Document:

Exhibit 4.8

 

JV PURCHASE PRICE ESCROW AGREEMENT

 

ESCROW
AGREEMENT (“Agreement”) dated December __, 2015 by and among Cambridge Holdco Corp., a Cayman Islands company (“Holdco”),
Benjamin Gordon (the “Representative”), as the representative of Surviving Pubco (as defined below) immediately prior
to the Effective Time (as defined in the Reorganization Agreement), Ability Security Systems Ltd., an Israeli company (“ASM”),
Eyal Tzur, the sole shareholder and owner of ASM (“ASM SH”), each of the undersigned former holders (the “Stockholders”)
of the outstanding capital stock of Ability Company & Software Industries Ltd., an Israeli company (the “Company”),
and Continental Stock Transfer & Trust Company, as escrow agent (the “Escrow Agent”).

 

Holdco,
Cambridge Capital Acquisition Corporation, a Delaware corporation (“Cambridge”), the Company and the Stockholders
are the parties to an Agreement and Plan of Reorganization dated as of September 6, 2015 (the “Reorganization Agreement”)
pursuant to which (i) Cambridge has merged with and into Holdco, with Holdco being the surviving entity of such merger (the “Merger,”
and the surviving entity of the Merger is referred to herein as the “Surviving Pubco”), and (ii) the Stockholders
have exchanged 100% of the shares of the Company for ordinary shares of Surviving Pubco (the “Surviving Pubco Stock”),
including the right to receive certain contingent shares as provided for in Section 1.13 of the Reorganization Agreement, and
cash as provided therein (the “Share Exchange”).

 

ASM,
ASM SH, the Company, Cambridge, Holdco and the Stockholders are parties to a Share Purchase Agreement dated as of September 6,
2015 (the “Joint Venture Acquisition Agreement”) pursuant to which (i) ASM SH shall have the right to exercise the
Put Option (as defined in the JV Acquisition Agreement) (the “Put Option”) during the Option Period (as defined in
the JV Acquisition Agreement) (the “Option Period”), and (ii) Surviving Pubco shall have the right to exercise the
Call Option (as defined in the Joint Venture Acquisition Agreement) (the “Call Option”) during the Call Period (as
defined in the JV Acquisition Agreement) (the “Call Period”), in each case, subject to the terms and conditions of
the Joint Venture Acquisition Agreement. The parties desire to establish an escrow fund to hold 480,000 shares of Surviving Pubco
Stock otherwise issuable to the Stockholders at Closing to secure the exercise of the Put Option or Call Option.

 

Capitalized
terms used herein that are not otherwise defined herein shall have the meanings ascribed to them in the Reorganization Agreement.
The Stockholders, together with their permitted transferees, including the ASM SH, are referred to herein as the “Owners.”

 

The
parties agree as follows:

 

1.    (a)    Concurrently
with the execution hereof, each of the Stockholders (or Holdco, on their behalf) is delivering to the Escrow Agent, to be
held in escrow pursuant to the terms of this Agreement, stock certificates in the amounts set forth in Schedule A hereto
issued in the name of such Stockholder representing a portion of the shares of Surviving Pubco Stock issued to such
Stockholder in the Share Exchange. The shares of Surviving Pubco Stock represented by the stock certificates so delivered by
the Stockholders to the Escrow Agent are herein referred to in the aggregate as the “Escrow Fund.” The Escrow
Agent shall maintain a separate account for each Stockholder’s, and, subsequent to any transfer permitted pursuant to
Paragraph 1(d) hereof, each Owner’s, portion of the Escrow Fund.

 

     

     

    

 

(b)    The
Escrow Agent hereby agrees to act as escrow agent and to hold, safeguard and disburse the Escrow Fund pursuant to the terms and
conditions hereof. It shall treat the Escrow Fund as a trust fund in accordance with the terms of this Agreement and not as the
property of Surviving Pubco. The Escrow Agent’s duties hereunder shall terminate upon its distribution of the entire Escrow
Fund in accordance with this Agreement.

 

(c)   Except
as herein provided, the Owners shall retain all of their rights as shareholders of Surviving Pubco with respect to shares of Surviving
Pubco Stock constituting the Escrow Fund during the period the Escrow Fund is held by the Escrow Agent in accordance with Section
2 of the Joint Venture Acquisition Agreement (the “Escrow Period”), including, without limitation, the right to vote
their shares of Surviving Pubco Stock included in the Escrow Fund. For purposes of clarity, subject to Sections 2(b) and 2(c)
below which may extend the Escrow Period in certain circumstances with respect to a portion of the Escrow Fund, the Escrow Period
shall be the greater of the Option Period and the Call Period.

 

(d)    During
the Escrow Period, all dividends payable in cash with respect to the shares of Surviving Pubco Stock included in the Escrow Fund
shall be paid to the Owners, but all dividends payable in stock or other non-cash property (“Non-Cash Dividends”)
shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As used herein, the term “Escrow Fund”
shall be deemed to include the Non-Cash Dividends distributed thereon, if any.

 

(e)   During
the Escrow Period and except as otherwise set forth in the Two Year Lock-Up Agreement applicable to each Stockholder, no sale,
transfer or other disposition may be made of any or all of the shares of Surviving Pubco Stock in the Escrow Fund except (i) to
a “Permitted Transferee” (as hereinafter defined), (ii) by virtue of the laws of descent and distribution upon death
of any Owner, or (iii) pursuant to a qualified domestic relations order; provided, however, that such permissive
transfers may be implemented only upon the respective transferee’s written agreement to be bound by the terms and conditions
of this Agreement. As used in this Agreement, the term “Permitted Transferee” shall include: (1) members of a Stockholder’s
“Immediate Family” (as hereinafter defined); (2) an entity in which (A) a Stockholder and/or members of a Stockholder’s
Immediate Family beneficially own 100% of such entity’s voting and non-voting equity securities, or (B) a Stockholder and/or
a member of such Stockholder’s Immediate Family is a general partner and in which such Stockholder and/or members of such
Stockholder’s Immediate Family beneficially own 100% of all capital accounts of such entity; (3) a revocable trust established
by a Stockholder during his lifetime for the benefit of such Stockholder or for the exclusive benefit of all or any of such Stockholder’s
Immediate Family; and (4) any Affiliate. As used in this Agreement, the term “Immediate Family” means, with respect
to any Stockholder, a spouse, parent, lineal descendants, the spouse of any lineal descendant, and brothers and sisters (or a
trust, all of whose current beneficiaries are members of an Immediate Family of the Stockholder). In connection with and as a
condition to each permitted transfer, the Permitted Transferee shall agree in writing to be bound by the terms and conditions
of this Agreement. Upon receipt of such agreement, the Escrow Agent shall deliver to Surviving Pubco’s transfer agent the
original stock certificate out of which the assigned shares are to be transferred, and shall request that Surviving Pubco issue
new certificates representing (x) the number of shares, if any, that continue to be owned by the transferring Stockholder, and
(y) the number of shares owned by the Permitted Transferee as the result of such transfer. Surviving Pubco, the transferring Stockholder
and the Permitted Transferee shall cooperate in all respects with the Escrow Agent in documenting each such transfer and in effectuating
the result intended to be accomplished thereby. During the Escrow Period, no Owner shall pledge or grant a security interest in
such Owner’s shares of Surviving Pubco Stock included in the Escrow Fund or grant a security interest in such Owner’s
rights under this Agreement.

 

    	 	- 2 -	 

     

    

 

2.    (a)    In
the event that the Put Option is not exercised by the ASM SH prior to the expiration of the Option Period and the Call Option
is not exercise by Surviving Pubco prior to the expiration of the Call Period, the Escrow Fund shall be automatically
released to the Stockholders pro rata in accordance with Schedule B hereto.

 

(b)    In
the event that the Put Option is exercised by the ASM SH prior to the expiration of the Option Period in accordance with the Joint
Venture Acquisition Agreement, upon delivery of a Joint Notice (as defined below) to the Escrow Agent or, in the event of a dispute,
upon a final determination (after exhaustion of any appeals) of a court of competent jurisdiction, (i) the Escrow Agent shall
release ninety-five (95%) of the Surviving Pubco Stock comprising the Escrow Fund to the ASM SH, and (ii) the remaining five percent
(5%) of the Escrow Fund shall remain in escrow for one year from the closing of the Put Option as determined by Section 4.1 of
the Joint Venture Acquisition Agreement.

 

(c)    In
the event that the Call Option is exercised by Surviving Pubco prior to the expiration of the Call Period in accordance with the
Joint Venture Acquisition Agreement, upon delivery of a Joint Notice (as defined below) to the Escrow Agent or, in the event of
a dispute, upon a final determination (after exhaustion of any appeals) of a court of competent jurisdiction, (i) the Escrow Agent
shall release eighty-five (85%) of the Surviving Pubco Stock comprising the Escrow Fund to the ASM SH, (ii) ten (10%) of the Surviving
Pubco Stock comprising the Escrow Fund to the Stockholders pro rata in accordance with Schedule B hereto, and (iii) the remaining
five percent (5%) of the Escrow Fund shall remain in escrow for one year from the closing of the Call Option as determined by
Section 4.2 of the Joint Venture Acquisition Agreement.

 

(d)    As
used in this Agreement, a “Joint Notice” means a written notice executed and delivered by the ASM SH, the Representative
and Stockholder Nominee (as defined herein) to the Escrow Agent directing the Escrow Agent to release the Escrow Fund in accordance
with Section 2(a) (in the event of an exercise of the Put Option) or in accordance with Section 2(b) (in the event of an exercise
of the Call Option), as applicable.

 

(e)    For
purposes of clarification, the five percent (5%) of the Escrow Fund remaining in escrow in accordance with Section 2(a)(ii)
(in the event of an exercise of the Put Option) or in accordance with Section 2(b)(iii) (in the event of an exercise of the
Call Option), as applicable (the “Remaining Escrow Fund”), shall be held in escrow by the Escrow Agent as a
remedy for the indemnification obligations set forth in Article VII of the Reorganization Agreement. The Remaining Escrow
shall be governed by that certain Escrow Agreement dated as of the date hereof by and among Holdco, the Representative, the
Stockholders and the Escrow Agent (the “Indemnity Escrow Agreement”), which is attached hereto as Exhibit A, and
shall be added to the amount of the “Escrow Fund” (as such term is defined in the Indemnity Escrow Agreement)
thereunder.

 

    	 	- 3 -	 

     

    

 

3.    The
Escrow Agent, the Representative and Stockholder Nominee shall cooperate in all respects with one another in the calculation of
any amounts determined to be payable to Surviving Pubco and the Owners in accordance with this Agreement and in implementing the
procedures necessary to effect such payments.

 

4.    (a)    The
Escrow Agent undertakes to perform only such duties as are expressly set forth herein. It is understood that the Escrow Agent
is not a trustee or fiduciary and is acting hereunder merely in a ministerial capacity.

 

(b)    The
Escrow Agent shall not be liable for any action taken or omitted by it in good faith and in the exercise of its own best judgment,
and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel
(including counsel chosen by the Escrow Agent), statement, instrument, report or other paper or document (not only as to its due
execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information
therein contained) which is believed by the Escrow Agent to be genuine and to be signed or presented by the proper person or persons.
The Escrow Agent shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement
unless evidenced by a writing delivered to the Escrow Agent signed by the proper party or parties and, if the duties or rights
of the Escrow Agent are affected, unless it shall have given its prior written consent thereto.

 

(c)    The
Escrow Agent’s sole responsibility upon receipt of any notice requiring any payment to any party hereunder pursuant to the
terms of this Agreement or, if such notice is disputed by the Representative or Stockholder Nominee, the settlement with respect
to any such dispute, whether by virtue of joint resolution, arbitration or determination of a court of competent jurisdiction,
is to pay to such party the amount specified in such notice, and the Escrow Agent shall have no duty to determine the validity,
authenticity or enforceability of any specification or certification made in such notice.

 

(d)     The
Escrow Agent shall not be liable for any action taken by it in good faith and believed by it to be authorized or within the rights
or powers conferred upon it by this Agreement, and may consult with counsel of its own choice and shall have full and complete
authorization and indemnification under Section 5(g), below, for any action taken or suffered by it hereunder in good faith and
in accordance with the opinion of such counsel.

 

(e)    The
Escrow Agent may resign at any time and be discharged from its duties as escrow agent hereunder by its giving the other
parties hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall
become effective at such time that the Escrow Agent shall turn over the Escrow Fund to a successor escrow agent appointed
jointly by the Representative and Stockholder Nominee. If no new escrow agent is so appointed within the 60 day period
following the giving of such notice of resignation, the Escrow Agent may deposit the Escrow Fund with any court it reasonably
deems appropriate. The Escrow Agent shall resign and be discharged from its duties as escrow agent hereunder if so requested
in writing at any time by the parties hereto, jointly, provided, however, that such resignation shall become effective only
upon acceptance of appointment by a successor escrow agent as provided in this Section 5(e).

 

    	 	- 4 -	 

     

    

 

(f)     The
Escrow Agent shall be indemnified and held harmless by Surviving Pubco from and against any expenses, including counsel fees and
disbursements, or loss suffered by the Escrow Agent in connection with any action, suit or other proceeding involving any claim
which in any way, directly or indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder,
or the Escrow Fund held by it hereunder, other than expenses or losses arising from the gross negligence or willful misconduct
of the Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any
action, suit or proceeding, the Escrow Agent shall notify the other parties hereto in writing. In the event of the receipt of
such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in the any state or
federal court located in New York County, State of New York.

 

(g)    The
Escrow Agent shall be entitled to reasonable compensation from Surviving Pubco for all services rendered by it hereunder. The
Escrow Agent shall also be entitled to reimbursement from Surviving Pubco for all expenses paid or incurred by it in the administration
of its duties hereunder including, but not limited to, all counsel, advisors’ and agents’ fees and disbursements and
all taxes or other governmental charges.

 

(h)     From
time to time on and after the date hereof, the Representative and Stockholder Nominee shall deliver or cause to be delivered to
the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent
shall reasonably request to carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith
or to assure itself that it is protected in acting hereunder.

 

(i)     Notwithstanding
anything herein to the contrary, the Escrow Agent shall not be relieved from liability hereunder for its own gross negligence
or its own willful misconduct.

 

5.    This
Agreement expressly sets forth all the duties of the Escrow Agent with respect to any and all matters pertinent hereto. No implied
duties or obligations shall be read into this Agreement against the Escrow Agent. The Escrow Agent shall not be bound by the provisions
of any agreement among the parties hereto except this Agreement and the Indemnity Escrow Agreement and shall have no duty to inquire
into the terms and conditions of any agreement made or entered into in connection with this Agreement, including, without limitation,
the Reorganization Agreement.

 

6.     This
Agreement shall inure to the benefit of and be binding upon the parties and their respective heirs, successors, assigns and legal
representatives shall be governed by and construed in accordance with the law of New York applicable to contracts made and to
be performed therein. This Agreement cannot be changed or terminated except by a writing signed by the Representative, the Escrow
Agent and a majority of the Stockholders.

 

    	 	- 5 -	 

     

    

 

7.   All
disputes arising under this Agreement between the ASM SH, the Representative and Stockholder Nominee, including a dispute arising
from a party’s failure or refusal to sign a Joint Notice, shall be submitted to arbitration to the American Arbitration
Association in New York City. The ASM SH, the Representative and Stockholders each hereby consents to the exclusive jurisdictions
of the federal and state courts sitting in New York County, State of New York, with respect to any claim or controversy arising
out of this Agreement. Service of process in any action or proceeding brought against the ASM SH, the Representative or Stockholders
in respect of any such claim or controversy may be made upon it by registered mail, postage prepaid, return receipt requested,
at the address specified in Section 10, with copies delivered by nationally recognized overnight carrier to Graubard Miller, The
Chrysler Building, 405 Lexington Avenue, New York, N.Y. 10174, Attention: David Alan Miller, Esq., and to Blank Rome LLP, The
Chrysler Building, 405 Lexington Avenue, New York, N.Y. 10174, Attention: Robert J. Mittman.

 

8. 
 The Stockholders hereby appoint Anatoly Hurgin to act on their behalf (the “Stockholder Nominee”) to
take any and all actions and make any decisions required or permitted to be taken by such Stockholders under this Agreement.
Should the Stockholder Nominee resign or be unable to serve, a new Stockholder Nominee will be selected by a majority of the
Stockholders, whose appointment shall be effective upon execution by such successor of a joinder agreement providing for such
successor to become a party to the Escrow Agreement as the Stockholder Nominee, in which case such successor shall for all
purposes of this Agreement be the Stockholder Nominee (and the prior acts taken by the succeeded Stockholder Nominee shall
remain valid for purposes of this Agreement). The Stockholder Nominee shall not be liable to the Stockholders for any
liability, loss, damage, penalty, fine, cost or expense incurred without gross negligence or willful misconduct by the
Stockholder Nominee while acting in good faith and arising out of or in connection with the acceptance or administration of
its duties hereunder.

 

9.   All
notices and other communications under this Agreement shall be in writing and shall be deemed given if given by hand or delivered
by nationally recognized overnight carrier, or if given by telecopier and confirmed by mail (registered or certified mail, postage
prepaid, return receipt requested), to the respective parties as follows:

  

	 	A.	If
    to the Representative, to it at:
	 	 	 
	 	 	Benjamin
    Gordon
	 	 	 
	 	 	525
    South Flagler Drive, Suite 201 
	 	 	West
    Palm Beach, Florida 33401 
	 	 	Telecopy:
    (561) 655-6232 
	 	 	E-mail:
    ben@cambridgecapital.com
	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Graubard
    Miller
	 	 	The
    Chrysler Building
	 	 	405
    Lexington Avenue
	 	 	New
    York, New York 10174-1901
	 	 	Attention:
    David Alan Miller, Esq.
	 	 	Telecopy:
    212-818-8881
	 	 	Email:
    dmiller@graubard.com

 

    	 	- 6 -	 

     

    

  

	 	B.	If
    to the Stockholders, to each at the address listed on Schedule A hereto
	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Anatoly
    Hurgin
	 	 	c/o
    Ability Computer & Software Industries Ltd.
	 	 	Yad
    Harutzim 14
	 	 	Tel
    Aviv, Israel, 6770007
	 	 	Attention:
    Anatoly Hurgin
	 	 	Telecopy:
    972-3-5376483
	 	 	E-mail:
    ability@ability.co.il
	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Blank
    Rome LLP
	 	 	The
    Chrysler Building
	 	 	405
    Lexington Avenue
	 	 	New
    York, New York 10174-1901
	 	 	Attention:
    Robert J. Mittman, Esq.
	 	 	Telecopy:
    212-885-5001
	 	 	E-mail:
    rmittman@blankrome.com
	 	 	 
	 	C.	If
                                         to the ASM SH, to:

                                                                                 

                                                                                Eyal
                                         Tzur

	 	 	14
    Zalman Shneor St. Ramat
	 	 	Hasharon
    47217,Israel . P.O.B 2269
	 	 	Telecopy:
    +972-3-6092088
	 	 	E-mail:
    eyal@heronis.co.il

 

	 	D.	If
    to the Escrow Agent, to it at:
	 	 	 
	 	 	Continental
    Stock Transfer & Trust Company
	 	 	17
    Battery Place
	 	 	New
    York, New York 10004
	 	 	Attention:
    Mark Zimkind
	 	 	Telecopy:
    212-509-5150
	 	 	E-mail:
    [______________] hfarrell@continentalstock.com

 

or
to such other person or address as any of the parties hereto shall specify by notice in writing to all the other parties hereto.

 

10. (a)     If
this Agreement requires a party to deliver any notice or other document, and such party refuses to do so, the matter shall be
submitted to arbitration pursuant to paragraph 7 of this Agreement.

 

(b)     All
notices delivered to the Escrow Agent shall refer to the provision of this Agreement under which such notice is being delivered
and, if applicable, shall clearly specify to whom and in what amount the Escrow Fund is to be distributed by the Escrow Agent.

 

(c)     This
Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original instrument and all of
which together shall constitute a single agreement.

 

[Signatures
are on following page]

 

    	 	- 7 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

 

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	/s/
Benjamin Gordon
	 	Name:
    	Benjamin
    Gordon
	 	Title:
    	CEO
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	/s/
    Benjamin Gordon
	 	Benjamin
    Gordon
	 	 	 
	 	STOCKHOLDERS:
	 	 	 
	 	 
	 	Anatoly
    Hurgin
	 	 	 
	 	 
	 	Alexander
    Aurovsky
	 	 	 
	 	ABILITY
    SECURITY SYSTEMS LTD.
	 	 	 
	 	By:	                
	 	Name:	 
	 	Title:	 
	 		 
	 	 
	 	Eyal
    Tzur

 

    	 	- 8 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

  

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	                
	 	Name:
    	 
	 	Title:
    	 
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	 
	 	Benjamin
    Gordon
	 	 
	 	STOCKHOLDERS:
	 	 
	 	/s/
    Anatoly Hurgin
	 	Anatoly
    Hurgin
	 	 
	 	/s/
    Alexander Aurovsky
	 	Alexander
    Aurovsky
	 	 	 
	 	ABILITY
    SECURITY SYSTEMS LTD.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	 
	 	Eyal
    Tzur

 

    	 	- 9 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

  

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	                
	 	Name:
    	
	 	Title:
    	
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	 
	 	Benjamin
    Gordon
	 	 	 
	 	STOCKHOLDERS:
	 	 	 
	 	 
	 	Anatoly
    Hurgin
	 	 	 
	 	 
	 	Alexander
    Aurovsky
	 	 	 
	 	ABILITY
    SECURITY SYSTEMS LTD.
	 	 	 
	 	By:	/s/
    Eyal Tzur
	 	Name:	Eyal
    Tzur 
	 	Title:	CEO 
	 		 
	 	/s/
    Eyal Tzur
	 	Eyal
    Tzur
	 	 
	 	ESCROW
    AGENT:
	 	 	 
	 	CONTINENTAL
    STOCK TRANSFER & 

TRUST COMPANY
	 	 	 
	 	By:	/s/
    Henry Farrell
	 	Name:	Henry
    Farrell
	 	Title:	Vice
    President

 

 

    	 	- 10 -	 

     

    

 

Schedule
A

 

Escrow
Shares 

 

Anatoly
Hurgin: 240,000 shares of Surviving Pubco Stock

 

Alexander
Aurovsky: 240,000 shares of Surviving Pubco Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	- 11 -	 

     

    

 

Schedule
B

 

Stockholder’s
Pro Rata Portion

 

Anatoly
Hurgin: 50%

 

Alexander
Aurovsky: 50%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	- 12 -	 

     

    

 

Exhibit
A

 

Indemnity
Escrow Agreement 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    	 	- 13 -	 

     

    

 

INDEMNITY
ESCROW AGREEMENT

 

ESCROW
AGREEMENT (“Agreement”) dated December 23, 2015 by and among Cambridge Holdco Corp., a Cayman Islands company (“Holdco”),
Benjamin Gordon (the “Representative”), as the representative of Surviving Pubco (as defined below) immediately prior
to the Effective Time (as defined in the Merger Agreement), each of the undersigned former holders (the “Stockholders”)
of the outstanding capital stock of Ability Company & Software Industries Ltd., an Israeli company (“Company”),
and Continental Stock Transfer & Trust Company, as escrow agent (the “Escrow Agent”).

 

Holdco,
Cambridge Capital Acquisition Corporation, a Delaware corporation (“Cambridge”), the Company and the Stockholders
are the parties to an Agreement and Plan of Reorganization dated as of September 6, 2015 (the “Merger Agreement”)
pursuant to which (i) Cambridge has merged with and into Holdco, with Holdco being the surviving entity of such merger (the “Merger,”
and the surviving entity of the Merger is referred to herein as the “Surviving Pubco”), and (ii) the Stockholders
have exchanged 100% of the shares of the Company for ordinary shares of Surviving Pubco (the “Surviving Pubco Stock”),
including the right to receive certain contingent shares as provided for in Section 1.13 of the Merger Agreement, and cash as
provided therein (the “Share Exchange”). The parties desire to establish an escrow fund as the sole remedy for the
indemnification obligations set forth in Article VII of the Merger Agreement. The Stockholders, together with their permitted
transferees, are referred to herein as the “Owners.” Capitalized terms used herein that are not otherwise defined
herein shall have the meanings ascribed to them in the Merger Agreement.

 

The
parties agree as follows:

 

1.   (a)    Concurrently
with the execution hereof, each of the Stockholders (or Holdco, on their behalf) is delivering to the Escrow Agent, to be
held in escrow pursuant to the terms of this Agreement, stock certificates in the amounts set forth in Schedule A hereto
issued in the name of such Stockholder representing a portion of the shares of Surviving Pubco Stock issued to such
Stockholder in the Share Exchange. The shares of Surviving Pubco Stock represented by the stock certificates so delivered by
the Stockholders to the Escrow Agent are herein referred to in the aggregate as the “Escrow Fund.” The Escrow
Agent shall maintain a separate account for each Stockholder’s, and, subsequent to any transfer permitted pursuant to
Paragraph 1(d) hereof, each Owner’s, portion of the Escrow Fund.

 

(b)    The
Escrow Agent hereby agrees to act as escrow agent and to hold, safeguard and disburse the Escrow Fund pursuant to the terms and
conditions hereof. It shall treat the Escrow Fund as a trust fund in accordance with the terms of this Agreement and not as the
property of Surviving Pubco. The Escrow Agent’s duties hereunder shall terminate upon its distribution of the entire Escrow
Fund in accordance with this Agreement.

 

(c)    Except
as herein provided, the Owners shall retain all of their rights as shareholders of Surviving Pubco with respect to shares of Surviving
Pubco Stock constituting the Escrow Fund during the period the Escrow Fund is held by the Escrow Agent in accordance with Section
1.10 of the Merger Agreement (the “Escrow Period”), including, without limitation, the right to vote their shares
of Surviving Pubco Stock included in the Escrow Fund.

 

     

     

    

 

(d)    During
the Escrow Period, all dividends payable in cash with respect to the shares of Surviving Pubco Stock included in the Escrow Fund
shall be paid to the Owners, but all dividends payable in stock or other non-cash property (“Non-Cash Dividends”)
shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As used herein, the term “Escrow Fund”
shall be deemed to include the Non-Cash Dividends distributed thereon, if any.

 

(e)    During
the Escrow Period and except as otherwise set forth in the Two Year Lock-Up Agreement applicable to each Stockholder, no sale,
transfer or other disposition may be made of any or all of the shares of Surviving Pubco Stock in the Escrow Fund except (i) to
a “Permitted Transferee” (as hereinafter defined), (ii) by virtue of the laws of descent and distribution upon death
of any Owner, or (iii) pursuant to a qualified domestic relations order; provided, however, that such permissive transfers may
be implemented only upon the respective transferee’s written agreement to be bound by the terms and conditions of this Agreement.
As used in this Agreement, the term “Permitted Transferee” shall include: (1) members of a Stockholder’s “Immediate
Family” (as hereinafter defined); (2) an entity in which (A) a Stockholder and/or members of a Stockholder’s Immediate
Family beneficially own 100% of such entity’s voting and non-voting equity securities, or (B) a Stockholder and/or a member
of such Stockholder’s Immediate Family is a general partner and in which such Stockholder and/or members of such Stockholder’s
Immediate Family beneficially own 100% of all capital accounts of such entity; (3) a revocable trust established by a Stockholder
during his lifetime for the benefit of such Stockholder or for the exclusive benefit of all or any of such Stockholder’s
Immediate Family; and (4) any Affiliate. As used in this Agreement, the term “Immediate Family” means, with respect
to any Stockholder, a spouse, parent, lineal descendants, the spouse of any lineal descendant, and brothers and sisters (or a
trust, all of whose current beneficiaries are members of an Immediate Family of the Stockholder). In connection with and as a
condition to each permitted transfer, the Permitted Transferee shall agree in writing to be bound by the terms and conditions
of this Agreement. Upon receipt of such agreement, the Escrow Agent shall deliver to Surviving Pubco’s transfer agent the
original stock certificate out of which the assigned shares are to be transferred, and shall request that Surviving Pubco issue
new certificates representing (x) the number of shares, if any, that continue to be owned by the transferring Stockholder, and
(y) the number of shares owned by the Permitted Transferee as the result of such transfer. Surviving Pubco, the transferring Stockholder
and the Permitted Transferee shall cooperate in all respects with the Escrow Agent in documenting each such transfer and in effectuating
the result intended to be accomplished thereby. During the Escrow Period, no Owner shall pledge or grant a security interest in
such Owner’s shares of Surviving Pubco Stock included in the Escrow Fund or grant a security interest in such Owner’s
rights under this Agreement.

 

(f)     The
parties hereto have entered into that certain Escrow Agreement dated as of the date hereof (the “Put/Call Escrow Agreement”),
which is attached hereto as Exhibit A. For purposes of clarification, to the extent that there is an amount constituting the Remaining
Escrow Fund (as defined in the Put/Call Escrow Agreement) remaining in escrow under the Put/Call Escrow Agreement, then (i) such
Remaining Escrow Fund shall be added to the Escrow Fund hereunder and (ii) the Escrow Period shall be extended for the escrow
of such Remaining Escrow Fund in accordance with the Put/Call Escrow Agreement.

 

    	 	- 2 -	 

     

    

 

2.    (a)    Surviving
Pubco, acting through the Representative, may make a claim for indemnification pursuant to the Merger Agreement
(“Indemnification Claim”) against the Escrow Fund by giving notice (a “Notice”) to the Stockholder
Nominee (defined below), with a copy to the Escrow Agent, specifying (i) the covenant, representation, warranty, agreement,
undertaking or obligation contained in the Merger Agreement which it asserts has been breached or otherwise entitles
Surviving Pubco to indemnification, (ii) in reasonable detail, the nature and dollar amount of any Indemnification Claim, and
(iii) whether the Indemnification Claim results from a Third Party Claim against Surviving Pubco or the Company. The
Representative also shall deliver to the Escrow Agent (with a copy to the Stockholder Nominee), concurrently with its
delivery to the Escrow Agent of the Notice, a certification as to the date on which the Notice was delivered to the
Stockholders in accordance with the requirements set forth in the Merger Agreement.

 

(b)    If
the Stockholder Nominee shall give a notice to the Representative (with a copy to the Escrow Agent and Surviving Pubco) (a “Counter
Notice”), within 30 days following the date of receipt (as specified in the Representative’s certification) by the
Stockholder Nominee of a copy of the Notice, disputing whether the Indemnification Claim is indemnifiable under the Merger Agreement,
the Representative and Stockholder Nominee shall attempt to resolve such dispute by voluntary settlement as provided in paragraph
2(c) below. If no Counter Notice with respect to an Indemnification Claim is received by the Escrow Agent from the Stockholder
Nominee within such 30-day period, the Indemnification Claim shall be deemed to be an Established Claim (as hereinafter defined)
for purposes of this Agreement.

 

(c)    If
the Stockholder Nominee delivers a Counter Notice to the Representative and the Escrow Agent, the Representative and Stockholder
Nominee shall, during the period of 60 days following the delivery of such Counter Notice or such greater period of time as the
parties may agree to in writing (with a copy to the Escrow Agent), attempt to resolve the dispute in good faith with respect to
which the Counter Notice was given. If the Representative and Stockholder Nominee shall reach a settlement with respect to any
such dispute, they shall jointly deliver written notice of such settlement to the Escrow Agent specifying the terms thereof.

 

(d)     If
the Representative and Stockholder Nominee cannot resolve a dispute prior to expiration of the 60-day period referred to in paragraph
2(c) above (or such longer period as the parties may have agreed to in writing), then such dispute shall be submitted (and either
party may submit such dispute) for arbitration in accordance with Section 8.

 

(e)     As
used in this Agreement, “Established Claim” means any (i) Indemnification Claim deemed established pursuant to
the last sentence of paragraph 2(b) above, (ii) Indemnification Claim resolved in favor of Surviving Pubco by settlement
pursuant to paragraph 2(c) above, resulting in an award to Surviving Pubco, (iii) Indemnification Claim established by the
decision of an arbitrator pursuant to paragraph 2(d) above and in accordance with Section 8, resulting in an award to
Surviving Pubco, (iv) Third Party Claim that has been sustained by a final determination (after exhaustion of any appeals) of
a court of competent jurisdiction, or (v) Third Party Claim that the Representative and Stockholder Nominee have jointly
notified the Escrow Agent has been settled in accordance with the provisions of the Merger Agreement; provided that, subject
to the terms of the Merger Agreement, notwithstanding anything herein, no Indemnification Claim by Surviving Pubco shall
become an Established Claim unless and until the aggregate amount of indemnification Losses exceeds (i) the Deductible, in
which event all Indemnifiable Losses so due in excess of the Deductible shall be paid out of the Escrow Shares. The aggregate
liability for Losses shall not in any event exceed the Escrow Shares, and Surviving Pubco shall have no claim against the
Stockholders other than for any of such Escrow Shares (and any dividends declared and actually paid with respect to the
Escrow Shares).

 

    	 	- 3 -	 

     

    

 

(f)   (i)      Promptly
after an Indemnification Claim becomes an Established Claim, the Representative and Stockholder Nominee shall jointly deliver
a notice to the Escrow Agent (a “Joint Notice”) directing the Escrow Agent to pay to Surviving Pubco, and the
Escrow Agent promptly shall deliver Escrow Shares to Surviving Pubco, the dollar amount of which, valued at the “Fair
Market Value” (as defined below), shall equal the Indemnifiable Loss resulting from the Established Claim (or, if at
such time there remains in the Escrow Fund less than the full amount so payable, the full amount remaining in the Escrow
Fund).

 

(ii)     Payment
of an Established Claim shall be made from Escrow Shares pro rata from the account maintained on behalf of each Owner. For
purposes of each payment, such shares shall be valued at the “Fair Market Value” (as defined below). However, in
no event shall the Escrow Agent be required to calculate Fair Market Value or make a determination of the number of shares to
be delivered to Surviving Pubco in satisfaction of any Established Claim; rather, such calculation shall be included in and
made part of the Joint Notice. The Escrow Agent shall transfer to Surviving Pubco out of the Escrow Fund that number of
shares of Surviving Pubco Stock necessary to satisfy each Established Claim, as set out in the Joint Notice. Any dispute
between the Representative and Stockholder Nominee concerning the calculation of Fair Market Value or the number of shares
necessary to satisfy any Established Claim, or any other dispute regarding a Joint Notice, shall be resolved between the
Representative and Stockholder Nominee in accordance with the procedures specified in paragraph 2(d) above, and shall not
involve the Escrow Agent. Each transfer of shares in satisfaction of an Established Claim shall be made by the Escrow Agent
delivering to Surviving Pubco one or more stock certificates held in each Owner’s account evidencing not less than such
Owner’s pro rata portion of the aggregate number of shares specified in the Joint Notice, together with assignments
separate from certificate executed in blank by such Owner and completed by the Escrow Agent in accordance with instructions
included in the Joint Notice. Upon receipt of the stock certificates and assignments, Surviving Pubco shall deliver to the
Escrow Agent new certificates representing the number of shares owned by each Owner after such payment. The parties hereto
(other than the Escrow Agent) agree that the foregoing right to make payments of Established Claims in shares of Surviving
Pubco Stock may be made notwithstanding any other agreements restricting or limiting the ability of any Owner to sell any
shares of Surviving Pubco stock or otherwise. The Representative and Stockholder Nominee shall be required to exercise utmost
good faith in all matters relating to the preparation and delivery of each Joint Notice. As used herein, “Fair Market
Value” means the average reported closing price for the Surviving Pubco Stock for the twenty trading days ending on the
last trading day prior to (x) the day the Established Claim is paid with respect to Indemnification Claims paid on or
before the Basic Indemnity Escrow Termination Date, (y) the Basic Indemnity Escrow Termination Date with respect to shares
constituting the Pending Claims Reserve (as hereinafter defined) on the Basic Indemnity Escrow Termination Date, and (z) with
respect to shares placed in the Pending Claims Reserve for an Additional Indemnification Claim asserted after the Basic
Indemnity Escrow Termination Date, the day such Additional Indemnification Claim is asserted. If Surviving Pubco Stock is not
then listed or admitted to trading on any national securities exchange, the “Fair Market Value” means the average
of the reported closing bid and asked prices of Surviving Pubco Stock on such date on the principal over the counter market
on which Surviving Pubco Stock is traded, and if Surviving Pubco Stock is not so traded, a market price per share determined
in good faith by the Surviving Pubco Board of Directors.

 

    	 	- 4 -	 

     

    

 

(iii)     Notwithstanding anything herein to the contrary, at such time as an Indemnification Claim has become an Established Claim, the
Stockholders shall have the right, in their sole discretion, to substitute for the Escrow Shares that otherwise would be paid
in satisfaction of such claim (the “Claim Shares”) cash in an amount equal to the Fair Market Value of the Claim Shares
(“Substituted Cash”). In such event (i) the Joint Notice shall include a statement describing the substitution of
Substituted Cash for the Claim Shares, and (ii) substantially contemporaneously with the delivery of such Joint Notice, the Stockholders
shall cause currently available funds to be delivered to the Escrow Agent in an amount equal to the Substituted Cash. Upon receipt
of such Joint Notice and Substituted Cash, the Escrow Agent shall (y) in payment of the Established Claim described in the Joint
Notice, deliver the Substituted Cash to Surviving Pubco in lieu of the Claim Shares, and (z) cause the Claim Shares to be returned
to the Owners.

 

3.     (a)     On
the first Business Day after the Basic Indemnity Escrow Termination Date, upon receipt of a Joint Notice, the Escrow Agent
shall distribute and deliver to each Owner certificates representing shares of Surviving Pubco Stock then in such
Owner’s account in the Escrow Fund equal to fifty percent (50%) of the original number of shares placed in such
Owner’s account less that number of shares in such Owner’s account equal to the sum of (i) the number of shares
applied in satisfaction of Indemnification Claims made prior to that date and (ii) the number of shares in the Pending Claims
Reserve allocated to such Owner’s account, as provided in the following sentence, and shall continue to hold the
remaining shares in such Owner’s account as Additional Indemnity Shares. If, at such time, there are any
Indemnification Claims with respect to which Notices have been received but which have not been resolved pursuant to Section
2 hereof or in respect of which the Escrow Agent has not been notified of, and received a copy of, a final determination
(after exhaustion of any appeals) by a court of competent jurisdiction, as the case may be (in either case, “Pending
Claims”), and which, if resolved or finally determined in favor of Surviving Pubco, would result in a payment to
Surviving Pubco, the Escrow Agent shall retain in the Pending Claims Reserve that number of shares of Surviving Pubco Stock
having a Fair Market Value equal to the dollar amount equal to the Indemnifiable Losses for which indemnification is sought
in such Indemnification Claim, allocated pro rata from the account maintained on behalf of each Owner. The Representative and
Stockholder Nominee shall certify to the Escrow Agent the Fair Market Value to be used in calculating the Pending Claims
Reserve and the number of shares of Surviving Pubco Stock to be retained therefor. Thereafter, if any Pending Claim becomes
an Established Claim, the Representative and Stockholder Nominee shall deliver to the Escrow Agent a Joint Notice directing
the Escrow Agent to deliver to Surviving Pubco the number of shares in the Pending Claims Reserve in respect thereof
determined in accordance with paragraph 2(f) above and to deliver to each Owner the remaining shares in the Pending Claims
Reserve allocated to such Pending Claim, all as specified in a Joint Notice. If any Pending Claim is resolved against
Surviving Pubco, the Representative and Stockholder Nominee shall deliver to the Escrow Agent a Joint Notice directing the
Escrow Agent to pay to each Owner his pro rata portion of the number of shares allocated to such Pending Claim in the Pending
Claims Reserve.

 

    	 	- 5 -	 

     

    

 

(b)     On
the first Business Day after the Additional Indemnity Escrow Termination Date, upon receipt of a Joint Notice, the Escrow Agent
shall distribute and deliver to each Owner certificates representing the remaining shares of Surviving Pubco Stock then in such
Owner’s account in the Escrow Fund other than Additional Indemnity Shares in the Pending Claims Reserve. Upon the subsequent
resolution of a Claim for which shares remain in the Pending Claims Reserve, upon receipt of a Joint Notice, the Escrow Agent
shall distribute and deliver such shares to Surviving Pubco, if the Claim is resolved in favor of Surviving Pubco, or to the Owners
pro rata to the accounts maintained for them, if the Claim is resolved against Surviving Pubco. Upon resolution of all Pending
Claims, the Representative and Stockholder Nominee shall deliver to the Escrow Agent a Joint Notice directing the Escrow Agent
to pay to each Owner the remaining portion of his or her account in the Escrow Fund.

 

(c)    As
used herein, the “Pending Claims Reserve” shall mean, at the time any such determination is made, that number of shares
of Surviving Pubco Stock in the Escrow Fund having a Fair Market Value equal to the Indemnifiable Losses claimed to be due with
respect to all Pending Claims (as shown in the Notices of such Claims).

 

4.     The
Escrow Agent, the Representative and Stockholder Nominee shall cooperate in all respects with one another in the calculation of
any amounts determined to be payable to Surviving Pubco and the Owners in accordance with this Agreement and in implementing the
procedures necessary to effect such payments.

 

5.     (a) 
 The Escrow Agent undertakes to perform only such duties as are expressly set forth herein. It is understood
that the Escrow Agent is not a trustee or fiduciary and is acting hereunder merely in a ministerial capacity.

 

(b)     The Escrow Agent shall not be liable for any action taken or omitted by it in good faith and in the exercise of its own
best judgment, and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate,
opinion or advice of counsel (including counsel chosen by the Escrow Agent), statement, instrument, report or other paper or
document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and
acceptability of any information therein contained) which is believed by the Escrow Agent to be genuine and to be signed or
presented by the proper person or persons. The Escrow Agent shall not be bound by any notice or demand, or any waiver,
modification, termination or rescission of this Agreement unless evidenced by a writing delivered to the Escrow Agent signed
by the proper party or parties and, if the duties or rights of the Escrow Agent are affected, unless it shall have given its
prior written consent thereto.

 

(c)    The
Escrow Agent’s sole responsibility upon receipt of any notice requiring any payment to Surviving Pubco pursuant to the
terms of this Agreement or, if such notice is disputed by the Representative or Stockholder Nominee, the settlement with
respect to any such dispute, whether by virtue of joint resolution, arbitration or determination of a court of competent
jurisdiction, is to pay to Surviving Pubco the amount specified in such notice, and the Escrow Agent shall have no duty to
determine the validity, authenticity or enforceability of any specification or certification made in such notice.

 

    	 	- 6 -	 

     

    

 

(d)     The
Escrow Agent shall not be liable for any action taken by it in good faith and believed by it to be authorized or within the rights
or powers conferred upon it by this Agreement, and may consult with counsel of its own choice and shall have full and complete
authorization and indemnification under Section 5(g), below, for any action taken or suffered by it hereunder in good faith and
in accordance with the opinion of such counsel.

 

(e)    The
Escrow Agent may resign at any time and be discharged from its duties as escrow agent hereunder by its giving the other parties
hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall become effective
at such time that the Escrow Agent shall turn over the Escrow Fund to a successor escrow agent appointed jointly by the Representative
and Stockholder Nominee. If no new escrow agent is so appointed within the 60 day period following the giving of such notice of
resignation, the Escrow Agent may deposit the Escrow Fund with any court it reasonably deems appropriate. The Escrow Agent shall
resign and be discharged from its duties as escrow agent hereunder if so requested in writing at any time by the parties hereto,
jointly, provided, however, that such resignation shall become effective only upon acceptance of appointment by a successor escrow
agent as provided in this Section 5(e).

 

(f)     The
Escrow Agent shall be indemnified and held harmless by Surviving Pubco from and against any expenses, including counsel fees and
disbursements, or loss suffered by the Escrow Agent in connection with any action, suit or other proceeding involving any claim
which in any way, directly or indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder,
or the Escrow Fund held by it hereunder, other than expenses or losses arising from the gross negligence or willful misconduct
of the Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any
action, suit or proceeding, the Escrow Agent shall notify the other parties hereto in writing. In the event of the receipt of
such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in the any state or
federal court located in New York County, State of New York.

 

(g)    The
Escrow Agent shall be entitled to reasonable compensation from Surviving Pubco for all services rendered by it hereunder. The
Escrow Agent shall also be entitled to reimbursement from Surviving Pubco for all expenses paid or incurred by it in the administration
of its duties hereunder including, but not limited to, all counsel, advisors’ and agents’ fees and disbursements and
all taxes or other governmental charges.

 

(h)    From
time to time on and after the date hereof, the Representative and Stockholder Nominee shall deliver or cause to be delivered to
the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent
shall reasonably request to carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith
or to assure itself that it is protected in acting hereunder.

 

(i)      Notwithstanding
anything herein to the contrary, the Escrow Agent shall not be relieved from liability hereunder for its own gross negligence
or its own willful misconduct.

 

    	 	- 7 -	 

     

    

 

6.     This
Agreement expressly sets forth all the duties of the Escrow Agent with respect to any and all matters pertinent hereto. No implied
duties or obligations shall be read into this Agreement against the Escrow Agent. The Escrow Agent shall not be bound by the provisions
of any agreement among the parties hereto except this Agreement and the Put/Call Escrow Agreement and shall have no duty to inquire
into the terms and conditions of any agreement made or entered into in connection with this Agreement, including, without limitation,
the Merger Agreement.

 

7.     This
Agreement shall inure to the benefit of and be binding upon the parties and their respective heirs, successors, assigns and legal
representatives shall be governed by and construed in accordance with the law of New York applicable to contracts made and to
be performed therein. This Agreement cannot be changed or terminated except by a writing signed by the Representative, the Escrow
Agent and a majority of the Stockholders.

 

8.     All
disputes arising under this Agreement between the Representative and Stockholder Nominee, including a dispute arising from a party’s
failure or refusal to sign a Joint Notice, shall be submitted to arbitration to the American Arbitration Association in New York
City. The Representative and Stockholders each hereby consents to the exclusive jurisdictions of the federal and state courts
sitting in New York County, State of New York, with respect to any claim or controversy arising out of this Agreement. Service
of process in any action or proceeding brought against the Representative or Stockholders in respect of any such claim or controversy
may be made upon it by registered mail, postage prepaid, return receipt requested, at the address specified in Section 10, with
copies delivered by nationally recognized overnight carrier to Graubard Miller, The Chrysler Building, 405 Lexington Avenue, New
York, N.Y. 10174, Attention: David Alan Miller, Esq., and to Blank Rome LLP, The Chrysler Building, 405 Lexington Avenue, New
York, N.Y. 10174, Attention: Robert J. Mittman.

 

9.     The
Stockholders hereby appoint Anatoly Hurgin to act on their behalf (the “Stockholder Nominee”) to take any and all
actions and make any decisions required or permitted to be taken by such Stockholders under this Agreement. Should the Stockholder
Nominee resign or be unable to serve, a new Stockholder Nominee will be selected by a majority of the Stockholders, whose appointment
shall be effective upon execution by such successor of a joinder agreement providing for such successor to become a party to the
Escrow Agreement as the Stockholder Nominee, in which case such successor shall for all purposes of this Agreement be the Stockholder
Nominee (and the prior acts taken by the succeeded Stockholder Nominee shall remain valid for purposes of this Agreement). The
Stockholder Nominee shall not be liable to the Stockholders for any liability, loss, damage, penalty, fine, cost or expense incurred
without gross negligence or willful misconduct by the Stockholder Nominee while acting in good faith and arising out of or in
connection with the acceptance or administration of its duties hereunder.

 

    	 	- 8 -	 

     

    

 

10.   All
notices and other communications under this Agreement shall be in writing and shall be deemed given if given by hand or
delivered by nationally recognized overnight carrier, or if given by telecopier and confirmed by mail (registered or
certified mail, postage prepaid, return receipt requested), to the respective parties as follows:

 

	 	A.	If to the Representative, to it at:

                                                                                 

                                                                                 Benjamin Gordon

                                                                                 

	 	 	525 South Flagler Drive, Suite 201

                                                                                 West Palm Beach, Florida 33401

                                                                                Telecopy: (561) 655-6232

                                                                                E-mail:
                                         ben@cambridgecapital.com

	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Graubard
    Miller
	 	 	The
    Chrysler Building
	 	 	405
    Lexington Avenue
	 	 	New
    York, New York 10174-1901
	 	 	Attention:
    David Alan Miller, Esq.
	 	 	Telecopy:
    212-818-8881
	 	 	Email: dmiller@graubard.com
	 	 	 
	 	B.	If
    to the Stockholders, to each at the address listed on Schedule A hereto
	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Anatoly
    Hurgin
	 	 	c/o
    Ability Computer & Software Industries Ltd.
	 	 	Yad
    Harutzim 14
	 	 	Tel
    Aviv, Israel, 6770007
	 	 	Attention:
    Anatoly Hurgin
	 	 	Telecopy:
    972-3-5376483
	 	 	E-mail:
    ability@ability.co.il
	 	 	 
	 	 	with
    a copy to:
	 	 	 
	 	 	Blank
    Rome LLP
	 	 	The
    Chrysler Building
	 	 	405
    Lexington Avenue
	 	 	New
    York, New York 10174-1901
	 	 	Attention:
    Robert J. Mittman, Esq.
	 	 	Telecopy:
    212-885-5001
	 	 	E-mail: rmittman@blankrome.com

 

    	 	- 9 -	 

     

    

 

	 	C.	If
    to the Escrow Agent, to it at:
	 	 	 
	 	 	Continental
    Stock Transfer & Trust Company
	 	 	17
    Battery Place
	 	 	New
    York, New York 10004
	 	 	Attention:
    Mark Zimkind
	 	 	Telecopy:
    212-509-5150
	 	 	E-mail:
    [______________] hfarrell@continentalstock.com

 

or
to such other person or address as any of the parties hereto shall specify by notice in writing to all the other parties hereto.

 

11.   (a)    If
this Agreement requires a party to deliver any notice or other document, and such party refuses to do so, the matter shall be
submitted to arbitration pursuant to paragraph 2(d) of this Agreement.

 

(b)    All
notices delivered to the Escrow Agent shall refer to the provision of this Agreement under which such notice is being delivered
and, if applicable, shall clearly specify the aggregate dollar amount due and payable to Surviving Pubco.

 

(c)    This
Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original instrument and all of
which together shall constitute a single agreement.

 

[Signatures
are on following page]

 

    	 	- 10 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

 

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	 /s/
    Benjamin Gordon
	 	Name:
    	Benjamin
    Gordon
	 	Title:
    	CEO
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	/s/
    Benjamin Gordon
	 	Benjamin
    Gordon
	 	 	 
	 	STOCKHOLDERS:
	 	 	 
	 	 
	 	Anatoly
    Hurgin
	 	 	 
	 	 
	 	Alexander
    Aurovsky
	 	 
	 	ESCROW
    AGENT:
	 	 	 
	 	CONTINENTAL
    STOCK TRANSFER & 

TRUST COMPANY
	 	 	 
	 	By:	                
	 	Name:	
	 	Title:	

 

    	 	- 11 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

  

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	                 
	 	Name:
    	 
	 	Title:
    	 
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	 
	 	Benjamin
    Gordon
	 	 
	 	STOCKHOLDERS:
	 	 	 
	 	/s/
    Anatoly Hurgin
	 	Anatoly
    Hurgin
	 	 
	 	/s/
    Alexander Aurovsky
	 	Alexander
    Aurovsky
	 	 
	 	ESCROW
    AGENT:
	 	 	 
	 	CONTINENTAL
    STOCK TRANSFER & 

TRUST COMPANY
	 	 	            
	 	By:	
	 	Name:	
	 	Title:	

 

    	 	- 12 -	 

     

    

 

IN
WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement on the date first above written.

  

	 	CAMBRIDGE
    HOLDCO CORP.
	 	 	 
	 	By:	                
	 	Name:
    	
	 	Title:
    	
	 	 	 
	 	THE
    REPRESENTATIVE:
	 	 	 
	 	 
	 	Benjamin
    Gordon
	 	 	 
	 	STOCKHOLDERS:
	 	 	 
	 	 
	 	Anatoly
    Hurgin
	 	 	 
	 	 
	 	Alexander
    Aurovsky
	 	 
	 	ESCROW
    AGENT:
	 	 	 
	 	CONTINENTAL
    STOCK TRANSFER & 

TRUST COMPANY
	 	 	 
	 	By:	/s/
    Henry Farrell
	 	Name:	Henry
    Farrell
	 	Title:	Vice
    President

 

    	 	- 13 -	 

     

    

 

Schedule
A

 

Escrow
Shares

 

Anatoly
Hurgin: 474,257.50 shares of Surviving Pubco Stock*

 

Alexander
Aurovsky: 474,257.50 shares of Surviving Pubco Stock*

 

 

 

 

*As
may be increased by the amount of the Remaining Escrow Fund (as defined in the Put/Call Escrow Agreement), if any.

 

    	 	- 14 -	 

     

    

 

Exhibit
A

 

Put/Call
Escrow Agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- 15 -Exhibit 4.12

 

ABILITY
INC. (FORMERLY CAMBRIGE HOLDCO CORP.)

 ISRAELI SUB-PLAN

TO THE ABILITY INC.  2015 LONG-TERM Equity incentive PLAN

 

		1.	General.

 

This
Ability Inc. Israeli Sub-Plan (this “Sub-Plan”) is to be read as a part of the Ability Inc. (formerly Cambrige
Holdco Corp.) 2015 Long-Term Equity incentive Plan (the “Plan”, the "Company"), and the Plan
and this Sub-Plan shall be deemed one integrated document. The provisions of the Plan shall apply to Awards (as defined below)
granted under this Sub-Plan, subject to the modifications set forth below. In the event of any conflict between the Plan and this
Sub-Plan, the terms of this Sub-Plan shall govern with respect to Awards granted to Israeli Participants. This Sub-Plan shall
only apply to, and modify Awards granted to, Israeli Participants (as defined below) so that such Awards will be governed by the
terms of this Sub-Plan and comply with the requirements of Israeli law generally, and specifically with the provisions of Section
102 and Section 3(i) of the Ordinance (as defined below). For the avoidance of doubt, this Sub-Plan shall not modify the Plan
with respect of any other category of Participant. 

 

Unless
otherwise defined in this Sub-Plan, all capitalized terms used herein shall have the same meanings given to such terms in the
Plan. Capitalized terms used herein that are the plural forms or singular forms of defined terms shall have the corresponding
plural or singular meanings of the corresponding defined terms. The following terms shall have the meanings set forth below, unless
the context clearly requires a different meaning:

 

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

 

(b)     “102
Award” means an Award granted pursuant to Section 102 of the Ordinance to any person who is an Israeli Employee
Participant.

 

(c)     “102
Capital Gains Award” means a Trustee 102 Award elected and designated by the Employing Company to qualify for Capital
Gains tax treatment in accordance with the provisions of Section 102(b)(2) of the Ordinance.

 

(d)     “102
Ordinary Income Award” means a Trustee 102 Award elected and designated by the Employing Company to qualify for
ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) of the Ordinance.

 

(e)     “Affiliate”
means any “employing company” within the meaning of Section 102(a) of the Ordinance.

 

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

 

(g)     
“Award” means an award of Options, Restricted Shares Award, or other Share Award.

 

     

     

    

 

(h)     "Award
Agreement" means, with respect to each Award, the applicable signed written agreement between the Company and the
Participant setting forth the terms and conditions of an individual Award granted under the plan.

 

(i)     "Board"
means the Board of Directors of the Company.

 

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

 

(k)     "Committee"
means any committee of the Board, which the Board may designate.

 

(l)     “Employing
Company” shall have the meaning ascribed to it in Section 102(a) of the Ordinance.

 

(m)     “Israeli
Employee Participant” means a person who is a resident of the state of Israel or who is deemed to be a resident
of the state of Israel for the payment of tax,

and who is an employee or an Office Holder (“Noseh Missra”) of the Company, or any Affiliate of the Company,
in each case excluding a person who is a Controlling Shareholder prior to the issuance of the relevant Award or as a result thereof.

 

(n)     “Israeli
Non-Employee Participant” means a person who is a resident of the state of Israel or who is deemed to be a resident
of the state of Israel for the payment of tax, and who is (i) a consultant, adviser or service provider of the Company, or any
Affiliate of the Company, who is not an Israeli Employee Participant, or (ii) a Controlling Shareholder (whether or not an employee
of the Company or any Affiliate of the Company).

 

(o)     “Israeli
Participant” means Israeli Employee Participants and Israeli Non-Employee Participants.

 

(p)     “ITA”
means the Israeli Income Tax Authorities.

 

(q)     “Lockup
Period” means the requisite period prescribed by the Ordinance and the Rules, or such other period as may be required
by the ITA, with respect to 102 Trustee Grants, during which Awards or shares issued thereunder, and all rights resulting from
them, including bonus shares, must be held by the Trustee.

 

(r)     “Non-Trustee
102 Award” means an Award granted to an Israeli Participant pursuant to Section 102(c) of the Ordinance, which is
not required to be held in trust by a Trustee.

 

(s)     “Ordinance”
means the Income Tax Ordinance [New Version] 5721-1961 or any successor statute, as amended from time to time.

 

(t)     “Restricted
Shares” means an Award granted to Israeli Participant pursuant to Section 6 below.

 

(u)     “Rules”
means the Income Tax Rules (Tax Relief in the Issuance of Shares to Employees), 5763-2003.

 

(v)     “Section
102” means Section 102 of the Ordinance and any regulations, rules, orders or procedures promulgated thereunder
as now in effect or as amended or replaced from time to time.

 

    	 	2	 

     

    

 

(w)     “Tax”
means any tax (including, without limitation, any income tax, capital gains tax, value added tax, sales tax, property tax, gift
tax, or estate tax), levy, assessment, tariff, duty (including any customs duty), deficiency, or other fee, and any related charge
or amount (including any fine, penalty, interest, linkage differentials or addition to tax), imposed, assessed, or collected by
or under the authority of any governmental body.

 

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

 

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

 

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

 

		2.	Issuance
                                         of Awards. 

 

(a)     (i)
Israeli Employee Participants may be granted only 102 Awards; and (ii) Israeli Non-Employee Participants may be granted only 3(i)
Awards. In each case, such Awards shall be subject to the terms and conditions of the Ordinance.

 

(b)     The
Employing Company may, pursuant to Section 102, designate 102 Awards granted to Israeli Employee Participants as Non-Trustee 102
Awards or as Trustee 102 Awards. The Employing Company may seek any tax ruling as it may reasonably consider in connection with
the application of Section 102 on any Awards granted by the Company.

 

(c)     The
Employing Company shall have the absolute discretion to decide whether Awards granted pursuant to Section 3(i) of the Ordinance
shall be held by the Trustee for any period.

 

(d)     Any
trustee, including, without limitation, the Trustee, holding Awards or shares issued upon the exercise thereof, or rights resulting
therefrom, including bonus shares, shall not be liable for any good faith determination, act or omission in connection with the
Plan, any Sub-Plan, any Award or any agreement entered into between such Trustee and the Company or any Affiliate.

 

(e)     The
grant of Approved 102 Awards shall be made under this Sub-Plan not earlier than 30 days from the date it was submitted to the
ITA.

 

(f)     Approved
102 Awards may either be classified as 102 Capital Gains Award or 102 Ordinary Income Award.

 

(g)     No
Approved 102 Awards may be granted under this Sub-Plan to any eligible Employee, unless and until, the Company’s election
of the type of Approved 102 Awards as 102 Capital Gains Award or 102 Ordinary Income Award granted to Employees (the “Election”),
is appropriately filed with the ITA. Such Election shall become effective beginning the first date of grant of an Approved 102
Award under this Sub-Plan and shall remain in effect until the end of the year following the year during which the Company first
granted Approved 102 Awards. The Election shall obligate the Company to grant only the type of Approved 102 Award it has elected,
and shall apply to all Israeli Participants who were granted Approved 102 Awards during the period indicated herein, all in accordance
with the provisions of Section 102(g) of the Ordinance. For the avoidance of doubt, such Election shall not prevent the Company
from granting Unapproved 102 Awards or 3(i) Award simultaneously.

 

    	 	3	 

     

    

 

(h)     All
Approved 102 Awards must be held in trust by a Trustee, as described in Section 3 below.

 

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

 

		3.	Trustee
                                         102 Awards. 

 

(a)     Awards
granted pursuant to this Section are intended to constitute Trustee 102 Awards and are subject to the provisions of Section 102
and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to Awards under a
different tax law or regulation.

 

(b)     Trustee
102 Awards may be granted only to Israeli Employee Participants.

 

(c)     Trustee
102 Awards shall be classified as either 102 Capital Gains Awards or 102 Ordinary Income Awards, subject to the terms and conditions
of Section 102 and the provisions of the Plan and this Sub-Plan.

 

(d)     No
Trustee 102 Awards may be granted under this Sub-Plan, unless and until the Employing Company’s election of the type of
Trustee 102 Awards to be granted to Israeli Employee Participants, being either 102 Capital Gains Awards or 102 Ordinary Income
Awards, (the “Election”), is appropriately filed with the ITA. The Board or the Committee, as the case may
be, shall have the right to determine whether the Election shall be that the Trustee 102 Awards be 102 Capital Gains Awards or
102 Ordinary Income Awards. After making an Election, the Company may grant only the type of Trustee 102 Awards it has elected
(i.e., 102 Capital Gains Awards or 102 Ordinary Income Awards), and the Election shall apply to all grants to Israeli Employee
Participants of Trustee 102 Awards until such Election is changed pursuant to the provisions of Section 102(g) of the Ordinance.
The Employing Company may change such Election only after the passage of the minimum time period prescribed by Section 102. For
the avoidance of doubt, such Election shall not prevent the Company from granting Non-Trustee 102 Awards or 3(i) Awards.

 

(e)     The
grant of Trustee 102 Awards shall be conditioned upon the approval (or the deemed approval pursuant to the provisions of Section
102(a) of the Ordinance) of the Plan, this Sub-Plan and the Trustee by the ITA.

 

    	 	4	 

     

    

 

(f)     Trustee
102 Awards may be granted only after the passage of thirty days (or a shorter period as, and if, approved by the ITA) following
the delivery by the appropriate Employing Company to the ITA of a request for approval of the Plan (including this Sub-Plan) and
the Trustee in accordance with Section 102. Notwithstanding the foregoing paragraph and pursuant to any applicable law, if within
ninety (90) days of delivery of the abovementioned request, the appropriate ITA officer notifies the Employing Company of his
or her decision not to approve the Plan (including this Sub-Plan) or the Trustee, the Awards that were intended to be granted
as a Trustee 102 Awards shall be deemed to be Non-Trustee 102 Awards, unless (i) otherwise determined by the ITA officer or (ii)
pursuant to applicable law elected otherwise by the Company.

 

(g)     Anything
herein to the contrary notwithstanding, all Trustee 102 Awards granted under this Plan shall be granted or issued to a Trustee.
The Trustee shall hold each such Trustee 102 Award, all shares issued upon exercise thereof, and all other rights resulting from
such Trustee 102 Award or shares, including bonus shares, in trust for the benefit of the Israeli Employee Participant to which
such Award was granted. All certificates representing Awards or shares issued to the Trustee under the Plan shall be issued in
the Trustee’s name, deposited with the Trustee, and shall be held by the Trustee until such time that such Awards or shares
are released from the trust.

 

(h)     With
respect to 102 Capital Gains Awards and 102 Ordinary Income Awards, such Awards or any shares issued upon the exercise thereof
and all rights resulting from such Awards or shares, including bonus shares, will be held by the Trustee, from the date such Awards
or shares were deposited with the Trustee until the end of the applicable Lockup Period (currently at least 24 months in case
of 102 Capital Gains Awards and 12 months in case of 102 Ordinary Income Awards) or such shorter period as approved by the ITA,
under the terms set forth in Section 102.

 

(i)     Notwithstanding
anything to the contrary, the Trustee shall not release any shares allocated or issued upon exercise or vesting of Approved 102
Awards prior to the full payment of the Employee’s tax liabilities, if any, or to the full satisfaction of the trustee that
such applicable tax payments will be made, arising from Approved 102 Awards which were granted to him/her and/or any shares allocated
or issued upon exercise or vesting of such Awards.

 

(j)     
In accordance with Section 102, the Israeli Employee Participant shall not sell, cause the release from trust, or otherwise
dispose of, any Trustee 102 Award, any share issued upon the exercise thereof, or any rights resulting from such Award or share,
including bonus shares, until the end of the applicable Lockup Period. Notwithstanding the foregoing but without derogating from
the provisions of the Plan and the terms and conditions set forth in the Award Agreement, if any such sale, release, or disposition
occurs during the Lockup Period, then the provisions of Section 102 relating to non-compliance with the Lockup Period will apply
and all sanctions and liability under Section 102 shall be borne by the Israeli Employee Participant. The Israeli Employee Participant
will indemnify the Company, the Trustee and any other party which incurs any liability as a result of such sale, release or disposition.

 

(k)     In
the event that the requirements for the Trustee 102 Awards are not met, then the Trustee 102 Awards shall be deemed Non-Trustee
102 Awards.

 

(l)     Upon
receipt of a Trustee 102 Award, the Israeli Employee Participant will sign an Award Agreement under which such Participant will
agree to be subject to the trust agreement between the Company or its Affiliate and the Trustee, stating, inter alia, that the
Trustee will be released from any liability in respect of any action or decision taken or executed in good faith with respect
to this Sub-Plan, or any Trustee 102 Award or share issued to him or her thereunder, or right resulting therefrom, including bonus
shares.

 

    	 	5	 

     

    

 

(m)     The
validity of any order given to the Trustee by an Israeli Employee Participant shall be subject to the approval of the Employing
Company. The Employing Company shall render its decision regarding whether to approve orders given by any Israeli Employee Participant
to the Trustee within a reasonable period of time. The Employing Company shall not be required to approve any order which is incomplete,
is not in accordance with the provisions of this Plan and the applicable Award Agreement or which the Employing Company believes
should not be executed for any reasonable reason. The Employing Company shall notify the Israeli Employee Participant of the reason
for not approving his order. Approval by the Employing Company of any order given to the Trustee by an Israeli Employee Participant
shall not constitute proof of the Employing Company’s recognition of any right of such Israeli Employee Participant.

 

(n)     Without
derogating from the above, the Employing Company shall have the authority to determine the specific procedures and conditions
of the trusteeship with the Trustee in a separate agreement between the Employing Company and the Trustee.

 

(o)     In
the case of 102 Awards, the Trustee shall have no rights as a shareholder of the Company with respect to the shares covered by
such Award until the Trustee becomes the record holder for such shares for the Participant’s benefit, and the Israeli Participant
shall have no rights as a shareholder of the Company with respect to the shares covered by the Award until the date of the release
of such shares from the Trustee to the Israeli Participant and the transfer of record ownership of such shares to the Israeli
Participant.

 

		4.	Non-Trustee
                                         102 Awards.

 

(a)     Awards
granted pursuant to this Section are intended to constitute Non-Trustee 102 Awards and are subject to the provisions of Section
102 and the general terms and conditions specified in the Plan, except for such provisions of the Plan applying to Awards granted
under a different tax law or regulations.

 

(b)     Non-Trustee
102 Awards may be granted only to Israeli Employee Participants.

 

(c)     Non-Trustee
102 Awards that shall be granted pursuant to the Plan may be issued directly to the Israeli Employee Participant or to a trustee
appointed by the Board or the Committee, as the case may be, in its sole discretion. In the event that the Board or the Committee,
as the case may be, determines that Non-Trustee 102 Awards, or shares issued upon the exercise thereof, or rights resulting therefore,
including bonus shares, shall be deposited with a trustee, the provisions of Section ‎(f) of this Sub-Plan shall apply, mutatis
mutandis.

 

(d)     In
the event that an Israeli Employee Participant was granted a Non-Trustee 102 Award and thereafter such Israeli Employee Participant’s
employment by the Company, or any Affiliate thereof, terminates for any reason, such Israeli Employee Participant will be obligated
to provide his employer, upon the termination of his employment, with a security or guarantee to cover any future tax obligation
resulting from the grant, exercise or disposition of the Award, the shares issuable upon the exercise thereof, or any rights resulting
therefrom, in a form satisfactory to such employer in such employer’s sole discretion.

 

    	 	6	 

     

    

 

		5.	3(i)
                                         Awards.

 

(a)     Awards
granted pursuant to this Section are intended to constitute 3(i) Awards and are subject to the provisions of Section 3(i) of the
Ordinance and the general terms and conditions specified the Plan, except for provisions of the Plan applying to Awards granted
under a different tax law or regulations.

 

(b)     3(i)
Awards may be granted only to Israeli Non-Employee Participants.

 

(c)     3(i)
Awards that shall be granted pursuant to the Plan may be issued directly to the Israeli Non-Employee Participant or to a trustee
appointed by the Board or the Committee, as the case may be, in its sole discretion. In the event that the Board or the Committee,
as the case may be, determines that 3(i) Awards or shares issued upon the exercise thereof, or rights resulting therefrom, including
bonus shares, shall be deposited with a trustee, the provisions of Section 3 of this Sub-Plan shall apply, mutatis mutandis.

 

(d)     In
the event that an Israeli Non-Employee Participant was granted a 3(i) Award and thereafter such Israeli Non-Employee Participant’s
employment by the Company, or any Affiliate thereof, terminates for any reason, such Israeli Non-Employee Participant will be
obligated to provide his employer, upon the termination of his employment, with a security or guarantee to cover any future tax
obligation resulting from the grant, exercise or disposition of the Award, the shares issuable upon the exercise thereof, or any
rights resulting therefrom, in a form satisfactory to such employer in such employer’s sole discretion.

 

		6.	Restricted
                                         Shares. 

 

(a)     In
case of grant of Restricted Shares to Israeli Employee Participant, the Trustee will retain custody of the share certificate or
certificates, if any, representing the Restricted Shares during the Restriction Period and the Retained Distributions made or
declared with respect to the Restricted Shares until such time, if ever, as the Restricted Shares with respect to which such Retained
Distributions shall have been made, paid or declared shall have become vested and with respect to which the Restriction Period
shall have expired.

 

(b)     The
Company and/or the Trustee (as the case may be) shall not be required to release any Share certificate to the Israeli Participant
or to any third party until all required tax payments have been fully made or will be made to the full satisfaction of the Company
and the Trustee.

 

		7.	The
                                         Award Agreement.

 

The
terms and conditions upon which the Awards shall be issued and exercised shall be as specified in an Award Agreement to be executed
pursuant to the Plan and this Sub-Plan. Each Award Agreement shall state, inter alia, the number of shares granted under the Award,
the type of Award granted thereunder (whether such Award is a Trustee 102 Award, and if so, whether it is a 102 Capital Gains
Award or 102 Ordinary Income Award, or a Non-Trustee 102 Award, or a 3(i) Award), the vesting provisions, the term of the Award,
and the exercise price. Any grant of Awards shall be conditioned upon the Israeli Participant’s undertaking to be subject
to the provisions of Section 102 or Section 3(i) of the Ordinance, as applicable.

 

    	 	7	 

     

    

 

		8.	Fair
                                         Market Value For Israeli Tax Purposes.

 

Without
derogating from Section 1(l) of the Plan and solely for the purpose of determining the tax liability pursuant to Section
102(b)(3) of the Ordinance, if at the date of grant of a 102 Capital Gains Award the Company’s shares are listed on any
established stock exchange or a national market system, or if the Company’s shares are registered for trading within
ninety (90) days following the date of grant of the 102 Capital Gains Award, the fair market value of the shares at the date
of grant shall be determined in accordance with the average value of the Company’s shares on the thirty (30)
trading days preceding the date of grant or on the thirty (30) trading days following the date of registration for trading,
as the case may be.

 

		9.	Exercise
                                         of Awards.

 

Awards
that represent options to purchase Shares shall be exercised by the Israeli Participant by giving a written or electronic notice
to the Company and/or to any third party designated by the Company (the “Representative”), in such form and
method as may be determined by the Company and, when applicable, by the Trustee, in accordance with the requirements of Section
102 or section 3(i), which exercise shall be effective upon receipt of such notice by the Company and/or the Representative and
the payment of the exercise price for the number of Shares with respect to which the Award is being exercised and the payment
of the tax in case of exercise of 3(i) Awards, at the Company’s or the Representative’s principal office. The notice
shall specify the number of Shares with respect to which the Award is being exercised.

 

Other
Awards shall be exercised in such form and method as may be determined by the Company and, when applicable, by the Trustee, in
accordance with the requirements of Section 102 or Section 3(i), which exercise shall be effective upon receipt of the payment
of the tax in case of exercise of 3(i) Awards;

 

For
the avoidance of doubt it is hereby clarified that no exercise of 3(i) Awards shall be affective if the applicable tax was not
paid to the Company or its Representative’s.

 

		10.	Integration
                                         of Section 102 And Tax Assessing Officer’s Permit.

 

(a)     With
respect to Trustee 102 Awards, the provisions of the Plan, this Sub-Plan and the Award Agreement shall be subject to the provisions
of Section 102 and the Tax

Assessing Officer’s permit (to the extent that such permit is issued) and/or any pre-ruling obtained by the ITA (the “Permit”),
and the provisions of the Permit shall be deemed integrated with, and a part of, the Plan, this Sub-Plan and the Award Agreement.

 

(b)     Any
provision of Section 102 or the Permit which is necessary in order to obtain or preserve any tax benefit pursuant to Section 102,
which is not expressly specified in the Plan, this Sub-Plan, or the Award Agreement, shall be deemed to have been automatically
incorporated into this Sub-Plan and binding upon the Company and the Participants who are Israeli Participants.

 

		11.	Dividends.

 

Without
derogating from the provisions of the Plan, an Israeli Participant shall be entitled to receive dividends with respect to shares
issued upon the exercise of his or her Awards, whether such shares are held by the Israeli Participant or by the Trustee (entitled
dividends with respect to shares held by the Trustee, shall be received by the Trustee) for his or her benefit, in accordance
with the provisions of the Company’s Certificate of Incorporation (including all amendments thereto), subject to any applicable
taxation on distribution of dividends and, when applicable, subject to the provisions of Section 102.

 

    	 	8	 

     

    

 

		12.	Tax
                                         Consequences.

 

(a)     Any
liability for any Tax arising with respect to the Awards and the shares, including, but not limited to, as a result of the grant
of Awards, the exercise of an Award for shares, the receipt of cash, the transfer, waiver, or expiration of Awards or shares or
the disposal of shares, shall be borne solely by the Israeli Participants, and in the event of their death, by their estates or
heirs. Neither the Company nor any Affiliate nor the Trustee shall be required to pay such Taxes, directly or indirectly, nor
shall they be required to gross up such Taxes in the Israeli Participants’ salaries or remuneration. The applicable Tax
may be deducted from any cash to be provided to the Israeli Participant or from the proceeds of the disposal of the shares or
shall be paid to the Trustee or to the Company or its Affiliates by the Israeli Participants at their request, or may be provided
via any combination of the above. 

 

(b)     The
Company, its Affiliates and the Trustee shall be entitled to withhold Taxes according to the requirements of any applicable laws,
rules, and regulations, including by withholding Taxes at source and specifically under Rule 7(b) of the Rules.

 

(c)     The
Israeli Participants undertake to indemnify the Company, its Affiliates and the Trustee, immediately upon their request, for any
Tax for which the Israeli Participant is liable under any applicable law, under the Plan or this Sub-Plan, and which was paid
by the Company or the Trustee, or which the Company or the Trustee are required to pay and hold them harmless against and from
any and all liability for any such tax or interest or penalty or indexation thereon, including without limitation, liabilities
relating to the necessity to withhold, or to have withhold any such tax from payments made to the Israeli Participant. The Company
may exercise its right to such indemnification by deducting the Tax subject to indemnification from Participant’s salary
or remuneration.

 

(d)     The
Board (or the Committee, as the case may be), or when applicable, the Trustee shall not be required to release any Awards, shares,
rights resulting therefrom, including bonus shares, or stock certificates, to an Israeli Participant until all required Tax payments
and other payments to be borne by such Israeli Participant have been fully made.

 

(e)     Notwithstanding
any other provision no Israeli Participant shall have any of the rights of a shareholder with respect to any shares until Participant
pays all payments required to be paid under this Section with respect to such shares.

 

(f)     The
ramifications of any future modification of any applicable law with respect to the taxation of Awards or shares granted to Participants
shall apply to the Israeli Participants accordingly and the Israeli Participants shall bear the full cost thereof, unless such
laws, as modified, mandatorily provide otherwise. For the avoidance of doubt, should the applicability of such taxing arrangements
to the Plan, this Sub-Plan or to securities issued hereunder or thereunder be conditioned on a decision by the Company or by the
Trustee that such arrangements shall apply, the Company shall be entitled to decide, at its absolute discretion, whether to apply
such taxing arrangements and to instruct the Trustee to act accordingly.

 

    	 	9	 

     

    

 

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

 

(h)     Each
Participant agrees to, and undertakes to comply with, any ruling, settlement, closing agreement or other similar agreement or
arrangement with any tax authority in connection with the foregoing which is approved by the Company.

 

		13.	Voting
                                         Rights. 

 

Subject
to the provisions of the Plan, so long as any shares issued to the Trustee on behalf of an Israeli Participant, under this Sub-Plan,
to the extent Trustee decides in its sole discretion to vote such shares, then unless the Trustee is directed otherwise by the
Board or the Committee, as the case may be, such shares shall be voted in the same proportion as the result of the shareholder
vote at the shareholders meeting or written consent in respect of which the shares held by the Trustee are being voted. However,
the Trustee shall not be obligated to exercise such voting rights nor notify the Israeli Participant of any meeting of the Company's
shareholders.

 

		14.	Governing Law & Jurisdiction. 

 

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

 

*
* *

 

 

10

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