Executive Officer’s role and according to the organizational unit to which he or she belongs and which he or she supervises. The Company targets may be the same for all Executive
Officer, or different from one Executive Officer to another.
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| 5.4 |
Maximum Annual Bonus – The maximum amount of the Annual Bonus shall not exceed thirty six (36) months’ base salary for an Executive Officer.
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| 5.5 |
Calculation of the Annual Bonus Upon Cessation of Employment or Service – In the event of cessation of employment or service during the course of a calendar year (provided that the employment or service was not terminated under
circumstances that do not entitle the Executive Officer to severance pay), the Executive Officer may be entitled to a full or a relative portion of the Annual Bonus, which will be calculated pro rata, in accordance with the period during
which the respective Executive Officer was employed by the Company and its affiliates in the respective calendar year, as shall be determined by the Company or its appliable affiliate.
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| 5.6 |
Special Bonus
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| 5.6.1 |
Subject to Section 5.6.2. below, in addition to an Annual Bonus, the Compensation Committee and the Board may approve a special bonus (which may be discretionary or based on predetermined targets) for an Executive Officer, which shall not
exceed twenty four (24) months’ base salary of such Executive Officer. If required under applicable law, the special bonus will be subject to approval of Shareholders.
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| 5.6.2 |
For the CEO, any portion of the special bonus that is not based on measurable criteria, together with the other discretionary components of the CEO’s total Annual Bonus as set forth in Section 5.1.3, to the extent there are such
components, shall not exceed three (3) months’ base salary.
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| 5.6.3 |
As part of the variable compensation component of any Executive Officer reporting to the CEO, the CEO may approve a bonus that is not based on measurable criteria, which shall not exceed three (3) months of
such Executive Officer’s base salary for the applicable year. Such a bonus shall be reported to the Compensation Committee at its first meeting following such approval by the CEO.
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| 5.7 |
Commissions
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| 5.7.1 |
The Company and its affiliates may pay commissions to an Executive Officer in accordance with the Company’s policies, which shall be approved by the Compensation Committee and the Board. Commissions may be paid in addition to an Annual
Bonus or a special bonus.
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| 5.7.2 |
The amount of the commissions awarded to an Executive Officer may be calculated as a percentage of the revenues from the Company’s overall sales, revenues from the sales of specific Company products, or revenues from sales in a particular
territory or market, in each case to be determined in advance, or as otherwise permitted under the Company’s policies. In any event, the amount of commissions awarded to an Executive Officer shall not exceed 95% of the base salary of the
Executive Officer.
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| 5.8 |
Discretion Regarding Reduction of Bonuses
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| 6. |
The Variable Equity Component
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| 6.1 |
General – Types of Securities. The Company shall be entitled to adopt, from time to time, one or more plans for the grant of options to be exercised for shares of the Company, shares of the Company, restricted shares, RSUs and other equity
based compensation (“Equity Awards”), to Executive Officers and Directors, as a long-term incentive. The Board may permit the grant of Equity Awards by any
subsidiary of the Company (whether wholly owned or not) to Executive Officers; provided that the below principles (including vesting period and fair value) shall apply, subject to applicable changes (and in such case the term Equity Awards
shall refer to equity awards of the Company’s subsidiary, mutatis mutandis).
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| 6.2 |
Equity Cap – The fair market value of the Equity Awards for the Executive Officers and Directors will be determined according to acceptable valuation practices at the time of grant. Such fair market value shall not exceed $10 million for
each Executive Officer or Director per year of vesting, on a linear basis.
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| 6.3 |
Formulation of Eligibility – The Company shall be entitled to grant Executive Officers and Directors Equity Awards that will vest after the passing of a period of time as stipulated and subject to continued employment or service with the
Company and its affiliates and shall also be entitled to grant Executive Officers and Directors Equity Awards whose vesting is conditioned on meeting targets or milestones or upon the occurrence of a particular event that shall be established
in advance and subject to continuous employment with (or provision of services to) the Company or an affiliate thereof. Without derogating from the generality of the above, such targets may include a target share price or company value on the
exchange on which the Company’s shares are traded.
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| 6.4 |
Vesting Period – The vesting period of Equity Awards will be as determined by the Company on the date they are granted. Unless determined otherwise in a specific award agreement or in a specific compensation plan approved by the
Compensation Committee and the Board, or otherwise provided in this Policy, grants to Executive Officers and Directors shall vest based on (i) time, spread over not less than one year from the grant date or from the start of the Executive
Officer’s or Director’s employment or service with the Company or its affiliates, as applicable, or (ii) performance criteria. In addition, with respect to any newly appointed Executive Officer, the vesting terms of any Equity Award grants
may have shorter vesting periods, including those that match those of any equity or similar incentives forfeited by such incoming Executive Officer in connection with his or her departure from his or her former employer.
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| 6.5 |
Acceleration of Vesting of Equity Awards – The Board may, following approval by the Compensation Committee, determine provisions with respect to the acceleration of the vesting period of any Executive Officer’s or Director’s Equity Awards,
including, in connection with a corporate transaction or a “Change of Control” (as determined by the Board) or the waiver of any performance-based vesting criteria.
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| 6.6 |
Exercise Period – The Company may determine for each option granted to an Executive Officer or Director the exercise period applicable upon the occurrence of each specified event, including the extension of the exercise period of options
following the date of termination of service or otherwise.
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| 6.7 |
Other Terms – All other terms of the Equity Awards shall be in accordance with the Company’s incentive plans and other related practices and policies. Accordingly, the Board may, following approval by the Compensation Committee, make
modifications to such awards consistent with the terms of such incentive plans, subject to any additional approval as may be required by the Companies Law.
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| 7. |
Employment as a Contractor or by Means of a Personal Services Company
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| 8. |
Indemnification, Exculpation and Insurance
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| 8.1 |
The Company and its affiliates may grant Executive Officers and Directors (a) an undertaking to indemnify, consistent with Company practice, (b) a release from liability and (c) liability insurance (including a run-off type insurance
policy) – in each of the cases specified in clauses (a) through (c), in advance and retroactively, subject to the provisions of applicable law, including the Companies Law, and the Company’s Articles of Association.
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| 8.2 |
Without derogating from the generality of the above, the Company may, at any time during the term of this Policy, acquire a directors’ and officers’ (including controlling shareholders) liability insurance policy, as they may serve the
Company from time to time, to extend and to renew the existing insurance policy, and to enter into a new policy on the renewal date or during the insurance coverage period, with the same insurer or with another insurer in Israel or overseas,
according to the terms specified below, for directors’ and officers’ insurance; provided that the engagements shall be on the basis of the principles of the terms specified below and the Compensation Committee and the Board have approved it:
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| 8.2.1 |
The maximum coverage under the policy shall not exceed the higher of (i) $200 million and (ii) 15% of the Company’s market capitalization, calculated based on the closing price of the Company’s shares, as
quoted on Nasdaq at the close of business on December 31 of the calendar year preceding the date of such approval, without limiting the premiums payable;
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| 8.2.2 |
The Compensation Committee and Board may approve annually the Company’s purchasing a new policy that meets the terms established in this Policy;
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| 8.2.3 |
The insurance policy may be extended to cover claims that may be filed against the Company itself (as opposed to claims against directors or officers) relating to violation of securities laws, and payment arrangement may be established for
insurance proceeds according to which the right of the directors and officers to receive indemnification from the insurer under the policy takes precedence over the Company’s right; and
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| 8.2.4 |
The policy shall also cover the liability of directors and officers considered controlling Shareholders or their relatives, from time to time; provided that the coverage terms in such case shall not exceed those of the Company’s and its
subsidiaries’ other directors and officers.
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| 9. |
Claw-Back of Annual or Special Bonuses and Equity Awards
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| (i) |
less than two years have passed from the date of payment of such compensation to an Executive Officer, and
|
| (ii) |
the Company’s audited financial statements are restated or otherwise revised for any year, in such manner that the amount of the compensation paid, granted, vested, settled or accrued to such Executive Officer with respect to such year
would have been in a lower amount had it been calculated according to the restated or otherwise revised data, the Board or Compensation Committee, in its discretion, may (and, to the extent required by applicable law, shall) require the
Executive Officer to reimburse the Company or an applicable affiliate for the difference between the amount of the compensation received and that to which the Executive Officer would have been entitled as a result of such restatement or other
revision.
|
| 10. |
Term
|
| 11. |
Policy Caps
|
| 12. |
Director Compensation
|
| 12.1 |
The total fees (whether periodic fees, fees per meeting or fees based on any other criteria) paid per annum to the Directors with respect to the provision of services to the Company will be determined by the Compensation Committee, the
Board and the general meeting of Shareholders. The approved gross fees per annum may include a mechanism for payment updates and currency conversion calculations. The remuneration may include both fixed and variable components (including
Equity Awards), as will be determined by the Compensation Committee, the Board and the general meeting of Shareholders, if so required by applicable law.
|
| 12.2 |
In addition, the Directors may be entitled to reimbursement for reasonable expenses actually paid in the context of his or her duties upon presentation of receipts, all in accordance with Company practice. There is no cap on such
reimbursement.
|
| 12.3 |
The remuneration to external directors, if any, will be (i) “relative remuneration” (as such term is defined in External Directors Regulations, as defined below) or (ii) annual remuneration and per meeting remuneration, which shall be
determined in accordance with the provisions stipulated in the Companies Regulations (Rules Regarding Remuneration and Expenses for an External Director), 5760-2000, as amended by the Companies Regulations (Relief for Public Companies Whose
Securities are Traded on Stock Exchanges Outside of Israel), 5760-2000, as such regulations may be amended from time to time (the “External Director Regulations”). External directors, if any, may also
be entitled to Equity Awards, subject to the provisions of the External Director Regulations.
|
| 13. |
Miscellaneous
|
| 11. |
Governing Law:
|
| 12. |
Compliance with Applicable Laws:
|
Exhibit 21.1
SUBSIDIARIES OF PAGAYA TECHNOLOGIES LTD.
|
Name of Subsidiary |
Jurisdiction of Organization |
|
| Pagaya Auto Loans Manager Ltd. | Cayman Islands | |
| Pagaya Auto Loans Manager, LP | Cayman Islands | |
| Pagaya Auto Loans Fund, LP | Cayman Islands | |
| Pagaya Auto Loans Sub Ltd. | Cayman Islands | |
| Pagaya Auto Loan Trust | U.S. (Delaware) | |
| Pagaya Auto Loan Trust II | U.S. (Delaware) | |
| Pagaya Structured Holdings II LLC | Cayman Islands | |
| Pagaya Structured Holdings III LLC | Cayman Islands | |
| Pagaya US Holding Company LLC | U.S. (Delaware) | |
| Pagaya Investments US LLC | U.S. (Delaware) | |
| Pagaya RE Management GP LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 1 LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 2 LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 3 LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 IL Feeder 2 Ltd. | Israel | |
| Pagaya Smartresi F1 Feeder 3 Holdings LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 3 RH LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 2 Holdings LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Feeder 2 BL LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 REIT Holdings, LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 REIT LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund, LP | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Equity Owner II LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Property Owner II LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Equity Owner LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Property Owner LLC | U.S. (Delaware) | |
| PATH 2021-1 REIT LLC | U.S. (Delaware) | |
| Pagaya SFR Depositor LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Equity Owner III LLC | U.S. (Delaware) | |
| Pagaya Smartresi F1 Fund Property Owner III LLC | U.S. (Delaware) | |
| Pagaya Structured Holdings III LLC | Cayman Islands | |
| Pagaya Opportunity Manager Ltd. | Cayman Islands | |
| Pagaya Opportunity Offshore Feeder Fund I, LP | Cayman Islands | |
| Pagaya Opportunity Master Fund Ltd. | Cayman Islands | |
| Pagaya Funding Trust | U.S. (Delaware) | |
| Pagaya Funding Trust II | U.S. (Delaware) |
|
Name of Subsidiary |
Jurisdiction of Organization |
|
| Pagaya Funding Trust III | U.S. (Delaware) | |
| Pagaya Structured Holdings LLC | Cayman Islands | |
| Pagaya Credit Opportunity Ltd | Cayman Islands | |
| Pagaya Opportunity Onshore Feeder Fund 1, LP | U.S. (Delaware) | |
| Pagaya Credit Opportunity LLC | U.S. (Delaware) | |
| Pagaya Credit Opportunity Trust | U.S. (Delaware) | |
| Pagaya Securities Holdings LLC | U.S. (Delaware) | |
| Pagaya Securities Holdings Trust | U.S. (Delaware) | |
| PREF 2019 LLC | U.S. (Delaware) | |
| Pagaya Technologies US LLC | U.S. (Delaware) | |
| Pagaya Motor Receivables Trust | U.S. (Delaware) | |
| Pagaya Acquisition Trust | U.S. (Delaware) | |
| Pagaya Acquisition Trust II | U.S. (Delaware) | |
| Pagaya Acquisition Trust III | U.S. (Delaware) | |
| Asset Acquisition Capital LLC | U.S. (Delaware) | |
| Citrus Tree Finance LLC | U.S. (Delaware) | |
| Pagaya US Holdings LLC | U.S. (Delaware) | |
| PAPA Owner LLC | U.S. (Delaware) | |
| Park Avenue Property Advisors LLC | U.S. (Delaware) | |
| TISCo 1, LLC | U.S. (Delaware) | |
| TISCO 2, LLC | U.S. (Delaware) | |
| Tangent Insurance Services LLC | U.S. (Delaware) | |
| Tangent Captive Insurance IC | U.S. (Delaware) | |
| PLG 1 LLC | U.S. (Delaware) | |
| PLGA LP | U.S. (Delaware) | |
| PLG 2 LLC | U.S. (Delaware) | |
| Rigel Merger Sub Inc. | Cayman Islands |
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” RESOLUTIONS 1, 2 AND 3.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE ☒
|
|
FOR
|
AGAINST
|
ABSTAIN
|
||||
| 1. |
Resolution No. 1 - The Business Combination Resolution - RESOLVED, as an ordinary resolution, that EJF Acquisition Corp.’s (“EJFA”) entry into the
Agreement and Plan of Merger, dated as of September 15, 2021 (the “Merger Agreement”), by and among EJFA, Pagaya Technologies Ltd. (“Pagaya”) and Rigel Merger Sub Inc. (“Merger Sub”),
a copy of which is attached as Annex A to the proxy statement/prospectus, pursuant to which, among other things, Merger Sub will merge with and into EJFA, with EJFA surviving the merger as a wholly-owned subsidiary of Pagaya, which will
become the parent/public company following the business combination, in accordance with the terms and subject to the conditions of the Merger Agreement, and the transactions contemplated by the Merger Agreement, be approved, ratified and
confirmed in all respects.
|
☐ |
☐ | ☐ | ||
| 2. |
Resolution No. 2 - The Merger Resolution - RESOLVED, as a special resolution, that the Plan of Merger be authorized, approved and confirmed in all respects, that EJF
Acquisition Corp. be and is hereby authorized to enter into the Plan of Merger, and that the merger of Rigel Merger Sub Inc. with and into EJF Acquisition Corp., with EJF Acquisition Corp. surviving the merger as a wholly-owned subsidiary of
Pagaya Technologies Ltd., be authorized, approved and confirmed in all respects.
|
☐ | ☐ |
☐ | ||
| 3. |
Resolution No. 3 - The Adjournment Resolution - RESOLVED, as an ordinary resolution, that the adjournment of the Special Meeting to a later date or dates be approved: (A)
to the extent necessary to ensure that any required supplement or amendment to the accompanying proxy statement/prospectus is provided to shareholders, (B) in order to solicit additional proxies from shareholders in favor of one or more of
the proposals at the Special Meeting, or (C) to seek withdrawals of redemption requests from shareholders.
|
☐ | ☐ | ☐ | ||
| To change the address on your account, please check the box at right and indicate your new address in the address space above. Please note that changes to the registered name(s) on the account may not be submitted via this method. |
☐
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|
Signature of Shareholder
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Date
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Signature of Shareholder
|
Date
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Note:
|
Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person. |