Exhibit 10.11

 

NOTICE OF OPTION GRANT

 

You have been granted the following options (the “Options”) to purchase shares
of common stock par value US$ 0.001 each (the “Shares”) of ScoutCam Inc. (the
“Company”), pursuant and subject to the terms and conditions of the Company’s
2020 Share Incentive Plan, a copy of which is attached hereto as Exhibit A (as
may be amended from time to time, the “Plan”), and the additional terms and
conditions contained herein. Unless otherwise defined, capitalized terms used
herein shall have the meaning ascribed to them under the Plan.

 

Grantee:         Date of Grant:     such date being subject to Section 9.4 of
the Plan and Section 10.2 of this Agreement       Intended Type of Award:  
______ Incentive Stock Option (U.S.) (✔ check one):   ______Nonqualified Stock
Option (U.S.)     ______Option designated as 102 Capital Gains Track Award (with
Trustee) (Israel)     ______Option designated as 102 Ordinary Income Track Award
(with Trustee) (Israel)     ______Option designated as 102 Non-Trustee Award
(Israel)     ______Option designated as 3(9) Award (Israel)     ______Other    
  the above being subject to Section ‎9 of the Option Agreement, Section 18.4 of
the Plan and applicable law   Exercise Price   (US$ / NIS / Other) ______ per
Share       Number of Shares underlying the Options:           Vesting
Commencement Date:           Vesting Schedule:   Subject to the terms of the
Plan (including Sections 6.6 and 6.7 thereof), the Options shall vest and become
exercisable under the following schedule: 25% of the Shares covered by the
Options, on the first anniversary of the date on the Vesting Commencement Date,
and 6.25% of the Shares covered by the Options at the end of each subsequent
three-month period thereafter over the course of the subsequent 3 years;
provided, in each case, that the Grantee remains continuously as a Service
Provider of the Company or its Affiliates throughout each such vesting date.    
  Exercise Period:   The date determined in accordance with and subject to
Section ‎8 of the Option Agreement and the provisions of the Plan.

 

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

 

   

 

 

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

 

OPTION AGREEMENT

 

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

 

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

 

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

 

2. Issuance and Disposition of Shares.

 

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

 

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2.2. Provisions Governing Shares. Shares issued upon exercise of Options shall
be subject to the restrictions referred to in Section 16 of the Plan (Conditions
upon Issuance of Shares; Governing Provisions) and in this Agreement, the
Articles of Incorporation of the Company, any limitation, restriction or
obligation included in any stockholders agreement applicable to all or
substantially all of the holders of Shares (regardless of whether or not the
Grantee is a formal party to such stockholders agreement), any other governing
documents of the Company, and all policies, manuals and internal regulations
adopted by the Company from time to time, in each case, as may be amended from
time to time, including, without limitation, any provisions included therein
concerning restrictions or limitations on disposition of Shares (such as, but
not limited to, right of first refusal and lock-up/market stand-off) or grant of
any rights with respect thereto, forced sale and bring along provisions, any
provisions concerning a restrictions on the use of inside information and other
provisions deemed by the Company to be appropriate in order to ensure compliance
with Applicable Laws and with the requirements of any transaction entered into
or proposed to be entered into by the Company. By exercising an Option the
Grantee is deemed to have undertaken to comply with all the foregoing
provisions. The Grantee shall execute (and authorizes any person designated by
the Company to so execute, as well as (if applicable) the Trustee holding any
Shares for the Grantee’s behalf) such separate agreement(s) as may be requested
by the Company relating to matters set forth in or otherwise for the purpose of
implementing this Section ‎2.2. The execution of such separate agreement(s) may
be a condition by the Company to the exercise of any Award and the Company (and,
if applicable, the Trustee) may exercise its authorization above and sign such
agreement on behalf of the Grantee or subject the Grantee to the provisions of
such agreements.

 

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

 

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

 

2.5. Market Stand-Off. As a material precondition to the grant of Options and
the issuance of any Shares in accordance with the Plan, and without limitation
of Section 17 of the Plan, the Grantee hereby agrees that in connection with any
underwritten public offering of equity securities of the Company pursuant to an
effective registration statement filed under the U.S. Securities Act of 1933, as
amended, or equivalent law in another jurisdiction, and in recognition of the
benefit that such an offering will confer upon the undersigned as a stockholder
of the Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with the
Company and each underwriter, during the Lock Up Period (as defined below), that
the undersigned will not, without the prior written consent of the Company or
the underwriters (or the lead underwriter, as the underwriters shall agree among
themselves), directly or indirectly, (i) lend, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant for the sale of, or otherwise
dispose of or transfer any shares of the Company or any securities convertible
into or exchangeable or exercisable for shares or securities of the Company,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition
(including, without limitation, awards under any Company share or equity plan)
and any shares or other securities issued or distributed with respect to or in
substitution of any of the foregoing (collectively, the “Lock Up Securities”),
(ii) exercise any right with respect to the registration of any of the Lock Up
Securities, or file or cause to be filed any registration statement in
connection therewith, under the U.S. Securities Act of 1933, as amended, or
equivalent law in another jurisdiction, or (iii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part, directly
or indirectly, the economic consequence of ownership of the Lock Up Securities,
whether any such swap or transaction in this clause (iii) or (i) above is to be
settled by delivery of shares or other securities of the Company, in cash or
otherwise. The foregoing shall not apply to the sale of any shares to an
underwriter pursuant to an underwriting agreement. The Lock Up Period shall be:
(A) until the expiration of 90 days following the effective date of such
registration statement relating to any other public offering; or (B) as shall be
requested by the Company or the underwriter(s). Notwithstanding anything herein
to the contrary, if the underwriter(s) and the Company agreed on a termination
date of the Lock Up Period in the event of failure to consummation a certain
public offering, then such termination shall apply also to the Lock Up Period
hereunder with respect to that particular public offering.

 

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2.6. Data Privacy; Data Transfer. Information related to the Grantee and
Award(s) hereunder, as shall be received from Grantee or others, and/or held by,
the Company or its Affiliates from time to time, and which information may
include sensitive and personal information related to the Grantee
(“Information”), will be used by the Company or its Affiliates (or third parties
appointed by any of them, including the Trustee) to comply with any applicable
legal requirement, or for administration of the Plan as they deems necessary or
advisable, or for the respective business purposes of the Company or its
Affiliates (including in connection with transactions related to any of them).
The Company and its Affiliates shall be entitled to transfer the Information
among the Company or its Affiliates and to third parties for the purposes set
forth above, which may include persons located abroad (including, any person
administering the Plan or providing services in respect of the Plan or in order
to comply with legal requirements, or the Trustee, their respective officers,
directors, employees and representatives, and the respective successors and
assigns of any of the foregoing), and any person so receiving Information shall
be entitled to transfer it for the purposes set forth above. The Company shall
use commercially reasonable efforts to ensure that the transfer of such
Information shall be limited to the reasonable and necessary scope. By receiving
an Award hereunder, Grantee acknowledges and agrees that the Information is
provided at Grantee’s free will and that Grantee hereby consents to the storage
and transfer of the Information as set forth above.

 

3. Exercise Procedures.

 

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

 

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

 

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

 

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

 

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

 

6. Restricted Securities. Grantee acknowledges and understands that, unless the
issuance of Shares that may be acquired upon exercise of the Options is
registered under the Securities Act of 1934, as amended (the “Securities Act”),
before any exercise of the Options, the Shares acquired upon exercise of the
Options will be characterized as “restricted securities” under the federal
securities laws, as the shares will be acquired from the Company in a
transaction not involving a public offering, and that under such laws and
applicable regulations the Shares may not be resold without registration under
the Securities Act, except in certain limited circumstances. The Grantee
represents to the Company that he or she is either familiar with Rule 144
promulgated under the Securities Act, as presently in effect, and understands
the resale limitations imposed thereby and by the Securities Act, or has sought
counsel from someone with such knowledge.

 

The Grantee acknowledges that if an exemption from registration or qualification
is available, it may be conditioned on various requirements, including, but not
limited to, the time and manner of sale, the holding period for the Shares, and
on requirements relating to the Company that are outside the Grantee’s control,
and which the Company is under no obligation to satisfy and may not be able to
satisfy. Prior to any transfer of the Shares by the Grantee, the Company retains
the right to request and receive from the Grantee an opinion of counsel that the
proposed transfer may be completed in compliance with all applicable federal and
state securities laws.

 

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

 

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

 

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

 

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

 

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9. Tax Matters and Consultation.

 

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

 

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

 

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

 

10. Section 102 Awards.

 

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

 

10.2. 102 Award Grant Date.

 

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

 

10.2.2. Unless otherwise permitted by the Ordinance, any grants of 102 Trustee
Awards that are made on or after the date of the adoption of this Plan or an
amendment to this Plan, as the case may be, that may become effective only at
the expiration of thirty (30) days after the filing of this Plan or any
amendment thereof (as the case may be) with the ITA in accordance with the
Ordinance shall be conditional upon the expiration of such 30-day period, such
condition shall be read and is incorporated by reference into any corporate
resolutions approving such grants and into this Agreement and any agreement
evidencing such grants (whether or not explicitly referring to such condition),
and the date of grant shall be at the expiration of such 30-day period, whether
or not the date of grant indicated therein corresponds with this Section ‎10.2.
In the case of any contradiction, this provision and the date of grant
determined pursuant hereto shall supersede and be deemed to amend any date of
grant indicated in the Notice or in any corporate resolution or any agreement.

 

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

 

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

 

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

 

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

 

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

 

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

 

12. Miscellaneous.

 

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

 

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

 

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

 

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

 

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

 

- Signature Pages Following -

 

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

 

Grantee:   SCOUTCAM INC.       Name:     Name:                  ID No.:    
Title:   Date:     Date: