Document:

Exhibit 10.7

 

 

 

Indemnification,
Insurance and Exculpation Undertaking

 

 

 

Date: ______ __, 20__

 

Mr. / Ms. _________

 

		WHEREAS,	at the request of REE Automotive Ltd. (the “Company”), you served in the past, are currently
serving or will serve in the future as an “Office Holder” (“nosse misra”) of the Company, as such term
is defined in Section 1 of the Israeli Companies Law, 5759-1999 (the “Companies Law”); and

 

		WHEREAS,	both the Company 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,	the Company has determined that (i) the increased difficulty in attracting and retaining competent
persons is detrimental to the best interests of the Company’s shareholders and that the Company should act to assure such persons
that there will be increased certainty of such protection in the future, (ii) and it is reasonable, prudent and necessary for the
Company contractually to 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 the Company free from undue concern that they will not be so indemnified;
and

 

		WHEREAS,	Article 64 of the Company’s Articles of Association provides that the Company may indemnify its
Office Holders to the fullest 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 the Company in an effective manner and, in part, in order to provide you with specific contractual assurance that
the indemnification, insurance and exculpation afforded by the Articles of Association will be available to you, the Company wishes to
undertake in this Indemnification, Insurance and Exculpation Undertaking to indemnify you and to advance expenses to you to the fullest
extent permitted by applicable law and as set forth in this Indemnification, Insurance and Exculpation Undertaking and provide for insurance
and exculpation of you as set forth in this Indemnification, Insurance and Exculpation Undertaking; and

 

		WHEREAS,	on ______ __, 2021, the Company’s shareholders in general meeting approved the issuance of this
Indemnification, Insurance and Exculpation Undertaking;

 

     

     

    

 

		THEREFORE,	the Company hereby confirms to you that:

 

Indemnification

 

		1.	Undertaking to Indemnify. The Company hereby undertakes to indemnify you to the fullest
extent permitted by applicable law for any liability and expense specified in subsections (a) through (f) below, imposed on you due
to or in connection with an act performed by you, either prior to or after the date hereof, in your capacity as an Office Holder, including,
without limitation, as a director, officer, employee, observer, agent or fiduciary of the Company, any subsidiary thereof or any another
corporation, collaboration, partnership, joint venture, trust or other enterprise, in which you serve at any time at the request of the
Company (a “Corporate Capacity”). The term “act performed in your capacity as an Office Holder” shall include,
without limitation, any act, omission and failure to act and any other circumstances relating to or arising from your service in a Corporate
Capacity.

 

		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 Indemnification, Insurance and Exculpation Undertaking, the term “person” shall include, without limitation, 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 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 but with the imposition of a financial obligation in lieu of a criminal
proceeding in 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 mean closing the case in accordance with Section 62 of the Criminal Procedure
Law [Consolidated Version], 5742-1982 (in this subsection - the Criminal Procedure Law), or suspension of the proceedings by the Attorney
General under Section 231 of the Criminal Procedure Law;

 

		ii.	“financial obligation in lieu of a criminal proceeding” – a financial liability imposed
by 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 or assessed against you by
a court, in a proceeding instituted against you by the Company 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.

 

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		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
or in connection therewith, 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 law to indemnify
you including, without limitation, in accordance with Section 56h(b)(1) of the Israeli Securities Law, 5728-1968.

 

		i.	For the purpose of this Indemnification, Insurance and Exculpation Undertaking, “expenses”
shall include, without limitation, attorneys’ fees and all other costs, expenses and obligations paid or incurred by you in connection
with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness in or
participate in any claim relating to any matter for which indemnification hereunder may be provided. Expenses shall be considered paid
or incurred by you at such time as you are required to pay or incur such cost or expenses, including upon receipt of an invoice or payment
demand.

 

		2.	Scope of Coverage. The Company’s undertaking to indemnify you pursuant to Section
1(a) above is limited to liabilities and expenses deriving from your actions in the cases detailed below (in this section, the “Company”
– including subsidiaries and affiliated companies in which you serve as an Office Holder in matters related thereto):

 

		a.	actions or omissions deriving from the Company being public or from the fact that its securities were
offered or will be offered to the public or traded or will be traded on a stock exchange, 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, which were not disclosed
as required by law, whether such liabilities and expenses relate to the securities laws of the United States, of Israel or of any other
jurisdiction;

 

		c.	actions or omissions in connection with investments the Company 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;

 

		d.	any sale, purchase or holding of marketable securities, or other investments for or on behalf of the Company;

 

		e.	actions or omissions relating to the purchase or sale of companies, legal entities or their assets, their
splitting or merging;

 

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		f.	actions or omissions related to the Company’s labor relations or the Company’s commercial
relationships, including with employees, independent contractors, customers, suppliers and other service providers;

 

		g.	any “Transaction” as defined in Section 1 of the Companies Law;

 

		h.	issuance of the Company’s securities pursuant to a prospectus and any amendment to such prospectus,
whether such liabilities and expenses relate to the securities laws of the United States, of Israel or of any other jurisdiction;

 

		i.	all the subjects that would have been required to be disclosed in a prospectus, including in any draft
of the prospectus, as to which disclosure was not made or allegedly was not made as required by law, and all subjects that would have
been required to be disclosed in subsequent disclosure documents or reports of the Company, whether such liabilities and expenses relate
to the securities laws of the United States, of Israel or of any other jurisdiction;

 

		j.	public or private securities offerings by the Company, whether such liabilities and expenses relate to
the securities laws of the United States, of Israel or of any other jurisdiction.

 

		3.	Exclusions. The Company shall not indemnify you for any financial liability imposed
upon you for any of the following:

 

		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 the Company;

 

		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.

 

		4.	Amount of indemnification.

 

		a.	The maximum aggregate amount of indemnification to be paid by the Company to all Office Holders who are
entitled to indemnification, whether in advance or retroactively, according to all the indemnification undertakings that the Company 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 greatest of (i) 25% of shareholders’ equity
(as reported in the Company’s last published consolidated financial statements, as of the date of each payment in respect of the
indemnification undertakings), (ii) US$50 million, (iii) 10% of the total market capitalization of the Company (calculated as the average
closing price of the Company’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 the Company as of the date of each payment) and (iv) in
connection with or arising out of a public offering of the Company’s securities, the aggregate amount of proceeds from the sale
of, or value exchanged in relation to, such securities by the Company and/or any shareholder in such offering (the “Maximum Indemnification
Amount”).

 

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		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
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 Indemnification, Insurance and Exculpation Undertaking
for such indemnification, and the amount received from the insurer in respect of such matter, provided that the indemnification amount
to which the Company has committed does not exceed the Maximum Indemnification Amount. In the event that the Company receives indemnification
from the insurer as stated, the Company’s liability shall not be reduced according to this Indemnification, Insurance and Exculpation
Undertaking and the amounts of the total indemnification may be beyond the amounts received from the insurance company up to the Maximum
Indemnification Amount.

 

		5.	Conditions for granting indemnification.

 

		a.	You shall notify the Company 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 the Company or to whomever is designated by the Company, without delay, any
document you receive in connection with such proceeding.

 

		b.	The Company shall be entitled to assume your legal defense of such Legal Proceeding or to turn over such
defense to any counsel selected by the Company for this purpose.

 

		c.	The Company 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 the Company, you shall sign any document authorizing the Company or such counsel to
handle your defense in such proceeding and to represent you in all matters related thereto, in accordance with the above. The Company
shall not be liable to indemnify you under this Indemnification, Insurance and Exculpation Undertaking for any amounts or expenses paid
in connection with a settlement of any action, claim or otherwise, effected by you without the Company’s prior written consent.

 

		d.	If the Company acts in accordance with the provisions of subsection (c) above and you enable it to do
so, the Company 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 Indemnification, Insurance and Exculpation
Undertaking.

 

		e.	You shall fully cooperate with the Company 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 the Company will cover all expenses involved so that you will not be
required to pay or finance them yourself.

 

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Insurance

 

		6.	The Company undertakes that, subject to the mandatory limitations under applicable law, as long as it
may be obligated to provide indemnification and advance expenses under this Indemnification, Insurance and Exculpation Undertaking, the
Company will purchase and maintain in effect directors and officers liability insurance, which will include coverage for your benefit,
providing coverage in amounts as reasonably determined by the Board; provided that the Company shall have no obligation to obtain
or maintain directors and officers insurance policy if the Company determines in good faith that such insurance is not reasonably available,
the premium costs for such insurance are disproportionate to the amount of coverage provided, or the coverage provided by such insurance
is so limited by exclusions that it provides an insufficient benefit. The Company hereby undertakes to notify you at least 30 days
prior to the expiration or termination of the directors and officers insurance policy.

 

		7.	The Company undertakes to give prompt written notice of the commencement
of any claim hereunder to the insurers in accordance with the procedures set forth in each of the policies. The Company shall thereafter
diligently take all actions reasonably necessary under the circumstances to cause such insurers to pay, on your behalf, all amounts payable
as a result of such action, suit, proceeding, inquiry or investigation in accordance with the terms of such policies. The above shall
not derogate from the Company’s authority to freely negotiate or reach any compromise with the insurer which is reasonable in the
Company’s sole discretion, provided that the Company shall act in good faith and in a diligent manner.

 

		8.	The Company shall not be liable under this Indemnification, Insurance and Exculpation Undertaking to make
any payment in connection with any Indemnifiable Event to the extent you have otherwise actually received payment under any insurance
policy or otherwise (without any obligation on your part to repay any such amount) of the amounts otherwise indemnifiable hereunder. Any
amounts paid to you under such insurance policy or otherwise after the Company has indemnified you for such liability or expense shall
be repaid to the Company promptly upon receipt by you. The Company hereby acknowledges that from time to time you may have certain rights
to indemnification, advancement of expenses or insurance provided by shareholders of the Company, and certain of its affiliates and third
parties (collectively, the “Secondary Indemnitors”). The Company hereby agrees (i) that the Company is the indemnitor of first
resort (i.e. its obligations to you are primary and any obligation of the Secondary Indemnitors to advance expenses or to provide
indemnification for the same expenses or liabilities incurred by you are secondary); (ii) that the Company shall be required to advance
the full amount of expenses incurred by you and shall be liable for the full amount of all expenses, judgments, penalties, fines and amounts
paid in settlement to the extent legally permitted and as required by the terms of this Agreement (or any other agreement between the
Company and you), without regard to any rights you may have against the Secondary Indemnitors; and (iii) that the Company irrevocably
waives, relinquishes and releases the Secondary Indemnitors from any and all claims the Company may have against the Secondary Indemnitors
for contribution, subrogation or any other recovery of any kind in respect thereof. Without altering or expanding any of the Company’s
indemnification obligations hereunder, the Company further agrees that no advancement or payment by the Secondary Indemnitors on behalf
of you with respect to any claim for which you have sought indemnification from the Company shall affect the foregoing and the Secondary
Indemnitors shall have a right of contribution and be subrogated to the extent of such advancement or payment to all of the rights of
recovery of you against the Company. The Company agrees that the Secondary Indemnitors are express third party beneficiaries of the terms
of this section.

 

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Exculpation

 

		9.	To the maximum extent permitted by law, the Company hereby exculpates and releases you in advance and
retrospectively from your responsibility, in whole or in part, to the Company with respect to damages related to any breach of the duty
of care to the Company, except in those instances where the Company cannot exculpate you in advance from your responsibility to the Company,
including with respect to the breach of the duty of care in connection with a “distribution” as such term is defined in the
Companies Law.

 

Validity of the Undertaking

 

		10.	This Indemnification, Insurance and Exculpation Undertaking relates to your performance as an Office Holder
of the Company, or a director or officer, employee, observer, agent or fiduciary in the entities specified in the first paragraph of Section
1, and will be valid both with respect to proceedings taken against you during your term as an Office Holder, or director or officer,
employee, observer, agent or fiduciary as above, and with respect to proceedings against you following the end of your term, provided
that they relate to actions that were performed by you from the date on which your term of office commenced, either directly or indirectly,
during or as a result of your being an Office Holder of the Company, or a director or officer, employee, observer, agent or fiduciary
in the entities specified in the first paragraph of Section 1, and as a result thereof. This Indemnification, Insurance and Exculpation
Undertaking shall also inure to the benefit of your heirs and other legal substitutes.

 

		11.	This Indemnification, Insurance and Exculpation Undertaking supersedes any prior undertaking for indemnification,
if given to you in the past; however, this undertaking does not derogate from or waive any other indemnification or exculpation to which
you are entitled from any other source by law or by any other undertaking.

 

		12.	This Indemnification, Insurance and Exculpation Undertaking shall not restrict the Company or prevent
it from granting additional or special indemnification or exculpation, provided that this does not prejudice the indemnification or exculpation
that are the subject of this Indemnification, Insurance and Exculpation Undertaking.

 

		13.	Your rights hereunder shall not be deemed exclusive of any other rights that you may have under the Articles
of Association, applicable law or otherwise, and to the extent that during the indemnification period the indemnification rights of the
then serving directors and officers are more favorable to such directors or officers than the indemnification rights provided hereunder
to you, you shall be entitled to the full benefits of such more favorable indemnification rights to the extent permitted by law. No amendment,
alteration or repeal of this undertaking or of any provision hereof shall limit or restrict any of your rights under this undertaking
in respect of any action taken or omitted by you prior to such amendment, alteration or repeal, unless caused by a change to the law that
cannot be altered contractually.

 

	 	Sincerely,
	 	 
	 	REE Automotive 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

 

 

-7-Exhibit
10.8

 

REE
Automotive Ltd.

Compensation
Policy

 

As
approved by the Company’s Board of Directors on June 16, 2021

and
by the Company’s Shareholders at a General Meeting on          , 2021

 

Each
capitalized term in this Compensation Policy shall have the meaning assigned to it in the Israeli Companies Law, 5759-1999 (the “Companies
Law”), unless otherwise defined in this Compensation Policy.

 

		1.	General

 

The
Companies Law sets forth provisions regarding the structure of compensation to office holders (as such term is defined in the
Companies Law; in this Compensation Policy, “Office Holders”) in publicly held companies, establishes a process
for the approval of such compensation and prescribes an obligation to adopt a compensation policy. Accordingly, this Compensation
Policy (the “Compensation Policy” or the “Policy”) of REE Automotive Ltd., an Israeli company
(the “Company”), was adopted by the Board of Directors of the Company (the “Board of
Directors” or the “Board”) and by the shareholders of the Company. Unless this Policy refers explicitly
to directors or the context makes clear that a section refers to or include directors, the term “Office Holders” in this
Policy refers to Office Holders who are not solely directors and to the Chairperson of the Board, rather than to directors other
than the Chairperson.

 

The
Board shall review and reassess the adequacy of this Policy from time to time, as required by the Companies Law.

 

Subject
to the terms and conditions of this Policy and any mandatory provisions of applicable law, and in addition to the Board of Directors’
powers provided elsewhere in this Policy and by the Companies Law, the Board of Directors, or the Company’s Compensation Committee
(the “Compensation Committee” or the “Committee”), subject to the provisions of the Companies Law
and unless the Board determines otherwise, shall have full authority in its discretion, from time to time, to (i) interpret this policy;
(ii) prescribe, amend and rescind rules and regulations relating to and for carrying out this policy, as it may deem appropriate; and
(iii) any other matter which it determines to be necessary or desirable for, or incidental to, the administration of this Policy and
any determination made pursuant to this Policy.

 

     

     

    

 

Considerations
in Adopting the Policy – The considerations that guided the Board of Directors in adopting the Policy are:

 

		●	advancement
                                            of the Company’s objectives and its financial goals, from the perspective of the current
                                            relevant year and also with a long-term view;
	 	 	 

		●	creating
                                            appropriate incentives for Office Holders in the Company taking into account, inter alia,
                                            specific divisions or regions of the Company and the Company’s risk management
                                            practices;
	 	 	 

		●	creating
                                            alignment between the Office Holders’ interests and the interests of the Company’s
                                            shareholders;
	 	 	 

		●	the
                                            Company’s size and the nature of its activities and markets;
	 	 	 

		●	the
                                            Company’s competitive environment. The compensation of an Office Holder will be determined
                                            after giving consideration to the terms offered to comparable Office Holders in comparable
                                            companies, to the extent such information is readily available, in order to offer competitive
                                            terms and attract and retain competent and capable Office Holders. The applicable benchmark
                                            will be determined such that the compensation of Office Holders serving in roles having responsibility
                                            over global operations will generally be compared to global roles, and Office Holders 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;
	 	 	 

		●	the
                                            Office Holders’ 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 Office Holders’ positions; and
	 	 	 

		●	recruitment
                                            and retention of high-quality personnel.

 

The
Compensation Policy was drafted taking into account the character of the Company as a company engaged in the field of electric mobility
that aims to reinvent the EV and next-generation e-mobility market, taking into account the scope of the Company’s current and
prospective activities and markets, and geographic regions and its being a company listed for trade on the Nasdaq Stock Market (“Nasdaq”).

 

Main
Principles of the Policy – The principles of the Compensation Policy were formulated after internal deliberations that took
place within the Board in consultation with external advisors. The principles of this Policy are intended to ensure that the Office Holder’s
compensation will be consistent with the Company’s targets and its total organizational strategy while taking into account the
Company’s risk management policy. Furthermore, the Policy seeks to increase the alignment of Office Holders’ interests with
the Company’s interests and to incentivize the Office Holders in order to retain high-quality Office Holders over time.

 

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The
components of Office Holders’ compensation may be as follows:

 

		A.	Fixed
components: 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 Office Holder with respect to the cessation of
his or her service or employment with the Company).

 

		B.	Variable
                                            Components: Different types of bonuses including an annual bonus, a special bonus, etc.

 

		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 reward plans that have been
                                            adopted or will be adopted in the future by the Company.

 

		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 Office Holders, in advance or retroactively, and grant of an undertaking
                                            to indemnify the officer in advance and retroactively.

 

The
provisions of this Compensation Policy apply only to the Company’s Office Holders, as defined in the Companies Law.

 

This
Policy does not grant rights to the Company’s Office Holders to receive any type of compensation specified in the Policy. The types
and components of compensation to which an Office Holder will be entitled will be solely those approved specifically regarding each Office
Holder by the Committee, Board and/or shareholders, according to applicable law.

 

		2.	Principles
                                            for Determining Compensation

 

In
setting the compensation of an Office Holder, the Compensation Committee and Board of Directors shall consider the following factors,
among others, to the extent relevant to the Office Holder:

 

		2.1	the
                                            education, qualifications, expertise, professional experience, and achievements of the Office
                                            Holder;

 

		2.2	the
                                            Office Holder’s position, his or her fields of responsibility, and his or her expected
                                            contributions to achieving the Company’s goals, as well as any additional duties and
                                            positions with the Company and its subsidiaries which go beyond the Office Holder’s
                                            position specified in his or her service or employment agreement;

 

		2.3	the
                                            Office Holder’s existing and prior compensation arrangements with the Company or its
                                            affiliates, or prior employers, to the extent not prohibited by law and best practices;

 

		2.4	the
                                            terms of compensation of corresponding functionaries in the Company;

 

 

	1	With respect to any reference in the Compensation Policy to annual wage (gross)/base salaries, the total actual cost to the Company will
also include payment of social and related benefits to the extent required by law.

 

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		2.5	to
                                            the extent necessary, and in the Compensation Committee’s discretion, a comparison
                                            shall 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;

 

		2.6	the
                                            Office Holder’s past performance and expected contribution to the Company’s future
                                            growth and profitability;

 

		2.7	the
                                            ratio between the compensation of the Office Holder and that of other employees of the Company;
                                            and

 

		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.

 

		3.	Ratio
                                            Between Fixed and Variable Components; Intra-Company Compensation Ratio

 

		3.1	The
                                            total annual variable compensation of each Office Holder may be any percentage less than
                                            100% (based on the planned compensation package) of the total compensation package of such
                                            Office Holder on an annual basis.

 

		3.2	In
                                            the process of establishing this Policy, the Board of Directors has examined the ratio between
                                            overall compensation of Office Holders who are officers 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.

 

		4.	The
                                            Fixed Compensation Component

 

		4.1	Base
                                            Salary

 

		4.1.1	Chairperson
                                            of the Board of Directors

 

		4.1.1.1	The
                                            total, gross annual payment to the Chairperson of the Board of Directors with respect to
                                            the provision of services to the Company will be determined by the Compensation Committee,
                                            the Board of Directors and the general meeting of the Company’s shareholders. Said
                                            approved gross annual payment may include a mechanism for payment updates and currency conversion
                                            calculations.

 

		4.1.1.2	In
                                            addition, the Chairperson of the Board of Directors will be entitled to reimbursement for
                                            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.

 

		4.1.2	Directors
                                            (other than the Chairperson of the Board of Directors), in their capacity as directors

 

		4.1.2.1	The
                                            remuneration to external directors, if any, and independent directors of the Company will
                                            be (i) relative remuneration 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 (the “External
                                            Director Regulations”), as in effect from time to time (for the avoidance of doubt,
                                            as the External Director Regulations may be amended by the Companies Regulations (Relief
                                            for Public Companies Whose Securities are Traded on Stock Exchanges Outside of Israel), 5760-2000,
                                            as in effect from time to time). External directors may also be entitled to Equity Awards
                                            (as defined in Section ‎6 below), subject to the provisions of the External Director
                                            Regulations.

 

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		4.1.2.2	The
                                            Company shall be entitled to pay special compensation to an expert director, which will be
                                            (i) relative remuneration or (ii) annual remuneration and per meeting remuneration, which
                                            shall be determined in accordance with the provisions stipulated in the External Director
                                            Regulations as in effect from time to time.

 

		4.1.2.3	The
                                            remuneration that will be paid to directors who are not external directors, independent directors
                                            or the Chairperson of the Board of Directors may include both fixed and variable components,
                                            as will be determined by the Compensation Committee, the Board of Directors and the general
                                            meeting of the Company’s shareholders. Said approved remuneration may include a mechanism
                                            for payment updates and currency conversion calculations.

 

		4.1.2.4	In
                                            addition, all directors of the Company will be entitled to reimbursement for expenses actually
                                            paid in the context of their duties, upon presentation of receipts, all in accordance with
                                            Company practice. There is no cap on such reimbursement.

 

		4.1.3	Company
                                            CEO

 

		4.1.3.1	The
                                            annual gross salary of the Chief Executive Officer (CEO) of the Company will be determined
                                            by the Compensation Committee, the Board of Directors and the general meeting of the Company’s
                                            shareholders, if required by applicable law. Said approved annual gross salary may include
                                            a mechanism for salary updates and currency conversion calculations.

 

    5

     

    

 

		4.1.3.2	In
                                            determining the Company CEO’s salary, the members of the Compensation Committee and
                                            Board of Directors may take into consideration the salaries of chief executive officers 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 CEO’s
                                            contribution to the Company.

 

		4.1.3.3	In
                                            addition, the Company CEO will be entitled to reimbursement for 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.

 

		4.1.4	Officers

 

		4.1.4.1	The
                                            annual gross salary of the officers of the Company other than the CEO will be determined
                                            by the Compensation Committee and the Board of Directors. Said approved annual gross salary
                                            may include a mechanism for salary updates and currency conversion calculations.

 

		4.1.4.2	In
                                            determining the salary of an officer of the Company other than the CEO, the members of the
                                            Compensation Committee and Board of Directors may take into consideration the recommendation
                                            of the CEO, the salaries of similar officers of the Comparable Companies as well as the Company’s
                                            financial performance and the officer’s contribution to the Company.

 

		4.1.4.3	In
                                            addition, an officer of the Company other than the CEO will be entitled to reimbursement
                                            for 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.

 

		4.1.4.4	Notwithstanding
                                            any other provision of this Compensation Policy, the Company CEO may approve an amendment
                                            to the terms of service or employment (whether fixed or variable) of officers reporting to
                                            him or her, provided that (i) such amendment is not material, (ii) such amendment is consistent
                                            with the provisions of this Compensation Policy, and (iii) the aggregate effect of such amendment
                                            during the term of this Policy does not exceed three (3) months of such officer’s salary
                                            for the applicable year. Such an immaterial amendment so approved by the Company CEO as aforesaid
                                            shall be reported to the Compensation Committee at its first meeting following such approval,
                                            and shall be in compliance with this Policy.

 

    6

     

    

 

		4.2	Benefits

 

		4.2.1	The
                                            Company shall be entitled to grant Office Holders (other than in the capacity of directors)
                                            benefits as specified below, which shall be determined taking into account the terms customary
                                            in the market for Office Holders in similar positions and in accordance with the Company’s
                                            policies, 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, Office Holders (other than a director)
                                            employed outside of Israel may receive other benefits that are customary in the jurisdiction
                                            in which he or she is employed.

 

		4.2.2	The
                                            Company may offer additional benefits to its Office Holders (other than in the capacity of
                                            directors), including but not limited to, mobile phones, mobile computers, Internet connection,
                                            other telecommunication and electronic devices and communication expenses, company cars and
                                            travel benefits, 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 Office
                                            Holder shall not be deemed an employment benefit for any purpose.

 

		4.2.3	In
                                            the event of relocation or repatriation of an officer
                                            to another country, such officer may receive benefits including reimbursement for out-of-pocket payments,
                                            whether one time or ongoing, such as moving expenses, housing allowance, car allowance, home
                                            leave visit, etc.

 

		4.3	Signing
                                            Bonus, Retention Bonus and Relocation Bonus

 

		4.3.1	The
                                            Company shall be entitled, under circumstances to be approved by the Compensation Committee
                                            and the Board of Directors, to offer an Office Holder (other than in the capacity of a director)
                                            a signing bonus, a retention bonus, or a bonus for relocation, all subject to obtaining the
                                            approvals required by law.

 

		4.3.2	In
                                            the event of hiring a new Office Holder (other than a director), the Compensation Committee
                                            and the Board of Directors may elect to pay a signing bonus.  The maximum cash signing
                                            bonus payable to such an Office Holder shall not exceed twelve (12) months of such Office
                                            Holder’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 of Directors,
                                            that the Office Holder will be required to return all or part of the signing bonus to the
                                            Company to the extent that he or she does not complete a minimum term of service with the
                                            Company.

 

    7

     

    

 

		4.3.3	A
                                            bonus for relocation may be granted in the event an Office Holder is relocated to a different
                                            country or state in order to work for the Company. The total bonus for relocation will not
                                            exceed the sum of the employer’s cost for twelve (12) months of such Office Holder’s
                                            salary and additional or related benefits for the specific year of the relevant
                                            Office Holder, and may be paid in cash or as share-based compensation, at the discretion
                                            of the Compensation Committee and the Board of Directors. The above limitation excludes any
                                            reimbursement of expenses incurred by the Office Holder in connection with such relocation
                                            as set forth in Section ‎4.2.3 above. The Company shall be entitled to determine on the
                                            date the relocation bonus is granted and at the discretion of the Compensation Committee
                                            and the Board of Directors, that the Office Holder will be required to return all or part
                                            of the relocation bonus to the Company to the extent that he or she does not complete a minimum
                                            term of service with the Company.

 

		4.3.4	The
                                            total retention bonus shall not exceed the sum of the employer’s cost for twelve (12)
                                            months of such Office Holder’s salary and additional or related benefits for the specific
                                            year of the relevant Office Holder. The Company shall be entitled to determine, on the date
                                            the retention bonus is granted and at the discretion of the Compensation Committee and the
                                            Board of Directors, that the Office Holder will be required to return all or part of the
                                            signing bonus to the Company to the extent that he or she does not complete a minimum additional
                                            term of service with the Company.

 

		4.4	Severance
                                            Pay and Retirement Payments

 

		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 Office Holder under circumstances which, in the opinion of the Compensation
                                            Committee and the Board of Directors, grant the Company the right to terminate his or her
                                            employment or service without severance pay under the law should such officer have been an
                                            employee of the Company), the Office Holder will be entitled to severance pay to the extent
                                            required by law or, alternatively, to the amount of the payments deposited on his or her
                                            behalf with respect to severance pay into a provident fund, pension funds, etc. (e.g.,
                                            in accordance with the provisions of Section 14 of the Israeli Severance Pay Law, 5763-1963)
                                            and in the case of an Office Holder whose terms of employment or service are not governed
                                            by Israeli law, the severance normally allocated in the Office Holder’s home country,
                                            all in the discretion of the Company and according to the provisions stipulated in the employment
                                            or service agreement.

 

		4.4.2	Notwithstanding
                                            the above, the Company shall be entitled to stipulate in an employment or service agreement
                                            with an Office Holder (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 Office Holder by
                                            law, up to a cap equal to the employer’s cost for twenty-four (24) months of such Office
                                            Holder’s salary and additional or related benefits for the specific 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 the Office Holder’s role, position, the number of years of his or her
                                            employment or service with the Company, and so forth.

 

    8

     

    

 

		4.5	Advance
                                            Notice and Adaptation or Transition Period

 

		4.5.1	The
                                            Company shall be entitled to give the CEO of the Company a period of advance notice of termination
                                            of up to twelve (12) months. The Company shall be entitled to give an officer in the Company
                                            who is not the CEO a period of advance notice of termination of up to twelve (12) months.
                                            The Company shall be entitled to waive the services of an officer (including the Company
                                            CEO) with the Company 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
                                            shall be entitled to terminate an officer’s (including the Company CEO’s) employment
                                            or service without advance notice, provided the Company pays the officer (who may be the
                                            Company CEO), on the date of the termination of his or her employment or service, payments
                                            that shall not be less than 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).

 

		4.5.2	The
                                            Compensation Committee and the Board of Directors will be entitled to grant an officer (who
                                            may be the Company CEO) monetary and 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.

 

		4.5.3	The
                                            Company may provide an additional adaptation or transition period during which an Office
                                            Holder 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 Board may, upon approval by the Compensation Committee, extend the vesting of an Office
                                            Holder’s options or other equity awards during such period. In this regard, the Compensation
                                            Committee and Board of Directors shall take into consideration the Office Holder’s
                                            term of employment or service, the officer’s compensation during employment or service
                                            with the Company, the Company’s performance during such period, and the contribution
                                            of the officer in achieving the Company’s goals and the circumstances of termination.

 

    9

     

    

 

		4.6	Payment
                                            upon a Change of Control and a Cap for all payments due to termination of Service

 

		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, except that, instead of 24 months, the limit
                                            shall be 36 months.

 

		4.7	Non-solicitation
                                            or Non-compete Arrangements

 

		4.7.1	Non-solicitation or
                                            non-compete undertakings by an Office Holder, and payment in consideration for such undertakings,
                                            shall not exceed twenty-four (24) months of such Office Holder’s salary.

 

		4.8	Cap
                                            for Payments Upon Termination of Service

 

		4.8.1	All
                                            non-equity payments due as a result of the Office Holders’ termination of service shall,
                                            in no event, exceed in the aggregate the employer’s cost for twenty-four (24) months
                                            of such Office Holder’s salary and additional or related benefits for the specific
                                            year of the relevant Office Holder, 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).

 

		5.	The
                                            Variable Cash Component – Bonuses, Special Bonuses and Commissions

 

		5.1	Targets
                                            for an annual cash bonus (“Annual Bonus”) for an Office Holder (including
                                            the Company CEO but excluding non-executive directors)

 

The
Company may grant an Office Holder (including the Company CEO) an Annual Bonus that will be calculated based on the achievement of targets
and indicators of various types, in whole or in part, all as specified below. Such targets and indices with respect to the Company CEO
shall be approved by the Compensation Committee and the Board of Directors pursuant to this Policy.

 

    10

     

    

 

The
Company may grant Office Holders who report to the Company CEO (other than in the capacity of a director) an Annual Bonus, which will
be calculated taking into consideration the achievement by the respective Office Holder of targets and indicators of various types, in
whole or in part. Such targets and indices may be determined solely by the Company’s CEO, as specified below.

 

		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; (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. The weight that may be given to one or more Company
                                            Targets is up to 100%. 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 of Directors.

 

		5.1.2	Individual
                                            Targets – Indicators that will be determined in relation to each of the Office
                                            Holders (including the Company CEO), in accordance with such Office Holder’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, raising capital (including by means of a public offering), meeting success targets
                                            for customer training and marketing events, and meeting supply targets.

 

		5.1.3	Supervisor’s
                                            Evaluation – Performance evaluation by the Board of Directors (in relation to the
                                            CEO) or by the CEO of the Company (in relation to all other Office Holders who report to
                                            the CEO). The evaluation may address criteria that are not financial, the long-term contribution
                                            of the Office Holder 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 Office
                                            Holder who is an officer with skills, know-how or unique expertise; the responsibility imposed
                                            on an Office Holder; changes that occurred in the responsibility imposed on an Office Holder
                                            during the year; performance satisfaction, including assessing the degree of involvement
                                            of an Office Holder and devotion of efforts in the performance of his or her duties; assessment
                                            of the ability of an Office Holder to work in coordination and cooperation with other employees;
                                            and contribution to an appropriate control environment and ethical environment. For the Company
                                            CEO, the scope of this discretionary component may be up to the higher of three (3) months
                                            of such Office Holder’s base salary or 30% of the total target Annual Bonus. For other
                                            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 of Directors.  

 

 

	2	For the purpose of the above, operating income/loss may be measured on a non-GAAP basis, for example after neutralizing depreciation
and amortization, changes in allocations for lost and doubtful accounts, expenses with respect to equity-based compensation, and the
effect of one-time events. 

 

    11

     

    

 

		5.2	The
                                            Compensation Committee and the Board of Directors (with respect to the Company CEO) or the
                                            Company CEO (with respect to officers reporting to him or her) will determine the Company
                                            and individual targets for each respective year. The Compensation Committee and the Board
                                            of Directors, or the Company CEO, as set forth above, may condition the entitlement to an
                                            Annual Bonus on meeting one or more targets.

 

		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 officer (to the extent that
                                            targets are determined for each officer, as noted above), and may be based on the officer’s
                                            role and according to the organizational unit to which he or she belongs and which he or
                                            she supervises.

 

		5.4	Maximum
                                            Annual Bonus – The maximum amount of the Annual Bonus shall not exceed (i) 36 months’
                                            base salary for the Company CEO, and (ii) 24 months’ base salary for any other Office
                                            Holder.

 

		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 Office Holder to
                                            severance pay), the Office Holder may be entitled to a relative portion of the Annual Bonus,
                                            which will be calculated pro rata, in accordance with the period during which the respective
                                            officer was employed by the Company in the respective calendar year.

 

		5.6	Special
                                            Bonus for the CEO

 

		5.6.1	In
                                            addition to an Annual Bonus, the Compensation Committee and the Board of Directors may approve
                                            a special bonus (which may be discretionary or based on predetermined targets) for the Company
                                            CEO. If required under applicable law, the special bonus will be subject to approval of the
                                            Company’s shareholders.

 

		5.6.2	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 the higher of three
                                            (3) months’ base salary or 30% of the CEO’s total target Annual Bonus.

 

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		5.7	Special
                                            Bonus for Office Holders Reporting to the CEO

 

		5.7.1	The
                                            Compensation Committee and the Board of Directors may determine that, in addition to the
                                            Annual Bonus or instead of the Annual Bonus, an Office Holder who reports to the Company
                                            CEO may be eligible for a special bonus (which may be based on criteria that are not measurable
                                            or based on predetermined targets) which shall not exceed twelve (12) months’ base
                                            salary of such Office Holder.

 

		5.7.2	As
                                            part of the variable compensation component of any Office Holder reporting to the Company
                                            CEO, the Company CEO may approve a bonus that is not based on measurable criteria, which
                                            shall not exceed three (3) months of such Office Holder’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 Company CEO.

   

		5.8	Commissions

 

		5.8.1	The
                                            Company may pay commissions to Office Holders in accordance with the Company’s policies
                                            which shall be approved by the Compensation Committee and the Board of Directors. Commissions
                                            may be paid in addition to an Annual Bonus or a special bonus.

 

		5.8.2	The
                                            amount of the commissions awarded to an Office Holder 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. In any event, the amount of commissions awarded to an Office
                                            Holder shall not exceed 90% of the base annual salary of the Office Holder.

 

		5.9	Discretion
                                            Regarding Reduction of Bonuses

 

The
Compensation Committee and the Board of Directors shall be entitled, in cases of fraud or willful misconduct to reduce or cancel a bonus
or commissions to an Office Holder to the extent permitted by the applicable law of the jurisdiction governing the Office Holder.

 

		6.	The
                                            Variable Equity Component

 

		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 (in this section,
                                            “Equity Awards”), to Office Holders, as a long-term incentive. The Company’s
                                            Board of Directors may permit the grant of equity-based awards by any subsidiary of the Company
                                            (whether wholly owned or not) to Office Holders, provided that the below principles (including
                                            vesting period and fair value) shall apply, subject to applicable changes.

 

		6.2	Equity
                                            Cap – The total number of shares subject to all Equity Awards granted to an Office
                                            Holder in any fiscal year shall not exceed 1.5% of fully diluted share capital of the Company
                                            at the time of grant.

 

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		6.3	Amendment
                                            of Performance Criteria - To the extent applicable, the performance criteria of a performance
                                            Equity Award may be revisited with and adjusted upward or downward by the Committee, and
                                            if approved by the Committee, then by the Board, during the performance period, including
                                            in order to account for changes in the roles and responsibilities of an Office Holder who
                                            is an officer, recruitments and promotions during such year, significant changes in the Company’s
                                            operations or business or market terms, mergers and acquisitions or other material changes
                                            applicable to the Company.

 

		6.4	Formulation
                                            of Eligibility – The Company shall be entitled to grant Office Holders 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 shall also be entitled to grant Office Holders
                                            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 of the Company. 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.

 

		6.5	Vesting
                                            Period – The vesting period of Equity Awards will be as determined by the Company on
                                            the date they are granted, but in any event (other than as described in Section ‎6.6
                                            below), the vesting period of Equity Awards shall be spread over not less than one year from
                                            the grant date or from the start of the Office Holder’s employment or service with
                                            the Company.

 

		6.6	Acceleration
                                            of Vesting of Equity Awards – The Board of Directors may, following approval by the
                                            Compensation Committee, determine provisions with respect to the acceleration of the vesting
                                            period of any Office Holder’s Equity Awards, including, without limitation, in connection
                                            with a corporate transaction or a change of control.

 

		6.7	Adjustments
                                            – The exercise price of Equity Awards may be subject to customary adjustments, including
                                            adjustments with respect to a dividend, bonus shares, changes in equity (consolidation, split,
                                            etc.), the issuance of rights, a change in the Company’s structure (such as a stock
                                            split, reverse split, merger, etc.), and so forth.

 

		6.8	Method
                                            of Exercise of Equity Awards – The Compensation Committee and the Board of Directors
                                            may stipulate that the exercise of any Equity Awards may be made according to the value of
                                            the benefit inherent therein (“net exercise”), in consideration for sale of shares,
                                            or by any other lawful method.

 

		6.9	Exercise
                                            Period – The Company may determine for each option granted to an Office Holder 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.

 

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		7.	Employment
                                            as a Contractor or by Means of a Personal Services Company

 

The
Company may employ an Office Holder as an independent contractor rather than as an employee. In such case, all of the ceilings stipulated
in this Policy will be converted into employer cost terms in order to examine whether the terms of the employment of such Office Holder
meet the principles of this Compensation Policy, which shall apply to him or her mutatis mutandis. In such case, the term “employment
agreement” in this Policy shall refer to an “agreement for the provision of services” or a “consulting agreement,”
as applicable.

 

		8.	Indemnification,
                                            Exculpation and Insurance

 

		8.1	The
                                            Company may grant Office Holders (including 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.

 

		8.2	Without
                                            derogating from the generality of the above, the Company may, at any time during the term
                                            of this Compensation 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 said engagements shall be on the basis of the
                                            principles of the terms specified below and the Compensation Committee and the Board of Directors
                                            have approved it:

 

		8.2.1	The
                                            maximum coverage under the policy shall not exceed the higher of (i) $150 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;

 

		8.2.2	The
                                            Compensation Committee and Board of Directors may approve annually the Company’s purchasing
                                            a new policy that meets the terms established in this Policy;

 

		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

 

		8.2.4	The
                                            policy shall also cover the liability of directors and officers considered controlling shareholders
                                            of the Company 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

 

To
reflect sound corporate governance, the Board of Directors or Compensation Committee, in its discretion, may determine that an Office
Holder’s rights, payments and benefits with respect to annual or special bonuses and equity awards granted to such Office Holder
shall be subject to reduction, cancellation, forfeiture, rescission or recoupment upon the occurrence of certain specified events, in
addition to any otherwise applicable vesting, restrictions or other performance conditions of the equity award. Such events may include,
but shall not be limited to, termination with or without cause, or breach of noncompetition, confidentiality, or other restrictive covenants
that may apply to the Office Holder.

 

In
addition, in the event that

 

		(i)	less
                                            than two years have passed from the date of payment of such compensation to an Office Holder,
                                            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 Office Holder 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 of Directors or Compensation Committee, in its discretion, may (and, to the extent required by law, shall) require the Office Holder
to reimburse the Company for the difference between the amount of the compensation received and that to which the Office Holder would
have been entitled as a result of such restatement or other revision.

 

The
manner of payment or reimbursement of such sums, as applicable, shall be determined by the Compensation Committee and Board of Directors.

 

Nothing
in this Section ‎9 derogates from any other “recoupment,” “claw-back” or similar provisions regarding disgorging
of profits imposed on Office Holders by virtue of applicable law.

 

    16

     

    

 

		10.	Term
                                            of Compensation Policy

 

This
Compensation Policy shall remain in effect for a period of five years, commencing on the date of approval of the Compensation Policy
by the general meeting of shareholders.

 

		11.	Policy
                                            Caps

 

Any
deviation from any cap set forth in this Policy by up to 10% shall not be deemed to be a deviation and the compensation shall be viewed
as compensation in compliance with this Policy and its provisions.

 

		12.	Advance
                                            of Payments

 

To
the extent permitted under applicable law, including Section 402 of the Sarbanes Oxley Act of 2002, any cash compensation contemplated
under this Compensation Policy may be paid up to 6 months in advance, provided that the amount of the advance shall not exceed 50% of
the employer’s cost for such Office Holder’s salary and additional or related benefits for such period.

 

		13.	Miscellaneous

 

Nothing
contained in this Policy shall derogate from the provisions of the Companies Law or the Company’s Articles of Association with
regard to the manner in which the Company engages an Office Holder of any kind in connection with the terms of their service and employment.
Similarly, the provisions of this Policy do not derogate from any requirement to report Office Holders’ compensation in accordance
with applicable law.

 

*
* * * *

 

 

17

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