Document:

exhibit_10-1.htm

Exhibit 10.1

 

ISRAELI SHARE OPTION PLAN

FINAL 

 

 

Gamida Cell Ltd.

 

THE 2003 ISRAELI SHARE OPTION PLAN

(*In compliance with Amendment No. 132 of the Israeli Tax Ordinance, 2002)

 

  

  

  

ISRAELI SHARE OPTION PLAN 

 

 

TABLE OF CONTENTS

 

	
1.

	
PURPOSE OF THE ISOP

	
3

	
2.

	
DEFINITIONS

	
3

	
3.

	
ADMINISTRATION OF THE ISOP

	
6

	
4.

	
DESIGNATION OF PARTICIPANTS

	
8

	
5.

	
DESIGNATION OF OPTIONS PURSUANT TO SECTION 102

	
8

	
6.

	
TRUSTEE

	
9

	
7.

	
SHARES RESERVED FOR THE ISOP; RESTRICTION THEREON

	
10

	
8.

	
PURCHASE  PRICE

	
11

	
9.

	
ADJUSTMENTS

	
11

	
10.

	
TERM AND EXERCISE OF OPTIONS

	
13

	
11.

	
VESTING OF OPTIONS

	
16

	
12.

	
SHARES SUBJECT TO RIGHT OF FIRST REFUSAL AND BRING ALONG

	
16

	
13.

	
PURCHASE FOR INVESTMENT; LIMITATIONS UPON IPO; REPRESENTATIONS

	
18

	
14.

	
DIVIDENDS

	
19

	
15.

	
RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS

	
19

	
16.

	
EFFECTIVE DATE AND DURATION OF THE ISOP

	
19

	
17.

	
AMENDMENTS OR TERMINATION

	
20

	
18.

	
GOVERNMENT REGULATIONS

	
20

	
19.

	
CONTINUANCE OF EMPLOYMENT OR HIRED SERVICES

	
20

	
20.

	
GOVERNING LAW & JURISDICTION

	
20

	
21.

	
TAX CONSEQUENCES

	
20

	
22.

	
NON-EXCLUSIVITY OF THE ISOP

	
21

	
23.

	
MULTIPLE AGREEMENTS

	
21

 

 

  

2

  

ISRAELI SHARE OPTION PLAN

 

 

PREFACE

 

This plan, as amended from time to time, shall be known as the “Gamida Cell Ltd 2003 Israeli Share Option Plan” (the “ISOP”).

 

	
1. 

	
PURPOSE OF THE ISOP

 

The ISOP is intended to provide an incentive to retain, in the employ of the Company and its Affiliates (as defined below), persons of training, experience, and ability, to attract new employees, directors, consultants, service providers and any other entity which the Board shall decide their services are considered valuable to the Company, to encourage the sense of proprietorship of such persons, and to stimulate the active interest of such persons in the development and financial success of the Company by providing them with opportunities to purchase shares in the Company, pursuant to the ISOP.

 

	
2. 

	
DEFINITIONS

 

For purposes of the ISOP and related documents, including the Option Agreement, the following definitions shall apply:

	 	
2.1

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

	 	
2.2

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

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

	 	
2.4

	
“Capital Gain Option (CGO)” as defined in Section 5.4 below.

	 	
2.5

	
“Cause” means, termination of Employee’s employment with Company as a result of the occurrence of any one of the following: (i) Employee has committed a dishonorable criminal offense; (ii) Employee is in breach of his duties of trust or loyalty to Company; (iii) Employee deliberately causes harm to Company’s business affairs; (iv) Employee breaches the confidentiality and/or non-competition and/or non-solicitation and/or assignment of inventions provisions of this Agreement; and/or (v) circumstances that do not entitle Employee to severance payments under any applicable law and/or under any judicial decision of a competent tribunal.

	 	
2.6

	
“Chairman” means the chairman of the Committee.

	 	
2.7

	
“Committee” means a share option compensation committee appointed by the Board, which shall consist of no fewer than two members of the Board.

 

  

3

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
2.8 

	
“Company” means Gamida Cell Ltd, an Israeli company.

	 	
2.9 

	
“Companies Law” means the Israeli Companies Law 5759-1999.

	 	
2.10

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

	 	
2.11

	
“Date of Grant” means, the date of grant of an Option, as determined by the Board  and set forth in the Optionee’s Option Agreement.

	 	
2.12

	
“Employee” means a person who is employed by the Company or its Affiliates, including an individual who is serving as a director or an office holder, but excluding Controlling Shareholder.

	 	
2.13

	
“Expiration date” means the date upon which an Option shall expire, as set forth in Section 10.2 of the ISOP.

 

	 	
2.14

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

 

(i) If the Shares are listed on any established stock exchange or a national market system, including without limitation the NASDAQ National Market system, or the NASDAQ SmallCap Market of the NASDAQ Stock Market, the Fair Market Value shall be the closing sales price for such Shares (or the closing bid, if no sales were reported), as quoted on such exchange or system for the last market trading day prior to time of determination, as reported in the Wall Street Journal, or such other source as the Board deems reliable. Without derogating from the above, solely for the purpose of determining the tax liability pursuant to Section 102(b)(3) of the Ordinance, if at the Date of Grant the Company’s shares are listed on any established stock exchange or a national market system or if the Company’s shares will be registered for trading within ninety (90) days following the Date of Grant, the Fair Market Value of a Share 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;

 

(ii) If the Shares are regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value shall be the mean between the high bid and low asked prices for the Shares on the last market trading day prior to the day of determination, or;

 

(iii) In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Board.

 

	 	
2.15

	
“IPO” means the underwritten initial public offering of the Company’s shares pursuant to a registration statement filed with and declared effective under the Israeli Securities Law, 1968, under the U.S. Securities Act of 1933, as amended, or under any similar law of any other jurisdiction.

 

  

4

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
2.16

	
“ISOP” means this 2003 Israeli Share Option Plan.

	 	
2.17

	
“ITA” means the Israeli Tax Authorities.

	 	
2.18

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

	 	
2.19

	
“Ordinary Income Option (OIO)” as defined in Section 5.5 below.

	 	
2.20

	
“Option” means an option to purchase one or more Shares of the Company pursuant to the ISOP.

	 	
2.21

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

	 	
2.22

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

	 	
2.23

	
“Optionee” means a person who receives or holds an Option under the ISOP.

	 	
2.24

	
“Option Agreement” means the share option agreement between the Company and an Optionee that sets out the terms and conditions of an Option.

 

	 	
2.25

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

	 	
2.26

	
“Purchase Price” means the purchase price for each Share underlying an Option.

	 	
2.27

	
“Section 102” means section 102 of the Ordinance as now in effect or as hereafter amended.

	 	
2.28 

	
“Share” means the Company’s ordinary shares, NIS 0.01 par value each.

	 	
2.29

	
“Successor Company” means any entity into which or with the Company is merged or by which the Company is acquired, pursuant to a Transaction in which the Company is not the surviving entity.

	 	
2.30

	
“Transaction” means (i) merger, acquisition or reorganization of the Company with one or more other entities in which the Company is not the surviving entity, (ii) a sale of all or substantially all of the assets or shares of the Company.

	 	
2.31

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

 

  

5

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
2.32

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

	 	
2.33

	
“Vested Option” means any Option, which has vested and is exercisable according to the Vesting Dates or otherwise (such as in the event of acceleration if applicable).

	 	
2.34

	
“Vesting Dates” means, with respect to each Option, the date as of which the Optionee shall be entitled to exercise such Option or a portion thereof, as set forth in section 11 of the ISOP.

	
3. 

	
ADMINISTRATION OF THE ISOP

 

	 	
3.1

	
The Board shall have the power to administer the ISOP either directly or upon the recommendation of the Committee, all as provided by applicable law and in the Company’s Articles of Association. Notwithstanding the above, for all intents and purposes hereunder, the Board shall automatically have residual authority if no Committee shall be constituted or if such Committee shall cease or otherwise be unable to operate for any reason.

 

	 	
3.2

	
The Committee shall select one of its members as its Chairman and shall hold its meetings at such times and places as the Chairman shall determine or as otherwise specified in the Articles of Association of the Company. The Committee shall keep records of its meetings and shall make such rules and regulations for the conduct of its business as it shall deem advisable.

 

	 	
3.3

	
The Committee shall have the power to recommend to the Board and the Board shall have the full power and authority to: (i) designate Optionees; (ii) determine the terms and provisions of the respective Option Agreements (which need not be identical), including, but not limited to, the number of Options to be granted to each Optionee, the number of Shares to be covered by each Option, provisions concerning the time and the extent to which the Options may be exercised and the nature and duration of restrictions as to the transferability or restrictions constituting substantial risk of forfeiture and to cancel or suspend awards, as necessary; (iii) determine the Fair Market Value of the Shares covered by each Option; (iv) make an Election (as defined in Section 5.6 below) as to the type of Approved 102 Option; and (v) designate the type of  Options.

 

  

6

  

ISRAELI SHARE OPTION PLAN

 

 

The Committee shall have full power and authority to: (i) alter any restrictions and conditions of any Options or Shares subject to any Options (ii) interpret the provisions and supervise the administration of the ISOP; (iii) accelerate the right of an Optionee to exercise in whole or in part, any previously granted Option; (iv) determine the Purchase Price of the Option; (v) prescribe, amend and rescind rules and regulations relating to the ISOP in cases specifically set forth hereunder; and (vi) make all other determinations deemed necessary or advisable for the administration of the ISOP.

 

	 	
3.4

	
Notwithstanding the above, the Committee shall not be entitled to grant Options to the Optionees, however, it will be authorized to issue Shares underlying Options which have been granted by the Board and duly exercised pursuant to the provisions herein in accordance with section 112(a)(5) of the Companies Law.

 

	 	
3.5

	
The Board shall have the authority to grant, at its discretion, to the holder of an outstanding Option, in exchange for the surrender and cancellation of such Option, a new Option having a purchase price equal to, lower than or higher than the Purchase Price of the original Option so surrendered and canceled and containing such other terms and conditions as the Committee may prescribe in accordance with the provisions of the ISOP.

 

	 	
3.6

	
Subject to the Company’s Articles of Association, all decisions and selections made by the Board or the Committee pursuant to the provisions of the ISOP shall be made by a majority of its members except that no member of the Board or the Committee shall vote on, or be counted for quorum purposes, with respect to any proposed action of the Board or the Committee relating to any Option to be granted to that member. Any decision reduced to writing shall be executed in accordance with the provisions of the Company’s Articles of Association, as the same may be in effect from time to time.

 

	 	
3.7

	
The interpretation and construction by the Committee of any provision of the ISOP or of any Option Agreement thereunder shall be final and conclusive unless otherwise determined by the Board.

 

	 	
3.8

	
Subject to the Company’s Articles of Association, to applicable law, to the Company’s decision, and to all approvals legally required, , each member of the Board or the Committee shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by such member, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the ISOP unless arising out of such member's own fraud or bad faith, to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the member may have as a director or otherwise under the Company's Articles of Association, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise.

 

  

7

  

ISRAELI SHARE OPTION PLAN

 

 

	
4. 

	
DESIGNATION OF PARTICIPANTS

 

	 	
4.1

	
The persons eligible for participation in the ISOP as Optionees shall include any Employees and/or Non-Employees of the Company or of any Affiliate thereof; provided, however, that (i) Employees may only be granted 102 Options; and (ii) Non-Employees may only be granted 3(i) Options;.

 

	 	
4.2

	
The grant of an Option hereunder shall neither entitle the Optionee to participate nor disqualify the Optionee from participating in, any other grant of Options pursuant to the ISOP or any other option or share plan of the Company or any of its Affiliates.

 

	 	
4.3

	
Anything in the ISOP to the contrary notwithstanding, all grants of Options to directors and office holders shall be authorized and implemented in accordance with the provisions of the Companies Law or any successor act or regulation, as in effect from time to time.

	
5. 

	
DESIGNATION OF OPTIONS PURSUANT TO SECTION 102

 

	 	
5.1

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

	 	
5.2

	
The grant of Approved 102 Options shall be made under this ISOP adopted by the Board as described in Section 16 below, and shall be conditioned upon the approval of this ISOP by the ITA.

	 	
5.3

	
Approved 102 Option may either be classified as Capital Gain Option (“CGO”) or Ordinary Income Option (“OIO”).

	 	
5.4

	
Approved 102 Option elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) shall be referred to herein as CGO.

	 	
5.5

	
Approved 102 Option elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) shall be referred to herein as OIO.

	 	
5.6

	
The Company’s election of the type of Approved 102 Options as CGO or OIO granted to Employees (the “Election”), shall be appropriately filed with the ITA before the Date of Grant of an Approved 102 Option under such Election. Such Election shall become effective beginning the first Date of Grant of an Approved 102 Option under such Electionand shall remain in effect until the end of the year following the year during which the Company first granted Approved 102 Options under such Election. The Election shall obligate the Company to grant only the type of Approved 102 Option it has elected, and shall apply to all Optionees who were granted Approved 102 Options 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 Options simultaneously.

 

  

8

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
5.7

	
All Approved 102 Options must be held in trust by a Trustee, as described in Section 6 below.

	 	
5.8

	
For the avoidance of doubt, the designation of Unapproved 102 Options and Approved 102 Options shall be subject to the terms and conditions set forth in Section 102 of the Ordinance and the regulations promulgated thereunder.

	 	
5.9

	
With regards to Approved 102 Options, the provisions of the ISOP and/or the Option Agreement shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s permit, and the said provisions and permit shall be deemed an integral part of the ISOP and of the Option Agreement. Any provision of Section 102 and/or the said permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in the ISOP or the Option Agreement, shall be considered binding upon the Company and the Optionees.

 

	
6. 

	
TRUSTEE

 

	 	
6.1

	
Approved 102 Options which shall be granted under the ISOP and/or any Shares allocated or issued upon exercise of such Approved 102 Options and/or other shares received subsequently following any realization of rights, including without limitation bonus shares, shall be allocated or issued to the Trustee (and registered in the Trustee’s name on behalf of the respective Optionee in the shareholders register of the Company) and held for the benefit of the Optionees for such period of time as required by Section 102 or any regulations, rules or orders or procedures promulgated thereunder (the “Holding Period”). All certificates representing Shares issued to the Trustee under the Plan shall be deposited with the Trustee, and shall be held by the Trustee until such time that such Shares are released from the aforesaid trust as herein provided. In the case the requirements for Approved 102 Options are not met, then the Approved 102 Options may be treated as Unapproved 102 Options, all in accordance with the provisions of Section 102 and regulations promulgated thereunder. 

 

	 	
6.2

	
Notwithstanding anything to the contrary, the Trustee shall not release any Shares allocated or issued upon exercise of Approved 102 Options prior to the full payment of the Optionee’s tax liabilities arising from Approved 102 Options which were granted to such Optionee and/or any Shares allocated or issued upon exercise of such Options.

 

	 	
6.3

	
With respect to any Approved 102 Option, subject to the provisions of Section 102 and any rules or regulation or orders or procedures promulgated thereunder, an Optionee shall not sell or release from trust any Share received upon the exercise of an Approved 102 Option and/or any share received subsequently following any realization of rights, including without limitation, bonus shares, until the lapse of the Holding Period required under Section 102 of the Ordinance. Notwithstanding the above, if any such sale or release occurs during the Holding Period, the sanctions under Section 102 of the Ordinance and under any rules or regulation or orders or procedures promulgated thereunder shall apply to and shall be borne by such Optionee.

 

  

9

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
6.4

	
Upon receipt of Approved 102 Option, the Optionee will sign an undertaking to release the Trustee from any liability in respect of any action or decision duly taken and bona fide executed in relation with the ISOP, or any Approved 102 Option or Share granted to him thereunder.

 

	
7. 

	
SHARES RESERVED FOR THE ISOP; RESTRICTION THEREON

 

	 	
7.1

	
The Company has reserved an aggregate of ________     (               ) authorized but unissued Shares, for the purposes of this ISOP and for the purposes of  any other share option plans which were previously, or may in the future be, adopted by the Company, subject to adjustment as set forth in Section 9 below (to date, some of such Shares have already been issued upon exercise of options granted under other share option plans of the Company). Any Shares which remain unissued and which are not subject to the outstanding Options at the termination of the ISOP shall cease to be reserved for the purpose of the ISOP, but until termination of the ISOP the Company shall at all times reserve sufficient number of Shares to meet the requirements of the ISOP. Should any Option for any reason expire or be canceled prior to its exercise or relinquishment in full, the Shares subject to such Option may again be subjected to an Option under the ISOP or under the Company’s other share option plans.

 

	 	
7.2

	
Each Option granted pursuant to the ISOP, shall be evidenced by a written Option Agreement between the Company and the Optionee, in such form as the Board or the Committee shall from time to time approve. Each Option Agreement shall state, among other matters, the number of Shares to which the Option relates, the type of Option granted thereunder (whether a CGO, OIO, Unapproved 102 Option or a 3(i) Option), the Vesting Dates, the Purchase Price per share, the Expiration Date and such other terms and conditions as the Committee or the Board in its discretion may prescribe, provided that they are consistent with this ISOP.

 

	 	
7.3

	
The Company, at its sole discretion, may require that, until the consummation of an IPO, any Shares issued upon exercise of Options (and securities of the Company issued with respect thereto) shall be voted by an irrevocable proxy (the ”Proxy”) pursuant to the directions of the Board, such Proxy to be assigned to the person or persons designated by the Board and to provide for the power of such designated person(s) to act, instead of the Optionee and on its behalf, with respect to any and all aspects of the Optionee’s shareholdings in the Company. The Proxy may be contained in the Option Agreement of an Optionee or otherwise as the Committee determines. If contained in the Option Agreement, no further document shall be required to implement such Proxy, and the signature of the Optionee on the Option Agreement shall indicate approval of the Proxy thereby granted. Such person or persons designated by the Board shall be indemnified and held harmless by the Company against any cost or expense (including counsel fees) reasonably incurred by him/her, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the voting of such Proxy unless arising out of such member's own fraud or bad faith, to the extent permitted by applicable law. Such indemnification shall be in addition to any rights of indemnification the person(s) may have as a director or otherwise under the Company's Articles of Association, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise. Without derogating from the above, with respect to Approved 102 Options, such shares shall be voted in accordance with the provisions of Section 102 and any rules, regulations or orders promulgated thereunder.

 

  

10

  

ISRAELI SHARE OPTION PLAN

 

 

	
8. 

	
PURCHASE  PRICE

 

	 	
8.1

	
The Purchase Price of each Share subject to an Option shall be determined by the Committee in its sole and absolute discretion in accordance with applicable law, subject to any guidelines as may be determined by the Board from time to time. Each Option Agreement will contain the Purchase Price determined for each Optionee.

 

	 	
8.2

	
The Purchase Price shall be payable upon the exercise of the Option in a form satisfactory to the Committee, including without limitation, by cash or check. The Committee shall have the authority to postpone the date of payment on such terms as it may determine.

	 	
8.3

	
The Purchase Price shall be denominated in the currency of the primary economic environment of, either the Company or the Optionee (that is the functional currency of the Company or the currency in which the Optionee is paid) as determined by the Company.

 

	
9. 

	
ADJUSTMENTS

 

Upon the occurrence of any of the following described events, Optionee's rights to purchase Shares under the ISOP shall be adjusted as hereafter provided:

 

	 	
9.1

	
In the event of Transaction, the unexercised Options then outstanding under the ISOP shall be assumed or substituted for options to purchase an appropriate number of shares of each class of shares or other securities of the Successor Company (or a parent or subsidiary of the Successor Company), per each Share underlying the assumed or substituted Option, as were distributed to the holders of Shares of the Company per each Share held by them, in connection with and pursuant to the Transaction. In the case of such assumption and/or substitution of Options, appropriate adjustments shall be made to the Purchase Price so as to reflect such action and all other terms and conditions of the Option Agreements shall remain unchanged, including but not limited to the vesting schedule, all subject to the determination of the Committee or the Board, which determination shall be in their sole discretion and final. The Company shall notify the Optionee of the Transaction in such form and method as it deems applicable and at such time in advance as notification was given to the holders of other Shares which were issued either upon exercise of Options under this ISOP or upon exercise of options to purchase shares of the Company granted under any other share option plan of the Company..

 

  

11

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
9.2

	
Notwithstanding the above and subject to any applicable law, the Board or the Committee shall have full power and authority to determine with respect to any Options, that in the Option Agreement applicable to such Options there shall be a clause instructing that if, in any such Transaction, the Successor Company (or parent or subsidiary of the Successor Company) does not agree to assume or substitute any unexercised Options underlying such Option Agreement, the Vesting Dates of such Options shall be accelerated so that any such unexercised Options that are then unvested shall be immediately vested and exercisable as of the date which is ten (10) days prior to the effective date of the Transaction and for a period of 10-days thereafter (upon expiration of which period the Options shall expire).

Notwithstanding the above and subject to any applicable law, unless the Board or the Committee determines otherwise with respect to certain Option(s), if, in any such Transaction, the Successor Company (or parent or subsidiary of the Successor Company) does not agree to assume or substitute for the Options, all unexercised Options shall expire as of immediately prior to the consummation of the Transaction.

	 	
9.3

	
For the purposes of section 9.1 above, an Option shall be considered assumed or substituted if, following the Transaction, the assumed or substituted Option confers the right to purchase or receive, for each Share underlying such an assumed or substituted Option immediately prior to the Transaction, the consideration (whether shares, options, cash, or other securities or property) received in the Transaction for each Share held by holders of Shares of the Company on the effective date of the Transaction (and if such holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Transaction is not solely shares (or their equivalent) of the Successor Company or its parent or subsidiary, the Committee may, with the consent of the Successor Company, provide for the consideration to be received upon the exercise of the assumed or substituted Option to be solely shares (or their equivalent) of the Successor Company or its parent or subsidiary equal in Fair Market Value to the per Share consideration received by holders of a majority of the outstanding shares in the Transaction; and provided further that the Committee may determine, in its discretion, that in lieu of such assumption or substitution of Options for options of the Successor Company or its parent or subsidiary, such Options will be substituted for any other type of asset or property including cash which is fair under the circumstances.

	 	
9.4

	
If the Company is voluntarily liquidated or dissolved while unexercised Options remain outstanding under the ISOP, the Company shall immediately notify all unexercised Option holders of such liquidation, and the Option holders shall then have ten (10) days to exercise any unexercised Vested Option held by them at that time, in accordance with the exercise procedure set forth herein. Upon the expiration of such ten-days period, all remaining unexercised Options will terminate immediately.

 

  

12

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
9.5

	
If the outstanding shares of the Company shall at any time be changed or exchanged by declaration of a share dividend (bonus shares), share split, combination or exchange of shares, recapitalization, or any other like event by or of the Company, and as often as the same shall occur, then the number, class and kind of the Shares subject to the ISOP or subject to any Options therefore granted, and the Purchase Prices, shall be appropriately and equitably adjusted so as to maintain the proportionate number of Shares without changing the aggregate Purchase Price, provided, however, that the Purchase Price shall not be less than the par value of the Share underlying any such Options, and provided further, that no adjustment shall be made by reason of the distribution of subscription rights (rights offering) on outstanding shares. Upon happening of any of the foregoing, the class and aggregate number of Shares issuable pursuant to the ISOP (as set forth in Section 7 hereof), in respect of which Options have not yet been exercised, shall be appropriately adjusted, all as will be determined by the Board whose determination shall be final.

	 	
9.6

	
 Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Option.

	 	
9.7

	
Anything herein to the contrary notwithstanding, if prior to the completion of the IPO, a Transaction is consummated pursuant to which, all or substantially all of the shares of the Company are sold, or exchanged for securities of another Company, then each Optionee shall be obliged to sell or exchange, as the case may be, any Shares such Optionee purchased under the ISOP (in accordance with the value of the Optionee’s Shares pursuant to the terms of the Transaction), and perform any action and/or execute any document required in order to effectuate such Transaction, all in accordance with the instructions issued by the Board in connection with the Transaction, whose determination shall be final.

 

	
10. 

	
TERM AND EXERCISE OF OPTIONS

 

	 	
10.1

	
Options shall be exercised by the Optionee by giving written 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, which exercise shall be effective upon receipt of such notice by the Company and/or the Representative and the payment of the Purchase Price at the Company’s or the Representative’s principal office. The notice shall specify the number of Shares with respect to which the Option is being exercised.

 

  

13

  

ISRAELI SHARE OPTION PLAN

 

 

	
  

	 

	 	
10.2

	
Options, to the extent not previously exercised, shall terminate forthwith upon the earlier of: (i) the date set forth in the Option Agreement (unless otherwise determined in accordance with the provisions of this ISOP with respect to any Option(s), such date shall be seven (7) years from the respective Date of Grant); and (ii) the expiration of any extended period in any of the events set forth in section 10.5 below.

	
  

	 

	 	
10.3

	
The Options may be exercised by the Optionee in whole at any time or in part from time to time, to the extent that the Options become vested and exercisable, prior to the Expiration Date, and provided that, subject to the provisions of section 10.5 below, the Optionee is employed by or providing services to the Company or any of its Affiliates, at all times during the period beginning with the granting of the Option and ending upon the date of exercise.

	
  

	 

	 	
10.4

	
Subject to the provisions of section 10.5 below, in the event of termination of Optionee’s employment or services, with the Company or any of its Affiliates, all Options granted to such Optionee will immediately expire. A notice of termination of employment or service shall be deemed to constitute termination of employment or service. For the avoidance of doubt, in case of such termination of employment or service, the unvested portion of the Optionee’s Option shall not vest and shall not become exercisable and any unvested portion of the Optionee’s Option shall revert to the ISOP.

	 	
10.5

	
Notwithstanding anything to the contrary hereinabove and unless otherwise determined in the Optionee’s Option Agreement, an Option may be exercised after the date of termination of Optionee's employment or service with the Company or any Affiliates during an additional period of time beyond the date of such termination, but only with respect to the number of Vested Options at the time of such termination according to the Vesting Dates, if:

 

	 	
(i)

	
termination is without Cause, in which event any Vested Option still in force and unexpired may be exercised within a period of ninety (90) days after the date of such termination; or-

  

	 	
(ii)

	
termination is the result of death, Retirement or Disability (each, as hereinafter defined) of the Optionee, in which event any Vested Option still in force and unexpired may be exercised within a period of twelve (12) months after the date of such termination; or -

  

	 	
(iii)

	
prior to the date of such termination, the Committee shall authorize an extension of the terms of all or part of the Vested Options beyond the date of such termination for a period not to exceed the period during which the Options by their terms would otherwise have been exercisable.

For avoidance of any doubt, notwithstanding anything herein to the contrary, if termination of employment or service is for Cause, any outstanding unexercised Option (whether vested or non-vested), will immediately expire and terminate, and the Optionee shall not have any right in connection to such outstanding Options.

 

  

14

  

ISRAELI SHARE OPTION PLAN

 

 

As used herein: (i) the term “Disability” means an Optionee’s inability to perform his/her duties to the Company, or to any of its Affiliates, for a consecutive period of at least 180 days, by reason of any medically determinable physical or mental impairment, as determined by a physician selected by the Optionee and acceptable to the Company; and (ii) the term “Retirement” means an Optionee's retirement pursuant to applicable law or in accordance with the terms of any tax-qualified retirement plan maintained by the Company or any of its Affiliates in which the Optionee participates.

	 	
10.6

	
To avoid doubt, the Optionees shall not be deemed owners of the Shares issuable upon the exercise of Options and shall not have any of the rights or privileges of shareholders of the Company in respect of any Shares purchasable upon the exercise of any Option, nor shall they be deemed to be a class of shareholders or creditors of the Company for purpose of the operation of sections 350 and 351 of the Companies Law or any successor to such section, until registration of the Optionee as holder of such Shares in the Company’s register of shareholders upon exercise of the Option in accordance with the provisions of the ISOP, but in case of Options and Shares held by the Trustee, subject to the provisions of Section 6 of the ISOP.

	 	
10.7

	
Any form of Option Agreement authorized by the ISOP may contain such other provisions as the Committee may, from time to time, deem advisable.

	 	
10.8

	
With respect to Unapproved 102 Option, if the Optionee ceases to be employed by the Company or any Affiliate, the Optionee 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.

	 	
10.9

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

	 	
10.10

	
With respect to Unapproved 102 Options, if the Optionee ceases to be employed by the Company or any Affiliate, the Optionee 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, regulations or orders promulgated thereunder.

 

  

15

  

ISRAELI SHARE OPTION PLAN

 

 

	
11. 

	
VESTING OF OPTIONS

 

	 	
11.1

	
Subject to the provisions of the ISOP, each Option shall vest and become exercisable commencing on the Vesting Date thereof, as determined by the Board or by the Committee, and for the number of Shares as shall be provided in the Option Agreement. However, no Option shall be exercisable after the Expiration Date.

	 	
11.2

	
An Option may be subject to such other terms and conditions on the time or times when it may be exercised, as the Committee may deem appropriate. The vesting provisions of individual Options may vary.

 

	
12. 

	
SHARES SUBJECT TO RIGHT OF FIRST REFUSAL AND BRING ALONG

 

	 	
12.1

	
Notwithstanding anything to the contrary in the Articles of Association of the Company, none of the Optionees shall have a right of first refusal in relation with any Sale (as hereinafter defined) of shares in the Company.

	
  

	 

	 	
12.2

	
Unless otherwise determined by the Committee, until such time as the Company shall complete an IPO, an Optionee shall not have the right to sell Shares issued upon the exercise of an Option within six (6) months and one day of the later of the date of exercise of such Option or issuance of such Shares (if such an issuance is not made immediately upon exercise).

 

	 	
12.3

	
A sale, transfer, assignment or other disposition (collectively, “Sale”) of Shares issuable upon the exercise of an Option shall be subject to the right of first refusal of other shareholders of the Company as set forth in the Articles of Association of the Company or in any agreement among the Company and all or substantially all of its shareholders. In the event that neither the Articles of Association of the Company nor any such agreement shall provide for applicable rights of first refusal, then, unless otherwise determined by the Committee, until such time as the Company shall complete an IPO, the Sale of Shares issuable upon the exercise of an Option shall be subject to a right of first refusal on the part of the Repurchaser(s) , as follows:

	
  

	 

(a) Repurchaser(s) means (i) the Company, if permitted by applicable law, ( ii) if the Company is not permitted by applicable law, then any Affiliate of  the Company designated by the Committee; or (iii) if no decision is reached by the Committee, then the Company’s existing shareholders (save, for avoidance of doubt, for other Optionees who already exercised their Options), pro rata in accordance with their respective shareholdings in the Company’s issued and outstanding share capital.

(b) The Optionee shall give a notice of sale (hereinafter the “Notice”) to the Company in order to offer the Shares to the Repurchaser(s). The Company will forward the Notice to the applicable Repurchaser(s).

 

  

16

  

ISRAELI SHARE OPTION PLAN

 

 

(c) The Notice shall specify the name of each proposed purchaser or other transferee (hereinafter the “Proposed Transferee”), the number of Shares offered for sale, the price per Share and the payment terms. The Repurchaser(s) will be entitled for thirty (30) days from the day of receipt of the Notice (hereinafter the “Notice Period”), to purchase all or part of the offered Shares (if the Repurchaser(s) are shareholders of the Company, then such entitlement shall be on a pro rata basis based upon their respective holdings in the Company’s issued and outstanding share capital).

(d) If by the end of the Notice Period not all of the offered Shares have been purchased by the Repurchaser(s), the Optionee shall be entitled to Sell such remaining unpurchased Shares at any time during the ninety (90) days following the end of the Notice Period on terms not more favorable to the Proposed Transferee than those set out in the Notice, provided that the Proposed Transferee agrees in writing that the provisions of this section shall continue to apply to the Shares in the hands of such Proposed Transferee. Any Sale of Shares issued under the ISOP by the Optionee that is not made in accordance with the ISOP or the Option Agreement shall be null and void.

(e) If the consideration to be paid for the Shares is not cash, the value of the consideration shall be determined in good faith by the Company’s Board of Directors, and if the Company cannot for any reason pay for the Shares in the form of non-cash consideration, the Company may pay the cash equivalent thereof, as determined by the Board of Directors.

 

	 	
12.4 

	
Prior to an IPO, and in addition to the right of first refusal, any transfer of Shares by an Optionee shall require the Board of Directors’ approval as to the identity of the transferee and as required under the Company’s Articles of Association. The Board of Directors may refuse to approve the transfer of Shares to any competitor of the Company or to any other person or entity the Board determines, in its discretion, may be detrimental to the Company.

	 	
12.5 

	
Anything herein to the contrary notwithstanding, the Optionees shall be bound by the “bring along” provisions of any agreement among the Company and all or substantially all of its shareholders, as in effect from time to time, to the effect that if, prior to the completion of the IPO, shareholders holding a certain percentage of the Company’s share capital (as set forth in such agreement) (“Proposing Holders”), elect to sell all of their equity securities in the Company to a third party, or agree to merge or consolidate the Company with or into another entity, and such sale or merger is conditioned upon the sale of all remaining stock of the Company to such third party, or to the agreement of all of the shareholders, the Optionees shall be required, if so demanded by the Proposing Holders, to sell or transfer all of their equity securities in the Company to such third party at the same price and upon the same terms and conditions as the Proposing Holders.

  

17

  

ISRAELI SHARE OPTION PLAN

 

 

	
13.

	
PURCHASE FOR INVESTMENT; LIMITATIONS UPON IPO; REPRESENTATIONS

 

	 	
13.1 

	
The Company’s obligation to issue or allocate Shares upon exercise of an Option granted under the ISOP is expressly conditioned upon: (a) the Company’s completion of any registration or other qualifications of such Shares under all applicable laws, rules and regulations or (b) representations and undertakings by the Optionee (or his legal representative, heir or legatee, in the event of the Optionee’s death) to assure that the sale of the Shares complies with any registration exemption requirements which the Company in its sole discretion shall deem necessary or advisable. Such required representations and undertakings may include representations and agreements that such Optionee (or his legal representative, heir, or legatee): (a) is purchasing such Shares for investment and not with any present intention of selling or otherwise disposing thereof; and (b) agrees to have placed upon the face and reverse of any certificates evidencing such Shares a legend setting forth (i) any representations and undertakings which such Optionee has given to the Company or a reference thereto and (ii) that, prior to effecting any sale or other disposition of any such Shares, the Optionee must furnish to the Company an opinion of counsel, satisfactory to the Company, that such sale or disposition will not violate the applicable laws, rules, and regulations, whether of the State of Israel or of the United States or any other State having jurisdiction over the Company and the Optionee.

	 	
13.2 

	
The Optionee acknowledges that in the event that the Company’s shares shall be registered for trading in any public market, Optionee’s rights to sell the Shares may be subject to certain limitations (including a lock-up period), as will be requested by the Company or its underwriters, and the Optionee unconditionally agrees and accepts any such limitations.

	 	
13.3 

	
Upon the grant of Options to an Optionee or the issuance of Shares upon the exercise thereof, the Company shall obtain from such the representations and undertakings as follows:

  (a)           That the Optionee is familiar with the Company, its activity and its financial and commercial forecast, and that the Optionee knows that there is no certainty that the exercise of the Options will be financially worthwhile. The Optionee hereby undertakes not to have any claim against the Company or any of its directors, employees, stockholders or advisors if it emerges, at the time of exercising the Options, that the Optionee’s investment in the Company‘s Shares was not worthwhile, for any reason whatsoever.

  (b)           That the Optionee knows that his rights regarding the Options and the Shares are subject for all intents and purposes to the instructions of the Company’s documents of incorporation and to the agreements of the stockholders in the Company.

  (c)           That the Optionee knows that in addition to the allocations set forth above, the Company has allocated and/or is entitled to allocate Options and Shares to other employees and other people, and the Optionee shall have no claim regarding such allocations, their quantity, the relationship among them and between them and the other stockholders in the Company, exercising of the options or any matter related to or stemming from them.

 

  

18

  

ISRAELI SHARE OPTION PLAN

 

 

  (d)           That the Optionee knows that neither the ISOP nor the grant of Option or Shares thereunder shall impose any obligation on the Company to continue the engagement of the Optionee, and nothing in the ISOP or in any Option or Shares granted pursuant thereto shall confer upon any Optionee any right to continue being engaged by the Company, or restrict the right of the Company to terminate such engagement at any time.

	
14. 

	
DIVIDENDS

 

With respect to all Shares (but excluding, for avoidance of any doubt, any unexercised Options) allocated or issued upon the exercise of Options purchased by the Optionee and held by the Optionee or by the Trustee, as the case may be, the Optionee shall be entitled to receive dividends in accordance with the quantity of such Shares, subject to the provisions of the Company’s Articles of Association (and all amendments thereto) and subject to any applicable taxation on distribution of dividends, and when applicable subject to the provisions of  Section 102 and the rules, regulations or orders promulgated thereunder.

 

	
15. 

	
RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS

 

	 	
15.1

	
No Option or any right with respect thereto, purchasable hereunder, whether fully paid or not, shall be assignable, transferable or given as collateral or any right with respect to it given to any third party whatsoever, except as specifically allowed under the ISOP, and during the lifetime of the Optionee each and all of such Optionee's rights to purchase Shares hereunder shall be exercisable only by the Optionee.

 

	 	
  

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

 

	 	
15.2

	
As long as Options and/or Shares are held by the Trustee on behalf of  the Optionee, all rights of the Optionee over the Shares are personal, can not be transferred, assigned, pledged or mortgaged, other than by will or pursuant to the laws of descent and distribution.

 

	
16. 

	
EFFECTIVE DATE AND DURATION OF THE ISOP

 

The ISOP shall be effective as of the day it was adopted by the Board and shall terminate at the end of seven (7) years from such day of adoption, unless terminated earlier in accordance with Section 17 hereof.

 

  

19

  

ISRAELI SHARE OPTION PLAN

 

 

	
17. 

	
AMENDMENTS OR TERMINATION

 

The Board may at any time, but when applicable, after consultation with the Trustee, amend, alter, suspend or terminate the ISOP. No amendment, alteration, suspension or termination of the ISOP shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Company, which agreement must be in writing and signed by the Optionee and the Company. Termination of the ISOP shall not affect the Committee’s ability to exercise the powers granted to it hereunder with respect to Options granted under the ISOP prior to the date of such termination.

 

	
18. 

	
GOVERNMENT REGULATIONS

 

The ISOP, and the grant and exercise of Options hereunder, and the obligation of the Company to sell and deliver Shares under such Options, shall be subject to all applicable laws, rules, and regulations, whether of the State of Israel or of the United States or any other State having jurisdiction over the Company and the Optionee, including , without limitation,  the United States Securities Act of 1933, the Companies Law, the Securities Law, 1968, and the Ordinance and to such approvals by any governmental agencies or national securities exchanges as may be required. Nothing herein shall be deemed to require the Company to register the Shares under the securities laws of any jurisdiction.

 

	
19. 

	
CONTINUANCE OF EMPLOYMENT OR HIRED SERVICES

 

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

 

	
20. 

	
GOVERNING LAW & JURISDICTION

 

The ISOP 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 of Tel-Aviv, Israel shall have sole jurisdiction in any matters pertaining to the ISOP.

 

	
21. 

	
TAX CONSEQUENCES

 

	 	
21.1

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

 

  

20

  

ISRAELI SHARE OPTION PLAN

 

 

	 	
21.2

	
The Company and/or, when applicable, the Trustee shall not be required to release any Share certificate to an Optionee until all required payments have been fully made.

	
22. 

	
NON-EXCLUSIVITY OF THE ISOP

 

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

 

For the avoidance of doubt, prior grant of options to Optionees of the Company under their employment agreements, and not in the framework of any previous option plan, shall not be deemed an approved incentive arrangement for the purpose of this Section.

 

	
23.

	
MULTIPLE AGREEMENTS

 

The terms of each Option may differ from other Options granted under the ISOP at the same time, or at any other time. The Board may also grant more than one Option to a given Optionee during the term of the ISOP, either in addition to, or in substitution for, one or more Options previously granted to that Optionee.

21exhibit10_3-1.htm

Exhibit 10.3.1

 

APMB Draft January 3, 2005

 

PERSONAL EMPLOYMENT AGREEMENT

 

THIS AGREEMENT (the “Agreement”) is made and entered into as of the date of the last signature hereto, by and between Gamida Cell Ltd. (P.C. No. 51-2601204), of business address at 5 Nachum Hafzadi, Givat Shaul, Jerusalem, 65484 Israel (the “Company”), and Dr. Yael Margolin, ID no. 5167346-5 of 2 Yehoshua Bin-Nun Street, Herzlia (“Executive”).

 

WHEREAS Company wishes to employ Executive as CEO of the Company, and Executive agrees to be so employed by Company, as of the Commencement Date of Employment and throughout the Term (as such terms are defined hereunder); and

 

WHEREAS the parties wish to regulate their relationship in accordance with the terms and conditions set forth in this Agreement;

 

NOW, THEREFORE, in consideration of the mutual premises, covenants and undertakings contained herein, the parties hereto have hereby agreed as follows:

	  	  	  
	
1.

	
Representations and Warranties

	  	  	  
	  	
1.1.

	
Executive represents to Company that as of the Commencement Date of Employment (as defined below) Executive is free to be employed by Company pursuant to the terms contained in this Agreement and there are no contracts, impediments and/or restrictive covenants preventing full performance of Executive’s duties and obligations hereunder.

	  	  	  
	  	
1.2.

	
The Company represents that there is no impediment preventing it from entering into this Agreement with the Executive.

	  	  	  
	
2.

	
Term

	  	  	  
	  	
Executive’s employment with Company shall commence as of January 1, 2005 (the “Commencement Date of Employment”) and shall continue until terminated in accordance with the provisions of Section 11 hereof (the “Term”).

	  	  	  
	
3.

	
Position

	  	  	  
	  	
3.1.

	
Company hereby agrees to employ Executive and Executive hereby agrees to be employed by Company as its Chief Executive Officer (the “Position”).

	  	  	  
	  	
3.2.

	
During Executive’s employment with Company in the Position, Executive shall have the authority, functions, duties and responsibilities, as provided by the Companies Law 5759-1999 or as otherwise may be stipulated by the Board of Directors of the Company from time to time, Executive shall report to the Board of Directors.

	  	  	  
	  	
3.3.

	
Executive shall serve as a member of the Company’s Board of Directors, ex officio, during the Term only and only for as long as she serves in the Position. Notwithstanding the foregoing provision, the Board of Directors may remove Executive from the Board of Directors at any time during the Notice Period (defined hereinafter).

	  	  	  
	  	
3.4.

	
It is hereby acknowledged and agreed that Executive’s Position shall be deemed a senior position and/or one that shall require a special degree of trust; therefore, the provisions of The Work and Rest Hours Law, 1951 (the “Rest Hours Law”), shall not apply to this Agreement and to Executive’s employment with Company.

 

704/201/99

 

  

  

  

 

	  	  	  
	
4.

	
Executive’s Duties

	  	  	  
	  	
Executive affirms and undertakes throughout the Term:

	  	  	  
	  	
4.1.

	
To devote her entire working time, know-how, energy, expertise, talent, experience and best efforts to the business and affairs of Company and to the performance of her duties with the Company.

	  	  	  
	  	
4.2.

	
To perform and discharge well and faithfully, with devotion, honesty and fidelity, her obligations pursuant to her Position and to ensure that the strategies and objectives of the Company as determined and approved by the Board of Directors of the Company will be diligently pursued.

	  	  	  
	  	
4.3.

	
To comply with the directives of the Board of Directors.

	  	  	  
	  	
4.4.

	
To travel abroad from time to time if and as may be required pursuant to her Position.

	  	  	  
	  	
4.5.

	
Not to receive, at any time, whether during the Term and/or at any time thereafter, directly or indirectly, any payment, benefit and/or other consideration, from any third party in connection with her employment with Company, without the Company’s prior written authorization.

	  	  	  
	  	
4.6.

	
To immediately and without delay inform the Company’s Board of Directors of any affairs and/or matters that might constitute a conflict of interest with Executive’s Position and/or employment with Company.

	  	  	  
	  	
4.7.

	
Not to assume, directly or indirectly, whether with or without consideration, any employment obligations unrelated to the Company (and/or any subsidiary and/or parent company of Company) and not to be retained as a consultant or advisor or contractor (whether or not compensated therefore) to any other business or entity other than with the prior written approval of the Company (not to be unreasonably withheld) and in accordance with the terms and conditions of such approval.

	  	  	  
	  	
4.8.

	
Notwithstanding the foregoing provision, Executive shall be permitted to (i) serve as a director on the Board of Directors of Collgard Biopharmaceuticals Ltd.; and (ii) provide consulting services to the FoamOtic project (each a “Permitted Activity” and together, “Permitted Activities”), provided that the Permitted Activities do not exceed, in the aggregate, ten (10) hours per month, and further provided that the carrying out of the Permitted Activities by Executive are subject to the complete fulfillment by Executive of her duties to Company under this Agreement, including her assignment of rights obligations under Section 10 below, and that they do not, nor shall they in the future, constitute a conflict of interest with Executive’s Position and/or employment with Company. In the event that the Company’s Board of Directors determines that one or both of the Permitted Activities constitute a conflict of interest as aforesaid, Executive undertakes to immediately cease the Permitted Activity or Permitted Activities, provided however, that in any event Executive shall be permitted to remain a director of Collgard Biopharmaceuticals Ltd. through the end of February 2005.

	  	  	  
	  	
4.9.

	
Not to use in connection with the Position any trade secrets or proprietary information in such a manner that may breach any confidentiality and/or other obligation Executive may have undertaken relating to any former employer(s) and/or any third party.

704/201/99

 

  

2

  

 

	  	  	  	  
	
5.

	
Compensation

	  	  	  	  
	  	
5.1.

	Subject to and in consideration of Executive’s fulfillment of her obligations in pursuance of this Agreement, Company shall pay Executive a monthly gross salary in the NIS equivalent of Twelve Thousand Dollars (US $12,000) (the “Salary”), based on the representative rate of exchange of the US dollar known on the last day of the month to which the Salary relates (the “Rate of Exchange”), provided however, that the Rate of Exchange shall not be less than the representative rate of exchange of the US dollar known on January 1, 2005.
	  	  	  	  
	  	5.2.	The Salary shall be payable by no later than the ninth (9th) day of the consecutive calendar month following the calendar month of employment to which the payment relates. 
	 	 	 	 
	 	5.3. 	Israeli income tax and other applicable withholdings with respect to the Salary shall be deducted from the Salary by the Company at source.
	  	  	  	  
	  	
5.4.

	The Salary shall serve as the basis for deductions and contributions to managers’ insurance policy (Bituach Menahalim) and advanced study fund (Keren Hishtalmut) pursuant to sections 6.1 and 6.2 hereunder, and for the calculation of all social benefits.
	  	  	  	  
	
6.

	
Social and Fringe benefits

	  	  	  	  
	  	
6.1.

	Managers’ Insurance and Pension Fund
	  	  	  	  
	  	  	
6.1.1.

	
Company shall contribute an aggregate monthly amount equal to up to 15.83% of the Salary as premium on a Managers’ Insurance (Bituach Menahalim) policy or a Pension Fund policy, as designated by the Executive to the Company in writing (the “Social Benefits Policy”).

	  	  	  	  
	  	  	
6.1.2.

	
The abovementioned contributions by Company shall be as follows: 5% towards compensatory payments (the “Compensatory Payments Component”), 8.33% towards severance payments (the “Severance Payments Component”), and up to 2.5% towards a disability insurance.

	  	  	  	  
	  	  	
6.1.3.

	
In addition, Executive shall contribute, and for that purpose Executive irrevocably authorizes and instructs Company to deduct from her Salary at source, an aggregate monthly amount equal to 5% of the Salary to such Social Benefits Policy. The percentages set forth in Section 6.1.2 above, in this Section 6.1.3, and in Section 6.1.5 below, shall be adjusted, from time to time, in compliance with the applicable tax regulations.

	  	  	  	  
	  	  	
6.1.4.

	
Executive shall bear any and all taxes in connection with amounts paid by Executive and/or Company to the Social Benefits Policy pursuant to this Section 6.1.

704/201/99

 

  

3

  

 

	 	  	  	 
	 	  	
6.1.5.

	
Executive may, at her option, notify the Company in writing that Company’s and Executive’s aforesaid contributions to the Compensatory Payments Component of the Social Benefits Policy are to be calculated on the basis of that portion of the Salary up to, but not exceeding, the recognized ceiling for contributions to the Social Benefits Policy, that are exempted from taxes under the provisions of applicable law as shall be in effect from time to time (the “Social Benefits Ceiling”). In such event, Executive shall be entitled to an additional monthly gross payment in an amount equal to 5% of that portion of the Salary that exceeds the Social Benefits Ceiling (the “Additional Social Benefits Payment”). Executive shall bear any and all taxes applicable in connection with the payment by Company and/or the receipt by Executive of the Additional Social Benefits Payment. For the removal of doubt, it is hereby clarified that the Additional Social Benefits Payment shall not constitute part of the Salary for purposes of Section 5.4 above.

	 	  	  	  
	 	  	
6.1.6.

	
In the event of termination of the Executive’s employment under this Agreement for any reason (including resignation by the Executive), other than a Termination for Cause (as defined hereinafter), (a) Executive shall be entitled to receive full severance pay (as calculated in accordance with the Severance Pay Law - 1963), whether or not she is entitled to severance pay pursuant to the aforesaid law, and (b) all sums accumulated in the Severance Payments Component and the Compensatory Payments Component of the aforesaid Social Benefits Policy shall be released to Executive without delay. Executive shall bear all taxes related to such transfers, if any.

	 	  	  	  
	 	  	
6.1.7.

	
All funds accumulated in the Severance Payments Component and released to Executive as set forth above shall be counted towards Company’s aforesaid obligation to pay to Employee severance pay.

	 	  	  	  
	 	
6.2.

	
Advanced Study Fund

	 	  	  	  
	 	  	
6.2.1.

	
Company shall contribute towards an advanced study fund (Keren Hishtalmut) (the “Advanced Study Fund”) an aggregate monthly amount equal to 7.5% of the Salary.

	 	  	  	  
	 	  	
6.2.2.

	
Executive shall contribute, and for that purpose, Executive irrevocably authorizes and instructs Company to deduct from her Salary at source, an aggregate monthly amount equal to 2.5% of the Salary as Executive’s participation in such Advanced Study Fund.

	 	  	  	  
	 	  	
6.2.3.

	
Executive shall bear any and all taxes applicable in connection with amounts payable by Executive and/or Company to the Advanced Study Fund pursuant to this Section 6.2.

704/201/99

 

  

4

  

 

	 	  	  	  
	 	  	
6.2.4.

	
Executive may, at her option, notify the Company in writing that Company’s and Executive’s aforesaid contributions to the Advanced Study Fund are to be calculated on the basis of that portion of the Salary up to, but not exceeding, the recognized ceiling for contributions to the Advanced Study Fund, that are exempted from taxes under the provisions of applicable law as shall be in effect from time to time (the “Advanced Study Fund Ceiling”). In such event, Executive shall be entitled to an additional monthly gross payment in an amount equal to 7.5% of that portion of the Salary that exceeds the Advanced Study Fund Ceiling (the “Additional Advanced Study Fund Payment”). Executive shall bear any and all taxes applicable in connection with the payment by Company and/or the receipt by Executive of the Additional Advanced Study Fund Payment. For the removal of doubt, it is hereby clarified that the Additional Advanced Study Fund Payment shall not constitute part of the Salary for purposes of Section 5.4 above.

	 	  	  	  
	 	  	
6.2.5.

	
In the event of termination of Executive’s employment under this Agreement for any reason, Executive shall be entitled to all sums accumulated in the Advanced Study Fund, and shall bear all taxes related to her receipt of such sums, if any.

	 	  	  	  
	 	
6.3.

	
Annual Leave

	 	  	  	  
	 	  	
Executive shall be entitled to an annual leave totaling, in the aggregate, 22 working days per year (the “Annual Leave Quota”). Annual leave shall be taken with adequate regard to the needs of Company. Unexploited leave days may be accumulated up to a maximum of twice the Annual Leave Quota

	 	  	  	  
	 	
6.4.

	
Sick Leave

	 	  	  	  
	 	  	
Executive shall be entitled to sick leave in accordance with the provisions of the Sickness Pay Law, 1976. . Notwithstanding the foregoing, the Executive shall be entitled to full sick leave pay commencing upon the first day of illness.

	 	  	  	  
	 	
6.5.

	
Company Car

	 	  	  	  
	 	  	
6.5.1.

	
Company shall provide Executive with a class 4 car (i.e., not exceeding a value of $____) (the “Company Car”) to be placed at Executive’s disposal, for her business and reasonable personal use.

	 	  	  	  
	 	  	
6.5.2.

	
Executive shall take good care of such Company Car and ensure that Company’s rules relating to Company Car and the provisions of the insurance policy relating to the use of said car, are strictly, lawfully and carefully observed. 

 

In the event that the Company Car shall be leased from a leasing company, Executive undertakes to strictly comply with all of the provisions of the lease agreement with said leasing company relating to the use of the Company Car.

	 	  	  	  
	 	  	
6.5.3.

	
Executive shall bear and pay all expenses relating to any violation of law committed by the Executive in connection with the use of Company Car.

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6.5.4.

	
The value of the monthly use of the Company Car shall be added to the Salary, in accordance with income tax regulations applicable thereto and Company shall gross up Executive’s Salary to cover any taxes imposed on Executive in connection with the Company Car and/or the use thereof.

	 	  	  	  
	 	  	
6.5.5.

	
Executive shall return the Company Car (together with its keys and any other equipment supplied and/or installed therein by Company) to Company’s principal office upon termination of her employment under this Agreement. Executive shall have no rights of lien with respect to Company Car and/or any of said other equipment.

	 	  	  	  
	 	
6.6.

	
Phones and Internet

	 	  	  	  
	 	  	
6.6.1.

	
The Company shall provide Executive with, and pay for the use of, a cellular phone (the “Cellular Phone”) for Executive’s use in the course of performing her obligations under her Position.

	 	  	  	  
	 	  	
6.6.2.

	
Executive shall bear all (if any) taxes applicable to her in connection with the Cellular Phone and/or the use thereof.

	 	  	  	  
	 	  	
6.6.3.

	
Upon termination of her employment under this Agreement, Executive shall return the Cellular Phone to Company at its principal office. Executive shall have no rights of lien with respect to the Cellular Phone.

	 	  	  	  
	 	  	
6.6.4.

	
In addition and without limitation to the above, the Company shall fully reimburse Executive for expenses related to her use of a home-phone line and at home high-speed Internet connection.

	 	  	  	  
	 	
6.7.

	
Recreation Pay

	 	  	  	  
	 	  	
Executive shall be entitled to annual recreation pay (D’mey Havra’ah) in an amount to be determined in accordance with Israeli regulations with respect to such recreation pay.

	 	  	  	  
	 	
6.8.

	
Expenses

	 	  	  	  
	 	  	
The Company shall pay or reimburse the executive for all reasonable expenses incurred by the Executive in discharge of her responsibilities hereunder, in Israel. In addition, and without limitation to the above, Company shall reimburse Executive, or pay, for those of Executive’s international travel expenses as have been previously approved by the Board of Directors, including airline tickets, hotel accommodations and other travel-related expenses. Any reimbursement of expenses under this Section 6.8 shall be conditioned upon receipt by Company of copies of all invoices, receipts and other evidence of expenditures as may be required by Company policy from time to time.

	 	  	  	  
	 	
6.9.

	
Officers’ Liability Insurance

	 	  	  	  
	 	  	
The Company shall obtain on behalf of the Executive officers’ liability insurance and shall provide the Executive with a written undertaking to indemnify and release, all in accordance with the officers and directors insurance and indemnity currently provided by the Company to its officers and directors.

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6.10.

	
Performance Bonus

	  	  	  
	  	  	
A review of Executive’s performance shall be conducted on an annual basis by the Company’s Board of Directors and the Board shall determine, at its sole discretion, whether Executive shall be entitled to a bonus for her performance and if so, in what amount. For the removal of doubt, it is hereby clarified that nothing in the aforestated shall be construed as obligating the Company to grant Executive a bonus, or to grant a bonus in any particular amount.

	  	  	  
	
7.

	
Options

	  	  	  
	  	
7.1.

	
The Company hereby undertakes to grant to the Executive, as soon as practicable following the Commencement Date of Employment, options (the “Options”) entitling Executive to purchase 200,000 Ordinary Shares “B” of Company (the “Shares”), at an exercise price of $1.41 per share.

	  	  	  
	  	
7.2.

	
The vesting periods for the Options shall be three years and the vesting schedule shall be as follows:

	  	  	  
	  	  	
1/3 of the Options shall vest on the first anniversary of the Commencement Date of Employment. The remaining 2/3 of the Options shall vest on a monthly basis during the 24 month period between the first and third anniversaries of the Commencement Date of Employment.

	  	  	  
	  	
7.3.

	
Notwithstanding the foregoing, the Options shall immediately vest and become exercisable with respect to the aggregate number of Shares subject to the Options upon (a) the Company’s initial public offering; (b) the occurrence of a merger or sale of the Company, other than a merger with or a sale to a wholly owned subsidiary or pursuant to a reorganization of the Company, e.g., a reorganization and immigration of the Company into a Delaware corporation for purposes of changing the Company’s domicile or jurisdiction of registration; or (c) a sale of all or substantially all of the Company’s shares or assets (“Exit Event”). For clarification purposes, any agreement with Teva Pharmaceutical Industries Ltd. (“Teva”) pursuant to the MOU entered into between the Company and Teva on February 27, 2003, shall not be deemed an Exit Event triggering the acceleration provided under this Section 7.3.

	  	  	  
	  	
7.4.

	
The Options shall be granted pursuant to, and in accordance with the terms of, the Company’s stock option plan (the “Plan”) and the option agreement to be entered into between the Company and the Executive in the form approved by the Board of Directors (the “Option Agreement”). The Options shall be classified as Capital Gain Options. In the event of the termination of this Agreement by Company or by Executive, other than a Termination for Cause, those Options which have vested as of the aforesaid termination shall be exercisable for that period of time which is the shorter of (i) a period of (five) 5 years from the effective date of termination of this Agreement; and (ii) the period of time commencing on the effective date of termination of this Agreement and ending on the occurrence of an Exit Event, provided that (x) such Exit Event results in the termination of all options and similar rights held by all of the Company’s option-holders and warrant-holders who are not employees of the Company at the time of the Exit Event, (y) Company informs Executive in writing, subject to Executive’s prior written confidentiality undertaking, immediately following the signing of a definitive agreement contemplating such Exit Event, such notice including the material terms and conditions of the expected Exit Event, and (z) Executive shall have the right to condition her exercise of the Options on the actual occurrence of the Exit Event, such that the lack of such occurrence shall entitle the Executive to rescind her decision to so exercise, thereby resulting in an obligation of the Company to promptly return to Executive any exercise price paid by her (if any).

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7.5.

	
The Company undertakes that all shares issued to the Executive upon exercise of the Options shall be duly authorized and validly issued, fully paid and nonassessable, free and clear of liens, claims, charges, encumbrances, and any third party rights.

	 	 	 
	  	
7.6.

	
All terms of the Options not specifically set forth in this Section 7, including customary provisions such as those pertaining to certain adjustments, restrictions on transfer, termination of employment and tax liability, shall be as set forth in the Plan and in the Option Agreement.

	  	  	  
	  	
7.7.

	
Executive undertakes to execute any and all documents, including the Option Agreement, as may be required by the Company in connection with the Options, and the grant of the Options shall be subject to Executive’s fulfillment of the aforesaid undertaking.

	 	 	 
	8.	Proprietary Information and Confidentiality

 

	  	
8.1.

	
The Executive is aware that, in the course of employment under this Agreement, she may have access to, and be entrusted with, information in respect of the business and financing of the Company and/or its affiliates (both present and future) and/or subsidiaries (both present and future) (together, the “Affiliates”), their dealings, transactions and affairs, and likewise in relation to their customers and suppliers, all of which information may be confidential. The Executive also acknowledges and agrees that the Company and/or Affiliates possess and will continue to possess, acquire and develop information and technology that has been created, discovered or developed, or has otherwise become known to the Company and/or Affiliates, which information has commercial value in the business in which the Company and/or Affiliates is engaged. All of the above information, whether documentary, written, oral or computer generated, shall be deemed to be and referred to as “Proprietary Information”, which by way of illustration, but not limitation, includes trade secrets, processes, formulae, data and know-how, improvements, inventions, techniques, products and/or technologies (actual or planned), marketing plans, strategies, forecasts and customer lists, Proprietary Information shall not include any of the foregoing which the Executive can establish was known to her prior to the date of disclosure by the Company and/or Affiliates or is at the date of the Agreement, or in the future becomes, public knowledge as evidenced by published or generally available materials, other than by breach of this section. The obligations of confidentiality hereunder shall not apply to information required by law to be disclosed by Executive, provided that the Executive notifies the Company of such requirement as soon as practicable and prior to any anticipated disclosure.

 

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8.2.

	
Executive agrees and declares that all Proprietary Information, patents and/or patent applications, copyrights and other intellectual properly rights in connection therewith, are and shall remain the sole property of Company and/or Affiliates and their assigns. All business records, papers and documents however documented, kept or made by Executive relating to the business and affairs of Company and/or Affiliates shall be and remain the property of Company and/or Affiliates, as the case may be.

	 	 	 
	 	
8.3.

	
Executive further recognizes and acknowledges that such Proprietary Information is a valuable and unique asset of the business and affairs of Company and/or Affiliates, and that its use or disclosure other than in accordance with the provisions of this Agreement, would cause Company and/or Affiliates, as the case may be, substantial loss and damages, Accordingly, Executive undertakes and agrees that, at all times, during the Term and upon its expiration thereafter, Executive shall keep in confidence and trust all Proprietary Information, and any part thereof, and shall not use or disclose and/or make available, directly or indirectly, to any third party any Proprietary Information without the prior written consent of Company, except and to the extent as may be necessary in the ordinary course of performing Executive’s duties pertaining to Company and except and to the extent as may be required under any applicable law, regulation, judicial decision or determination of any governmental entity.

	 	 	 
	 	8.4.	Without derogating from the generality of the foregoing, Executive agrees as follows:
	 	 	 

	 	 	
8.4.1.

	
She shall not copy, transmit, reproduce, summarize, quote, publish and/or make any commercial or other use whatsoever of the Proprietary Information, or any part thereof, without the prior written consent of Company, except as may be necessary in the performance of her duties pertaining to Company;

	 	 	 	 
	 	 	
8.4.2.

	
She shall exercise strict care in safeguarding the Proprietary Information against loss, theft or other inadvertent disclosure and shall take all reasonable steps necessary to ensure the maintaining of confidentiality;

	 	 	 	 
	 	 	
8.4.3.

	
Upon termination of her employment, and/or as otherwise requested by Company, she shall promptly deliver to Company all Proprietary Information and any and all copies thereof, whether in written or electronic form, that had been furnished to Executive, prepared thereby and/or came to her possession in any manner whatsoever, during and in the course of her employment with Company, and shall not retain and/or make copies thereof in whatever form.

	 	 	 	 
	 	8.5.	The provisions of this Section 8 shall survive termination of this Agreement and shall remain in full force and effect at all times thereafter.
	 	 	 
	9.	Non-Competition and Non-Solicitation

 

	 	
9.1.

	Executive hereby covenants that throughout the Term and thereafter for a period of twelve (12) months following the effective date of termination of Executive’s employment howsoever arising, Executive shall not;
	 	 	 
	 	 	
9.1.1.

	
Engage, directly or indirectly, in any capacity whatsoever, whether independently or as an employee, consultant or otherwise through any corporate body and/or with or through others, in direct competition with the Company and/or Affiliates.

 

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	 	 	9.1.2.	Accept any position, whether as employee, consultant or otherwise with, or hold any interest in, any corporate body that competes directly with Company and/or Affiliates, provided however, that nothing stated herein shall preclude Executive from owning a stock interest in any corporation, provided it is solely a passive interest.
	 	 	 	 
	 	 	
9.1.3.

	Whether on her own account and/or on behalf of others, in any way interfere with and/or endeavor to entice away, or offer or solicit for the purpose of so interfering and/or enticing away, from Company and/or its Affiliates, any person, firm or company with whom Company and/or its Affiliates shall have any contractual and/or commercial relationship as an employee, consultant, licenser, joint venturer, supplier, customer, distributor, agent or contractor of whatsoever nature, existing or under negotiation on, or prior to, the effective date of termination of Executive’s employment with Company.
	 	 	 
	 	
9.2.

	Executive is aware of and acknowledges that her obligations, under this Section 9, are derived of her access to the Confidential Information, and the Options granted to her according to Section 7 above constitute a special consideration given to Executive in return for the aforesaid undertakings.

	 	 	 
	10. 	Inventions
	 	 	 
	  	
10.1.

	
Executive shall promptly disclose and describe to Company any ideas, inventions, mask works, discoveries, original works of authorship, developments, improvements, modifications, and enhancements, whether or not capable of being patented or copyrighted, which she may solely or jointly with others, conceive, develop or reduce to practice or cause to be conceived or reduced to practice during the Term, whether or not conceived during working hours, which pertain to or relate to Company and/or Affiliates, including, without limitation, its technology and/or business, or to any experimental work performed by Company and/or Affiliates, and/or arise from Executive’s employment with Company (collectively, the “Inventions”).

	 	 	 
	  	
10.2.

	
All Inventions, and any and all rights, interests and title therein, including the droit moral therein, shall be the exclusive property of Company and/or Affiliates, as the case may be, and Executive shall not be entitled to, and hereby waives now and/or in the future, any claim to any right, compensation and/or reward in connection therewith.

	 	 	 
	  	
10.3.

	
In the event that by operation of law, any Invention shall be deemed Executive’s, Executive hereby assigns and shall in the future take all the requisite steps (including by way of illustration only, signing all appropriate documents) to assign to company or its designee(s) (including Affiliates) any and all of her foregoing rights, titles and interests worldwide in and to the Inventions and in all intellectual property rights based upon the Inventions, and acknowledges and shall in the future acknowledge Company’s full and exclusive ownership of intellectual property rights, both foreign and domestic, relating to the Inventions. To the extent necessary, Executive shall, prior to or following termination of this Agreement and at the Company’s exclusive cost, execute all documents and take all steps reasonably necessary to effectuate the assignment to Company and/or its designee and/or assist Company to obtain the exclusive and absolute rights, title and interests in and to all Inventions, whether by the registration of patent, trade mark, trade secret and/or any other applicable legal protection, and to protect same against infringement by any third party.

 

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	 	 	This provision shall apply with equal force and effect to all items that may be subject to copyright or trademark protection.
	 	 	 
	  	
10.4.

	
The provisions of this Section 10 shall survive termination of this Agreement and shall be and remain in full force and effect at all times thereafter.

	 	 	 
	11.	Termination

 

	  	
11.1.

	
Either party may, at any time, during the Term, furnish the other party hereto with a written notice that this Agreement is terminated (the “Termination Notice”). The Termination Notice may be with or without cause and must be furnished to the other party, at least 3 (three) months prior to the Termination Notice having effect (the “Notice Period”). The Termination Notice shall set forth both the date on which said notice is being furnished and the date on which the Termination Notice shall be effective.

	 	 	 
	  	
11.2.

	
In the event that a Termination Notice is delivered by either party hereto, the following shall apply:

	 	 	 

	  	 	11.2.1.	During the Notice Period, Executive shall be obligated to continue to discharge and perform all of her duties and obligations with Company and to take all steps, satisfactory to Company, to ensure the orderly transition to any persons designated by Company of all matters handled by Executive during the course of her employment with Company.
	 	 	 	 
	  	  	
11.2.2.

	
Notwithstanding the provisions of Section 11.2.1 above to the contrary, by notifying Executive concurrently with or at any time after a Termination Notice is delivered by either party hereto, Company shall be entitled to waive Executive’s services with Company during the Notice Period, or any part thereof and/or terminate the employer-employee relationship prior to the completion of the Notice Period. In such events, Executive shall be entitled to the Salary and the social and fringe benefits detailed in Sections 6.1, 6.2, 6.3, 6.5, and 6.7 for the duration of the Notice Period, or, in the event Company has terminated the employer-employee relationship, to payment of a lump-sum amount equal to the Salary and to the value of the aforesaid social and fringe benefits.

	 	 	 	 
	  	11.3.	Transition Period. In addition and without limitation to the provisions of Section 11.1 and 11.2 above, in the event of termination of the Executive’s employment under this Agreement for any reason (including resignation by the Executive), other than Termination for Cause, Executive shall be entitled to a 3 (three) months transition period (the “Transition Period”) starting immediately upon the expiration of the Notice Period. For the duration of the Transition Period, Executive shall receive the Salary and the social and fringe benefits detailed in Sections 6.1, 6.2, 6.3, 6.5, and 6.7 hereof. At the request of the Company, Executive shall consult with the Company during the Transition Period, up to 15 hours per month, Executive shall not be entitled to receive any additional compensation for such consulting.

 

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11.4.

	
The provisions of Sections 11.1 and 11.2 above notwithstanding, Company, by furnishing a notice to Executive, shall be entitled to terminate her employment with Company with immediate effect where said termination is a Termination for Cause. In the event of such termination, without derogating from the rights of Company under this Agreement and/or any applicable law, Executive shall not be entitled to any of the consideration specified in Sections 11.1 and 11.2 above and/or to severance pay and/or to Company’s contributions to the Social Benefits Policy (Severance Payments Component). Executive shall be entitled to the Compensatory Payments Component and to the Advanced Study Fund.

	 	 	 
	  	
11.5.

	
As used in this Agreement, the term “Termination for Cause” shall mean termination of Executive’s employment with Company as a result of the occurrence of any one of the following: (i) Executive has been convicted of a dishonorable criminal offense; (ii) Executive is in breach of her duties of trust or loyalty to Company; (iii) Executive deliberately causes harm to Company’s business affairs; (iv) Executive breaches Section 8 (confidentiality) and/or Section 9 (non-competition and non-solicitation) and/or Section 10 (assignment of inventions) of this Agreement; and/or (v) other misconduct that negate Executive’s entitlement to severance payments under any applicable law and/or under any judicial decision of a competent tribunal.

	 	 	 
	  	
11.6.

	
Without derogating from Company’s rights pursuant to any applicable law, in the event that Executive shall terminate employment with Company with immediate effect or upon shorter notice than the Notice Period, Company shall have the right to receive from the Executive an amount equal to the Salary and/or any benefits to which Executive shall have otherwise been entitled for his employment hereunder during the Notice Period, or any part thereof, as the case may be.

	 	 	 
	  	
11.7.

	
Upon termination of Executive’s employment with Company, Executive affirms and undertakes to transfer her Position to her replacement, as shall be determined by Company, in an efficient, complete, appropriate and orderly manner, and to fulfill her obligations under sections 6.5.5, 6.6.3, and 8.4.4 above.

	 	 	 
	12. 	Approval of Beard of Directors

   

	 	This Agreement is subject to the approval of the Board of Directors of the Company and shall come into full force and effect only upon such approval and the execution thereof by those authorized by the Board of Directors to sign this Agreement on its behalf.

 

	13. 	General Provisions

    

	  	
13.1.

	
The parties acknowledge that no adequate remedy at law exists in which to enforce the terms and conditions of this Agreement. Therefore, in the event the Executive breaches the confidentiality, non-compete or assignment of inventions provisions of this Agreement, the Company shall be entitled to injunctive relief (including the issuance of a mandatory injunction) prohibiting the continuing breaches of the Agreement or ordering the Executive to assign the Inventions.

 

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13.2.

	

Except as otherwise provided herein, Company shall withhold, or charge Executive with, all taxes and other compulsory payments as required under applicable law with respect to all payments, benefits and/or other compensation paid to Executive in connection with her employment with Company.

	 	 	 
	  	
13.3.

	
Any failure or delay by either party in enforcing any of the provisions of thin Agreement shall not, in any way, be construed as a waiver of any such provisions, or prevent such party thereafter from enforcing each and every other provision of this Agreement, which were previously not enforced.

	 	 	 
	  	
13.4.

	
This Agreement shall not be amended, modified or varied by any oral agreement or representation other than by a written instrument executed by both parties or their duty authorized representatives.

	 	 	 
	  	
13.5.

	
This Agreement shall be interpreted and construed in accordance with the laws of the State of Israel. The parties submit to the exclusive jurisdiction of the competent courts of the State of Israel in any dispute related to this Agreement.

	 	 	 
	  	
13.6.

	
This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matters hereof, and supersedes all prior agreements and understandings between the parties with respect thereto.

	 	 	 
	  	
13.7.

	
Captions and paragraph headings used in this Agreement are for convenience purposes only and shall not be used for the interpretation thereof. Words in the masculine gender shall include the feminine gender.

	 	 	 
	  	
13.8.

	
Any notice to be given to the Company under this Agreement shall be addressed to the Chairman of the Board of Directors at the offices of the Company. Any notice to the Executive shall be addressed to her home address at 2 Yehoshua Bin-Nun Street, Herzeliya. Either party may designate a different address by notice in writing to the other party pursuant to this Section. Each notice and/or demand given by one party to the other pursuant to this Agreement shall be in writing and shall be either delivered by hand or sent by registered mail to the other party at the address stated in this Section or as otherwise notified pursuant to this Section, and such notice and/or demand shall be deemed given at the expiration of seventy two (72) hours from the date of mailing by registered mail in Israel or immediately if delivered by hand.

 

IN WITNESS WHEREOF, the parties hereto have each hereby duly executed this Agreement on the day and year set forth below their respective signatures.

 

	 		 	
	 	Gamida Cell Ltd. 	 	Dr. Yael Margolin
	 	
By: 

	    RUBEN KRUPIK	 	 
	 	Title:	    DIRECTOR	 	 
	 	Dated:	    6/1/05	 	Dated:	10.1.2005

 

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