Caesarstone 提交 6-K：2026 年度股东大会委托书，涉董事改选、薪酬政策更新与期权池增加，属例行治理事项

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EX-99.1
2
exhibit_99-1.htm
EXHIBIT 99.1
Exhibit 99.1
CAESARSTONE LTD.
Kibbutz Sdot-Yam, MP Menashe, 3780400, Israel
Tel: +972-4-6109217
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
Notice is hereby given that
an Annual General Meeting of Shareholders (the “Meeting”) of Caesarstone Ltd. (the “Company”) will be held at
5:00 p.m., Israel time, on November 25, 2026, at the Company’s offices at Kibbutz Sdot-Yam, MP Menashe 3780400, Israel, for the
following purposes:
(1)
to re-elect each of Messrs. Maxim Ohana, Eran Cohen and Yuval Beeri, and to elect each of Mr. Aviv Ben
Horin and Mr. Yaron Arzi (who currently serves as a director of the Company, having been appointed by the Board), to serve as directors
of the Company until the close of the next annual general meeting of the shareholders of the Company;
(2)
to re-elect Ms. Lily Ayalon, and to elect Ms. Hanna Yanovsky, to serve as external directors of the Company,
each for a three-year term commencing on December 1, 2026, and to approve their respective terms of compensation;
(3)
to approve an amended and restated Compensation Policy for the Company’s Executive Officers and
Directors, effective as of the date of the Meeting for a period of three years;
(4)
to approve an increase in the total number of ordinary shares reserved for issuance as incentive stock
options under the Company’s 2020 Share Incentive Plan;
(5)
to approve the grant of equity-based compensation to Yuval Beeri, Yaron Arzi, Lily Ayalon and Hanna Yanovsky,
subject to each such director’s election or re-election, as applicable, as a director at the Meeting and to the actual commencement
of his or her term of office;
(6)
to approve the grant of equity-based compensation to Eran Cohen, Aviv Ben Horin and Maxim Ohana, who are
currently affiliates of controlling shareholders of the Company, subject to each such director’s election or re-election, as applicable,
as a director at the Meeting;
(7)
to approve the terms of employment of Mr. Eran Cohen in his role as the Company’s ROW Sales Director,
subject to his election as a director at the Meeting; and
(8)
to re-appoint Kost, Forer, Gabbay & Kasierer (a member of Ernst & Young Global) as the Company’s
independent auditors for the year ending December 31, 2026, and its service until the annual general meeting of shareholders to be held
in 2027, and to authorize the Company’s board of directors (or, the audit committee, if authorized by the board of directors, subject
to the ratification of the board of directors), upon recommendation of the audit committee of the Company, to determine the compensation
of the independent auditors in accordance with the volume and nature of their services and receive an update regarding the Company’s
independent auditors’ remuneration for the past year.
In addition to considering
and voting on the foregoing proposals (the “
Proposals
”), members of the Company’s management will be available
at the Meeting to discuss the audited financial statements of the Company for the fiscal year ended December 31, 2025.
The board of directors
of the Company (the “Board”) unanimously recommends that you vote “FOR” each of the above Proposals, which are
described in the accompanying proxy statement.
We are currently not aware
of any other matters that will come before this Meeting. If any other matters are presented properly at the Meeting, the persons designated
as proxies may vote upon such matters in accordance with the recommendation of the Board or, absent such recommendation, using their best
judgment.
Any shareholder of the Company
who intends to present a proposal at the Meeting must satisfy the requirements of the Israeli Companies Law, 5759-1999 (the “Companies
Law”) and the Company’s Articles of Association (the “Articles”). Under the Articles, only shareholders who hold
at least 1% of the Company’s outstanding voting rights are entitled to request that the Board include a proposal at a shareholders’
meeting, provided that such proposal is deemed appropriate by the Board for consideration by shareholders at such meeting. Such request
made by an eligible shareholder must be received by us no later than October 28, 2026. To the extent that there are any additional agenda
items that the Board determines to add as a result of any such submission, the Company will publish an updated agenda and proxy card with
respect to the Meeting, no later than November 4, 2026.
The affirmative vote of the
holders of a majority of the voting power represented at the Meeting, in person or by proxy, is necessary for the approval of each Proposal.
The approval of Proposal
No. 2 and, if Proposal No. 3 is not approved, Proposals No. 5 and 6, are subject to the fulfillment of one of the following additional
voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who are not controlling shareholders or do not have a personal interest in the proposal, excluding a personal interest that did not result
from the shareholder’s relationship with the controlling shareholder; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
The approval of Proposal
No. 3 is subject to the fulfillment of one of the following additional voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who are not controlling shareholders or do not have a personal interest in the approval of the proposal; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
The approval of Proposal
No. 7 and, irrespective of the approval of Proposal No. 3, the approval of Proposal No. 6, are subject to the fulfillment of one of the
following additional voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who do not have a personal interest in the approval of the proposal; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
However, in connection with
Proposal No. 3, the Companies Law allows the board of directors of a company to approve a compensation policy even if the general meeting
of shareholders has voted against its approval, provided that the Company’s compensation committee, and thereafter its board of
directors, each determines to approve it, based on detailed arguments, and after having reconsidered the matter and concluded that such
action is in the best interest of the company.
ii
For purposes of the foregoing
requisite majority requirements:
·
a “
controlling shareholder
” is defined as any shareholder that has the ability to direct
the company’s activities (other than by means of being a director or office holder (as defined in the Companies Law) of the company),
including a person who holds 25% or more of the voting rights in the general meeting of the company if there is no other person who holds
more than 50% of the voting rights in the company; for the purpose of a holding, two or more persons holding voting rights in the company
each of which has a personal interest in the approval of the transaction being brought for approval of the company will be considered
to be joint holders. A person is presumed to be a controlling shareholder if it holds or controls, by himself or together with others,
one half or more of any one of the “means of control” of the company.
·
“
Means of control
” is defined as any one of the following: (i) the right to vote at
a general meeting of the company, or (ii) the right to appoint directors of the company or its chief executive officer.
·
“
personal interest
” of a shareholder in an action or transaction of a company includes
(i) a personal interest of any of the shareholder’s relative (i.e. spouse, brother or sister, parent, grandparent, child as well
as child, brother, sister or parent of such shareholder’s spouse or the spouse of any of the above) or an interest of a company
with respect to which the shareholder or the shareholder’s relative (as detailed above) holds 5% or more of such company’s
issued shares or voting rights, in which any such person has the right to appoint a director or the chief executive officer or in
which any such person serves as a director or the chief executive officer, including the personal interest of a person voting pursuant
to a proxy whether or not the proxy grantor has a personal interest; and (ii) excludes an interest arising solely from the ownership of
ordinary shares of the company.
Shareholders who are controlling
shareholders or have a personal interest in the approval of the foregoing Proposals, as applicable, are defined as “
Interested
Shareholders
”.
Under Israeli law, every voting shareholder is required to notify the Company whether such shareholder is
an Interested Shareholder. To avoid confusion, every shareholder voting by means of the enclosed proxy card or voting instruction
form, or via telephone or internet voting, will be deemed to confirm that such shareholder is
NOT
an Interested Shareholder. If
you are an Interested Shareholder (in which case your vote will only count for or against the ordinary majority, and not for or against
the special tally under Proposals No. 2, 3, 5, 6 and 7), please notify the Company’s General Counsel, Ron Mosberg, at AGM@caesarstone.com.
If your shares are held in “street name” by your broker, bank or other nominee and you are an Interested Shareholder, you
should notify your broker, bank or other nominee of that status, and they in turn should notify the Company as described in the preceding
sentence.
Other than Kibbutz Sdot-Yam
(as defined in the accompanying proxy statement), we are not aware of any controlling shareholders of the Company.
The presence (in person or
by proxy) of any two or more shareholders holding, in the aggregate, at least 25% of the voting rights in the Company constitutes a quorum
for purposes of the Meeting. In the absence of the requisite quorum of shareholders at the Meeting, the Meeting will be adjourned to the
same day in the next week, at the same time and place, unless otherwise determined at the Meeting in accordance with the Articles. At
such adjourned meeting any number of shareholders in person or by proxy (regardless of the voting power represented by their shares) will
constitute a quorum.
Only shareholders of record
at the close of business on October 20, 2026, are entitled to notice of, and to vote at, the Meeting, or at any adjournment or postponement
thereof. As of October 20, 2026, the Company had 34,589,257issued and outstanding ordinary shares, each of which is entitled to one vote
upon the matters to be presented at the Meeting.
iii
A proxy statement describing
the various matters to be voted upon at the Meeting along with a proxy card enabling the shareholders to indicate their vote on each matter
is being distributed to all shareholders entitled to vote at the Meeting, and also furnished to the U.S. Securities and Exchange Commission
(the “
SEC
”) under cover of Form 6-K and will be available on the Company’s website
www.caesarstone.com
.
Proxies must be submitted to Broadridge Financial Solutions (“
Broadridge
”), no later than 11:59 p.m. EST on November
24, 2026, or to our offices no later than 1:00 p.m. (Israel time) on November 25, 2026. Proxies delivered to the Company or to Broadridge
following such time will be presented to the chairperson of the Meeting and, at his or her discretion, may be voted as specified in the
instructions included in such proxies. If your ordinary shares in the Company are held in “street name” (meaning held through
a bank, broker or other nominee), you will be able to either direct the record holder of your shares on how to vote your shares or obtain
a legal proxy from the record holder to enable you to participate in and to vote your shares at the Meeting (or to appoint a proxy to
do so).
In accordance with the Companies
Law, any shareholder of the Company may submit to the Company a position statement on its behalf, expressing its position on an agenda
item for the Meeting, to the Company’s offices, c/o Kibbutz Sdot-Yam, MP Menashe 3780400, Israel, Attention: Ron Mosberg, General
Counsel and Corporate Secretary, no later than November 15, 2026. Any position statement received will be furnished to the SEC on Form
6-K, and will be made available to the public on the SEC’s website at
http://www.sec.gov
.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ariel Halperin
Dr. Ariel Halperin
Chairman of the Board of Directors
Kibbutz Sdot-Yam, MP Menashe 3780400, Israel
October 21, 2026
iv
CAESARSTONE LTD.
Kibbutz Sdot-Yam, MP Menashe, 3780400, Israel
Tel: +972-4-610-9217
PROXY STATEMENT
Annual General Meeting of Shareholders
To Be Held on November 25, 2026
General Information
This proxy statement (the
“
Proxy Statement
”) and the accompanying proxy card are being furnished to the holders of ordinary shares, par value
NIS 0.04 per share, of Caesarstone Ltd., an Israeli company (the “
Company
”), in connection with the solicitation of
proxies by the board of directors of the Company (the “
Board
”), for use at the annual general meeting of shareholders
of the Company (the “
Meeting
”) to be held on November 25, 2026, beginning at 5:00 p.m. Israel time, at the offices
of the Company at Kibbutz Sdot-Yam, MP Menashe 3780400, Israel.
You are entitled to receive
notice of, and vote at, the Meeting if you are a shareholder of record at the close of business on October 20, 2026 (the “
Record
Date
”), in person or through a broker, trustee or other nominee that is one of our shareholders of record at such time, or which
appear in the participant listing of a securities depository on that date. You can vote your shares by attending the Meeting or by following
the instructions under “How You Can Vote” below. Our Board urges you to vote your ordinary shares so that they will be counted
at the Meeting or at any postponements or adjournments of the Meeting.
Agenda Items
The following matters are
on the agenda for the Meeting:
(1)
to re-elect each of Messrs. Maxim Ohana, Eran Cohen and Yuval Beeri, and to elect each of Mr. Aviv Ben
Horin and Mr. Yaron Arzi (who currently serves as a director of the Company, having been appointed by the Board), to serve as directors
of the Company until the close of the next annual general meeting of the shareholders of the Company;
(2)
to re-elect Ms. Lily Ayalon, and to elect Ms. Hanna Yanovsky, to serve as external directors (“
External
Directors
”) of the Company, each for a three-year term commencing on December 1, 2026, and to approve their respective terms
of compensation;
(3)
to approve an amended and restated Compensation Policy for the Company’s Executive Officers and
Directors (the “
Proposed Compensation Policy
”), effective as of the date of the Meeting for a period of three years;
(4)
to approve an increase in the total number of ordinary shares reserved for issuance as incentive stock
options under the Company’s 2020 Share Incentive Plan;
(5)
to approve the grant of equity-based compensation to Yuval Beeri, Yaron Arzi, Lily Ayalon and Hanna Yanovsky,
subject to each such director’s election or re-election, as applicable, as a director at the Meeting, and to the actual commencement
of his or her term of office;
(6)
to approve the grant of equity-based compensation to Eran Cohen, Aviv Ben Horin and Maxim Ohana, who are
currently affiliates of controlling shareholders of the Company, subject to each such director’s election or re-election, as applicable,
as a director at the Meeting;
(7)
to approve the terms of employment of Mr. Eran Cohen in his role as the Company’s ROW Sales Director,
subject to his election as a director at the Meeting; and
(8)
to re-appoint Kost, Forer, Gabbay & Kasierer (a member of Ernst & Young Global) as the Company’s
independent auditors for the year ending December 31, 2026, and its service until the annual general meeting of shareholders to be held
in 2027, and to authorize the Company’s board of directors (or, the audit committee, if authorized by the board of directors, subject
to the ratification of the board of directors), upon recommendation of the audit committee of the Company, to determine the compensation
of the independent auditors in accordance with the volume and nature of their services and receive an update regarding the Company’s
independent auditors’ remuneration for the past year.
In addition to considering
and voting on the foregoing proposals (the “
Proposals
”), members of the Company’s management will be available
at the Meeting to discuss the audited financial statements of the Company for the fiscal year ended December 31, 2025.
The board of directors
of the Company (the “Board”) unanimously recommends that you vote “FOR” each of the above Proposals, which are
described in the accompanying proxy statement.
We are currently not aware
of any other matters that will come before this Meeting. If any other matters are presented properly at the Meeting, the persons designated
as proxies may vote upon such matters in accordance with the recommendation of the Board or, absent such recommendation, using their best
judgment.
Any shareholder of the Company
who intends to present a proposal at the Meeting must satisfy the requirements of the Israeli Companies Law, 5759-1999 (the “
Companies
Law
”) and the Company’s Articles of Association (the “
Articles
”). Under the Articles, only shareholders
who hold at least 1% of the Company’s outstanding voting rights are entitled to request that the Board include a proposal at a shareholders’
meeting, provided that such proposal is deemed appropriate by the Board for consideration by shareholders at such meeting. Such request
made by an eligible shareholder must be received by us no later than October 28, 2026. To the extent that there are any additional agenda
items that the Board determines to add as a result of any such submission, the Company will publish an updated agenda and proxy card with
respect to the Meeting, no later than November 4, 2026.
Board Recommendations
The Board unanimously
recommends that you vote “FOR” each of the above Proposals.
Proxy
Nahum Trost, our Chief Financial
Officer, Ron Mosberg, our General Counsel and Corporate Secretary, or Idan Gur, our Legal Counsel, may be appointed as proxies by the
shareholders entitled to vote at the Meeting with respect to the matters to be voted on at the Meeting.
All ordinary shares represented
by properly executed proxies delivered to the Company by mail at its offices at Kibbutz Sdot-Yam, MP Menashe 3780400, Israel, Attention:
Ron Mosberg, General Counsel and Corporate Secretary, or by email to AGM@caesarstone.com, or to Broadridge Financial Solutions (“
Broadridge
”)
will be voted as specified in the instructions indicated in such proxies. Proxies must be submitted to Broadridge no later than 11:59
p.m. EST on November 24, 2026, or to our offices no later than 1:00 p.m. (Israel time) on November 25, 2026. Proxies delivered to the
Company or to Broadridge following such times will be presented to the chairperson of the Meeting and, at his or her discretion, may be
voted as specified in the instructions included in such proxies. If you are a shareholder of record as of the Record Date for the Meeting,
subject to applicable law and the rules of the Nasdaq Stock Market (“
Nasdaq
”), if no instructions are indicated in
such proxies with respect to any Proposal, the shares represented by properly executed and received proxies will be voted “FOR”
Proposals No. 1, 4 and 8.
If you hold your shares in
“street name” through a broker, bank or other nominee, you are considered, with respect to those shares, a beneficial owner.
Brokers that hold shares in “street name” for clients typically have authority to vote on “routine” proposals
even when they have not received instructions from beneficial owners. The only item on the Meeting agenda that may be considered routine
is Proposal No. 8 relating to the re-appointment of our independent auditors for the fiscal year ending December 31, 2026; however, we
cannot be certain whether this will be treated as a routine matter since our proxy statement is prepared in compliance with the Companies
Law rather than the rules applicable to domestic U.S. reporting companies. Therefore, it is important for a shareholder that holds ordinary
shares through a bank, broker or other nominee to instruct such bank, broker or other nominee how to vote its shares, if the shareholder
wants its shares to count for the Proposals.
2
Revocation of Proxies
A shareholder may revoke
a proxy in one of the following ways: (i) by written notice of the revocation of the proxy delivered by mail to the Company at its offices
at Kibbutz Sdot-Yam, MP Menashe 3780400, Israel, Attention: Ron Mosberg, General Counsel and Corporate Secretary, or by email to
AGM@caesarstone.com
,
no later than 11:59 p.m. (Israel time) on November 24, 2026, or to Broadridge, no later than 11:59 p.m. EST on November 24, 2026, cancelling
the proxy or appointing a different proxy; (ii) by written notice of the revocation of the proxy delivered at the Meeting to the chairman
of the Meeting; or (iii) by attending and voting in person at the Meeting. Attendance at the Meeting will not, in and of itself, constitute
revocation of a proxy.
Shareholders Entitled to Vote – Record
Date
Shareholders of record who
held ordinary shares as of the Record Date are entitled to notice of, and to vote at, the Meeting. In addition, shareholders who, as of
the Record Date, held ordinary shares through a bank, broker or other nominee which is a shareholder of record of the Company at the close
of business on the Record Date, or which appears in the participant list of a securities depository on that date, are considered to be
beneficial owners of shares held in “street name.” These proxy materials are being forwarded to beneficial owners by the bank,
broker or other nominee that is considered the holder of record with respect to the Company’s ordinary shares. Beneficial owners
have the right to direct how their shares should be voted and are also invited to attend the Meeting but may not actually vote their shares
in person at the Meeting unless they first obtain a signed proxy from the record holder giving them the right to vote the shares.
As of the Record Date, there
were 35,692,353 issued ordinary shares and 34,589,257 (excluding 1,103,096 dormant shares held in treasury) entitled to vote at the Meeting.
Quorum and Required Vote
Pursuant to the Articles,
the quorum required for the Meeting consists of at least two shareholders present, in person or by proxy, who hold or represent between
them at least 25% of the Company’s voting power. If a quorum is not present within thirty (30) minutes from the time appointed for
the Meeting, the Meeting shall stand adjourned to the same day at the same time and place in the following week, or to a day, time and
place as the Board may decide if so specified in the notice of the meeting (the “
Adjourned Meeting
”). At such Adjourned
Meeting any number of shareholders shall constitute a quorum for the business for which the original meeting was called.
Abstentions and “broker
non-votes” are counted as present and entitled to vote for purposes of determining a quorum. A “broker non-vote” occurs
when a bank, broker or other holder of record holding shares for a beneficial owner attends the Meeting but does not vote on a particular
proposal because that holder does not have discretionary voting power for that particular item and has not received instructions from
the beneficial owner. If you hold your shares in “street name” and do not provide your broker with specific instructions regarding
how to vote on any proposal, your broker will not be permitted to vote your shares on the proposal, resulting in a “broker non-vote.”
The affirmative vote of the
holders of a majority of the voting power represented at the Meeting, in person or by proxy, is necessary for the approval of each Proposal.
3
The approval of Proposal
No. 2 and, if Proposal No. 3 is not approved, Proposals No. 5 and No. 6, are subject to the fulfillment of one of the following additional
voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who are not controlling shareholders or do not have a personal interest in the proposal, excluding a personal interest that did not result
from the shareholder’s relationship with the controlling shareholder; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
The approval of Proposal
No. 3 is subject to the fulfillment of one of the following additional voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who are not controlling shareholders or do not have a personal interest in the approval of the proposal; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
The approval of Proposal
No. 7 and, irrespective of the approval of Proposal No. 3, the approval of Proposal No. 6, are subject to the fulfillment of one of the
following additional voting requirements:
(i) a majority of the shares that are
voted at the Meeting in favor of the proposal, excluding abstentions, includes a majority of the votes of shareholders present and voting
who do not have a personal interest in the approval of the proposal; or
(ii) the total number of shares held
by the shareholders mentioned in clause (i) above that are voted against the proposal does not exceed two percent (2%) of the aggregate
voting rights in the Company.
However, in connection with
Proposal No. 3, the Companies Law allows the board of directors of a company to approve a compensation policy even if the general meeting
of shareholders has voted against its approval, provided that the Company’s compensation committee, and thereafter its board of
directors, each determines to approve it, based on detailed arguments, and after having reconsidered the matter and concluded that such
action is in the best interest of the company.
For purposes of the foregoing
requisite majority requirements:
·
a “
controlling shareholder
” is defined as any shareholder that has the ability to direct
the company’s activities (other than by means of being a director or office holder (as defined in the Companies Law) of the company),
including a person who holds 25% or more of the voting rights in the general meeting of the company if there is no other person who holds
more than 50% of the voting rights in the company; for the purpose of a holding, two or more persons holding voting rights in the company
each of which has a personal interest in the approval of the transaction being brought for approval of the company will be considered
to be joint holders. A person is presumed to be a controlling shareholder if it holds or controls, by himself or together with others,
one half or more of any one of the “means of control” of the company.
·
“
Means of control
” is defined as any one of the following: (i) the right to vote at
a general meeting of the company, or (ii) the right to appoint directors of the company or its chief executive officer.
·
“
personal interest
” of a shareholder in an action or transaction of a company includes
(i) a personal interest of any of the shareholder’s relative (i.e. spouse, brother or sister, parent, grandparent, child as well
as child, brother, sister or parent of such shareholder’s spouse or the spouse of any of the above) or an interest of a company
with respect to which the shareholder or the shareholder’s relative (as detailed above) holds 5% or more of such company’s
issued shares or voting rights, in which any such person has the right to appoint a director or the chief executive officer or in
which any such person serves as a director or the chief executive officer, including the personal interest of a person voting pursuant
to a proxy whether or not the proxy grantor has a personal interest; and (ii) excludes an interest arising solely from the ownership of
ordinary shares of the company.
4
Shareholders who are controlling
shareholders or have a personal interest in the approval of the foregoing Proposals, as applicable, are defined as “
Interested
Shareholders
”.
Under Israeli law, every voting shareholder is required to notify the Company whether such shareholder is
an Interested Shareholder. To avoid confusion, every shareholder voting by means of the enclosed proxy card or voting instruction
form, or via telephone or internet voting, will be deemed to confirm that such shareholder is
NOT
an Interested Shareholder. If
you are an Interested Shareholder (in which case your vote will only count for or against the ordinary majority, and not for or against
the special tally under Proposals No. 2, 3, 5, 6 and 7), please notify the Company’s General Counsel, Ron Mosberg, at AGM@caesarstone.com.
If your shares are held in “street name” by your broker, bank or other nominee and you are an Interested Shareholder, you
should notify your broker, bank or other nominee of that status, and they in turn should notify the Company as described in the preceding
sentence.
Other than Kibbutz Sdot-Yam
(as defined herein), we are not aware of any controlling shareholders of the Company.
For more information, please
see under “Beneficial Ownership of Securities by Certain Beneficial Owners and Management” below.
Except for the purpose of
determining a quorum, broker non-votes will not be counted as present and are not entitled to vote. Abstentions will not be treated as
either a vote “FOR” or “AGAINST” a matter. Each ordinary share is entitled to one vote on each Proposal or item
that comes before the Meeting.
On each matter submitted
to the shareholders for consideration at the Meeting, only ordinary shares that are voted on such matter will be counted toward determining
whether shareholders approved the matter. Ordinary shares present at the Meeting that are not voted on a particular matter (including
broker non-votes) will not be counted in determining whether such matter is approved by shareholders.
Each ordinary share is entitled
to one vote on each proposal or item that comes before the Meeting. If two or more persons are registered as joint owners of any ordinary
share, the right to vote at the Meeting and/or the right to be counted as part of the quorum for the Meeting shall be conferred exclusively
upon the more senior among the joint owners attending the Meeting in person or by proxy. For this purpose, seniority shall be determined
by the order in which the names appear in the Company’s share register.
How You Can Vote
·
Shareholders of Record.
If you are a shareholder of record (that is, you hold a share certificate
that is registered in your name or you are listed as a shareholder in the Company’s share register), you can submit your vote by
completing, signing and submitting a proxy card, which has or will be sent to you and which will be accessible at the ‘Investor
Relations’ portion of the Company’s website, as described below under “Availability of Proxy Materials.”
If you provide specific instructions
(by marking a box) with regard to the Proposals, your shares will be voted as you instruct. If you sign and return your proxy card without
giving specific instructions with respect to the Proposals No. 1, 4 and 8, your shares will be voted in accordance with the recommendations
of the Board.
5
Ballots will be passed out at the Meeting
to anyone who wants to vote at the Meeting. If you choose to do so, please bring the enclosed proxy card or proof of identification. If
you are a shareholder of record and your shares are held directly in your name, you may vote in person at the Meeting.
·
Shareholders Holding in “Street Name.”
If you hold ordinary shares in “street
name” through a bank, broker or other nominee, the voting process will be based on your directing the bank, broker or other nominee
to vote the ordinary shares in accordance with the voting instructions on your voting instruction card. Please follow the instructions
on the voting instruction card received from your bank, broker or nominee. You may also be able to submit voting instructions to a bank,
broker or nominee by phone or via the Internet if your voting instruction card describes such voting methods. Please be certain to have
your control number from your voting instruction card ready for use in providing your voting instructions. It is important for a shareholder
that holds ordinary shares through a bank or broker to instruct its bank or broker how to vote its shares if the shareholder wants its
shares to count for the proposal.
You may also vote in person at the Meeting.
However, because a beneficial owner is not a shareholder of record, you must first obtain a “legal proxy” from the bank, broker
or nominee that holds your shares, giving you the right to vote the shares at the Meeting.
Even if you plan to attend
the Meeting, the Company recommends that you vote your shares in advance so that your vote will be counted if you later decide not to
attend the Meeting.
Voting Results
The final voting results
will be tallied by the Company based on the information provided by Broadridge or otherwise, and the overall results of the Meeting will
be published following the Meeting in a report of foreign private issuer on Form 6-K that will be furnished to the SEC.
Proxy Solicitation
The Company will bear the
costs of solicitation of proxies for the Meeting. In addition to solicitation by mail, directors, officers and employees of the Company
may solicit proxies from shareholders by telephone, personal interview or otherwise. Such directors, officers and employees will not receive
additional compensation, but may be reimbursed for reasonable out-of-pocket expenses in connection with such solicitation. Brokers, nominees,
fiduciaries and other custodians have been requested to forward soliciting material to the beneficial owners of ordinary shares held of
record by them, and such custodians will be reimbursed by the Company for their reasonable out-of-pocket expenses. The Company may also
retain an independent contractor to assist in the solicitation of proxies. If retained for such services, the costs will be paid by the
Company.
Availability of Proxy Materials
Copies of the proxy card,
the Notice of the Annual General Meeting of Shareholders and this Proxy Statement are available at the ‘Investor Relations’
section of our Company’s website,
www.caesarstone.com
. The contents of that website are not a part of this Proxy Statement.
6
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
For information regarding
compensation granted to our five most highly compensated office holders during or with respect to the year ended December 31, 2025, please
see Item 6.B of our annual report on Form 20-F for the year ended December 31, 2025, which was filed with the SEC on March 4, 2026, and
is accessible through the Company’s website at
www.caesarstone.com
or through the SEC’s website at
www.sec.gov
.
7
BENEFICIAL OWNERSHIP OF SECURITIES BY CERTAIN
BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets
forth certain information regarding the beneficial ownership of our outstanding ordinary shares as of the Record Date, by each person
who we know beneficially owns five percent or more of our outstanding ordinary shares.
Beneficial ownership of ordinary
shares is determined in accordance with the rules of the SEC and includes any ordinary shares over which a person has or shares voting
or investment power (including the power to dispose). For purposes of the table below, we deem shares subject to options or warrants that
are currently exercisable or exercisable within 60 days of October 20, 2026, to be outstanding and to be beneficially owned by the person
holding the options for the purposes of computing the percentage ownership of that person, but we do not treat them as outstanding for
the purpose of computing the percentage ownership of any other person. The table assumes 34,589,257 ordinary shares (excluding 1,103,096
dormant ordinary shares held in treasury) outstanding as of October 20, 2026.
All of our shareholders,
including the shareholders listed below, have the same voting rights attached to their ordinary shares.
Name of Beneficial Owner
Number of
Shares
Beneficially
Owned
Percentage
of Shares
Beneficially
Held
Mifalei Sdot-Yam Agricultural Cooperative Society Ltd. (1)
10,440,000
30.2
%
Tene
Investments in Projects 2016, L.P.(2)
3,589,494
10.4
%
Executive
Officers
Yos
Shiran
870,112
2.5
%
Nahum
Trost
92,550
*
David
Cullen
51,825
*
Ken
Williams
42,250
*
Kobi
Brenner
27,000
*
Chen Livne
21,550
*
Amihai Seider
62,025
*
Erez Margalit
73,400
*
Ron Mosberg
30,721
*
Lilach Gilboa
34,004
*
Idit Maayan-Zohar
47,689
*
Directors
Dr. Ariel Halperin(3)
3,626,244
10.5
%
Nurit Benjamini
7,500
*
Lily Ayalon
7,500
*
Yuval Beeri
-
-
Maxim Ohana
25,750
*
Yaron Arzi
-
-
Eran Cohen
-
-
All current directors
and executive officers as a group (18 persons) (4)
* Less than one percent of the outstanding ordinary shares.
(1)
Based on a
Schedule
13D/A filed on September 23, 2026 by Mifalei Sdot-Yam Agricultural Cooperative
Society Ltd. (“
Mifalei Sdot-Yam
”). Mifalei Sdot-Yam is controlled by Sdot-Yam Business, Holding and Management –
Agricultural Cooperative Society Ltd., which is in turn controlled by Kibbutz Sdot-Yam. Mifalei Sdot-Yam holds sole voting and dispositive
power, over 10,440,000 ordinary shares. No individual member of Mifalei Sdot-Yam has dispositive power or casting vote over the ordinary
shares. The Economic Council elected by the members of Kibbutz Sdot-Yam manages the economic activities and strategy of Kibbutz Sdot-Yam.
The Economic Council takes its decisions by majority vote and currently has eleven members, including Eran Cohen, which is a director
on our board
.
The address of Kibbutz Sdot-Yam is MP Menashe 3780400, Israel. Our board of directors operates independently from
the Economic Council.
8
Kibbutz Sdot-Yam is
a communal society, referred to in Hebrew as a “kibbutz” (plural “kibbutzim”) with approximately 460 members and
an additional 350 residents located in Israel on the Mediterranean coast between Tel Aviv and Haifa. Established in 1940, Kibbutz Sdot-Yam
is a largely self-governed community of members who share certain social ideals and professional interests on a communal basis. Initially,
the social idea behind the formation of the kibbutzim in Israel was to create a communal society in which all members share equally in
all the society’s resources and which provides for the needs of the community. Over the years, the structure of the kibbutzim has
evolved, and today there are a number of different economic and social arrangements adopted by various kibbutzim.
Today, each member
of Kibbutz Sdot-Yam continues to own an equal part of the assets of the Kibbutz. The members of Kibbutz Sdot-Yam are engaged in a number
of economic activities, including agriculture, industrial operations and outdoor venue operations. A number of Kibbutz members are engaged
in professions outside the Kibbutz. The Kibbutz is the owner and operator of several private companies. The Kibbutz community holds in
common all land, buildings and production assets of these companies.
Some of the members
of Kibbutz Sdot-Yam work in one of the production activities of Kibbutz Sdot-Yam, according to the requirements of Kibbutz Sdot-Yam and
the career objectives of the individual concerned. Other members work outside of Kibbutz Sdot-Yam in businesses owned by other entities.
In the past, each member receives income based on the position the member held and his or her economic contribution to the community,
as well as on the size and composition of his or her family, and each member’s income depended on the income of Kibbutz Sdot-Yam
from its economic activities. In recent years, however, following a privatization process undertaken by Kibbutz Sdot-Yam, this is no longer
the case, and each member’s salary from his or her employment is now paid by his or her employer directly into such member’s
own bank account. Each member has a personal pension fund that is funded by Kibbutz Sdot-Yam, and all accommodation, educational, health
and old age care services, as well as social and municipal services, are provided either by or through Kibbutz Sdot-Yam and are subsidized
by Kibbutz Sdot-Yam.
The elected Economic
Council is the key economic decision-making body of Kibbutz Sdot-Yam. Kibbutz Sdot-Yam also has a General Secretary (chairman) and other
senior officers, all of whom are elected by the members of Kibbutz Sdot-Yam at its General Meeting for terms of seven years. A meeting
of the members of the Kibbutz may remove a member of the Economic Council by simple majority vote.
As of December 31,
2025, 15 of our employees, or ~1% of our total workforce, were also members of Kibbutz Sdot-Yam.
(2) Based on a Schedule 13D/A
filed on October 8, 2026 and on information provided to the Company by the beneficial owner, Tene Investments in Projects 2016, L.P. (“
Tene”
)
has shared voting and dispositive power over 3,589,494 ordinary shares, which Tene holds of record. Dr. Ariel Halperin is a director and
the major shareholder of Tene Growth Capital III (G.P.) Company Ltd. (“
Tene III
”), and the major owner of rights of
Tene Growth Capital 3 (Fund 3 G.P.) Projects, L.P. (“
Tene III Projects
”). Tene III is the general partner of Tene III
Projects, which is the general partner of Tene. Dr. Halperin is also currently a member of our board of directors, however, as detailed
below, Dr. Halperin is not standing for re-election at the Meeting. Each of Dr. Halperin, Tene III and Tene III Projects may thus be deemed
to share beneficial ownership of the 3,589,494 ordinary shares held of record by Tene. Each of them disclaims any such beneficial ownership.
(3) Consists of (i) 36,750
options to acquire our ordinary shares held directly by Dr. Halperin and (ii) 3,589,494 ordinary shares beneficially owned by Tene Investments
in Projects 2016, L.P. (“
Tene
”). As further described in footnote (2) under “ITEM 7.A: Major Shareholders and
Related Party Transactions—Major Shareholders,” Each of Dr. Halperin, Tene Growth Capital III (G.P.) Company Ltd. (“
Tene
III
”), and Tene Growth Capital 3 (Fund 3 G.P.) Projects, L.P (“
Tene III Projects
”) may be deemed to share
voting and dispositive power over the 3,589,494 ordinary shares beneficially owned by Tene. See footnote (2) above.
(4) Our directors and executive
officers hold, in the aggregate, (i) 1,338,544 options immediately exercisable or exercisable within 60 days from October 20, 2026, with
a weighted average exercise price of $5.29 per share and have expiration dates generally seven years after the grant date, (ii) 42,370
RSUs that vest within 60 days from October 20, 2026, and (iii) 49,712 ordinary shares.
9
CORPORATE GOVERNANCE
Our Articles provide that
the Board shall consist of no fewer than seven and no more than 11 directors, as may be determined by the Board from time to time. Any
amendment to these provisions of our Articles requires the approval of holders of at least 65% of the total voting power of our shareholders.
As of the date of this Proxy
Statement, our Board consists of seven directors: Dr. Ariel Halperin (Chairman), Maxim Ohana, Yuval Beeri, Eran Cohen, Yaron Arzi, Nurit
Benjamini and Lily Ayalon. Mr. Yaron Arzi was appointed by the Board in December 2025 to fill the vacancy created by the resignation of
Ms. Irit Ben-Dov, who had been elected at the Company’s 2025 annual general meeting. Proposals No. 1 and No. 2 of this Proxy Statement
contemplate certain changes to the composition of the Board, as described herein. Assuming the approval of Proposals No. 1 and No. 2 and
the election or re-election of all nominees as contemplated in Proposals No. 1 and No. 2, following the Meeting our Board will consist
of seven directors: Yuval Beeri, Lily Ayalon, Hanna Yanovsky, Maxim Ohana, Aviv Ben Horin, Eran Cohen and Yaron Arzi. Following the Meeting,
the Board will appoint a new Chairman of the Board from among its members, in accordance with the Articles and the Companies Law.
Our nominating committee
of the Board (the “
Nominating Committee
”) is currently composed of Ms. Nurit Benjamini, Ms. Lily Ayalon, and Mr. Yaron
Arzi, each of whom has been determined by the Board to be independent under the Nasdaq corporate governance rules.
Under Nasdaq’s corporate
governance rules, a majority of our directors must meet the independence requirements specified in those rules. Following the Meeting,
assuming the election of all nominees set forth in Proposals No. 1 and No. 2, our Board will consist of seven members, four of whom our
Nominating Committee and Board have determined to be independent under Nasdaq rules, including Yuval Beeri, Yaron Arzi, Lily Ayalon and
Hanna Yanovsky. In reaching this conclusion, the Nominating Committee and Board determined that none of the foregoing nominees has a relationship
that would preclude a finding of independence and that any relationship that these nominees have with us does not impair their independence.
Assuming the approval of
Proposal No. 2, each of Ms. Ayalon and Ms. Yanovsky will serve as an External Director under the Companies Law.
Our Board has further determined
that Yaron Arzi meets the independence requirements of the Companies Law and will serve as an independent director under the Companies
Law (an “
Independent Director
”).
Each of the nominees for
election or re-election has certified to us that he or she complies with all requirements under the Companies Law for serving as a director
(and, in the case of Lily Ayalon, Hanna Yanovsky and Yaron Arzi, for serving as an External or Independent Director, as applicable, under
the Companies Law).
Under the Companies Law,
the board of directors of a public company is required to determine the minimum number of directors with “accounting and financial
expertise” who will serve on the board. The Board determined that at least one director must have “accounting and financial
expertise,” as such term is defined by regulations promulgated under the Companies Law. The Board determined that each of Ms. Lily
Ayalon, Mr. Yaron Arzi and Mr. Yuval Beeri has such “accounting and financial expertise,” and that each of Ms. Ayalon and
Mr. Arzi qualifies as an “Audit Committee Financial Expert,” as defined by the rules of the SEC, and has the requisite financial
experience required by the Nasdaq rules. Each member of our audit committee (the “
Audit Committee
”) meets the additional
independence requirements of Rule 10A-3 of the U.S. Securities Exchange Act of 1934, as amended (the “
Exchange Act
”).
Following the Meeting, assuming
the approval of Proposals No. 1 and No. 2 and the election or re-election of all nominees as contemplated therein, each of our Audit Committee
and our Compensation Committee will be composed of Lily Ayalon (Chairperson), Hanna Yanovsky and Yaron Arzi, and our Nominating Committee
will be composed of Yaron Arzi (Chairperson), Lily Ayalon and Hanna Yanovsky.
10
Our Audit Committee met four
times since last year’s annual general meeting. Our compensation committee (the “
Compensation Committee
”) met
seven times since last year’s annual general meeting. The Nominating Committee met twice since last year’s annual general
meeting. Our Board has met eight times since last year’s annual general meeting (excluding written resolutions). Our incumbent director’s
candidates nominated for election have attended, in aggregate, 98% of the meetings of the Board and its committees on which they served
since last year’s annual general meeting. As approved at our 2014 and 2015 annual general meetings of shareholders and effective
as of such dates, each of our directors (including External Directors but excluding Dr. Ariel Halperin) is entitled to an annual fee of
NIS 120,000, subject to the limitation discussed below (the “
Annual Fee
”), and a fee of NIS 3,350 per meeting for participating
in meetings of the Board and committees of the Board (the “
Participation Compensation
”). The Annual Fee may not exceed
the maximum annual fee of an expert external director set forth in the Companies Regulations (Rules regarding Compensation and Expenses
of External Directors), 5760–2000, as adjusted by the Companies Regulations (Reliefs for Public Companies with Shares Listed for
Trading on a Stock Market Outside of Israel), 5760–2000 (together, the “
Israeli Companies Regulations
”). The
Participation Compensation will be reduced to 50% for resolutions adopted without an actual convening (unanimous written resolutions)
and to 60% for participation through media communication.
As previously approved by
our shareholders’ general meeting, Tene Growth Capital 3 Funds Management Company Ltd. (“
Tene Management
”) has
provided the Company with certain management services, including the role of Dr. Ariel Halperin as executive Chairman of the Board, for
an annual fee of NIS 630,000, payable in equal quarterly installments (the “
Management Agreement
”). The Management
Agreement is expected to terminate in connection with Dr. Halperin’s departure from the Board.
In addition to the Annual
Fee and Participation Compensation described above, directors have received grants of options to purchase our ordinary shares at our 2017,
2020 and 2023 annual general meetings of shareholders. At the 2017 meeting, each director (other than the Chairman) received 3,750 options
and Dr. Halperin received 33,000 options, each with an exercise price of $28.65; all of these options are fully expired. At the 2020 meeting,
each director received 3,750 options and Dr. Halperin received 33,000 options, each with an exercise price of $11.51; all of these options
are fully vested. At the 2023 meeting, each director received 3,750 options with an exercise price of $4.28; these options vest in three
equal annual installments, subject to continuous service on the Board on the relevant vesting date, and have a seven-year term. The exercise
price for each grant was the closing price of our ordinary shares on Nasdaq as of the applicable approval or grant date. All such options
have been granted in accordance with, and subject to, all terms and conditions of the applicable Company incentive plan and the Company's
customary option agreement, including provisions for adjustment of the exercise price due to dividend distribution and for acceleration
upon a change of control.
The Company purchases directors’
and officers’ liability insurance for its directors and executive officers, consistent with our Compensation Policy as approved
by our shareholders. In addition, the Company released its directors from liability and committed to indemnifying them to the fullest
extent permitted by law and its Articles and provided them with exemption and indemnification agreements for this purpose. The current
form of Letter of Exemption and Indemnification is described in ITEM 6.C: Directors, Senior Management and Employees—Board Practices—Exculpation,
insurance and indemnification of office holders of our annual report on Form 20-F for the year ended December 31, 2025, filed with the
SEC on March 4, 2026 and is available on the SEC website at www.sec.gov.
Any candidate elected as
a director at the Meeting will be entitled to the cash remuneration in the manner described above, and would benefit from the insurance,
indemnification and release discussed above.
Each director (except for
external directors) holds office until the annual general meeting of our shareholders in the following year, unless the tenure of such
director expires earlier pursuant to the Companies Law or such director is removed from office as described below.
11
PROPOSAL ONE
APPROVAL OF THE RE-ELECTION AND ELECTION OF
DIRECTORS
Background
At the Meeting, shareholders
will be asked to re-elect each of Maxim Ohana, Eran Cohen and Yuval Beeri, and to elect each of Mr. Aviv Ben Horin and Mr. Yaron Arzi
(collectively, the “
Nominees
”), to serve as directors of the Company until the close of the next annual general meeting
of shareholders. Dr. Ariel Halperin, who has served as Chairman of the Board, is not standing for re-election at the Meeting.
Ms. Irit Ben-Dov, who was
elected as a director at the Company’s 2025 annual general meeting of shareholders, notified the Company shortly following her election
that she would be unable to serve as a director. In accordance with its authority to fill vacancies under the Articles, the Board appointed
Mr. Yaron Arzi to serve as a director, effective as of December 14, 2025, and determined that he qualifies as an independent director
under both the Nasdaq corporate governance rules and the Companies Law, and that he possesses “accounting and financial expertise”
under the Companies Law. The Company furnished a Report of Foreign Private Issuer on Form 6-K regarding this appointment on December 15,
2025. Having been appointed by the Board, Mr. Arzi is standing for election by the shareholders at the Meeting.
In accordance with the Companies
Law, each of the Nominees has certified to the Company that he or she meets all requirements under the Companies Law for election as a
director of a public company, possesses the necessary qualifications, and has sufficient time to fulfill his or her duties as a director
of the Company, taking into account the size and particular needs of the Company. The Nominating Committee and the Board recommend that
each of the Nominees be re-elected or elected, as applicable, at the Meeting for a term expiring at the close of the next annual general
meeting of shareholders of the Company.
Biographical Information Concerning the Nominees
Maxim Ohana
has
been serving as our director since October 2023. He has previously served as the Chairman of the Board from 2010 to 2013. Prior to that,
Mr. Ohana served as chairman of the board of directors of the Economic Council, Kibbutz Sdot Yam from 2008 to 2012. From 2000 to 2008,
Mr. Ohana served as Chief Executive Officer of Sdot-Yam Marble Floors Company (1995) Ltd. and from 1997 to 2000, he served as Chief Executive
Officer of Hagor Industries Ltd. From 1993 to 1997, Mr. Ohana served as Chief Executive Officer of Cement Products Caesarea Ltd. and from
1990 to 1993, he served as Chief Executive Officer of Kibbutz Sdot Yam’s businesses and operations. Mr. Ohana holds a diploma in
general studies from the Kibbutzim College of Education, Technology and the Arts (Seminar Ha’Kibbutzim), Israel.
Yuval Beeri
has
been serving as our independent director since August 2024. Since December 2016, Mr. Beeri has been serving as the CEO of Ricor Cryogenic
Systems. As such, he is the Chairman of the board of its two subsidiaries: Netzer and Aero-Magnesium. Prior to Ricor, he served at Maytronics
from 2003 to 2016: five years as VP Marketing and seven years as the CEO. Prior to Maytronics, Mr. Beeri served at Kulicke and Soffa,
a semiconductor assembly equipment leader, from 1993 until 2003: the first five years at Micro-Swiss Israel as the capillary marketing
manager and the last five years as Semitec CEO in Santa Clara, CA. Parallel to his CEO position at Ricor, he also served as ARI (Kfar
Haruv) Chairman and ARAN (Nachshon) director. Mr. Beeri holds a B.A. in Agricultural Economy from the Hebrew University, Israel, and an
M.B.A. from the University of Derby, UK.
Eran Cohen
has
been serving as our director since November 2025. Mr. Cohen has served as Caesarstone’s ROW Sales Director since 2021 and as the
Chairman of Kibbutz Sdot Yam’s Economic Council since March 2025. Mr. Cohen has been employed by Caesarstone since 2011, and prior
to his current role, from 2011 to 2021 served as Sales Manager in the International Department, leading our distribution activities across
global markets. Prior to joining Caesarstone, from 2006 to 2009, he served as Vice President of Sales and International Operations at
Netcom Group, and from 2000 to 2004 as Vice President of Business Development and Director of Operations in Israel at Praxell Inc. Mr.
Cohen holds an M.A. in International Political Science from Bar-Ilan University, an M.E.I. in Technological Entrepreneurship from Swinburne
University of Technology, and a B.A. in Management and Behavioral Sciences from the College of Management Academic Studies.
Yaron Arzi
has
been serving as our director since December 2025. From July 2024 to September 2025 Mr. Arzi served as Chief Executive Officer of Brown
Hotels. Previously, from 2022 to 2023, Mr. Arzi served as Chief Financial Officer and Deputy Chief Executive Officer of the Din Marketing
& Roasting Group. From 2020 to 2021, he served as Head of Corporate Turnaround & Company Management Practice at KCR, a consulting
and advisory firm. From 2015 to 2020, Mr. Arzi served as Chief Financial Officer of the Negev Ceramics Group. From 2012 to 2015, he served
as Chief Financial Officer of Africa Israel Hotels. From 2008 to 2012, he served as Chief Financial Officer of Zoglovek. Previously, he
held senior finance roles at Frutarom Germany, Tivall (part of the Osem–Nestlé Group), Johnson & Johnson Israel, and
Tama Plastic Industry. Mr. Arzi holds a bachelor’s degree in Economics and Business Administration from Ruppin Academic Center and
a master’s degree in Public Administration from the University of Haifa.
12
Aviv Ben Horin
has been serving as Business Manager of Kibbutz Sdot-Yam since February 2023. Previously, from January 2013 to March 2023, Mr. Ben Horin
served as Manager of the Kibbutz’s dairy farm, with responsibility for its business and operational management, including budgeting,
strategic planning and personnel. Alongside his professional roles, he also served as a member of Kibbutz Sdot-Yam’s Economic Council
from 2018 to 2022. His additional roles within the kibbutz include serving as Chairman of its Real Estate and Business Operations Management
Committee and as a director of affiliated entities. In his capacity as Business Manager, he also participates in meetings of the Kibbutz’s
governing institutions, including its Economic Council. Mr. Ben Horin holds a B.A. in Business Administration from Ruppin Academic Center,
Israel, and a Practical Engineer diploma in Agriculture, specializing in Animal Sciences, from the same institution.
If this Proposal No. 1 is
approved, following the re-election and election, as applicable, of each of the Nominees, the Nominees will be entitled to the compensation
terms set forth in the section herein titled “Corporate Governance”.
Proposed Resolution
We are therefore proposing
to adopt the following resolutions:
“
RESOLVED
,
to approve the re-election of Maxim Ohana to serve as a director of the Company until the close of the next annual general meeting of
shareholders of the Company.”
“
RESOLVED
,
to approve the re-election of Eran Cohen to serve as a director of the Company until the close of the next annual general meeting of shareholders
of the Company.”
“
RESOLVED
,
to approve the re-election of Yuval Beeri to serve as a director of the Company until the close of the next annual general meeting of
shareholders of the Company.”
“
RESOLVED
,
to approve the election of Mr. Aviv Ben Horin to serve as a director of the Company until the close of the next annual general meeting
of shareholders of the Company.”
“
RESOLVED
,
to approve the election of Mr. Yaron Arzi to serve as a director of the Company until the close of the next annual general meeting of
shareholders of the Company.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
13
PROPOSAL TWO
RE-ELECTION AND ELECTION OF EXTERNAL DIRECTORS
AND APPROVAL OF CASH
COMPENSATION TERMS
Background
At the Meeting, shareholders
will be asked to re-elect Ms. Lily Ayalon, and to elect Ms. Hanna Yanovsky, to serve as External Directors of the Company under the Companies
Law, each for a three-year term commencing on December 1, 2026.
Ms. Ayalon currently serves
as an External Director of the Company; if re-elected, this will be her third and final three-year term as an External Director of the
Company.
The second three-year term
of Ms. Nurit Benjamini as an External Director of the Company expires on November 30, 2026, at which time her service as a director will
conclude. Ms. Benjamini has informed the Company that she has decided not to seek re-election for a third and final term. In her stead,
Ms. Hanna Yanovsky is proposed for election as an External Director of the Company for a three-year term commencing on December 1, 2026.
Following the Meeting, assuming
the shareholders approve this Proposal No. 2 by the requisite majority, Ms. Lily Ayalon will serve as chairperson of each of the Audit
Committee and the Compensation Committee of the Board.
Biographical Information
Lily Ayalon
has
served as an External Director under the Companies Law since December 2020. Ms. Ayalon is a business consultant and serves on the boards
of directors of Westdale America Limited, Meitav Investments Ltd. and Rekah Pharmaceutical Industries Ltd. She previously served on the
boards of directors of several other companies, including Haifa Port Company Ltd. and Israel Corporation Ltd. From 2010 to 2015, Ms. Ayalon
served as Senior Deputy Director General of the Israeli Government Companies Authority. From 2006 to 2009, she served as Deputy Chief
Executive Officer and Chief Financial Officer of the New Hamashbir Group Ltd. and as Chief Executive Officer of one of its subsidiaries.
From 2004 to 2006, she served as Chief Financial Officer of Amot Investments Ltd. Ms. Ayalon is a certified public accountant in Israel
and holds a B.A. in Accounting and Economics and an M.B.A. in Finance from the Hebrew University of Jerusalem.
Hanna Yanovsky
co-founded STXI Motion Ltd., a company with subsidiaries in the United States and Europe, and served on its board of directors from 2019
until its acquisition by the Wittenstein Group in March 2026. From 2019 to August 2025, Ms. Yanovsky served as General Manager and Chief
Revenue Officer of Caja Elastic Dynamic Solutions Ltd. and its U.S. subsidiary. From 2015 to 2019, she served as Vice President of Legal
and Business Affairs of Servotronix Motion Control Ltd. From 2005 to 2011, she was a senior commercial lawyer at Shibolet & Co. Law
Firm. Ms. Yanovsky is a member of the Israel Bar Association and holds an LL.B. and a B.A. in Economics from the University of Haifa and
an Executive M.B.A. from Tel Aviv University.
The Company has received
a statement from each of Ms. Ayalon and Ms. Yanovsky in which they each declared that they meet all of the requirements applicable to
External Directors as set forth in the Companies Law.
Our Board has determined
that each of Ms. Ayalon and Ms. Yanovsky is qualified to serve as an External Director under the Companies Law, meeting the requisite
professional criteria and satisfying the independence and non-affiliation requirements applicable to External Directors under the Companies
Law. Our Board further determined that each of the candidates is financially literate as contemplated by the rules of Nasdaq and satisfies
the independence requirements applicable to members of the Audit Committee and the Compensation Committee under the rules of the SEC and
Nasdaq.
An External Director is entitled
to compensation and reimbursement of expenses in accordance with regulations promulgated under the Companies Law and is otherwise prohibited
from receiving any other compensation, directly or indirectly, in connection with serving as a director, except for certain exculpation,
indemnification and insurance provided by the Company, as specifically allowed by the Israeli Companies Regulations. If duly re-elected
or elected by the shareholders, as applicable, the Company will pay Ms. Ayalon and Ms. Yanovsky the amounts set forth in the section herein
titled “Corporate Governance,” which amounts are within the minimum and maximum rates specified in the annexes of the Israeli
Companies Regulations.
14
Proposed Resolution
We are therefore proposing
to adopt the following resolutions:
“
RESOLVED
,
to re-elect Ms. Lily Ayalon to serve as an External Director of the Company under the Companies Law, for a three-year term commencing
on December 1, 2026, and to approve her terms of cash compensation, as described in this Proxy Statement.”
“
RESOLVED
,
to elect Ms. Hanna Yanovsky, to serve as an External Director of the Company under the Companies Law, for a three-year term commencing
on December 1, 2026, and to approve her terms of cash compensation, as described in this Proxy Statement.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
15
PROPOSAL THREE
APPROVAL OF AMENDED AND RESTATED COMPENSATION
POLICY
Background
Under the Companies Law,
the board of directors of an Israeli public company is required to establish a compensation policy regarding the terms of engagement of
its office holders. Our office holders include our directors, executive officers and other managers who meet the definition of “office
holder” under the Companies Law.
The Company’s prior
Compensation Policy was approved by our shareholders on October 30, 2023 for a term of three years and will expire on October 30, 2026
(the “
Prior Compensation Policy
”). The Proposed Compensation Policy, if approved, will remain effective for three years
from the date of the Meeting.
Under the Companies Law,
the adoption of the Proposed Compensation Policy requires the approval of the Company’s compensation committee, the Board, and our
shareholders, in that order. The shareholders’ approval is further subject to the fulfillment of special voting requirements, as
detailed under
‘Quorum and Required Vote’
above.
Our Compensation Committee
examined the factors and considerations set forth in the Companies Law and, following its own independent examination of such factors,
the Board considered and approved the Proposed Compensation Policy. Following such review, the Compensation Committee and the Board each
approved, and recommended that our shareholders approve, the Proposed Compensation Policy in the form attached hereto as
Appendix
A
.
If approved, the Proposed
Compensation Policy will take effect on the date of the Meeting and will apply immediately to all of our office holders.
The principal proposed changes
to the Prior Compensation Policy are summarized below:
A.
Section 10.1 (Special Bonus)
- to provide that a Special Bonus may be paid, in whole or in part,
in equity-based awards in lieu of cash, thereby increasing the alignment of such awards with long-term shareholder value and providing
the Company with additional flexibility in the form of payment.
To that end, the following sentence
is proposed to be added to Section 10.1: “
A Special Bonus can be paid, in whole or in part, in equity in lieu of cash.”
B.
Section 13.5 (Dilution Cap) -
the current language applies the overall 10% dilution cap to all
equity-based grants, including grants to employees who are not office holders (i.e., executive officers and directors). Under Israeli
Companies Law, governing compensation policies, such policies are to address compensation terms of office holders and do not extend to
employees. It is therefore proposed to delete the reference to employees, so that the policy’s cap applies only to such office holders.
Including “employees” within the scope of the dilution cap conflated two distinct categories: office holders, whose compensation
is governed by the compensation policy, and other employees, whose equity-based compensation is regulated through separate corporate mechanisms.
Equity-based grants to employees who are not office holders will continue to be governed by the Company’s equity incentive plan
and the share reserve approved thereunder, and by the approvals required under applicable law and the rules of Nasdaq.
16
The Compensation Committee and Board
note that, due to the sustained decline in the Company’s share price, no options have been exercised since August 2021 (i.e., for
more than five years), and the exercise price of the majority outstanding options exceeds significantly the current market price. In addition,
the Company’s equity compensation practices have resulted in modest net dilution: since 2023, approximately 3.3 million shares have
been subject to equity-based grants, while approximately 1.64 million shares have been returned to the share reserve due to forfeitures,
cancellations or expirations — a ratio of approximately 2:1 (granted to returned). In 2026, almost no new grants have been made
(40,000 options), while approximately 300,000 shares have been returned to the pool (a rate of approximately seven times the number of
shares granted). As a result, the dilution attributable to equity-based awards over the past 36 months averaged approximately 1.3% per
12-month period (most of which, as stated, are higher than the current share price).
As of October 20, 2026, outstanding
equity-based awards held by the Company’s office holders represented approximately 5.9% of the Company’s share capital on
a fully diluted basis, well below the 10% cap set forth in the Prior Compensation Policy (approximately 8.15% including awards held by
all employees), and the exercise price of the majority of the outstanding options was significantly in excess of the market price of the
Company’s ordinary shares on such date.
Our Compensation Committee
and Board believe that the Proposed Compensation Policy will better position the Company to attract, retain and motivate qualified candidates
to serve as officers and directors, particularly given the competitive demand for experienced and talented executives in the Israeli market.
The foregoing summary is
qualified in its entirety by reference to the full text of the Proposed Compensation Policy, which is marked against the Prior Compensation
Policy and attached as
Appendix A
hereto.
Under the Companies Law,
the Board may approve the Proposed Compensation Policy even if the shareholders vote against this Proposal No. 3, provided that the Compensation
Committee, and thereafter the Board, each determines, based on detailed reasoning and after having reconsidered the matter, that such
approval is in the best interest of the Company. This override authority may be exercised only in special circumstances prescribed
by the Companies Law and subject to the conditions set forth therein.
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to approve the Proposed Compensation Policy, as described in this Proxy Statement and as set forth in Appendix A attached hereto, effective
as of the date of the Meeting for a period of three years.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
17
PROPOSAL FOUR
TO APPROVE AN INCREASE IN THE TOTAL NUMBER OF
ORDINARY SHARES RESERVED FOR
ISSUANCE AS INCENTIVE STOCK OPTIONS UNDER THE COMPANY’S 2020 SHARE INCENTIVE PLAN
Generally, the Company is
not required by the Companies Law, or otherwise under applicable Israeli law, to obtain shareholder approval for the adoption, extension
or amendment of its equity compensation plans. However, in order for the Company to grant options that qualify as incentive stock options
(“
ISOs
”) under the U.S. Internal Revenue Code, shareholder approval is required for any amendment that increases the
total number of ordinary shares available for grant as ISOs.
On May 12, 2026, the Board
approved an amendment to the Company’s 2020 Share Incentive Plan (the “
Plan
”), increasing the total number of
ordinary shares available for grant as ISOs from 3,500,000 ordinary shares to 5,500,000 ordinary shares, as reflected in
Appendix
B
attached hereto.
The Board approved this amendment
because a substantial majority of the stock options currently outstanding under the Plan are significantly underwater, rendering them
ineffective as retention and incentive tools. The Company requires a sufficient reserve of available equity instruments to attract and
retain qualified employees and to motivate their continued service through meaningful long-term incentive compensation. The Board is submitting
this proposal to shareholders at this time solely because, in order to grant ISOs, shareholder approval is required for any amendment
that increases the total number of ordinary shares available for grant as ISOs.
Effect of Non-Approval
For the avoidance of doubt,
shareholder approval pursuant to this Proposal No. 4 is required solely for ISOs granted to employees subject to the U.S. Internal Revenue
Code. In the event that this Proposal No. 4 is not approved by shareholders, the amendment to the Plan shall nevertheless take effect
with respect to all other grants under the Plan, including grants to employees who are not subject to the U.S. Internal Revenue Code.
The Board believes that the
amendment is advisable to enable the Company to provide meaningful equity-based incentives to its U.S.-based employees through ISOs.
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to approve an increase in the total number of shares reserved for issuance as incentive stock options under the Company’s 2020 Share
Incentive Plan as set forth in Appendix B to the Proxy Statement.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
18
PROPOSAL FIVE
APPROVAL OF THE GRANT OF EQUITY-BASED COMPENSATION
TO THE COMPANY’S NON-
AFFILIATE DIRECTORS
Background
Under the Companies Law,
the terms of compensation of our directors must be approved by our Compensation Committee, the Board and the Company’s shareholders,
in that order.
Our Compensation Committee
and Board approved grants of options to purchase ordinary shares of the Company to each of Lily Ayalon, Hanna Yanovsky, Yuval Beeri and
Yaron Arzi, subject to his or her election or re-election, as applicable, at the Meeting (each, a “
Non-Affiliate Director Grantee
”).
This Proposal No. 5 does not relate to the approval of equity grants to any of our directors who are affiliated with a controlling shareholder
of the Company, which is addressed separately in Proposal No. 6.
If approved by the shareholders,
each Non-Affiliate Director Grantee will be granted 3,750 options to purchase ordinary shares of the Company (collectively, in this Proposal,
the “
Non-Affiliate Director Options
”).
The Non-Affiliate Director
Options are intended to align the interests of the Company’s directors with those of its shareholders and to provide a long-term
incentive for continued service on the Board.
The Non-Affiliate Director
Options will be granted under the Plan and in accordance with the terms and conditions of the Company’s form of option award agreement.
The grant date will be the date on which the applicable Non-Affiliate Director Grantee’s term of office commences: (i) for each
Grantee elected or re-elected under Proposal No. 1, the date of the Meeting; and (ii) for each of Ms. Ayalon and Ms. Yanovsky, December
1, 2026, which is the date on which their terms as External Directors commence under Proposal No. 2. The exercise price will be the closing
price of the Company’s ordinary shares on Nasdaq on the grant date. The Non-Affiliate Director Options will vest in three equal
annual installments, subject to continuous service on the Board on the relevant vesting date, and will have a term of seven years unless
they expire earlier in accordance with the terms of grant. The terms of grant include, among other things, provisions for adjustment of
the exercise price due to dividend distribution and for acceleration in the event of a change of control.
This Proposal No. 5 does
not pertain to any changes to the cash compensation currently payable to the directors, which shall remain as set forth in the section
herein titled “Corporate Governance.” This Proposal No. 5 is consistent with both the Prior Compensation Policy and the Proposed
Compensation Policy.
The grant of Non-Affiliate
Director Options to each Non-Affiliate Director Grantee is subject to his or her election or re-election as a director at the Meeting
pursuant to Proposal No. 1 or Proposal No. 2, as applicable, and will be made only upon the actual commencement of his or her term of
office as a director.
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to approve grants of options to purchase ordinary shares of the Company to each of Lily Ayalon, Hanna Yanovsky, Yuval Beeri and Yaron
Arzi, in the respective numbers and on the terms described in this Proxy Statement, subject to his or her election or re-election, as
applicable, at the Meeting, and provided that each such grant shall be made only upon, and shall be effective as of, the date on which
such director’s term of office actually commences.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
19
PROPOSAL SIX
APPROVAL OF THE GRANT OF EQUITY-BASED COMPENSATION
TO THE COMPANY’S
AFFILIATE DIRECTORS
Background
As discussed herein, certain
Nominees are affiliated with a controlling shareholder of the Company (the “
Affiliate Directors
”), namely Maxim Ohana,
Eran Cohen and Aviv Ben Horin. Under the Companies Law, the terms of compensation of the Company’s directors, including the Affiliate
Directors, must be approved by the Compensation Committee, the Board and the Company’s shareholders, in that order. The Compensation
Committee and the Board approved grants of options to purchase ordinary shares of the Company to each of the Affiliate Directors, subject
to his election or re-election, as applicable, as a director at the Meeting.
If approved by the shareholders,
each Affiliate Director will be granted 3,750 options to purchase ordinary shares of the Company (in this Proposal, the “
Affiliate
Director Options
”). The terms governing the Affiliate Director Options are the same as the terms governing the Non-Affiliate
Director Options as detailed in Proposal No. 5.
The Affiliate Director Options
are intended to align the interests of the Company’s directors with those of its shareholders and to provide a long-term incentive
for continued service on the Board.
The grant of Affiliate Director
Options to each of the Affiliate Directors is considered an interested party transaction under the Companies Law and is therefore subject
to a special majority vote requirement, as described under “Quorum and Required Vote” above. This Proposal No. 6 does not
pertain to any changes to the cash compensation currently payable to the Affiliate Directors, which shall remain as set forth in the section
herein titled “Corporate Governance.” This Proposal No. 6 is consistent with both the Prior Compensation Policy and the Proposed
Compensation Policy.
The grant of Affiliate Director
Options to each Affiliate Director is subject to his election or re-election, as applicable, as a director at the Meeting pursuant to
Proposal No. 1.
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to approve grants of options to purchase ordinary shares of the Company to each of Aviv Ben Horin, Eran Cohen and Maxim Ohana, subject
to his election or re-election, as applicable, at the Meeting, as described in this Proxy Statement.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
20
PROPOSAL SEVEN
APPROVAL OF THE TERMS OF EMPLOYMENT OF MR. ERAN
COHEN AS ROW SALES DIRECTOR
Background
Mr. Cohen has served as
a director of the Company since November 19, 2025. At that time, he was serving, and continues to serve, as the Company’s ROW Sales
Director, a position he has held since 2021, having previously served as the Company’s international sales manager for approximately
ten years. Mr. Cohen is a member of Kibbutz Sdot-Yam and currently serves as Chairman of Kibbutz Sdot-Yam’s Economic Council. Mr.
Cohen’s services to the Company in his sales role have been provided pursuant to the manpower agreement between the Company and
Kibbutz Sdot-Yam (the “
Kibbutz Manpower Agreement
”), which is described in Item 7.B of the Company’s annual report
on Form 20-F for the year ended December 31, 2025, filed with the SEC on March 4, 2026, under “Related Party Transactions —
Relationship and agreements with Kibbutz Sdot-Yam — Manpower agreement.”
Under the Companies Law,
the terms of office and employment of a director, including any compensation received from the Company in any other capacity, require
the approval of the Compensation Committee, the Board and the shareholders, in that order. At the time of Mr. Cohen’s election as
a director, no separate approval of his terms of employment was sought, as his engagement was already governed by the Kibbutz Manpower
Agreement and Mr. Cohen continued to provide his services on the same terms and conditions, without any change to his management-level
position.
The Kibbutz Manpower Agreement
is renewed annually. Kibbutz Sdot-Yam has notified the Company that it does not intend to renew the Kibbutz Manpower Agreement for an
additional year, and accordingly the agreement will terminate on December 31, 2026. Upon such termination, Mr. Cohen’s continued
service as the Company’s ROW Sales Director will no longer be governed by the Kibbutz Manpower Agreement. This Proposal No. 7 is
therefore submitted to approve his terms of direct employment with the Company, as described below.
Since Mr. Cohen is a director
of the Company and is affiliated with a controlling shareholder (as a member of Kibbutz Sdot-Yam), the approval of his terms of employment
requires a special majority of the Company’s shareholders, as described under “Quorum and Required Vote” above.
If this Proposal No. 7 is
not approved and the Kibbutz Manpower Agreement terminates as described above, Mr. Cohen would be required to either: (i) step down from
his role as the Company's ROW Sales Director (or continue to provide his services to the Company on a voluntary, uncompensated basis);
or (ii) cease serving as a director of the Company.
The principal proposed terms
of Mr. Cohen’s direct employment as the Company’s ROW Sales Director are summarized below:
·
Monthly gross base salary: NIS 36,000.
·
Job Grade: L2.
·
Company car, in accordance with the Company’s policy applicable to employees of the same job grade.
·
Annual bonus: a target bonus of 2.5 monthly salaries and a maximum bonus of 3.75 monthly salaries, subject
to the achievement of personal and Company objectives as determined by the Company from time to time.
·
Notice period: 60 days.
·
Annual vacation: 23 days.
·
Equity-based compensation: eligibility for equity-based awards under the Plan, as may be granted from
time to time at the discretion of the Company's Compensation Committee and Board.
·
Social benefits and customary provisions (including, but not limited to, confidentiality, intellectual
property assignment and expense reimbursement) in accordance with the Company’s standard terms of employment.
In approving the proposed
terms, the Compensation Committee and the Board considered, among other things, Mr. Cohen’s qualifications, professional experience,
achievements, the scope of his role, and his long tenure with and contribution to the Company. The Compensation Committee and the Board
also considered an internal benchmark analysis, which confirmed that the proposed terms fall within the range of the terms of employment
of other Company employees at the same job grade (L2) and of compensation levels for comparable sales-management positions in Israel,
where Mr. Cohen is based.
21
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to approve the terms of employment of Mr. Eran Cohen, a director of the Company, in his role as the Company’s ROW Sales Director,
as described in this Proxy Statement.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
22
PROPOSAL EIGHT
RE-APPOINTMENT OF INDEPENDENT AUDITORS AND AUTHORIZATION
TO DETERMINE
COMPENSATION
Background
Based upon the recommendation
of the Board, the Company is submitting for approval the re-appointment of Kost, Forer, Gabbay & Kasierer (a member of Ernst &
Young Global) as its independent auditors for the year ending December 31, 2026, and their service until the annual general meeting to
be held in 2027, and to authorize the Board (or the Audit Committee, if so authorized by the Board), upon recommendation of the Audit
Committee, to determine the compensation of the auditors in accordance with the volume and nature of their services.
The Audit Committee has
adopted a pre-approval policy for the engagement of the Company’s independent auditors to perform certain audit and non-audit services.
Pursuant to this policy, which is designed to ensure that such engagements do not impair the independence of the auditors, the Audit Committee
pre-approves annually a catalog of specific audit and non-audit services in the categories of audit services, audit-related services and
tax services that may be performed by the Company’s independent auditors.
The following table sets
forth the total compensation that was paid by the Company and its subsidiaries to the Company’s independent auditors, Ernst &
Young, in each of the previous two fiscal years (in thousands of U.S. dollars):
2025
2024
(in thousands of U.S. dollars)
Audit fees(1)
$
745
$
860
Audit-related fees(2)
1
1
Tax fees(3)
87
36
All other fees(4)
47
77
Total
$
880
974
(1)
“Audit fees” include fees for services performed by our independent public accounting firm
in connection with the integrated audit of our annual audit consolidated financial statements for 2025 and 2024, and its internal control
over financial reporting as of December 31, 2025 and 2024, certain procedures regarding our quarterly financial results submitted on Form
6-K, and consultation concerning financial accounting and reporting standards.
(2)
“Audit-related fees” relate to assurance and associated services that are traditionally performed
by the independent auditor.
(3)
“Tax fees” include fees for professional services rendered by our independent registered public
accounting firm for tax compliance and tax advice and tax planning services on actual or contemplated transactions.
(4)
“Other fees” include fees for services rendered by our independent registered public accounting
firm with respect to supply chain consulting, governmental incentives, due diligence investigations and other matters.
Proposed Resolution
We are therefore proposing
to adopt the following resolution:
“
RESOLVED
,
to re-appoint the Company’s auditor, Kost, Forer, Gabbay & Kasierer (a member of Ernst & Young Global) (the “
Auditors
”),
as the independent auditors of the Company for the year ending December 31, 2026, and its services until the close of the Company’s
next annual general meeting to be held in 2027, and that the board of directors of the Company (or the Audit Committee — if so authorized
by the Board of Directors) be authorized to determine the compensation of the Auditors in accordance with the volume and nature of their
services.”
Required Vote
See “
Quorum and
Required Vote
” above.
Board Recommendation
The Board unanimously recommends
that you vote “FOR” the proposed resolution.
23
OTHER BUSINESS
The Board is not aware of any other matters that
may be presented at the Meeting other than those mentioned in the enclosed Notice of Annual General Meeting of Shareholders. If any other
matters do properly come before the Meeting, it is intended that the persons named as proxies will vote, pursuant to their discretionary
authority, according to their best judgment in the interest of the Company.
ADDITIONAL INFORMATION
The Company’s Annual Report, filed on Form
20-F with the SEC on March 4, 2026, and other filings with the SEC, including reports regarding the Company’s quarterly business
and financial results, are available for viewing and downloading on the SEC’s website at www.sec.gov as well as under the ‘Investor
Relations’ section of the Company’s website at www.caesarstone.com. Shareholders may obtain a copy of these documents without
charge at www.caesarstone.com.
The Company is subject to the information reporting
requirements of the Exchange Act applicable to foreign private issuers. The Company fulfills these requirements by filing reports with
the SEC. As a foreign private issuer, the Company is exempt from the rules under the Exchange Act related to the furnishing and content
of proxy statements. The circulation of this Proxy Statement should not be taken as an admission that the Company is subject to those
proxy rules.
By order of the Board:
/s/ Ariel Halperin
Dr. Ariel Halperin
Chairman of the Board of Directors
Kibbutz Sdot-Yam, MP Menashe 3780400, Israel
October 21, 2026
24
COMPENSATION POLICY
CAESARSTONE LTD.
Compensation Policy for Executive Officers and
Directors
as amended on [_______],
2023
2026
Table of Contents
Page
A. Overview and Objectives
A - 3
B. Base Salary, Benefits and Perquisites
A - 5
C. Cash Bonuses
A - 6
D. Equity Based Compensation
A - 9
E. Retirement and Termination of Service Arrangements
A - 10
F. Exculpation, Indemnification and Insurance
A - 11
G. Arrangements upon Change of Control
A - 13
H. Board of Directors Compensation
A - 13
I. Miscellaneous
A - 14
A -
2
A.
Overview and Objectives
1.
Introduction
This
document sets forth the Compensation Policy for Executive Officers and Directors (this
“
Compensation
Policy
”
or
“
Policy
”)
of Caesarstone Ltd.
(“
Caesarstone
”
or the
“
Company
”),
in accordance
with the requirements
of the Companies Law, 5759-1999
(the
“
Companies
Law
”).
Compensation is a key component of
Caesarstone’s overall human capital strategy to attract, retain, reward, and motivate highly skilled individuals that will enhance
Caesarstone’s value and otherwise assist Caesarstone to reach its business and financial long-term goals. Accordingly, the structure
of this Policy is established to tie the compensation of each officer to Caesarstone’s goals and performance.
For purposes of this Policy, “Executive
Officers” shall mean “Office Holders” as such term is defined in Section 1 of the Companies Law, excluding, unless otherwise
expressly indicated herein, Caesarstone’s directors.
This Compensation Policy shall apply
to compensation agreements and arrangements which will be approved after the date on which this Compensation Policy is adopted and shall
serve as Caesarstone’s Compensation Policy for three (3) years commencing as of its adoption.
The Compensation Committee and the
Board of Directors of Caesarstone (the “
Compensation Committee
” and the “
Board
”, respectively) shall
review and reassess the adequacy of this Policy from time to time, as required by the Companies Law.
It is hereby clarified that nothing
in this Compensation Policy shall be deemed to grant any of Caesarstone’s Executive Officers or directors or employees or any third
party any right or privilege in connection with their employment by the Company. Such rights and privileges shall be solely governed by
the respective personal employment agreements.
2.
Objectives
Caesarstone’s objectives and
goals in setting this Compensation Policy are to attract, motivate and retain highly experienced personnel who will provide leadership
for Caesarstone’s success and enhance shareholder value, while supporting a performance culture that is based on merit, and differentiates
and rewards excellent performance in the long term, while recognizing Caesarstone’s core values. To that end, this Policy is designed,
among others:
2.1.
To closely align the interests of the Executive Officers with those of Caesarstone’s shareholders
in order to enhance shareholder value;
2.2.
To align the Executive Officers’ compensation with Caesarstone’s short and long-term goals
and performance;
2.3.
To provide the Executive Officers with a structured compensation package, including competitive salaries,
performance-motivating cash and equity incentive programs and benefits, and to promote for each Executive Officer an opportunity to advance
in a growing organization;
A -
3
2.4.
To strengthen the retention and the motivation of Executive Officers in the long term;
2.5.
To provide appropriate awards in order to incentivize superior individual excellence and corporate performance;
and
2.6.
To maintain consistency in the way Executive Officers are compensated.
3.
Compensation Instruments
3.1.
Compensation instruments under this Compensation Policy may include the following:
3.1.1.
Base salary;
3.1.2.
Benefits and perquisites;
3.1.3.
Cash bonuses;
3.1.4.
Equity based compensation; and
3.1.5.
Retirement and termination of service arrangements.
3.2.
Any grant of a compensation instrument shall be subject to this Compensation Policy and to the obtainment
of all approvals required under any applicable law.
4.
Inter-Company Compensation Ratio
4.1.
In the process of drafting this Policy, the Compensation Committee and the Board have examined the ratio
between employer cost associated with the engagement of the Executive Officers and the average and median employer cost of the other employees
of Caesarstone (including contractor employees as defined in the Companies Law), per territory and on a global basis (the
“
Ratio
”).
4.2.
The possible ramifications of the Ratio on the work environment in Caesarstone were examined and will
continue to be examined by the Company from time to time in order to ensure that levels of executive compensation, as compared to the
overall workforce will not have a negative impact on work relations in Caesarstone.
5.
Overall Compensation - Ratio Between Fixed and Variable Compensation
5.1.
This Policy aims to balance the mix of “Fixed Compensation” (comprised of base salary and
benefits) and “Variable Compensation” (comprised of cash bonuses and equity-based compensation) in order to, among other things,
appropriately incentivize Executive Officers to meet Caesarstone’s short- and long-term goals while taking into consideration the
Company’s need to manage a variety of business risks.
5.2.
The value of the annual target Variable Compensation of each Executive Officer, to which such Executive
Officer may be entitled subject to meeting his or her respective key performance indicators and/or by way of equity-based incentives,
shall be at least 30% of such Executive Officer’s annual Fixed Compensation.
A -
4
B.
Base Salary, Benefits and Perquisites
6.
Base Salary
6.1.
A base salary provides stable compensation to Executive Officers and allows Caesarstone to attract and
retain competent executive talent and maintain a reliable management team. The base salary varies between Executive Officers, and is individually
determined
according
to the educational background, prior vocational experience, qualifications,
role, business responsibilities and the past performance of each Executive Officer.
6.2.
Since a competitive base salary is essential to Caesarstone’s ability to attract and retain highly
skilled professionals, Caesarstone will seek to establish a base salary that is competitive with the base salaries paid to comparable
Executive Officers, while considering, among others, Caesarstone’s size, performance and field of operation and the geographical
location of the employed Executive Officer as well as his personal and professional skills. To that end, Caesarstone shall utilize as
a reference, comparative market data and practices, which may include, among others, a compensation survey that compares and analyses
the level of the overall compensation package offered to an Executive Officer of the Company with compensation packages in similar positions
to that of the relevant officer in other companies operating in sectors which are similar in their characteristics to Caesarstone’s,
as much as possible, while considering, among others, such companies’ size and characteristics including their revenues, profitability
rate, number of employees and operating arena (in Israel or globally), which shall be reviewed by the Compensation Committee. Such compensation
survey may be conducted internally or through an external consultant.
6.3.
The Compensation Committee and the Board may periodically consider and approve base salary adjustments
for Executive Officers. The main considerations for salary adjustment are similar to those used in initially determining the base salary,
but may also include, among others, change of role or responsibilities, recognition for professional achievements, regulatory or contractual
requirements, relocation, budgetary constraints or market trends. The Compensation Committee and the Board will also consider the previous
and existing compensation arrangements of the Executive Officer whose base salary is being considered for adjustment.
6.4.
The base salary, for the purpose of this Policy, means the monthly fixed payment due to an Executive Officer,
whether an Executive Officer is an employee who is paid a salary or a contractor whose monthly consideration is paid against a tax invoice,
in which case, the base salary shall be deemed as 75% of the monthly payment against a tax invoice.
7.
Benefits
7.1.
The following benefits may be granted to the Executive Officers in order, among other things, to comply
with legal requirements:
7.1.1.
Vacation days in accordance with applicable law and market practice;
7.1.2.
Sick days in accordance with applicable law and market practice;
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7.1.3.
Convalescence pay according to applicable law and market practice;
7.1.4.
Monthly remuneration for a study fund, as allowed by applicable law and with reference to Caesarstone’s
practice and market practice;
7.1.5.
Caesarstone shall contribute on behalf of the Executive Officer to an insurance policy or a pension fund,
as allowed by applicable law and with reference to Caesarstone’s policies and procedures and the practice in peer group companies;
and
7.1.6.
Caesarstone shall contribute on behalf of the Executive Officer towards work disability insurance, as
allowed by applicable law and with reference to Caesarstone’s policies and procedures and to the practice in peer group companies.
Non-Israeli Executive Officers may
receive other similar, comparable or customary benefits as applicable in the relevant jurisdiction in which they are employed. Such customary
benefits shall be determined based on the methods described in Section ‎6.2 of this Compensation Policy (with the necessary changes).
7.2.
In the event an Executive Officer relocates, such Executive Officer may receive other similar, comparable
or customary benefits as applicable in the relevant jurisdiction in which he or she is employed. Such benefits shall include reimbursement
of out of pocket one-time payments and other ongoing expenses, such as real estate broker fees, moving costs, car allowance, and home
leave visit, etc.
7.3.
Caesarstone may offer additional benefits to its Executive Officers, which will be comparable to customary
market practices, such as, but not limited to: cellular phone benefits, company car and travel benefits, reimbursement of business travel
expenses, including a daily stipend when traveling, and other business related expenses, insurances, professional licenses, membership
fees in professional organizations and other benefits (such as
newspaper subscriptions, academic and
professional studies and welfare activities)
, provided, however, that such additional benefits shall be determined in accordance
with Caesarstone’s policies and procedures.
C.
Cash Bonuses
8.
Annual Cash Bonuses - The Objective
8.1.
Compensation in the form of an annual cash bonus is an important element in aligning Executive Officers’
compensation with Caesarstone’s objectives and business goals. Therefore, a pay-for-performance element is an important part of
compensation, as payout eligibility and levels are determined based on actual financial and operational results, as well as individual
performance.
8.2.
An annual cash bonus may be awarded to Executive Officers upon the attainment of pre-set periodical objectives
and individual targets determined by the CEO and approved by the Compensation Committee at the beginning of each fiscal year or several
fiscal years, or upon engagement, in case of newly hired Executive Officers, taking into account Caesarstone’s short and long-term
goals, as well as its compliance and risk management policies. The Compensation Committee and the Board shall also determine applicable
minimum thresholds that must be met for entitlement to the annual cash bonus (all or any portion thereof) and the formula for calculating
the annual cash bonus payout. In special circumstances, as determined by the Compensation Committee and the Board (e.g., regulatory changes,
changes in Caesarstone’s business environment, objectives or timelines, a significant organizational change and a significant merger
and acquisition events), the Compensation Committee and the Board may modify the bonus plan during the calendar year.
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8.3.
In the event the employment of an Executive Officer is terminated prior to the end of a fiscal year, the
Company may pay such Executive Officer a full annual cash bonus (provided that the termination date occurs in the third or fourth quarter
of such fiscal year) or a prorated one. Such bonus will become due on the termination day of the Executive Officer's engagement with the
Company or on the same scheduled date for annual cash bonus payments by the Company.
8.4.
The actual annual cash bonus to be awarded to Executive Officers shall be approved by the Compensation
Committee and the Board.
9.
Annual Cash Bonuses - The Formula
Executive Officers other
than the CEO
9.1.
The annual cash bonus of Caesarstone’s Executive Officers other than Caesarstone’s chief executive
officer (“
CEO
” and “
VPs
”, respectively) will be based on the measurable objectives of the Company,
measurable personal objectives or a discretionary evaluation of the VP’s overall performance by the CEO (up to 25%) and subject
to a minimum threshold. The objectives will be recommended annually by Caesarstone’s CEO and approved by the Compensation Committee
on the basis of, but not limited to, Company and personal objectives. Examples of measurable objectives that will be considered include:
business and operational objectives (such as revenue, adjusted EBITDA and operating profit objectives, initiation of new markets and products,
operational efficiency); customer focus (such as customer satisfaction); project milestones (such as product implementation in production,
product acceptance and new product penetration) and investment in human capital (such as employee satisfaction, employee retention and
employee training and leadership programs).
9.2.
The annual cash bonus which may be awarded to each of the VPs will not exceed such VP’s monthly
base salary multiplied by eight (8).
CEO
9.3.
The annual bonus of Caesarstone’s CEO will be based mainly on measurable objectives of the Company
and subject to a minimum threshold. The measurable objectives will be approved by the Compensation Committee and the Board at the commencement
of each fiscal year or several fiscal years (or upon engagement, in case of newly hired CEO or in special circumstances as indicated in
Section 8.2 above).
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9.4.
The annual cash bonus which may be awarded to Caesarstone’s CEO with respect to a fiscal year shall
not exceed an amount equal to 2.5% of Caesarstone’s adjusted net income in such fiscal year and in any case the accumulated amount
of the annual bonus and the annual base salary of the CEO shall not exceed two (2) million US dollars.
9.5.
The annual cash bonus will be based mainly (at least 75%) on measurable objectives, and, with respect
to its less significant part (up to 25%), may be based on a discretionary evaluation of the CEO’s overall performance by the Compensation
Committee and the Board based on quantitative and qualitative criteria.
10.
Other Bonuses
10.1.
Special Bonus
. Caesarstone may grant its
Executive Officers a special bonus as an award for special achievements (such as in connection with mergers and acquisitions, offerings,
achieving target budget or business plan under exceptional circumstances
or
special recognition in case of retirement) at the CEO’s discretion (and in the CEO’s case, at the Board’s discretion),
subject to any additional approval as may be required by the Companies Law (the “
Special Bonus
”).
The Special
Bonus will not exceed twelve (12) monthly base salaries of the Executive Officer.
A
Special Bonus can be paid, in whole or in part, in equity in lieu of cash.
10.2.
Signing Bonus
. Caesarstone may grant a newly recruited Executive Officer a signing bonus at the
CEO’s discretion (and in the CEO’s case, at the Board’s discretion), subject to any additional approval as may be required
by the Companies Law (the “
Signing Bonus
”). The Signing Bonus will not exceed six (6) monthly base salaries of the
Executive Officer’s first annual compensation package.
10.3.
Relocation Bonus
. In the event an Executive Officer relocates, such Executive Officer may receive
other similar, comparable or customary benefits as applicable in the relevant jurisdiction in which he or she is employed. Such benefits
shall include reimbursement for out of pocket one-time payments and other ongoing expenses, such as real estate broker fees, moving costs,
home leave visit, etc. The relocation bonus will not exceed six (6) monthly base salaries of the Executive Officer.
10.4.
Non-Compete Grant
.
Upon termination of employment and subject to applicable law, Caesarstone
may grant to its Executive Officers a non-compete grant as an incentive to refrain from competing with Caesarstone for a defined period
of time. The terms and conditions of the non-compete grant shall be decided by the Board and shall not exceed such Executive Officer’s
monthly base salary multiplied by twelve (12).
11.
Compensation Recovery (“Clawback”)
11.1.
In the event of an accounting restatement, Caesarstone shall be entitled to recover from its Executive
Officers the annual bonus compensation or performance-based equity compensation in the amount in which such compensation exceeded what
would have been paid under the financial statements, as restated, provided that a claim is made by Caesarstone prior to the second anniversary
of the fiscal year end of the restated financial statements.
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11.2.
Notwithstanding the aforesaid, the compensation recovery will not be triggered in the following events:
11.2.1.
The financial restatement is required due to changes in the applicable financial reporting standards;
or
11.2.2.
The Compensation Committee has determined that clawback proceedings in the specific case would be impossible,
impractical or not commercially or legally efficient.
11.3.
Nothing in this Section ‎11 derogates from any other “clawback” or similar provisions
regarding disgorging of profits imposed on Executive Officers by virtue of applicable securities laws.
11.4.
Caesarstone intends to adopt and comply with a “clawback policy” (the “Clawback Policy”),
as contemplated pursuant to Rule 10D-1 under the Securities and Exchange Act of 1934, as may be amended from time to time, which directs
national securities exchanges, including The Nasdaq Stock Market LLC, to establish listing standards for purposes of complying with Rule
10D-1. The Clawback Policy shall not be limited in terms or substance to Sections 11.1 and 11.2 herein. To the extent there will be any
inconsistencies between this Compensation Policy and the Clawback Policy to be adopted by Caesarstone, the latter shall take precedence,
except to the extent of any mandatory requirement of the Companies Law, and, for the avoidance of any doubt, no amendments to, or further
corporate approvals in connection with, this Compensation Policy will be required in connection with the adoption or subsequent amendments
of the Clawback Policy.
D.
Equity Based Compensation
12.
The Objective
12.1.
The equity based compensation for Caesarstone’s Executive Officers is designed in a manner consistent
with the underlying objectives in determining the base salary and the annual cash bonus, with its main objectives being to enhance the
alignment between the Executive Officers’ interests with the long-term interests of Caesarstone and its shareholders, and to strengthen
the retention and the motivation of Executive Officers in the long term. In addition, since equity-based awards are to be structured to
vest over several years, their incentive value to recipients is aligned with longer-term strategic plans.
12.2.
The equity-based compensation may be in a form of share options and/or other equity-based awards, such
as restricted share units and phantom options, in accordance with the Company’s equity incentive plan in place as may be updated
from time to time.
12.3.
The equity-based compensation shall be granted from time to time and be individually determined and awarded
according to the performance, educational background, prior business experience, qualifications, role and the personal responsibilities
of the Executive Officer.
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13.
General Guidelines for the Grant of Awards
13.1.
The fair value of the equity based compensation
per vesting year (on a linear basis), determined in accordance with acceptable valuation practices at the time of grant, of each of Caesarstone’s
VPs shall not exceed 0.2% of Caesarstone’s market fair value based on the known
closing price of the Company’s shares
on Nasdaq as of the date of grant
.
13.2.
The fair value of the equity based compensation per vesting year (on a linear basis), determined in accordance
with acceptable valuation practices at the time of grant, of Caesarstone’s CEO shall not exceed 150% of the CEO’s annual base
salary.
13.3.
13.4.
The Compensation Committee and the Board may approve the grant of equity awards with a cap on the benefit
deriving from the exercise of equity-based compensation.
13.5.
Equity-based compensation awarded by the Company to
employees,
Executive Officers or
directors shall not be, in the aggregate, in excess of 10% of the Company’s share capital on a fully diluted basis at the date of
grant.
13.6.
All equity-based incentives granted to Executive Officers shall be subject to vesting periods in order
to promote long-term retention of the awarded Executive Officers. Unless determined otherwise in a specific award agreement approved by
the Compensation Committee and the Board, grants to Executive Officers shall vest gradually over a period of between three (3) to four
(4) years or based on performance. The exercise price of options shall be determined in accordance with Caesarstone’s equity award
policies, the main terms of which shall be disclosed in the annual report of Caesarstone.
13.7.
All other terms of the equity awards shall be in accordance with Caesarstone’s incentive plans and
other related practices and policies. Accordingly, the Board may, following approval by the Compensation Committee, extend the period
of time for which an award is to remain exercisable and make provisions with respect to the acceleration of the vesting period of any
Executive Officer’s awards, including, without limitation, in connection with a change of control, subject to any additional approval
if such may be required by the Companies Law.
13.8.
The fair value of the equity-based compensation for the Executive Officers will be determined according
to acceptable valuation practices at the time of grant.
E.
Retirement and Termination of Service
Arrangements
14.
Advanced Notice Period and Adjustment Period
14.1.
Caesarstone may provide a VP a prior notice of termination and/or an adjustment period accumulated to
up to nine (9) months, during which the VP may be entitled to all of the compensation elements, and to the continuation of vesting of
his options.
14.2.
Caesarstone may provide the CEO with a prior notice of termination and/or an adjustment period accumulated
to up to twelve (12) months, during which the CEO may be entitled to all of the compensation elements, and to the continuation of vesting
of his options.
14.3.
The Executive Officer shall be required not to compete with the Company during the advanced notice period
and the adjustment period.
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15.
Additional Retirement and Termination Benefits
15.1
Arrangements related to termination of service or employment may be determined based on the circumstances
of such termination (whether upon retirement, resignation, termination by the Company or otherwise), the term of service or employment
of the VP or CEO, his/her compensation package during such period, market practice in the relevant geographic location, Caesarstone’s
performance during such period and the VP’s or CEO’s contribution to Caesarstone achieving its goals and maximizing its profits
and other considerations that may be found relevant by Caesarstone. For example, the Compensation Committee and the Board may, at their
discretion, determine not to provide some or any post-service or employment benefits, compensation or protection, in the event of termination
for “cause,” which will be as defined in the applicable arrangement or plan document.
15.2
Caesarstone shall provide additional retirement and terminations benefits and payments as may be required
by applicable law (e.g., mandatory severance pay under Israeli labor laws), and may provide additional retirement and terminations benefits
and payments which will be comparable to customary market practices, provided that such additional retirement and termination benefits
together with the termination benefits provided under Section 14.1 and 14.2 shall not exceed 24 monthly base salaries of the Executive
Officer.
F.
Exculpation, Indemnification and Insurance
16.
Exculpation
Caesarstone may exempt
its
directors and Executive Officers
in advance for all or any of their liability for damage in consequence of a breach of the duty
of care vis-a-vis Caesarstone, to the fullest extent permitted by applicable law
.
17.
Insurance and Indemnification
17.1.
Caesarstone may indemnify its directors and Executive
Officers to the fullest extent permitted by applicable law, for any liability and expense that may be imposed on the director or Executive
Officer,
either retroactively or in advance
as provided in the indemnity
agreement between such individuals and Caesarstone, all subject to applicable law and the Company’s articles of association.
17.2.
Caesarstone will provide “Directors’ and Officers’ Liability Insurance” (the
“
Insurance
Policy
”
)
for its directors and Executive Officers, as follows:
17.2.1.
The limit of liability of the insurer shall not exceed US$150 million per claim and in the aggregate for
an annual policy and an additional limit of liability, exceeding the limit of liability in the policy, for defense costs in compliance
with Section 66 of the Israeli Insurance Contract Law – 1981 (the “
Insurance Law
”);
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17.2.2.
The Insurance Policy, as well as the limit of liability and the premium for each extension or renewal,
shall be approved by the Compensation Committee which shall determine whether (i) the sums are reasonable considering
Caesarstone
’s
exposures, the scope of coverage and market conditions and (ii) the Insurance Policy reflects then prevailing market conditions, and,
provided, further, that the Insurance Policy shall not materially affect the Company’s profitability, assets or liabilities; and
17.2.3.
The insurance terms and conditions will be the subject of negotiations between the Company and the insurer
(and if necessary alternative quotations will be considered).  The insurance coverage is and will be extended to indemnify the
Company for losses it may incur that derive from a claim against it concerning a wrongful act of the Company alleging a breach of the
securities laws. The policy may include priorities for payment of any insurance benefits pursuant to which the rights of the directors
and Officers to receive indemnity from the insurer takes precedence over the right of the Company itself.
17.3.
The Company shall be entitled, subject to the approval of the Compensation Committee, to the following:
17.3.1.
To purchase an insurance coverage for wrongful acts occurring before the effective date of the change
in risk (the "
Run Off Coverage
") of up to seven (7) years, from the same insurer or any other insurer, in Israel or overseas;
17.3.2.
The limit of liability of the insurer shall not exceed US$150 million per claim and in the aggregate for
the term of the policy and an additional limit of liability exceeding the limit of liability in the policy for defense costs in compliance
with Section 66 of the Insurance Law;
17.3.3.
The Run Off Coverage, as well as the limit of liability and the premium for each extension or renewal,
shall be approved by the Compensation Committee which shall determine whether (i) the sums are reasonable considering
Caesarstone
’s
exposures, the scope of coverage and market conditions and (ii) the Run Off Coverage reflects then prevailing market conditions, and,
provided, further, that the Run Off Coverage shall not materially affect the Company’s profitability, assets or liabilities.
17.4.
Caesarstone may extend an existing Insurance Policy to include coverage for liability pursuant to a future
public offering of securities, provided, however, that Such extension and consequent additional premium shall be approved by the Compensation
Committee which shall determine whether (i) the sums are reasonable considering Caesarstone’s exposures, the scope of coverage and
market conditions and (ii) said extension reflects then prevailing market conditions, and, provided, further, that the extension shall
not materially affect the Company’s profitability, assets or liabilities.
17.5.
Any other insurance coverage purchased by Caesarstone may be extended to include directors and Officers
as additionally insured beneficiaries, in so far as such extension will not result in an additional premium.
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G.
Arrangements upon Change of Control
18.
The
following benefits may be granted to the Executive Officers
in addition to the benefits applicable in the case of any retirement or termination of service or adverse adjustment of the service in
a material way which were upon or in connection with a “Change of Control”:
18.1.
Vesting
acceleration
of
outstanding options or other equity-based awards.
18.2.
Extension of the exercising period of options
for Caesarstone’s VPs and CEO for a
period
of up to one (1) year
and two (2) years, respectively, following the date of employment termination.
18.3.
Up
to
an
additional six (6) months of continued base salary, benefits and perquisites following the date of employment termination (the “
Additional
Adjustment Period
”). For avoidance of doubt, such additional Adjustment Period shall be in addition to the advance notice and
adjustment periods pursuant to Section ‎14 of this Compensation Policy, and in any case shall not exceed 24 monthly base salaries
as set forth in Section 15.2.
18.4.
In the case of the CEO, a cash bonus equal to up to twelve (12) monthly base salaries.
H.
Board of Directors Compensation
19.
Cash Compensation
All
Caesarstone’s Board members, excluding the chairman of the Board, the external directors and independent directors, shall be entitled
to a compensation as shall be determined from time to time and approved by
the Compensation Committee, the Board and the Company’s
shareholders
, based on the director’s relevant skills and experience,
up to, on an annual basis, (i) for a director who is an Israeli resident, the total compensation payable annually to the Company’s
external and independent directors, including annual fees and participation compensation; and (ii) for a director who is a non-Israeli
resident, 400% of the annual fees and 400% the participation compensation payable to the Company’s external and independent directors.
19.2.
The compensation of the Company’s external directors and independent directors shall be in accordance
with the Companies Regulations (Rules Regarding the Compensation and Expenses of an External Director), 5760-2000, as amended by the Companies
Regulations (Reliefs for Public Companies Traded in Stock Exchange Outside of Israel), 5760-2000, as such regulations may be amended from
time to time (“
Compensation of Directors Regulations
”).
19.3.
The chairperson of the Board shall be entitled
to an annual
base compensation that shall not exceed five (5) times the total annual compensation of an external director (
assuming
a total of nine (9) Board and committee meetings per year
). In addition, the chairperson of the Board may be granted an annual
bonus based on measurable parameters to be defined by the Compensation Committee and the Board, and approved by the Company’s shareholders
,
which shall amount to up to 50% of the chairperson’s annual base compensation.
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20.
Equity Based Compensation
20.1.
Directors may also be awarded equity-based compensation,
as shall be determined from time to time and approved by
the Compensation Committee, the Board and the Company’s shareholders
.
20.2.
The fair value of the equity-based compensation
per vesting year (on a linear basis) determined in accordance with acceptable valuation practices at the time of grant, of each director
shall not exceed the value of such director’s
total annual compensation (
assuming
a total of nine (9) Board and committee meetings per year
).
..
20.3.
The Compensation Committee and the Board may approve the grant of equity awards with a cap for the benefit
deriving from the exercise of equity-based compensation.
20.4.
All equity-based awards granted to directors shall be subject to vesting periods. Unless determined otherwise
in a specific award agreement, grants to directors shall vest gradually over a period of between three (3) to four (4) years.
20.5.
All other terms of the equity awards shall be in accordance with Caesarstone’s incentive plans and
other related practices and policies. Accordingly, the Board may, following approval by the Compensation Committee, extend the period
of time for which an award is to remain exercisable and make provisions with respect to the acceleration of the vesting period of any
director’s awards, including, without limitation, in connection with a change of control, subject to any additional approval if
such may be required by the Companies Law.
20.6.
The fair value of the equity-based compensation for directors will be determined according to acceptable
valuation practices at the time of grant.
21.
Expense Reimbursement
21.1.
Members of Caesarstone’s Board shall be entitled to reimbursement of expenses incurred in the performance
of their duties and other services to the Company.
I.
Miscellaneous
22.
Nothing in this Policy shall be deemed to grant any of Caesarstone’s Executive Officers, directors
or employees or any third party any right or privilege in connection with their engagement with the Company. Such rights and privileges
shall be governed by the respective personal employment or engagement agreements. The Board may determine that none or only part of the
payments and benefits shall be granted, and is authorized to cancel or suspend a compensation package or part thereof, subject to any
applicable law.
23.
An Immaterial Change in the terms of employment of a VP may be approved by the CEO, provided that the
amended terms of employment are in accordance with this Compensation Policy, and subject to the following mechanism: following the CEO's
approval of an Immaterial Change, any further change to the terms of employment of that certain VP (whether Immaterial Change or not)
shall be subject to the approval of the Compensation Committee and the Board, and, after their approvals, the next Immaterial Change in
the terms of employment of such VP may be once again approved by the CEO.
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An “Immaterial Change”
means change (or changes, on an accumulated basis) in the terms of employment of a VP, other than equity awards, that amounts to up to
5% of the VP's annual gross base salary.
24.
In the
event
that new regulations or law
amendment in connection with Executive Officers’ and directors’ compensation will be enacted following the adoption of this
Compensation Policy, Caesarstone may follow such new regulations or law
amendments
,
even if such new regulations and law amendments are in contradiction to the compensation terms set forth herein.
*********************
This Policy is designed solely for the benefit
of Caesarstone and none of the provisions thereof are intended to provide any rights or remedies to any person or entity other than Caesarstone.
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Caesarstone Ltd.
2020 Share Incentive Plan
- Amended
Unless otherwise defined, terms used herein shall have the meaning
ascribed to them in Section 2 hereof.
1.
PURPOSE; TYPES OF AWARDS; CONSTRUCTION
.
1.1.
Purpose
.
The purpose of this 2020 Share Incentive Plan (as amended, this “
Plan
”) is to afford an incentive to Service Providers
of Caesarstone Ltd., an Israeli company (together with any successor corporation thereto, the “
Company
”), or any Affiliate
of the Company, which now exists or hereafter is organized or acquired by the Company or its Affiliates, to continue as Service Providers,
to increase their efforts on behalf of the Company or its Affiliates and to promote the success of the Company’s business, by providing
such Service Providers with opportunities to acquire a proprietary interest in the Company by the issuance of Shares or restricted Shares
(“
Restricted Shares
”) of the Company, and by the grant of options to purchase Shares (“
Options
”),
Restricted Share Units (“
RSUs
”) and other Share-based Awards pursuant to Sections ‎11 through ‎13 of this Plan.
1.2.
Types
of Awards
. This Plan is intended to enable the Company to issue Awards under various tax regimes, including:
(i)       pursuant
and subject to the provisions of Section 102 of the Ordinance (or the corresponding provision of any subsequently enacted statute, as
amended from time to time), and all regulations and interpretations adopted by any competent authority, including the Israel Tax Authority
(the “
ITA
”), including the Income Tax Rules (Tax Benefits in Stock Issuance to Employees) 5763-2003 or such other rules
so adopted from time to time (the “
Rules
”) (such Awards that are intended to be (as set forth in the Award Agreement)
and which qualify as such under Section 102 of the Ordinance and the Rules, “
102 Awards
”);
(ii)       pursuant
to Section 3(i) of the Ordinance or the corresponding provision of any subsequently enacted statute, as amended from time to time (such
Awards, “
3(i) Awards
”);
(iii)       Incentive
Stock Options within the meaning of Section 422 of the Code, or the corresponding provision of any subsequently enacted United States
federal tax statute, as amended from time to time, to be granted to Employees who are deemed to be residents of the United States, for
purposes of taxation, or are otherwise subject to U.S. Federal income tax (such Awards that are intended to be (as set forth in the Award
Agreement) and which qualify as an incentive stock option within the meaning of Section 422(b) of the Code, “
Incentive Stock
Options
”); and
(iv)       Options
not intended to be (as set forth in the Award Agreement) or which do not qualify as an Incentive Stock Option to be granted to Service
Providers who are deemed to be residents of the United States for purposes of taxation, or are otherwise subject to U.S. Federal income
tax (“
Nonqualified Stock Options
”).
In addition to the issuance of Awards under the relevant tax regimes
in the United States of America and the State of Israel, and without derogating from the generality of Section ‎25, this Plan contemplates
issuances to Grantees in other jurisdictions or under other tax regimes with respect to which the Committee is empowered, but is not required,
to make the requisite adjustments in this Plan and set forth the relevant conditions in an appendix to this Plan or in the Company’s
agreement with the Grantee in order to comply with the requirements of such other tax regimes.
1.3.
Company
Status
. This Plan contemplates the issuance of Awards by the Company, both as a public and private company.
1.4.
Construction
.
To the extent any provision herein conflicts with the conditions of any relevant tax law, rule or regulation which are relied upon for
tax relief in respect of a particular Award to a Grantee, the Committee is empowered, but is not required, hereunder to determine that
the provisions of such law, rule or regulation shall prevail over those of this Plan and to interpret and enforce such prevailing provisions.
With respect to 102 Awards, if and to the extent any action or the exercise or application of any provision hereof or authority granted
hereby is conditioned or subject to obtaining a ruling or tax determination from the ITA, to the extent required by applicable law, then
the taking of any such action or the exercise or application of such section or authority with respect to 102 Awards shall be conditioned
upon obtaining such ruling or tax determination, and, if obtained, shall be subject to any condition set forth therein; it being clarified
that there is no obligation to apply for any such ruling or tax determination (which shall be in the sole discretion of the Committee)
and no assurance is made that if applied any such ruling or tax determination will be obtained (or the conditions thereof).
2.
DEFINITIONS
.
2.1.
Terms
Generally
. Except when otherwise indicated by the context, (i) the singular shall include the plural and the plural shall include
the singular; (ii) any pronoun shall include the corresponding masculine, feminine and neuter forms; (iii) any definition of or reference
to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document
as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements,
supplements or modifications set forth therein or herein), (iv) references to any law, constitution, statute, treaty, regulation,
rule or ordinance, including any section or other part thereof shall refer to it as amended from time to time and shall include any successor
thereof, (v) reference to a “company” or “entity” shall include a, partnership, corporation, limited liability
company, association, trust, unincorporated organization, or a government or agency or political subdivision thereof, and reference to
a “person” shall mean any of the foregoing or an individual, (vi) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this Plan in its entirety, and not to any particular
provision hereof, (vii) all references herein to Sections shall be construed to refer to Sections to this Plan; (viii) the words
“include”, “includes” and “including” shall be deemed to be followed by the phrase “without
limitation”; and (ix) use of the term “or” is not intended to be exclusive.
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2.2.
Defined
Terms
. The following terms shall have the meanings ascribed to them in this Section 2:
2.3.       “
Affiliate
”
shall mean, with respect to any person, any other person that, directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such person (with the term “control” or “controlled by” within
the meaning of Rule 405 of Regulation C under the Securities Act), including, without limitation, any Parent or Subsidiary, or Employer.
2.4.
“
Applicable Law
” shall mean any applicable law, rule, regulation, statute, pronouncement, policy, interpretation, judgment,
order or decree of any federal, provincial, state or local governmental, regulatory or adjudicative authority or agency, of any jurisdiction,
and the rules and regulations of any stock exchange, over-the-counter market or trading system on which the Company’s shares are
then traded or listed.
2.5.       “
Award
”
shall mean any Option, Restricted Share, RSUs, Shares or any other Share-based award granted under this Plan.
2.6.       “
Board
”
shall mean the Board of Directors of the Company.
2.7.
“
Change in Board Event
” shall mean any time at which individuals who, as of the Effective Date, constitute the Board
(the “
Incumbent Board
”) cease for any reason to constitute at least a majority of the Board;
provided
,
however
,
that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption
of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board.
2.8.       “
Code
”
shall mean the United States Internal Revenue Code of 1986, and any applicable regulations promulgated thereunder, all as amended.
2.9.       “
Committee
”
shall mean the compensation committee of the Board or any other committee established or appointed by the Board to administer this Plan,
subject to Section ‎3.1.
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2.10.       “
Companies
Law
” shall mean the Israel Companies Law, 5759-1999, and the regulations promulgated thereunder, all as amended from time to
time.
2.11.       “
Controlling
Shareholder
” shall have the meaning set forth in Section 32(9) of the Ordinance.
2.12.       “
Consultant
”
means a consultant, advisor or other independent contractor who is a natural person and performs services for the Company or an Affiliate
in a capacity other than as an Employee or member of the Board and that qualifies as a consultant under the applicable rules of the Securities
Exchange Commission for registration of Shares on a Form S-8 Registration Statement.
2.13.       “
Disability
”
shall mean unless otherwise defined in a policy of the Company that the Committee deems applicable to this Plan, or that makes reference
to this Plan, “Disability” shall mean the inability of the Grantee to engage in any substantial gainful activity or to perform
the major duties of the Grantee’s position with the Company or its Affiliates by reason of any medically determinable physical or
mental impairment which has lasted or can be expected to last for a continuous period of not less than 12 months (or such other period
as determined by the Committee), as determined by a qualified doctor acceptable to the Company. Notwithstanding the foregoing, (a) for
purposes of Incentive Stock Options granted under the Plan, “Disability” means that the Grantee is disabled within the meaning
of Section 22(e)(3) of the Code, and (b) with respect to an Award that is subject to Section 409A of the Code where the payment or settlement
of the Award will be made as a result of the Grantee’s Disability, solely for purposes of determining the timing of payment, no
such event will constitute a Disability for purposes of this Plan or any Award Agreement unless such event also constitutes a “disability”
as defined under Section 409A of the Code.
2.14.
“
Employee
” shall mean any person treated as an employee (including an officer or a director who is also treated as
an employee) in the records of the Company or any of its Affiliates (and in the case of 102 Awards, subject to Section ‎9.3 or in
the case of Incentive Stock Options, who is an employee for purposes of Section 422 of the Code); provided, however, that neither service
as a director nor payment of a director’s fee shall be sufficient to constitute employment for purposes of this Plan. The Company
shall determine in good faith and in the exercise of its discretion whether an individual has become or has ceased to be an Employee and
the effective date of such individual’s employment or termination of employment, as the case may be. For purposes of a person’s
rights, if any, under this Plan as of the time of the Company’s determination, all such determinations by the Company shall be final,
binding and conclusive, notwithstanding that the Company or any court of law or governmental agency subsequently makes a contrary determination.
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2.15.       “Employer”
means, for purpose of a 102 Trustee Award, the Company or an Affiliate, Subsidiary or Parent thereof, which is an “employing company”
within the meaning and subject to the conditions of Section 102(a) of the Ordinance.
2.16.       “
employment
”,
“
employed
” and words of similar import shall be deemed to refer to the employment of Employees or to the services of
any other Service Provider, as the case may be.
2.17.       “
exercise
”
“
exercised
” and words of similar import, when referring to an Award that does not require exercise or that is settled
upon vesting (such as may be the case with RSUs or Restricted Shares, if so determined in their terms), shall be deemed to refer to the
vesting of such an Award (regardless of whether or not the wording included reference to vesting of such an Awards explicitly).
2.18.       “
Exercise
Period
” shall mean the period, commencing on the date of grant of an Award, during which an Award shall be exercisable, subject
to any vesting provisions thereof (including any acceleration thereof, if any) and subject to the termination provisions hereof.
2.19.       “
Exercise
Price
” shall mean the exercise price for each Share covered by an Option or the purchase price for each Share covered by any
other Award.
2.20.       “
Fair
Market Value
” shall mean, as of any date, the value of a Share or other securities, property or rights as determined by the
Board, in its discretion, subject to the following: (i) if, on such date, the Shares are listed on any securities exchange, the average
closing sales price per Share on which the Shares are principally traded over the thirty (30) day calendar period preceding the subject
date (utilizing all trading days during such 30 calendar day period), as reported in The Wall Street Journal or such other source as the
Company deems reliable; (ii) if, on such date, the Shares are then quoted in an over-the-counter market, the average of the closing bid
and asked prices for the Shares in that market during the thirty (30) day calendar period preceding the subject date (utilizing all trading
days during such 30 calendar day period), as reported in The Wall Street Journal or such other source as the Company deems reliable; or
(iii) if, on such date, the Shares are not then listed on a securities exchange or quoted in an over-the-counter market, or in case of
any other securities, property or rights, such value as the Committee, in its sole discretion, shall determine, with full authority to
determine the method for making such determination and which determination shall be conclusive and binding on all parties, and shall be
made after such consultations with outside legal, accounting and other experts as the Committee may deem advisable; provided, however,
that, if applicable, the Fair Market Value of the Shares shall be determined in a manner that is intended to satisfy the applicable requirements
of and subject to Section 409A of the Code, and with respect to Incentive Stock Options, in a manner that is intended to satisfy the applicable
requirements of and subject to Section 422 of the Code, subject to Section 422(c)(7) of the Code. The Committee shall maintain a written
record of its method of determining such value. If the Shares are listed or quoted on more than one established stock exchange or over-the-counter
market, the Committee shall determine the principal such exchange or market and utilize the price of the Shares on that exchange or market
(determined as per the method described in clauses (i) or (ii) above, as applicable) for the purpose of determining Fair Market Value.
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2.21.       “
Grantee
”
shall mean an eligible Employee, Non-Employee Director or Consultant who has been granted an Award(s) under this Plan.
2.22.       “
Merger/Sale
”
shall mean (i) a sale of all or substantially all of the assets of the Company, or a sale (including an exchange) of all or substantially
all of the shares of the Company, to any person, or a purchase by a shareholder of the Company or by an Affiliate of such shareholder,
of all the shares of the Company held by all or substantially all other shareholders or by other shareholders who are not Affiliated with
such acquiring party; (ii) a merger (including, a reverse merger and a reverse triangular merger), consolidation, amalgamation or like
transaction of the Company with or into another corporation; (iii) a scheme of arrangement for the purpose of effecting such sale, merger,
consolidation, amalgamation or other transaction; (iv) approval by the shareholders of the Company of a complete liquidation or dissolution
of the Company, (v) Change in Board Event, (vi) a change in Company’s controlling shareholders (for this purpose the term ‘controlling
shareholder’ shall have the meaning ascribed to that term under Section 268 of the Companies Law); (vii) going private or (viii)
such other transaction or set of circumstances that is determined by the Board, in its discretion, to be a transaction subject to the
provisions of Section ‎14.2 excluding any of the foregoing transactions in clauses (i) through (vii) if the Board determines that
such transaction should be excluded from the definition hereof and the applicability of Section ‎14.2. Notwithstanding the foregoing,
if a Merger/Sale constitutes a payment event with respect to any Award (or any portion of an Award) that provides for the deferral of
compensation that is subject to Section 409A of the Code, to the extent required to avoid the imposition of additional taxes under Section
409A of the Code, the transaction or event described in subsection (i) (vi) with respect to such Award (or portion thereof) shall only
constitute a Merger/Sale for purposes of the payment timing of such Award if such transaction also constitutes a “change in control
event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).
2.23.
“
Non-Employee Director
” means any individual who is a member of the Board who is not an Employee.
2.24.       “
Ordinance
”
shall mean the Israeli Income Tax Ordinance (New Version) 1961, and the regulations and rules (including the Rules) promulgated thereunder,
all as amended from time to time.
2.25.       “
Parent
”
shall mean any company (other than the Company), which now exists or is hereafter organized, (i) in an unbroken chain of companies ending
with the Company if, at the time of granting an Award, each of the companies (other than the Company) owns stock possessing fifty percent
(50%) or more of the total combined voting power of all classes of stock in one of the other companies in such chain, or (ii) if applicable
and for purposes of Incentive Stock Options, that is a “parent corporation” of the Company, as defined in Section 424(e) of
the Code.
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2.26.       “
Retirement
”
shall mean the Grantee’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 Grantee participates or is subject to.
2.27.       “
Securities
Act
” shall mean the U.S. Securities Act of 1933, and the rules and regulations promulgated thereunder, all as amended from time
to time.
2.28.       “
Service
Provider
” shall mean an Employee, director, officer, consultant, advisor and any other person or entity who provides services
to the Company or any Parent, Subsidiary or Affiliate thereof. Service Providers shall include prospective Service Providers to whom Awards
are granted in connection with written offers of an employment or other service relationship with the Company or any Parent, Subsidiary
or any Affiliates thereof, provided, however, that such employment or service shall have actually commenced.
2.29.
“
Shares
” shall mean Ordinary Shares, NIS 0.04 par value of the Company (as adjusted for stock split, reverse stock
split, bonus shares, combination or other recapitalization events), or shares of such other class of shares of the Company as shall be
designated by the Board in respect of the relevant Award(s). “Shares” include any securities, property or rights issued or
distributed with respect thereto.
2.30.       “
Subsidiary
”
shall mean any company (other than the Company), which now exists or is hereafter organized or acquired by the Company, (i) in an unbroken
chain of companies beginning with the Company if, at the time of granting an Award, each of the companies other than the last company
in the unbroken chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in
one of the other companies in such chain, or (ii) if applicable and for purposes of Incentive Stock Options, that is a “subsidiary
corporation” of the Company, as defined in Section 424(f) of the Code.
2.31.       “
tax(es)
”
shall mean (a) all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments, including all income,
capital gains, alternative or add-on minimum, transfer, value added tax, real and personal property, withholding, payroll, employment,
escheat, social security, disability, national security, health tax, wealth surtax, stamp, registration and estimated taxes, customs duties,
fees, assessments and charges of any similar kind whatsoever (including under Section 280G of the Code) or other tax of any kind whatsoever,
(b) all interest, indexation differentials, penalties, fines, additions to tax or additional amounts imposed by any taxing authority in
connection with any item described in clause (a), (c) any transferee or successor liability in respect of any items described in clauses
(a) or (b) payable by reason of contract, assumption, transferee liability, successor liability, operation of Applicable Law, or as a
result of any express or implied obligation to assume Taxes or to indemnify any other person, and (d) any liability for the payment of
any amounts of the type described in clause (a) or (b) payable as a result of being a member of an affiliated, consolidated, combined,
unitary or aggregate or other group for any taxable period, including under U.S. Treasury Regulations Section 1.1502-6(a) (or any predecessor
or successor thereof of any analogous or similar provision under Law) or otherwise.
2.32.       “
Ten
Percent Shareholder
” shall mean a Grantee who, at the time an Award is granted to the Grantee, owns shares possessing more than
ten percent (10%) of the total combined voting power of all classes of shares of the Company or any Parent or Subsidiary, within the meaning
of Section 422(b)(6) of the Code.
2.33.       “
Trustee
”
shall mean the trustee appointed by the Committee to hold the Awards (and, in relation with 102 Trustee Awards, approved by the ITA),
if so appointed.
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2.34.
Other
Defined Terms
. The following terms shall have the meanings ascribed to them in the Sections set forth below:
Term
Section
102 Awards
‎1.2‎(i)
102 Capital Gains Track Awards
‎9.1
102 Non-Trustee Awards
‎9.2
102 Ordinary Income Track Awards
‎9.1
102 Trustee Awards
‎9.1
3(i) Awards
‎1.2‎(ii)
Award Agreement
‎6
Cause
‎6.6.4.4
Company
‎1.1
Disqualifying Disposition
8.11
Effective Date
‎24.1
Election
‎9.2
Eligible 102 Grantees
‎9.3.1
Incentive Stock Options
‎1.2(iii)
Information
‎16.4
ITA
‎‎‎1.2‎(i)
Market Stand-Off
‎17
Market Stand-Off Period
‎17
Nonqualified Stock Options
‎1.2‎(iv)
Plan
‎1.1
Pool
‎5.1
Prior Plan
‎5.2
Recapitalization
‎14.1
Required Holding Period
‎9.5
Restricted Period
‎11.2
Restricted Share Agreement
‎11
Restricted Share Unit Agreement
‎12
Restricted Shares
‎1.1
RSUs
‎1.1
Rules
‎‎1.2‎(i)
SAR
13.2
Securities
‎17.1
Successor Corporation
‎14.2.1
Withholding Obligations
‎18.5
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3.
ADMINISTRATION
.
3.1.       To
the extent permitted under Applicable Law, the Articles of Association and any other governing document of the Company, this Plan shall
be administered by the Committee. In the event that the Board does not appoint or establish a committee to administer this Plan, this
Plan shall be administered by the Board, and, accordingly, any and all references herein to the Committee shall be construed as references
to the Board. In the event that an action necessary for the administration of this Plan is required under Applicable Law to be taken by
the Board without the right of delegation, or if such action or power was explicitly reserved by the Board in appointing, establishing
and empowering the Committee, then such action shall be so taken by the Board. In any such event, all references herein to the Committee
shall be construed as references to the Board. Even if such a Committee was appointed or established, the Board may take any actions that
are stated to be vested in the Committee, and shall not be restricted or limited from exercising all rights, powers and authorities under
this Plan or Applicable Law.
3.2.       The
Board shall appoint the members of the Committee, may from time to time remove members from, or add members to, the Committee, and shall
fill vacancies in the Committee, however caused, provided that the composition of the Committee shall at all times be in compliance with
any mandatory requirements of Applicable Law, the Articles of Association and any other governing document of the Company. The Committee
may select one of its members as its Chairman and shall hold its meetings at such times and places as it shall determine. The Committee
may appoint a Secretary, who shall keep records of its meetings, and shall make such rules and regulations for the conduct of its business
as it shall deem advisable and subject to mandatory requirements of Applicable Law.
3.3.       Subject
to the terms and conditions of this Plan, any mandatory provisions of Applicable Law and any provisions of any Company policy required
under mandatory provisions of Applicable Law, and in addition to the Committee’s powers contained elsewhere in this Plan, the Committee
shall have full authority, in its discretion, from time to time and at any time, to determine any of the following, or to recommend to
the Board any of the following if it is not authorized to take such action according to Applicable Law:
(i)       eligible
Grantees,
(ii)       grants
of Awards and setting the terms and provisions of Award Agreements (which need not be identical) and any other agreements or instruments
under which Awards are made, including the number of Shares underlying each Award and the class of Shares underlying each Award (if more
than one class was designated by the Board),
(iii)       the
time or times at which Awards shall be granted,
(iv)       the
terms, conditions and restrictions applicable to each Award (which need not be identical) and any Shares acquired upon the exercise or
(if applicable) vesting thereof, including (1) designating Awards under Section ‎1.2; (2) the vesting schedule, the acceleration thereof
and terms and conditions upon which Awards may be exercised or become vested, (3) the Exercise Price, (4) the method of payment for Shares
purchased upon the exercise or (if applicable) vesting of the Awards, (5) the method for satisfaction of any tax withholding obligation
arising in connection with the Awards or such Shares, including by the withholding or delivery of Shares, (6) the time of the expiration
of the Awards, (7) the effect of the Grantee’s termination of employment with the Company or any of its Affiliates, and (8) all
other terms, conditions and restrictions applicable to the Award or the Shares not inconsistent with the terms of this Plan,
(v)       to
accelerate, continue, extend or defer the exercisability of any Award or the vesting thereof, including with respect to the period following
the Grantee’s termination of employment or other service,
(vi)       the
interpretation of this Plan and any Award Agreement and the meaning, interpretation and applicability of terms referred to in Applicable
Law,
(vii)       policies,
guidelines, rules and regulations relating to and for carrying out this Plan, and any amendment, supplement or rescission thereof, as
it may deem appropriate,
(viii)       to
adopt supplements to, or alternative versions of, this Plan, including, without limitation, as it deems necessary or desirable to comply
with the laws of, or to accommodate the tax regime or custom of, foreign jurisdictions whose citizens or residents may be granted Awards,
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(ix)       the
Fair Market Value of the Shares or other securities, property or rights,
(x)       the
tax track (capital gains, ordinary income track or any other track available under the Section 102 of the Ordinance) for the purpose of
102 Awards,
(xi)       the
authorization and approval of conversion, substitution, cancellation or suspension under and in accordance with this Plan of any or all
Awards or Shares,
(xii)       unless
otherwise provided under the terms of this Plan, the amendment, modification, waiver or supplement of the terms of any outstanding Award
(excluding reducing the Exercise Price of an Award),
provided
,
however
, that if such amendments increases the Exercise Price
of an Award or reduces the number of Shares underlying an Award, then such amendments shall require the consent of the applicable Grantee,
unless such amendment is made pursuant to the exercise of rights or authorities in accordance with Section ‎14,
(xiii)       to
correct any defect, supply any omission or reconcile any inconsistency in this Plan or any Award Agreement and all other determinations
and take such other actions with respect to this Plan or any Award as it may deem advisable to the extent not inconsistent with the provisions
of this Plan or Applicable Law, and
(xiv)       any
other matter which is necessary or desirable for, or incidental to, the administration of this Plan and any Award thereunder.
3.4.       The
authority granted hereunder includes the authority to modify Awards to eligible individuals who are foreign nationals or are individuals
who are employed outside Israel to recognize differences in local law, tax policy or custom, in order to effectuate the purposes of this
Plan but without amending this Plan.
3.5.       The
Board and the Committee shall be free at all times to make such determinations and take such actions as they deem fit. The Board and the
Committee need not take the same action or determination with respect to all Awards, with respect to certain types of Awards, with respect
to all Service Providers or any certain type of Service Providers and actions and determinations may differ as among the Grantees, and
as between the Grantees and any other holders of securities of the Company.
3.6.       All
decisions, determinations, and interpretations of the Committee, the Board and the Company under this Plan shall be final and binding
on all the Grantees (whether before or after the issuance of Shares pursuant to Awards), unless otherwise determined by the Committee,
the Board or the Company, respectively. The Committee shall have the authority (but not the obligation) to determine the interpretation
and applicability of Applicable Law to any Grantee or any Awards. No member of the Committee or the Board shall be liable to any Grantee
for any action taken or determination made in good faith with respect to this Plan or any Award granted hereunder.
3.7.       Any
officer or authorized signatory of the Company shall have the authority to act on behalf of the Company with respect to any matter, right,
obligation, determination or election which is the responsibility of or which is allocated to the Company herein, provided such person
has apparent authority with respect to such matter, right, obligation, determination or election. Such person or authorized signatory
shall not be liable to any Grantee for any action taken or determination made in good faith with respect to this Plan or any Award granted
hereunder.
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4.
ELIGIBILITY
.
Awards may be granted to Service Providers of the
Company or any Affiliate thereof, taking into account, at the Committee’s discretion and without an obligation to do so, the qualification
under each tax regime pursuant to which such Awards are granted, subject to the limitation on the granting of Incentive Stock Options
set forth in Section ‎8.1. A person who has been granted an Award hereunder may be granted additional Awards, if the Committee shall
so determine, subject to the limitations herein. However, eligibility in accordance with this Section ‎4 shall not entitle any person
to be granted an Award, or, having been granted an Award, to be granted an additional Award.
Awards may differ in number of Shares covered thereby,
the terms and conditions applying to them or on the Grantees or in any other respect (including, that there should not be any expectation
(and it is hereby disclaimed) that a certain treatment, interpretation or position granted to one shall be applied to the other, regardless
of whether or not the facts or circumstances are the same or similar).
5.
SHARES
.
5.1.       The
maximum aggregate number of Shares that may be issued pursuant to Awards under this Plan (the “
Pool
”) shall initially
be (i)
2,500,000
4,500,000
authorized but unissued Shares (except and as adjusted pursuant to Section ‎14.1
of this Plan) plus (ii) any Shares that remain available for issuance under the Company’s 2011 Incentive Compensation Plan, as amended
(the “
Prior Plan(s)
”) as of the Effective Date, which shall not exceed 1,000,000 Shares. However, except as adjusted
pursuant to Section ‎14.1, in no event shall more than
3,500,000
5,500,000
Shares, as adjusted in accordance
with Section ‎5.2, be available for issuance pursuant to the exercise of Incentive Stock Options.
5.2.       Any
Shares (a) underlying an Award granted hereunder or an award granted under the Prior Plan (in an amount not to exceed 1,000,000 Shares
under the Prior Plan) that has expired, or was cancelled, terminated, forfeited or settled in cash in lieu of issuance of Shares, for
any reason, without having been exercised; (b) if permitted by the Company, tendered to pay the Exercise Price of an Award (or the exercise
price or other purchase price of any option or other award under the Prior Plan), or withholding tax obligations with respect to an Award
(or any awards under the Prior Plan); or (c) if permitted by the Company, subject to an Award (or any award under the Prior Plan) that
are not delivered to the Grantee because such Shares are withheld to pay the Exercise Price of such Award (or of any award under the Prior
Plan), or withholding tax obligations with respect to such Award (or such other award); shall automatically, and without any further action
on the part of the Company or any Grantee, again be available for grant of Awards and Shares issued upon exercise of (if applicable) vesting
thereof for the purposes of this Plan (unless this Plan shall have been terminated) or unless the Board determines otherwise. Such Shares
may be, in whole or in part, authorized but unissued Shares, (and, subject to obtaining a ruling as it applies to 102 Awards) treasury
shares (dormant shares) or Shares otherwise that shall have been or may be repurchased by the Company (to the extent permitted pursuant
to the Companies Law).
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5.3.       Any
Shares under the Pool that are not subject to outstanding or exercised Awards at the termination of this Plan shall cease to be reserved
for the purpose of this Plan.
5.4.       From
and after the Effective Date, no further grants or awards shall be made under the Prior Plan; however, Awards made under the Prior Plan
before the Effective Date shall continue in effect in accordance with their terms.
6.
TERMS AND CONDITIONS OF AWARDS
.
Each Award granted pursuant to this Plan shall be evidenced by a written
or electronic agreement between the Company and the Grantee or a written or electronic notice delivered by the Company (the “
Award
Agreement
”), in substantially such form or forms and containing such terms and conditions, as the Committee shall from time
to time approve. The Award Agreement shall comply with and be subject to the following general terms and conditions and the provisions
of this Plan (except for any provisions applying to Awards under different tax regimes), unless otherwise specifically provided in such
Award Agreement, or the terms referred to in other Sections of this Plan applying to Awards under such applicable tax regimes, or terms
prescribed by Applicable Law. Award Agreements need not be in the same form and may differ in the terms and conditions included therein.
6.1.
Number
of Shares
. Each Award Agreement shall state the number of Shares covered by the Award.
6.2.
Type
of Award
. Each Award Agreement may state the type of Award granted thereunder, provided that the tax treatment of any Award, whether
or not stated in the Award Agreement, shall be as determined in accordance with Applicable Law.
6.3.
Exercise
Price
. Each Award Agreement shall state the Exercise Price, if applicable. Unless otherwise set forth in this Plan, an Exercise Price
of an Award of less than the par value of the Shares (if shares bear a par value) shall comply with Section 304 of the Companies Law.
Subject to Sections 3 ‎7.2 and ‎8.2 and to the foregoing, the Committee may reduce the Exercise Price of any outstanding Award,
on terms and subject to such conditions as it deems advisable. The Exercise Price shall also be subject to adjustment as provided in Section
‎14 hereof. The Exercise Price of any outstanding Award granted to a Grantee who is subject to U.S. federal income tax shall be determined
in accordance with Section 409A of the Code.
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6.4.
Manner
of Exercise
.
6.4.1.       An
Award that is exercisable may be exercised, as to any or all Shares as to which the Award has become exercisable, by written notice delivered
in person or by mail (or such other methods of delivery prescribed by the Company) to the Chief Financial Officer of the Company or to
such other person as determined by the Committee, or in any other manner as the Committee shall prescribe from time to time, specifying
the number of Shares with respect to which the Award is being exercised (which may be equal to or lower than the aggregate number of Shares
that have become exercisable at such time, subject to the last sentence of this Section), accompanied by payment of the aggregate Exercise
Price for such Shares in the manner specified in the following sentence. The Exercise Price shall be paid in full with respect to each
Share, at the time of exercise, either in (i) cash, (ii) if the Company’s shares are listed for trading on any securities exchange
or over-the-counter market, and if the Committee so determines, all or part of the Exercise Price and any withholding taxes may be paid
by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell
Shares and to deliver all or part of the sales proceeds to the Company or the Trustee, (iii) if the Company’s shares are listed
for trading on any securities exchange or over-the-counter market, and if the Committee so determines, payment may be made by means of
a broker-assisted “cashless exercise” pursuant to which a Grantee may elect to deliver a properly executed exercise notice
to the Company, together with a copy of irrevocable instructions to a broker to deliver promptly to the Company the amount of Share sale
or loan proceeds necessary to pay the Exercise Price, and, if requested, the amount of any federal, state, local or non-United States
withholding taxes, (iv) in such other manner as the Committee shall determine, or (v) Cashless Exercise Mechanism as described in Section
‎6.4.2 below. The application of cashless exercise with respect to any 102 Awards shall be subject to obtaining a ruling from the
ITA, to the extent required by applicable law.
6.4.2.       Unless
otherwise determined by the Committee, all Options shall be exercised using a cashless exercise mechanism and the number of the Shares
to be issued by the Company shall be calculated pursuant to the following formula (the “
Cashless Exercise Mechanism
”):
X =
Y * (A - B)
A
Where:  X = the number
of Shares to be issued to the Grantee.
Y = the number of Shares, as adjusted
to the date of such calculation, underlying the number of Options being exercised.
A= the Fair Market Value of one
Share at the exercise date.
B = the exercise price of each Option.
Upon completion of the calculation, if
X is a negative number, then X shall be deemed to be 0 (zero).
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6.5.
Term
and Vesting of Awards
.
6.5.1.       Each
Award Agreement shall provide the vesting schedule for the Award as determined by the Committee. The Committee shall have the authority
to determine the vesting schedule and accelerate the vesting of any outstanding Award at such time and under such circumstances as it,
in its sole discretion, deems appropriate. Unless otherwise resolved by the Committee and stated in the Award Agreement, and subject to
Sections ‎6.6 and ‎6.7 hereof, Awards shall vest and become exercisable under the following schedule: twenty-five percent (25%)
of the Shares covered by the Award, on the first anniversary of the vesting commencement date determined by the Committee (and in the
absence of such determination, of date on which such Award was granted), and six and one-quarter percent (6.25%) of the Shares covered
by the Award at the end of each subsequent three-month period thereafter over the course of the following three (3) years; provided that
the Grantee remains continuously as a Service Provider of the Company or its Affiliates throughout such vesting dates.
6.5.2.       The
Award Agreement may contain performance goals and measurements (which, in case of 102 Trustee Awards, may, if then required, be subject
to obtaining a specific tax ruling or determination from the ITA), and the provisions with respect to any Award need not be the same as
the provisions with respect to any other Award. Such performance goals may include, but are not limited to, sales, earnings before interest
and taxes, return on investment, earnings per share, any combination of the foregoing or rate of growth of any of the foregoing, as determined
by the Committee. The Committee may adjust performance goals pursuant to Awards previously granted to take into account changes in law
and accounting and tax rules and to make such adjustments as the Committee deems necessary or appropriate to reflect the inclusion or
the exclusion of the impact of extraordinary or unusual items, events or circumstances.
6.5.3.       The
Exercise Period of an Award will be seven (7) years from the date of grant of the Award, unless otherwise determined by the Committee
and stated in the Award Agreement, but subject to the vesting provisions described above and the early termination provisions set forth
in Sections ‎6.6 and ‎6.7 hereof. At the expiration of the Exercise Period, any exercisable Award, or any part thereof, that has
not been exercised within the term of the Award and the Shares covered thereby not paid for in accordance with this Plan and the Award
Agreement shall terminate and become null and void, and all interests and rights of the Grantee in and to the same shall expire.
6.6.
Termination
.
6.6.1.       Unless
otherwise determined by the Committee, and subject to Section ‎6.7 hereof, an Award may not be exercised unless the Grantee is then
a Service Provider of the Company or an Affiliate thereof or, in the case of an Incentive Stock Option, an employee of a company or a
Parent or Subsidiary company of such company issuing or assuming the Option in a transaction to which Section 424(a) of the Code applies,
and unless the Grantee has remained continuously so employed since the date of grant of the Award and throughout the vesting dates and
exercise date, as applicable.
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6.6.2.       In
the event that the employment or service of a Grantee shall terminate (other than by reason of death, Disability or Retirement), all Awards
of such Grantee that are unvested at the time of such termination shall terminate on the date of such termination, and all Awards of such
Grantee that are vested and exercisable at the time of such termination may be exercised within up to one-hundred twenty (120) days after
the date of such termination (or such different period as the Committee shall prescribe), but in any event no later than the date of expiration
of the Award’s term as set forth in the Award Agreement or pursuant to this Plan; provided, however, that if the Company (or the
Subsidiary or Affiliate, when applicable) shall terminate the Grantee’s employment or service for Cause (as defined below) (whether
occurring prior to or after termination of employment or service), all Awards theretofore granted to such Grantee (whether vested or not)
shall terminate, unless otherwise determined by the Committee.
6.6.3.       Notwithstanding
anything to the contrary, the Committee, in its absolute discretion, may, on such terms and conditions as it may determine appropriate,
extend the periods for which Awards held by any Grantee may continue to vest and be exercisable; it being clarified that such Awards may
lose their entitlement to certain tax benefits under Applicable Law (including, without limitation, qualification of an Award as an Incentive
Stock Option) as a result of the modification of such Awards and/or in the event that the Award is exercised beyond the later of: (i)
one-hundred and twenty (120) days after the date of termination of the employment or service relationship; or (ii) the applicable period
under Section ‎6.7 below with respect to a termination of the employment or service relationship because of the death, Disability
or Retirement of the Grantee.
6.6.4.       For
purposes of this Plan:
6.6.4.1.       A
termination of employment or service of a Grantee shall not be deemed to occur (except to the extent required by the Code with respect
to the Incentive Stock Option status of an Option) in case of (i) a transition or transfer of a Grantee among the Company and its Affiliates,
or (ii) a change in the capacity in which the Grantee is employed or renders service to the Company or any of its Affiliates or a change
in the identity of the employing or engagement entity among the Company and its Affiliates, provided, in case of the foregoing clauses
(i) and (ii) above, that the Grantee has remained continuously employed by and/or in the service of the Company and its Affiliates since
the date of grant of the Award and throughout the vesting period.
6.6.4.2.       An
entity or an Affiliate thereof assuming an Award or issuing in substitution thereof in a transaction to which Section 424(a) of the Code
applies or in a Merger/Sale in accordance with Section ‎14 shall be deemed as an Affiliate of the Company for purposes of this Section
‎6.6, unless the Committee determines otherwise.
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6.6.4.3.       In
the case of a Grantee whose principal employer or service recipient is a Subsidiary or Affiliate, the Grantee’s employment shall
also be deemed terminated for purposes of this Section 6.6 as of the date on which such principal employer or service recipient ceases
to be a Subsidiary or Affiliate.
6.6.4.4.       The
term “
Cause
” shall mean (provided no other definition included in any other agreement or instrument applicable to the
Grantee in which case such definition shall govern, and unless otherwise determined by the Committee) any of the following: (i) any theft,
fraud, embezzlement, dishonesty, willful misconduct, breach of fiduciary duty for personal profit, falsification of any documents or records
of the Company or any of its Affiliates, felony or similar act by the Grantee (whether or not related to the Grantee’s relationship
with the Company); (ii) an act of moral turpitude by the Grantee, or any act that causes significant injury to, or is otherwise adversely
affecting, the reputation, business, assets, operations or business relationship of the Company (or a Subsidiary or Affiliate, when applicable);
(iii) any breach by the Grantee of any material agreement with or of any material duty of the Grantee to the Company or any Subsidiary
or Affiliate thereof (including breach of confidentiality, non-disclosure, non-use, non-competition or non-solicitation covenants towards
the Company or any of its Affiliates) or failure to abide by code of conduct or other policies (including, without limitation, policies
relating to confidentiality and reasonable workplace conduct); (iv) any act which constitutes a breach of a Grantee’s fiduciary
duty towards the Company or an Affiliate or Subsidiary, including disclosure of confidential or proprietary information thereof or acceptance
or solicitation to receive unauthorized or undisclosed benefits, irrespective of their nature, or funds, or promises to receive either,
from individuals, consultants or corporate entities that the Company or a Subsidiary does business with; or (v) the Grantee’s unauthorized
use, misappropriation, destruction, or diversion of any tangible or intangible asset or corporate opportunity of the Company or any of
its Affiliates (including, without limitation, the improper use or disclosure of confidential or proprietary information);. For the avoidance
of doubt, the determination as to whether a termination is for Cause for purposes of this Plan, shall be made in good faith by the Committee
and shall be final and binding on the Grantee.
6.7.
Death,
Disability or Retirement of Grantee
.
6.7.1.       If
a Grantee shall die while employed by, or performing services for, the Company or its Affiliates, or within the one-hundred and twenty
(120) day period (or such longer period of time as determined by the Committee, in its discretion) after the date of termination of such
Grantee’s employment or service (or within such different period as the Committee may have provided pursuant to Section ‎6.6
hereof), or if the Grantee’s employment or service shall terminate by reason of Disability, all Awards theretofore granted to such
Grantee may (to the extent otherwise vested and exercisable and unless earlier terminated in accordance with their terms) be exercised
by the Grantee or by the Grantee’s estate or by a person who acquired the legal right to exercise such Awards by bequest or inheritance,
or by a person who acquired the legal right to exercise such Awards in accordance with applicable law in the case of Disability of the
Grantee, as the case may be, at any time within one (1) year (or such longer period of time as determined by the Committee, in its discretion)
after the death or Disability of the Grantee (or such different period as the Committee shall prescribe), but in any event no later than
the date of expiration of the Award’s term as set forth in the Award Agreement or pursuant to this Plan. In the event that an Award
granted hereunder shall be exercised as set forth above by any person other than the Grantee, written notice of such exercise shall be
accompanied by a certified copy of letters testamentary or proof satisfactory to the Committee of the right of such person to exercise
such Award.
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6.7.2.       In
the event that the employment or service of a Grantee shall terminate on account of such Grantee’s Retirement, all Awards of such
Grantee that are exercisable at the time of such Retirement may, unless earlier terminated in accordance with their terms, be exercised
at any time within the three (3) month period after the date of such Retirement (or such different period as the Committee shall prescribe).
6.8.
Suspension
of Vesting
. Unless the Committee provides otherwise, vesting of Awards granted hereunder shall not be suspended during any unpaid
leave of absence.
6.9.
Securities
Law Restrictions
. Except as otherwise provided in the applicable Award Agreement or other agreement between the Service Provider and
the Company, if the exercise of an Award following the termination of the Service Provider’s employment or service (other than for
Cause) would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities
Act or equivalent requirements under equivalent laws of other applicable jurisdictions, then the Award shall remain exercisable and terminate
on the earlier of (i) the expiration of a period of one-hundred and twenty (120) days (or such longer period of time as
determined by the Committee, in its discretion) after the termination of the Service Provider’s employment or service during which
the exercise of the Award would not be in such violation, or (ii) the expiration of the term of the Award as set forth in the Award
Agreement or pursuant to this Plan. In addition, unless otherwise provided in a Grantee’s Award Agreement, if the sale of any Shares
received upon exercise or (if applicable) vesting of an Award following the termination of the Grantee’s employment or service (other
than for Cause) would violate the Company’s insider trading policy, then the Award shall terminate on the earlier of (i) the
expiration of a period equal to the applicable post-termination exercise period after the termination of the Grantee’s employment
or service during which the exercise of the Award would not be in violation of the Company’s insider trading policy, or (ii) the
expiration of the term of the Award as set forth in the applicable Award Agreement or pursuant to this Plan.
6.10.
Other
Provisions
. The Award Agreement evidencing Awards under this Plan shall contain such other terms and conditions not inconsistent with
this Plan [as the Committee may determine, at or after the date of grant, including provisions in connection with the restrictions on
transferring the Awards or Shares covered by such Awards, which shall be binding upon the Grantees and any purchaser, assignee or transferee
of any Awards, and other terms and conditions as the Committee shall deem appropriate.
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7.
NONQUALIFIED STOCK OPTIONS
.
Awards granted pursuant to this Section ‎7 are intended to constitute
Nonqualified Stock Options and shall be subject to the general terms and conditions specified in Section ‎6 hereof and other provisions
of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations. In the event of any inconsistency
or contradictions between the provisions of this Section ‎7 and the other terms of this Plan, this Section ‎7 shall prevail. However,
if for any reason the Awards granted pursuant to Section 8 (or portion thereof) does not qualify as an Incentive Stock Option, then, to
the extent of such non-qualification, such Option (or portion thereof) shall be regarded as a Nonqualified Stock Option granted under
this Plan. In no event will the Board, the Company or any Parent or Subsidiary or any of their respective employees or directors have
any liability to the Grantee (or any other person) due to the failure of the Option to qualify for any reason as an Incentive Stock Option.
7.1.
Certain
Limitations on Eligibility for Nonqualified Stock Options
. Nonqualified Stock Options may not be granted to a Service Provider who
is deemed to be a resident of the United States for purposes of taxation or who is otherwise subject to United States federal income tax
unless the Shares underlying such Options constitute “service recipient stock” under Section 409A of the Code or unless such
Options comply with the payment requirements of Section 409A of the Code.
7.2.
Exercise
Price
. The Exercise Price of a Nonqualified Stock Option shall not be less than 100% of the Fair Market Value of a Share on the date
of grant of such Option unless the Committee specifically indicates that the Awards will have a lower Exercise Price and the Award complies
with Section 409A of the Code. Notwithstanding the foregoing, a Nonqualified Stock Option may be granted with an exercise price lower
than the minimum exercise price set forth above if such Award is granted pursuant to an assumption or substitution for another option
in a manner that complies with Section 424(a) of the Code or 1.409A-1(b)(5)(v)(D) of the U.S. Treasury Regulations or any successor guidance.
8.
INCENTIVE STOCK OPTIONS
.
Awards granted pursuant to this Section ‎8 are intended to constitute
Incentive Stock Options and shall be granted subject to the following special terms and conditions, the general terms and conditions specified
in Section ‎6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different
tax laws or regulations. In the event of any inconsistency or contradictions between the provisions of this Section ‎8 and the other
terms of this Plan, this Section ‎8 shall prevail.
8.1.
Eligibility
for Incentive Stock Options
. Incentive Stock Options may be granted only to Employees of the Company, or to Employees of a Parent
or Subsidiary, determined as of the date of grant of such Options. An Incentive Stock Option granted to a prospective Employee upon the
condition that such person become an Employee shall be deemed granted effective on the date such person commences employment, with an
exercise price determined as of such date in accordance with Section ‎8.2.
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8.2.
Exercise
Price
. The Exercise Price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value
of the Shares covered by the Awards on the date of grant of such Option or such other price as may be determined pursuant to the Code.
Notwithstanding the foregoing, an Incentive Stock Option may be granted with an exercise price lower than the minimum exercise price set
forth above if such Award is granted pursuant to an assumption or substitution for another option in a manner that complies with the provisions
of Section 424(a) of the Code.
8.3.
Date
of Grant
. Notwithstanding any other provision of this Plan to the contrary, no Incentive Stock Option may be granted under this Plan
after 10 years from the date this Plan is adopted, or the date this Plan is approved by the shareholders, whichever is earlier.
8.4.
Exercise
Period
. No Incentive Stock Option shall be exercisable after the expiration of ten (10) years after the effective date of grant of
such Award, subject to Section ‎8.6. No Incentive Stock Option granted to a prospective Employee may become exercisable prior to the
date on which such person commences employment.
8.5.
$100,000
Per Year Limitation
. The aggregate Fair Market Value (determined as of the date the Incentive Stock Option is granted) of the Shares
with respect to which all Incentive Stock Options granted under this Plan and all other “incentive stock option” plans of
the Company, or of any Parent or Subsidiary, become exercisable for the first time by each Grantee during any calendar year shall not
exceed one hundred thousand United States dollars ($100,000) with respect to such Grantee. To the extent that the aggregate Fair Market
Value of Shares with respect to which such Incentive Stock Options and any other such incentive stock options are exercisable for the
first time by any Grantee during any calendar year exceeds one hundred thousand United States dollars ($100,000), such options shall be
treated as Nonqualified Stock Options. The foregoing shall be applied by taking options into account in the order in which they were granted.
If the Code is amended to provide for a different limitation from that set forth in this Section ‎8.5, such different limitation shall
be deemed incorporated herein effective as of the date and with respect to such Awards as required or permitted by such amendment to the
Code. If an Option is treated as an Incentive Stock Option in part and as a Nonqualified Stock Option in part by reason of the limitation
set forth in this Section ‎8.5, the Grantee may designate which portion of such Option the Grantee is exercising. In the absence of
such designation, the Grantee shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Separate certificates
representing each such portion may be issued upon the exercise of the Option.
8.6.
Ten
Percent Shareholder
. In the case of an Incentive Stock Option granted to a Ten Percent Shareholder, notwithstanding the foregoing
provisions of this Section ‎8.6, (i) the Exercise Price shall not be less than one hundred and ten percent (110%) of the Fair Market
Value of a Share on the date of grant of such Incentive Stock Option, and (ii) the Exercise Period shall not exceed five (5) years from
the effective date of grant of such Incentive Stock Option.
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8.7.
Payment
of Exercise Price
. Each Award Agreement evidencing an Incentive Stock Option shall state each alternative method by which the Exercise
Price thereof may be paid.
8.8.
Leave
of Absence
. Grantee’s employment shall not be deemed to have terminated if the Grantee takes any leave as set forth in Section
‎6.8; provided, however, that if any such leave exceeds three (3) months, on the day that is three (3) months following the commencement
of such leave any Incentive Stock Option held by the Grantee shall cease to be treated as an Incentive Stock Option and instead shall
be treated thereafter as a Nonqualified Stock Option, unless the Grantee’s right to return to employment is guaranteed by statute
or contract.
8.9.
Exercise
Following Termination of Employment
. Notwithstanding anything else in this Plan to the contrary, Incentive Stock Options that are
not exercised within three (3) months following termination of the Grantee’s employment with the Company, its Parent or Subsidiary,
a corporation or a Parent or Subsidiary of such corporation issuing or assuming an Option in a transaction to which Section 424(a) of
the Code applies, in each case, without Cause (other than death or Disability) or within one (1) year in case of termination of the Grantee’s
employment with the Company or its Parent or Subsidiary due to death or a Disability (within the meaning of Section 22(e)(3) of the Code),
shall be deemed to be Nonqualified Stock Options.
8.10.
Adjustments
to Incentive Stock Options
. Any Awards Agreement providing for the grant of Incentive Stock Options shall indicate that adjustments
made pursuant to this Plan with respect to Incentive Stock Options could constitute a “modification” of such Incentive Stock
Options (as that term is defined in Section 424(h) of the Code) or could cause adverse tax consequences for the holder of such Incentive
Stock Options and that the holder should consult with his or her tax advisor regarding the consequences of such “modification”
on his or her income tax treatment with respect to the Incentive Stock Option.
8.11.
Notice
to Company of Disqualifying Disposition
. Each Grantee who receives an Incentive Stock Option must agree to notify the Company in writing
immediately after the Grantee makes a Disqualifying Disposition of any Shares received pursuant to the exercise of Incentive Stock Options.
A “
Disqualifying Disposition
” is any disposition (including any sale) of such Shares before the later of (i) two
years after the date the Grantee was granted the Incentive Stock Option, or (ii) one year after the date the Grantee acquired Shares
by exercising the Incentive Stock Option. If the Grantee dies before such Shares are sold, these holding period requirements do not apply
and no disposition of the Shares will be deemed a Disqualifying Disposition.
9.
102 AWARDS
.
Awards granted pursuant to this Section ‎9 are intended to constitute
102 Awards and shall be granted subject to the following special terms and conditions, the general terms and conditions specified in Section
6 hereof and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations.
In the event of any inconsistency or contradictions between the provisions of this Section ‎9 and the other terms of this Plan, this
Section ‎9 shall prevail.
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9.1.
Tracks
.
Awards granted pursuant to this Section ‎9 are intended to be granted pursuant to Section 102 of the Ordinance pursuant to either
(i) Section 102(b)(2) or (3) thereof (as applicable), under the capital gain track (“
102 Capital Gain Track Awards
”),
or (ii) Section 102(b)(1) thereof under the ordinary income track (“
102 Ordinary Income Track Awards
”, and together
with 102 Capital Gain Track Awards, “
102 Trustee Awards
”). 102 Trustee Awards shall be granted subject to the special
terms and conditions contained in this Section ‎9, the general terms and conditions specified in Section ‎6 hereof and other provisions
of this Plan, except for any provisions of this Plan applying to Options under different tax laws or regulations.
9.2.
Election
of Track
. Subject to Applicable Law, the Company may grant only one type of 102 Trustee Awards at any given time to all Grantees who
are to be granted 102 Trustee Awards pursuant to this Plan, and shall file an election with the ITA regarding the type of 102 Trustee
Awards it elects to grant before the date of grant of any 102 Trustee Awards (the “
Election
”). Such Election shall
also apply to any other securities, including bonus shares, received by any Grantee as a result of holding the 102 Trustee Awards. The
Company may change the type of 102 Trustee Awards that it elects to grant only after the expiration of at least 12 months from the end
of the year in which the first grant was made in accordance with the previous Election, or as otherwise provided by Applicable Law. Any
Election shall not prevent the Company from granting Awards, pursuant to Section 102(c) of the Ordinance without a Trustee (“
102
Non-Trustee Awards
”).
9.3.
Eligibility
for Awards
.
9.3.1.       Subject
to Applicable Law, 102 Awards may only be granted to an "employee" within the meaning of Section 102(a) of the Ordinance (which
as of the date of the adoption of this Plan means (i) individuals employed by an Israeli company being the Company or any of its Affiliates,
and (ii) individuals who are serving and are engaged personally (and not through an entity) as “office holders” by such an
Israeli company), but may not be granted to a Controlling Shareholder (“
Eligible 102 Grantees
”). Eligible 102 Grantees
may receive only 102 Awards, which may either be granted to a Trustee or granted under Section 102 of the Ordinance without a Trustee.
9.4.
102
Award Grant Date
.
9.4.1.       Each
102 Award will be deemed granted on the date determined by the Committee, subject to Section ‎9.4.2, provided that (i) the Grantee
has signed all documents required by the Company or pursuant to Applicable Law, and (ii) with respect to 102 Trustee Award, the Company
has provided all applicable documents to the Trustee in accordance with the guidelines published by the ITA, and if an agreement is not
signed and delivered by the Grantee within 90 days from the date determined by the Committee (subject to Section ‎9.4.2), then such
102 Trustee Award shall be deemed granted on such later date as such agreement is signed and delivered and on which the Company has provided
all applicable documents to the Trustee in accordance with the guidelines published by the ITA. In the case of any contradiction, this
provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend any date of grant indicated in any corporate
resolution or Award Agreement.
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9.4.2.       Unless
otherwise permitted by the Ordinance, any grants of 102 Trustee Awards that are made on or after the date of the adoption of this Plan
or an amendment to this Plan, as the case may be, that may become effective only at the expiration of thirty (30) days after the filing
of this Plan or any amendment thereof (as the case may be) with the ITA in accordance with the Ordinance shall be conditional upon the
expiration of such 30-day period, such condition shall be read and is incorporated by reference into any corporate resolutions approving
such grants and into any Award Agreement evidencing such grants (whether or not explicitly referring to such condition), and the date
of grant shall be at the expiration of such 30-day period, whether or not the date of grant indicated therein corresponds with this Section.
In the case of any contradiction, this provision and the date of grant determined pursuant hereto shall supersede and be deemed to amend
any date of grant indicated in any corporate resolution or Award Agreement.
9.5.
102
Trustee Awards
.
9.5.1.       Each
102 Trustee Award, each Share issued pursuant to the exercise of any 102 Trustee Award, and any rights granted thereunder, including bonus
shares, shall be issued to and registered in the name of the Trustee and shall be held in trust for the benefit of the Grantee for the
requisite period prescribed by the Ordinance (the “
Required Holding Period
”). In the event that the requirements under
Section 102 of the Ordinance to qualify an Award as a 102 Trustee Award are not met, then the Award may be treated as a 102 Non-Trustee
Award or 3(i) Award, all in accordance with the provisions of the Ordinance. After expiration of the Required Holding Period, the Trustee
may release such 102 Trustee Awards and any such Shares, provided that (i) the Trustee has received an acknowledgment from the ITA that
the Grantee has paid any applicable taxes due pursuant to the Ordinance, or (ii) the Trustee and/or the Company and/or the Employer withholds
all applicable taxes and compulsory payments due pursuant to the Ordinance arising from the 102 Trustee Awards and/or any Shares issued
upon exercise or (if applicable) vesting of such 102 Trustee Awards. The Trustee shall not release any 102 Trustee Awards or Shares issued
upon exercise or (if applicable) vesting thereof prior to the payment in full of the Grantee’s tax and compulsory payments arising
from such 102 Trustee Awards and/or Shares or the withholding referred to in (ii) above.
9.5.2.       Each
102 Trustee Award shall be subject to the relevant terms of the Ordinance, the Rules and any determinations, rulings or approvals issued
by the ITA, which shall be deemed an integral part of the 102 Trustee Awards and shall prevail over any term contained in this Plan or
Award Agreement that is not consistent therewith. Any provision of the Ordinance, the Rules and any determinations, rulings or approvals
by the ITA not expressly specified in this Plan or Award Agreement that are necessary to receive or maintain any tax benefit pursuant
to Section 102 of the Ordinance shall be binding on the Grantee. Any Grantee granted a 102 Trustee Awards shall comply with the Ordinance
and the terms and conditions of the trust agreement entered into between the Company and the Trustee. The Grantee shall execute any and
all documents that the Company and/or its Affiliates and/or the Trustee determine from time to time to be necessary in order to comply
with the Ordinance and the Rules.
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9.5.3.       During
the Required Holding Period, the Grantee shall not release from trust or sell, assign, transfer or give as collateral, the Shares issuable
upon the exercise or (if applicable) vesting of a 102 Trustee Awards and/or any securities issued or distributed with respect thereto,
until the expiration of the Required Holding Period. Notwithstanding the above, if any such sale, release or other action occurs during
the Required Holding Period it may result in adverse tax consequences to the Grantee under Section 102 of the Ordinance and the Rules,
which shall apply to and shall be borne solely by such Grantee. Subject to the foregoing, the Trustee may, pursuant to a written request
from the Grantee, but subject to the terms of this Plan, release and transfer such Shares to a designated third party, provided that both
of the following conditions have been fulfilled prior to such release or transfer: (i) payment has been made to the ITA of all taxes and
compulsory payments required to be paid upon the release and transfer of the Shares, and confirmation of such payment has been received
by the Trustee and the Company, and (ii) the Trustee has received written confirmation from the Company that all requirements for such
release and transfer have been fulfilled according to the terms of the Company’s corporate documents, any agreement governing the
Shares, this Plan, the Award Agreement and any Applicable Law.
9.5.4.       If
a 102 Trustee Award is exercised or (if applicable) vested, the Shares issued upon such exercise or (if applicable) vesting shall be issued
in the name of the Trustee for the benefit of the Grantee.
9.5.5.       Upon
or after receipt of a 102 Trustee Award, if required, the Grantee may be required to sign an undertaking to release the Trustee from any
liability with respect to any action or decision duly taken and executed in good faith by the Trustee in relation to this Plan, or any
102 Trustee Awards or Share granted to such Grantee thereunder.
9.6.
102
Non-Trustee Awards
. The foregoing provisions of this Section ‎9 relating to 102 Trustee Awards shall not apply with respect to
102 Non-Trustee Awards, which shall, however, be subject to the relevant provisions of Section 102 of the Ordinance and the applicable
Rules. The Committee may determine that 102 Non-Trustee Awards, the Shares issuable upon the exercise or (if applicable) vesting of a
102 Non-Trustee Awards and/or any securities issued or distributed with respect thereto, shall be allocated or issued to the Trustee,
who shall hold such 102 Non-Trustee Awards and all accrued rights thereon (if any), in trust for the benefit of the Grantee and/or the
Company, as the case may be, until the full payment of tax arising from the 102 Non-Trustee Awards, the Shares issuable upon the exercise
or (if applicable) vesting of a 102 Non-Trustee Awards and/or any securities issued or distributed with respect thereto. The Company may
choose, alternatively, to force the Grantee to provide it with a guarantee or other security, to the satisfaction of each of the Trustee
and the Company, until the full payment of the applicable taxes.
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9.7.
Written
Grantee Undertaking
. To the extent and with respect to any 102 Trustee Award, and as required by Section 102 of the Ordinance and
the Rules, by virtue of the receipt of such Award, the Grantee is deemed to have provided, undertaken and confirm the following written
undertaking (and such undertaking is deemed incorporated into any documents signed by the Grantee in connection with the employment or
service of the Grantee and/or the grant of such Award), and which undertaking shall be deemed to apply and relate to all 102 Trustee Awards
granted to the Grantee, whether under this Plan or other plans maintained by the Company, and whether prior to or after the date hereof.
9.7.1.       The
Grantee shall comply with all terms and conditions set forth in Section 102 of the Ordinance with regard to the “Capital Gain Track”
or the “Ordinary Income Track”, as applicable, and the applicable rules and regulations promulgated thereunder, as amended
from time to time;
9.7.2.       The
Grantee is familiar with, and understands the provisions of, Section 102 of the Ordinance in general, and the tax arrangement under the
“Capital Gain Track” or the “Ordinary Income Track” in particular, and its tax consequences; the Grantee agrees
that the 102 Trustee Awards and Shares that may be issued upon exercise or (if applicable) vesting of the 102 Trustee Awards (or otherwise
in relation to the 102 Trustee Awards), will be held by the Trustee appointed pursuant to Section 102 of the Ordinance for at least the
duration of the "Holding Period" (as such term is defined in Section 102) under the "Capital Gain Track" or the “Ordinary
Income Track”, as applicable. The Grantee understands that any release of such 102 Trustee Awards or Shares from trust, or any sale
of the Share prior to the termination of the Holding Period, as defined above, will result in taxation at marginal tax rate, in addition
to deductions of appropriate social security, health tax contributions or other compulsory payments; and
9.7.3.       The
Grantee agrees to the trust agreement signed between the Company, the Employer and the Trustee appointed pursuant to Section 102 of the
Ordinance.
10.
3(i) AWARDS
.
Awards granted pursuant to this Section ‎10 are
intended to constitute 3(i) Awards and shall be granted subject to the general terms and conditions specified in Section ‎6 hereof
and other provisions of this Plan, except for any provisions of this Plan applying to Awards under different tax laws or regulations.
In the event of any inconsistency or contradictions between the provisions of this Section ‎10 and the other terms of this Plan, this
Section ‎10 shall prevail.
10.1.       To
the extent required by the Ordinance or the ITA or otherwise deemed by the Committee to be advisable, the 3(i) Awards and/or any Shares
or other securities issued or distributed with respect thereto granted pursuant to this Plan shall be issued to a Trustee nominated by
the Committee in accordance with the provisions of the Ordinance or the terms of a trust agreement, as applicable. In such event, the
Trustee shall hold such Awards and/or other securities issued or distributed with respect thereto in trust, until exercised or (if applicable)
vested by the Grantee and the full payment of tax arising therefrom, pursuant to the Company’s instructions from time to time as
set forth in a trust agreement, which will have been entered into between the Company and the Trustee. If determined by the Board or the
Committee, and subject to such trust agreement, the Trustee will also hold the Shares issuable upon exercise, vesting, or settlement,
as applicable, of the 3(i) Awards, as long as they are held by the Grantee. If determined by the Board or the Committee, and subject to
such trust agreement, the Trustee shall be responsible for withholding any taxes to which a Grantee may become liable upon issuance of
Shares, whether due to the exercise or (if applicable) vesting of Awards.
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10.2.       Shares
pursuant to a 3(i) Award shall not be issued, unless the Grantee delivers to the Company payment in cash or by bank check or such other
form acceptable to the Committee of all withholding taxes due, if any, on account of the Grantee acquired Shares under the Award or gives
other assurance satisfactory to the Committee of the payment of those withholding taxes.
11.
RESTRICTED SHARES
.
The Committee may award Restricted Shares to any eligible Grantee,
including under Section 102 of the Ordinance. Each Award of Restricted Shares under this Plan shall be evidenced by a written agreement
between the Company and the Grantee (the “
Restricted Share Agreement
”), in such form as the Committee shall from time
to time approve. The Restricted Shares shall be subject to all applicable terms of this Plan, which in the case of Restricted Shares granted
under Section 102 of the Ordinance shall include Section ‎9 hereof, and may be subject to any other terms that are not inconsistent
with this Plan. The provisions of the various Restricted Shares Agreements entered into under this Plan need not be identical. The Restricted
Share Agreement shall comply with and be subject to Section ‎6 and the following terms and conditions, unless otherwise specifically
provided in such Agreement and not inconsistent with this Plan, or Applicable Law.
11.1.
Purchase
Price
. Section ‎6.4 shall not apply to Restricted Shares. Each Restricted Share Agreement shall state an amount of Exercise Price
to be paid by the Grantee, if any, in consideration for the issuance of the Restricted Shares and the terms of payment thereof, which
may include payment in cash or, subject to the Committee’s approval, by issuance of promissory notes or other evidence of indebtedness
on such terms and conditions as determined by the Committee.
11.2.
Restrictions
.
Restricted Shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of
descent and distribution (in which case they shall be transferred subject to all restrictions then or thereafter applicable thereto),
until such Restricted Shares shall have vested (the period from the date on which the Award is granted until the date of vesting of the
Restricted Share thereunder being referred to herein as the “
Restricted Period
”). The Committee may also impose such
additional or alternative restrictions and conditions on the Restricted Shares, as it deems appropriate, including the satisfaction of
performance criteria (which, in case of 102 Trustee Awards, may be subject to obtaining a specific tax ruling or determination from the
ITA). Such performance criteria may include, but are not limited to, sales, earnings before interest and taxes, return on investment,
earnings per share, any combination of the foregoing or rate of growth of any of the foregoing, as determined by the Committee or pursuant
to the provisions of any Company policy required under mandatory provisions of Applicable Law. Certificates for Shares issued pursuant
to Restricted Share Awards, if issued, shall bear an appropriate legend referring to such restrictions, and any attempt to dispose of
any such Shares in contravention of such restrictions shall be null and void and without effect. Such certificates may, if so determined
by the Committee, be held in escrow by an escrow agent appointed by the Committee, or, if a Restricted Share Award is made pursuant to
Section 102 of the Ordinance, by the Trustee. In determining the Restricted Period of an Award the Committee may provide that the foregoing
restrictions shall lapse with respect to specified percentages of the awarded Restricted Shares on successive anniversaries of the date
of such Award. To the extent required by the Ordinance or the ITA, the Restricted Shares issued pursuant to Section 102 of the Ordinance
shall be issued to the Trustee in accordance with the provisions of the Ordinance and the Restricted Shares shall be held for the benefit
of the Grantee for at least the Required Holding Period.
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11.3.
Forfeiture;
Repurchase
. Subject to such exceptions as may be determined by the Committee, if the Grantee’s continuous employment with or
service to the Company or any Affiliate thereof shall terminate for any reason prior to the expiration of the Restricted Period of an
Award or prior to the timely payment in full of the Exercise Price of any Restricted Shares, any Shares remaining subject to vesting or
with respect to which the purchase price has not been paid in full, shall thereupon be forfeited, transferred to, and redeemed, repurchased
or cancelled by, as the case may be, in any manner as set forth in Section ‎6.6.2(i) through (v), subject to Applicable Law and the
Grantee shall have no further rights with respect to such Restricted Shares.
11.4.
Ownership
.
During the Restricted Period the Grantee shall possess all incidents of ownership of such Restricted Shares, subject to Section ‎6.10
and Section ‎11.2, including the right to vote and receive dividends with respect to such Shares. All securities, if any, received
by a Grantee with respect to Restricted Shares as a result of any stock split, stock dividend, combination of shares, or other similar
transaction shall be subject to the restrictions applicable to the original Award.
12.
RESTRICTED SHARE UNITS
.
An RSU is an Award covering a number of Shares that
is settled, if vested and (if applicable) exercised, by issuance of those Shares. An RSU may be awarded to any eligible Grantee, including
under Section 102 of the Ordinance. The Award Agreement relating to the grant of RSUs under this Plan (the “
Restricted Share
Unit Agreement
”), shall be in such form as the Committee shall from time to time approve. The RSUs shall be subject to all applicable
terms of this Plan, which in the case of RSUs granted under Section 102 of the Ordinance shall include Section ‎9 hereof, and may
be subject to any other terms that are not inconsistent with this Plan. The provisions of the various Restricted Share Unit Agreements
entered into under this Plan need not be identical. RSUs may be granted in consideration of a reduction in the recipient’s other
compensation.
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12.1.
Exercise
Price
. No payment of Exercise Price shall be required as consideration for RSUs, unless included in the Award Agreement or as required
by Applicable Law (including, Section 304 of the Companies Law), and Section ‎6.4 shall apply, if applicable.
12.2.
Shareholders’
Rights
. The Grantee shall not possess or own any ownership rights in the Shares underlying the RSUs and no rights as a shareholder
shall exist prior to the actual issuance of Shares in the name of the Grantee.
12.3.
Settlements
of Awards
. Settlement of vested RSUs shall be made in the form of Shares or cash (in case of 102 Trustee Awards, the settlement shall
be made in the form of Shares only). Distribution to a Grantee of an amount (or amounts) from settlement of vested RSUs can be deferred
to a date after settlement as determined by the Committee. The amount of a deferred distribution may be increased by an interest factor
or by dividend equivalents. Any such dividend equivalents shall be subject to the same vesting terms and other conditions as relate to
the original Award. Until the grant of RSUs is settled, the number of Shares underlying such RSUs shall be subject to adjustment pursuant
hereto.
12.4.
Section 409A
Restrictions
. Notwithstanding anything to the contrary set forth herein, any RSUs granted under this Plan that are not exempt from
the requirements of Section 409A of the Code shall contain such restrictions or other provisions so that such RSUs will comply with
the requirements of Section 409A of the Code. Such restrictions, if any, shall be determined by the Committee and contained in the
Restricted Share Unit Agreement evidencing such RSU.
13.
OTHER SHARE OR SHARE-BASED AWARDS
.
13.1.       The
Committee may grant other Awards under this Plan pursuant to which Shares (which may, but need not, be Restricted Shares pursuant to Section
11 hereof), cash (in settlement of Share-based Awards) or a combination thereof, are or may in the future be acquired or received, or
Awards denominated in stock units, including units valued on the basis of measures other than market value.
13.2.       The
Committee may also grant stock appreciation rights (“
SAR
”) without the grant of an accompanying option, which rights
shall permit the Grantees to receive, at the time of any exercise of such rights, cash equal to the amount by which the Fair Market Value
of the Shares in respect to which the right was granted is so exercised exceeds the exercise price thereof. The exercise price of any
such SAR granted to a Grantee who is subject to U.S. federal income tax shall be determined in compliance with Section ‎7.2.
13.3.       Such
other Share-based Awards as set forth above may be granted alone, in addition to, or in tandem with any Award of any type granted under
this Plan (without any obligation or assurance that that such Share-based Awards will be entitled to tax benefits under Applicable Law
or to the same tax treatment as other Awards under this Plan).
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14.
EFFECT OF CERTAIN CHANGES
.
14.1.
General
.
14.1.1.       In
the event of a division or subdivision of the outstanding share capital of the Company, any distribution of bonus shares (stock split),
consolidation or combination of share capital of the Company (reverse stock split), reclassification with respect to the Shares or any
similar recapitalization events (each, a "
Recapitalization
"), a merger (including, a reverse merger and a reverse triangular
merger), consolidation, amalgamation or like transaction of the Company with or into another corporation, a reorganization (which may
include a combination or exchange of Shares, spin-off or other corporate divestiture or division, or other similar occurrences, the Committee
shall have the authority to make, without the need for a consent of any holder of an Award, such adjustments as determined by the Committee
to be appropriate, in its discretion, in order to adjust (i) the number and class of Shares reserved and available for grants of Awards,
(ii) the number and class of Shares covered by outstanding Awards, (iii) the Exercise Price per share covered by any Award, (iv) the terms
and conditions concerning vesting and exercisability and the term and duration of the outstanding Awards, (v) the type or class of security,
asset or right underlying the Award (which need not be only that of the Company, and may be that of the surviving corporation or any affiliate
thereof or such other entity party to any of the above transactions), and (vi) any other terms of the Award that in the opinion of the
Committee should be adjusted. Any fractional Shares resulting from such adjustment shall be treated as determined by the Committee, and
in the absence of such determination shall be rounded to the nearest whole share, and the Company shall have no obligation to make any
cash or other payment with respect to such fractional Shares. No adjustment shall be made by reason of the distribution of subscription
rights or rights offering to outstanding Shares or other issuance of Shares by the Company, unless the Committee determines otherwise.
The adjustments determined pursuant to this Section ‎14.1 (including a determination that no adjustment is to be made) shall be final,
binding and conclusive.
14.1.2.       Notwithstanding
anything to the contrary included herein, in the event of a distribution of cash dividend by the Company to all holders of Shares, the
Exercise Price of any Award, which is outstanding and unexercised on the record date of such distribution, shall be reduced by an amount
equal to the per Share gross dividend amount distributed by the Company, buy not less than the par value of a Share. The application of
this Section with respect to any 102 Awards shall be subject to obtaining a ruling from the ITA, to the extent required by applicable
law and subject to the terms and conditions of any such ruling.
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14.2.
Merger/Sale
of Company
. In the event of a Merger/Sale, then, without derogating from the general authority and power of the Board or the Committee
under this Plan, without the Grantee’s consent and action and without any prior notice requirement, the Committee may make any determination
as to the treatment of Awards, in its sole and absolute discretion, as provided herein:
14.2.1.       Unless
otherwise determined by the Committee, any Award then outstanding shall be assumed or be substituted by the Company, or by the successor
corporation in such Merger/Sale or by any parent or Affiliate thereof, as determined by the Committee in its discretion (the “
Successor
Corporation
”), under terms as determined by the Committee or the terms of this Plan applied by the Successor Corporation to
such assumed or substituted Awards.
For the purposes of this Section ‎14.2.1,
the Award shall be considered assumed or substituted if, following a Merger/Sale, the Award confers on the holder thereof the right to
purchase or receive, for each Share underlying an Award immediately prior to the Merger/Sale, either (i) the consideration (whether shares
or other securities, cash or other property, or rights, or any combination thereof) distributed to or received by holders of Shares in
the Merger/Sale for each Share held on the effective date of the Merger/Sale (and if holders were offered a choice or several types of
consideration, the type of consideration as determined by the Committee, which need not be the same type for all Grantees), or (ii) regardless
of the consideration received by the holders of Shares in the Merger/Sale, solely shares or any type of Awards (or their equivalent) of
the Successor Corporation at a value to be determined by the Committee in its discretion, or a certain type of consideration (whether
shares or other securities, cash or other property, or rights, or any combination thereof) as determined by the Committee. Any of the
consideration referred to in the foregoing clauses (i) and (ii) shall be subject to the same vesting and expiration terms of the Awards
applying immediately prior to the Merger/Sale, unless determined by the Committee, in its discretion, that the consideration shall be
subject to different vesting and expiration terms, or other terms, and the Committee may determine that it be subject to other or additional
terms. The foregoing shall not limit the Committee’s authority to determine that in lieu of such assumption or substitution of Awards
for Awards of the Successor Corporation, such Award will be substituted for shares or other securities, cash or other property, or rights,
or any combination thereof, including as set forth in Section 14.2.2 hereunder.
14.2.2.       Regardless
of whether or not Awards are assumed or substituted, the Committee may (but shall not be obligated to):
14.2.2.1.       provide
for the Grantee to have the right to exercise the Award in respect of Shares covered by the Award which would otherwise be exercisable
or vested, under such terms and conditions as the Committee shall determine, and the cancellation of all unexercised Awards (whether vested
or unvested) upon or immediately prior to the closing of the Merger/Sale, unless the Committee provides for the Grantee to have the right
to exercise the Award, or otherwise for the acceleration of vesting of such Award, as to all or part of the Shares covered by the Award
which would not otherwise be exercisable or vested, under such terms and conditions as the Committee shall determine;
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14.2.2.2.       provide
for the cancellation of each outstanding Award at or immediately prior to the closing of such Merger/Sale, and if and to the extent payment
shall be made to the Grantee of an amount in Shares or other securities of the Company, the acquiror or of a corporation or other business
entity which is a party to the Merger/Sale, cash or other property, or rights, or any combination thereof, as determined by the Committee
to be fair in the circumstances, and subject to such terms and conditions as determined by the Committee. The Committee shall have full
authority to select the method for determining the payment (being the intrinsic (“spread”) value of the option, Black-Scholes
model or any other method).
Inter alia
, and without limitation of the following determination being made in other circumstances,
the Committee’s determination may provide that payment shall be set to zero if the value of the Shares is determined to be less
than the Exercise Price, or in respect of Shares covered by the Award which would not otherwise be exercisable or vested, or that payment
may be made only in excess of the Exercise Price; and/or
14.2.2.3.       provide
that the terms of any Award shall be otherwise amended, modified or terminated, as determined by the Committee to be fair in the circumstances.
14.2.3.       The
Committee may determine: (i) that any payments made in respect of Awards shall be made or delayed to the same extent that payment of consideration
to the holders of the Shares in connection with the Merger/Sale is made or delayed as a result of escrows, indemnification, earn outs,
holdbacks or any other contingencies or conditions; (ii) the terms and conditions applying to the payment made or payable to the Grantees,
including participation in escrow, indemnification, releases, earn-outs, holdbacks or any other contingencies; and (iii) that any terms
and conditions applying under the applicable definitive transaction agreements shall apply to the Grantees (including, appointment and
engagement of a shareholders or sellers representative, payment of fees or other costs and expenses associated with such services, indemnifying
such representative, and authorization to such representative within the scope of such representative’s authority in the applicable
definitive transaction agreements).
14.2.4.       The
Committee may determine to suspend the Grantee’s rights to exercise any vested portion of an Award for a period of time prior to
the signing or consummation of a Merger/Sale transaction.
14.2.5.       Without
limiting the generality of this Section ‎14, if the consideration in exchange for Awards in a Merger/Sale includes any securities
and due receipt thereof by any Grantee (or by the Trustee for the benefit of such Grantee) may require under applicable law (i) the registration
or qualification of such securities or of any person as a broker or dealer or agent with respect to such securities; or (ii) the provision
to any Grantee of any information under the Securities Act or any other securities laws, then the Committee may determine that the Grantee
shall be paid in lieu thereof, against surrender of the Shares or cancellation of any other Awards, an amount in cash or other property,
or rights, or any combination thereof, as determined by the Committee to be fair in the circumstances, and subject to such terms and conditions
as determined by the Committee. Nothing herein shall entitle any Grantee to receive any form of consideration that such Grantee would
be ineligible to receive as a result of such Grantee’s failure to satisfy (in the Committee’s sole determination) any condition,
requirement or limitation that is generally applicable to the Company’s shareholders, or that is otherwise applicable under the
terms of the Merger/Sale, and in such case, the Committee shall determine the type of consideration and the terms applying to such Grantees.
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14.2.6.       Neither
the authorities and powers of the Committee under this Section 14.2, nor the exercise or implementation thereof, shall (i) be restricted
or limited in any way by any adverse consequences (tax or otherwise) that may result to any holder of an Award, and (ii) as,
inter
alia
, being a feature of the Award upon its grant, be deemed to constitute a change or an amendment of the rights of such holder under
this Plan, nor shall any such adverse consequences (as well as any adverse tax consequences that may result from any tax ruling or other
approval or determination of any relevant tax authority) be deemed to constitute a change or an amendment of the rights of such holder
under this Plan, and may be effected without consent of any Grantee and without any liability to the Company or its Affiliates, or to
their respective officers, directors, employees and representatives, and the respective successors and assigns of any of the foregoing.
The Committee need not take the same action with respect to all Awards or with respect to all Service Providers. The Committee may take
different actions with respect to the vested and unvested portions of an Award. The Committee may determine an amount or type of consideration
to be received or distributed in a Merger/Sale which may differ as among the Grantees, and as between the Grantees and any other holders
of Shares of the Company.
14.2.7.       The
Committee may determine that upon a Merger/Sale any Shares held by Grantees (or for Grantee’s benefit) are sold in accordance with
instructions issued by the Committee in connection with such Merger/Sale, which shall be final, conclusive and binding on all Grantees.
14.2.8.       All
of the Committee’s determinations pursuant to this Section ‎14 shall be at its sole and absolute discretion, and shall be final,
conclusive and binding on all Grantees (including, for clarity, as it relates to Shares issued upon exercise or vesting of any Awards
or that are Awards, unless otherwise determined by the Committee) and without any liability to the Company or its Affiliates, or to their
respective officers, directors, employees, shareholders and representatives, and the respective successors and assigns of any of the foregoing,
in connection with the method of treatment, chosen course of action or determinations made hereunder.
14.2.9.       If
determined by the Committee, the Grantees shall be subject to the definitive agreement(s) in connection with the Merger/Sale as applying
to holders of Shares including, such terms, conditions, representations, undertakings, liabilities, limitations, releases, indemnities,
appointing and indemnifying shareholders/sellers representative, participating in transaction expenses, shareholders/sellers representative
expense fund and escrow arrangement, in each case as determined by the Committee. Each Grantee shall execute (and authorizes any person
designated by the Company to so execute, as well as (if applicable) the Trustee holding any Shares for the Grantee’s behalf) such
separate agreement(s) or instruments as may be requested by the Company, the Successor Corporation or the acquiror in connection with
such in such Merger/Sale or otherwise under or for the purpose of implementing this Section ‎14.2, and in the form required by them.
The execution of such separate agreement(s) may be a condition to the receipt of assumed or substituted Awards, payment in lieu of the
Award, the exercise of any Award or otherwise to be entitled to benefit from Shares or other securities, cash or other property, or rights,
or any combination thereof, pursuant to this Section ‎14.2 (and the Company (and, if applicable, the Trustee) may exercise its authorization
above and sign such agreement on behalf of the Grantee or subject the Grantee to the provisions of such agreements).
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14.3.
Reservation
of Rights
. Except as expressly provided in this Section ‎14 (if any), the Grantee of an Award hereunder shall have no rights by
reason of any Recapitalization of shares of any class, any increase or decrease in the number of shares of any class, or any dissolution,
liquidation, reorganization (which may include a combination or exchange of shares, spin-off or other corporate divestiture or division,
or other similar occurrences), or Merger/Sale. Any issue by the Company of shares of any class, or securities convertible into shares
of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number, type or price
of shares subject to an Award. The grant of an Award pursuant to this Plan shall not affect in any way the right or power of the Company
to make adjustments, reclassifications, reorganizations or changes of its capital or business structures or to merge or to consolidate
or to dissolve, liquidate or sell, or transfer all or part of its business or assets or engage in any similar transactions.
15.
NON-TRANSFERABILITY OF AWARDS; SURVIVING BENEFICIARY
.
15.1.       All
Awards granted under this Plan by their terms shall not be transferable, other than by will or by the laws of descent and distribution,
unless otherwise determined by the Committee or under this Plan, provided that with respect to Shares issued upon exercise, Shares issued
upon the vesting of Awards or Awards that are Shares, the restrictions on transfer shall be the restrictions referred to in Section ‎16
(Conditions upon Issuance of Shares) hereof. Subject to the above provisions, the terms of such Award, this Plan and any applicable Award
Agreement shall be binding upon the beneficiaries, executors, administrators, heirs and successors of such Grantee. Awards may be exercised
or otherwise realized, during the lifetime of the Grantee, only by the Grantee or by his guardian or legal representative, to the extent
provided for herein. Any transfer of an Award not permitted hereunder (including transfers pursuant to any decree of divorce, dissolution
or separate maintenance, any property settlement, any separation agreement or any other agreement with a spouse) and any grant of any
interest in any Award to, or creation in any way of any direct or indirect interest in any Award by, any party other than the Grantee
shall be null and void and shall not confer upon any party or person, other than the Grantee, any rights. A Grantee may file with the
Committee a written designation of a beneficiary, who shall be permitted to exercise such Grantee’s Award or to whom any benefit
under this Plan is to be paid, in each case, in the event of the Grantee’s death before he or she fully exercises his or her Award
or receives any or all of such benefit, on such form as may be prescribed by the Committee and may, from time to time, amend or revoke
such designation. If no designated beneficiary survives the Grantee, the executor or administrator of the Grantee’s estate shall
be deemed to be the Grantee’s beneficiary. Notwithstanding the foregoing, upon the request of the Grantee and subject to Applicable
Law, the Committee, at its sole discretion, may permit the Grantee to transfer the Award to a trust whose beneficiaries are the Grantee
and/or the Grantee’s immediate family members (all or several of them).
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15.2.       Notwithstanding
any other provisions of the Plan to the contrary, no Incentive Stock Option may be sold, transferred, pledged, assigned or otherwise alienated
or hypothecated, other than by will or by the laws of descent and distribution or in accordance with a beneficiary designation pursuant
to Section ‎15.1. Further, all Incentive Stock Options granted to a Grantee shall be exercisable during his or her lifetime only by
such Grantee.
15.3.       As
long as the Shares are held by the Trustee in favor of the Grantee, all rights possessed by the Grantee over the Shares are personal,
and may not be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.
15.4.       If
and to the extent a Grantee is entitled to transfer an Award and/or Shares underlying an Award in accordance with the terms of the Plan
and any other applicable agreements, such transfer shall be subject (in addition, to any other conditions or terms applying thereto) to
receipt by the Company from such proposed transferee of a written instrument, on a form reasonably acceptable to the Company, pursuant
to which such proposed transferee agrees to be bound by all provisions of the Plan and any other applicable agreements, including without
limitation, any restrictions on transfer of the Award and/or Shares set forth herein (however, failure to so deliver such instrument to
the Company as set forth above shall not derogate from all such provisions applying on any transferee).
15.5.       The
provisions of this Section ‎‎15 shall apply to the Grantee and to any purchaser, assignee or transferee of any Shares.
16.
CONDITIONS UPON ISSUANCE OF SHARES; GOVERNING PROVISIONS
.
16.1.
Legal
Compliance
. The grant of Awards and the issuance of Shares upon exercise or settlement of Awards shall be subject to compliance with
all Applicable Law as determined by the Company, including, applicable requirements of federal, state and foreign law with respect to
such securities. The Company shall have no obligations to issue Shares pursuant to the exercise or settlement of an Award and Awards may
not be exercised or settled, if the issuance of Shares upon exercise or settlement would constitute a violation of any Applicable Law
as determined by the Company, including, applicable federal, state or foreign securities laws or other law or regulations or the requirements
of any stock exchange or market system upon which the Shares may then be listed. In addition, no Award may be exercised or settled in
Shares unless (i) a registration statement under the Securities Act or equivalent law in another jurisdiction shall at the time of exercise
or settlement of the Award be in effect with respect to the Shares issuable upon exercise of the Award, or (ii) in the opinion of legal
counsel to the Company, the Shares issuable upon exercise or settlement, as applicable, of the Award may be issued in accordance with
the terms of an applicable exemption from the registration requirements of the Securities Act or equivalent law in another jurisdiction.
The inability of the Company to obtain authority from any regulatory body having jurisdiction, if any, deemed by the Company to be necessary
to the lawful issuance and sale of any Shares hereunder, and the inability to issue Shares hereunder due to non-compliance with any Company
policies with respect to the sale of Shares, shall relieve the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority or compliance shall not have been obtained or achieved. As a condition to the exercise, vesting
or settlement of an Award, the Company may require the Grantee to satisfy any qualifications that may be necessary or appropriate, to
evidence compliance with any Applicable Law or regulation and to make any representation or warranty with respect thereto as may be requested
by the Company, including to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment
and without any present intention to sell or distribute such Shares, all in form and content specified by the Company.
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16.2.
Provisions
Governing Shares
. Shares issued pursuant to an Award shall be subject to this Plan and Award Agreement (unless otherwise determined
by the Committee), and shall be subject to the Articles of Association of the Company, any limitation, restriction or obligation included
in any shareholders agreement applicable to all or substantially all of the holders of Shares (regardless of whether or not the Grantee
is a formal party to such shareholders agreement), any other governing documents of the Company, all policies, manuals and internal regulations
adopted by the Company from time to time, in each case, as may be amended from time to time, including any provisions included therein
concerning restrictions or limitations on disposition of Shares (such as, but not limited to, right of first refusal and lock up/market
stand-off) or grant of any rights with respect thereto, forced sale and bring along/drag along provisions, any provisions concerning restrictions
on the use of inside information and other provisions deemed by the Company to be appropriate in order to ensure compliance with Applicable
Law. Each Grantee shall execute (and authorizes any person designated by the Company to so execute, as well as (if applicable) the Trustee
holding any Shares for the Grantee’s behalf) such separate agreement(s) as may be requested by the Company relating to matters set
forth in or otherwise for the purpose of implementing this Section ‎16.2. The execution of such separate agreement(s) may be a condition
by the Company to the exercise of any Award and the Company (and, if applicable, the Trustee) may exercise its authorization above and
sign such agreement on behalf of the Grantee or subject the Grantee to the provisions of such agreements. Without limitation of the foregoing,
the proxy pursuant to Section ‎6.10 includes an authorization of the holder of such proxy to sign, by and on behalf of any Grantee,
such documents and agreements.
16.3.
Share
Purchase Transactions; Forced Sale
. In the event that the Board approves a Merger/Sale effected by way of a forced or compulsory sale
(whether pursuant to the Company’s Articles of Association, pursuant to Section 341 of the Companies Law or any shareholders agreement
or otherwise) or in the event of a transaction for the sale of all Shares of the Company, then, without derogating from such provisions
and in addition thereto, the Grantee shall be obligated, and shall be deemed to have agreed to the offer to effect the Merger/Sale (and
the Shares held by or for the benefit of the Grantee shall be included in the Shares of the Company approving the terms of such Merger/Sale
for the purpose of satisfying the required majority), and shall sell all of the Shares held by or for the benefit of the Grantee on the
terms and conditions applying to the holders of Shares, in accordance with the instructions then issued by the Board, whose determination
shall be final. No Grantee shall contest, bring any claims or demands, or exercise any appraisal rights related to any of the foregoing.
Each Grantee shall execute (and authorizes any person designated by the Company to so execute, as well as (if applicable) the Trustee
holding any Shares for the Grantee’s behalf) such documents and agreements, as may be requested by the Company relating to matters
set forth in or otherwise for the purpose of implementing this Section ‎16.3. The execution of such separate agreement(s) may be a
condition by the Company to the exercise of any Award and the Company (and, if applicable, the Trustee) may exercise its authorization
above and sign such agreement on behalf of the Grantee or subject the Grantee to the provisions of such agreements.
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16.4.
Data
Privacy; Data Transfer
. Information related to the Grantees and Awards hereunder, as shall be received from Grantee or others, and/or
held by, the Company or its Affiliates from time to time, and which information may include sensitive and personal information related
to Grantees (“
Information
”), will be used by the Company or its Affiliates (or third parties appointed by any of them,
including the Trustee) to comply with any applicable legal requirement, or for administration of the Plan as they deems necessary or advisable,
or for the respective business purposes of the Company or its Affiliates (including in connection with transactions related to any of
them). The Company and its Affiliates shall be entitled to transfer the Information among the Company or its Affiliates, and to third
parties for the purposes set forth above, which may include persons located abroad (including, any person administering the Plan or providing
services in respect of the Plan or in order to comply with legal requirements, or the Trustee, their respective officers, directors, employees
and representatives, and the respective successors and assigns of any of the foregoing), and any person so receiving Information shall
be entitled to transfer it for the purposes set forth above. The Company shall use commercially reasonable efforts to ensure that the
transfer of such Information shall be limited to the reasonable and necessary scope. By receiving an Award hereunder, the Grantee acknowledges
and agrees that the Information is provided at the Grantee’s free will and Grantee consents to the storage and transfer of the Information
as set forth above.
17.
MARKET STAND-OFF
17.1.       In
connection with any underwritten public offering of equity securities of the Company pursuant to an effective registration statement filed
under the Securities Act or equivalent law in another jurisdiction, the Grantee shall not directly or indirectly, without the prior written
consent of the Company or its underwriters, (i) lend, offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly
or indirectly, any Shares or other Awards, any securities of the Company (whether or not such Shares were acquired under this Plan), or
any securities convertible into or exercisable or exchangeable (directly or indirectly) for Shares or securities of the Company and any
other shares or securities issued or distributed in respect thereto or in substitution thereof (collectively, “
Securities
”),
or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Securities, whether any such transaction described in the foregoing clauses (i) or (ii) is to be settled by delivery
of Securities, in cash or otherwise. The foregoing provisions of this Section ‎17.1 shall not apply to the sale of any shares to an
underwriter pursuant to an underwriting agreement. Such restrictions (the “
Market Stand-Off
”) shall be in effect for
such period of time (the “
Market Stand-Off Period
”): (A) ninety (90) days following the effective date of such registration
statement relating to any other public offering; or (B) such other period as shall be requested by the Company or the underwriters.
Notwithstanding
anything herein to the contrary, if the underwriter(s) and the Company agree on a termination date of the
Market Stand-Off
Period
in the event of failure to consummate a certain public offering, then such termination shall apply also to the
Market Stand-Off
Period hereunder with respect to that particular public offering.
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17.2.       In
the event of a subdivision of the outstanding share capital of the Company, the distribution of any securities (whether or not of the
Company), whether as bonus shares or otherwise, and whether as dividend or otherwise, a recapitalization, a reorganization (which may
include a combination or exchange of shares or a similar transaction affecting the Company’s outstanding securities without receipt
of consideration), a consolidation, a spin-off or other corporate divestiture or division, a reclassification or other similar occurrence,
any new, substituted or additional securities which are by reason of such transaction distributed with respect to any Shares subject to
the Market Stand-Off, or into which such Shares thereby become convertible, shall immediately be subject to the Market Stand-Off.
17.3.       In
order to enforce the Market Stand-Off, the Company may impose stop-transfer instructions with respect to the Shares acquired under this
Plan until the end of the applicable Market Stand-Off period.
17.4.       The
underwriters in connection with a registration statement so filed are intended third party beneficiaries of this Section ‎17 and shall
have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Each Grantee shall execute such
separate agreement(s) as may be requested by the Company or the underwriters in connection with such registration statement and in the
form required by them, relating to Market Stand-Off (which need not be identical to the provisions of this Section ‎17, and may include
such additional provisions and restrictions as the underwriters deem advisable) or that are necessary to give further effect thereto.
The execution of such separate agreement(s) may be a condition by the Company to the exercise of any Award.
17.5.       Without
derogating from the above provisions of this Section ‎17 or elsewhere in this Plan, the provisions of this Section 17 shall apply
to the Grantee and the Grantee’s
heirs, legal representatives, successors, assigns,
and to any purchaser, assignee or transferee of any Awards or Shares.
18.
AGREEMENT REGARDING TAXES; DISCLAIMER
.
18.1.       If
the Company shall so require, as a condition of exercise, vesting or settlement, as applicable, of an Award, the release of Shares by
the Trustee or the expiration of the Restricted Period, a Grantee shall agree that, no later than the date of such occurrence, the Grantee
will pay to the Company (or the Trustee, as applicable) or make arrangements satisfactory to the Company and the Trustee (if applicable)
regarding payment of any applicable taxes and compulsory payments of any kind required by Applicable Law to be withheld or paid.
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18.2.
TAX
LIABILITY
. ALL TAX CONSEQUENCES UNDER ANY APPLICABLE LAW WHICH MAY ARISE FROM THE GRANT OF ANY AWARDS OR THE EXERCISE VESTING, SETTELEMENT,
AS APPLICABLE, THEREOF, THE SALE OR DISPOSITION OF ANY SHARES GRANTED HEREUNDER OR ISSUED UPON EXERCISE OR (IF APPLICABLE) THE VESTING
OF ANY AWARD, THE ASSUMPTION, SUBSTITUTION, CANCELLATION OR PAYMENT IN LIEU OF AWARDS OR FROM ANY OTHER ACTION IN CONNECTION WITH THE
FOREGOING (INCLUDING WITHOUT LIMITATION ANY TAXES AND COMPULSORY PAYMENTS, SUCH AS SOCIAL SECURITY OR HEALTH TAX PAYABLE BY THE GRANTEE
OR THE COMPANY IN CONNECTION THEREWITH) SHALL BE BORNE AND PAID SOLELY BY THE GRANTEE, AND THE GRANTEE SHALL INDEMNIFY THE COMPANY, ITS
SUBSIDIARIES AND AFFILIATES AND THE TRUSTEE, AND SHALL HOLD THEM HARMLESS AGAINST AND FROM ANY LIABILITY FOR ANY SUCH TAX OR PAYMENT OR
ANY PENALTY, INTEREST OR INDEXATION THEREON. EACH GRANTEE AGREES TO, AND UNDERTAKES TO COMPLY WITH, ANY RULING, SETTLEMENT, CLOSING AGREEMENT
OR OTHER SIMILAR AGREEMENT OR ARRANGEMENT WITH ANY TAX AUTHORITY IN CONNECTION WITH THE FOREGOING WHICH IS APPROVED BY THE COMPANY.
18.3.
NO
TAX ADVICE
. THE GRANTEE IS ADVISED TO CONSULT WITH A TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF RECEIVING, EXERCISING, VESTING,
SETTLEMENT OR DISPOSING OF AWARDS HEREUNDER. THE COMPANY DOES NOT ASSUME ANY RESPONSIBILITY TO ADVISE THE GRANTEE ON SUCH MATTERS, WHICH
SHALL REMAIN SOLELY THE RESPONSIBILITY OF THE GRANTEE.
18.4.
TAX
TREATMENT
. THE COMPANY AND ITS AFFILIATES (INCLUDING THE EMPLOYER) DO NOT UNDERTAKE OR ASSUME ANY LIABILITY OR RESPONSIBILITY TO THE
EFFECT THAT ANY AWARD SHALL QUALIFY WITH ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT, OR BENEFIT FROM ANY
PARTICULAR TAX TREATMENT OR TAX ADVANTAGE OF ANY TYPE AND THE COMPANY AND ITS AFFILIATES (INCLUDING THE EMPLOYER) SHALL BEAR NO LIABILITY
IN CONNECTION WITH THE MANNER IN WHICH ANY AWARD IS TREATED FOR TAX PURPOSES, REGARDLESS OF WHETHER THE AWARD WAS GRANTED OR WAS INTENDED
TO QUALIFY UNDER ANY PARTICULAR TAX REGIME OR TREATMENT. THIS PROVISION SHALL SUPERSEDE ANY TYPE OF AWARDS OR TAX QUALIFICATION INDICATED
IN ANY CORPORATE RESOLUTION OR AWARD AGREEMENT, WHICH SHALL AT ALL TIMES BE SUBJECT TO THE REQUIREMENTS OF APPLICABLE LAW. THE COMPANY
AND ITS AFFILIATES (INCLUDING THE EMPLOYER) DO NOT UNDERTAKE AND SHALL NOT BE REQUIRED TO TAKE ANY ACTION IN ORDER TO QUALIFY ANY AWARD
WITH THE REQUIREMENT OF ANY PARTICULAR TAX TREATMENT AND NO INDICATION IN ANY DOCUMENT TO THE EFFECT THAT ANY AWARD IS INTENDED TO QUALIFY
FOR ANY TAX TREATMENT SHALL IMPLY SUCH AN UNDERTAKING. THE COMPANY AND ITS AFFILIATES (INCLUDING THE EMPLOYER) DO NOT UNDERTAKE TO REPORT
FOR TAX PURPOSES ANY AWARD IN ANY PARTICULAR MANNER, INCLUDING IN ANY MANNER CONSISTENT WITH ANY PARTICULAR TAX TREATMENT. NO ASSURANCE
IS MADE BY THE COMPANY OR ANY OF ITS AFFILIATES (INCLUDING THE EMPLOYER) THAT ANY PARTICULAR TAX TREATMENT ON THE DATE OF GRANT WILL CONTINUE
TO EXIST OR THAT THE AWARD WOULD QUALIFY AT THE TIME OF EXERCISE, VESTING, SETTLEMENT OR DISPOSITION THEREOF WITH ANY PARTICULAR TAX TREATMENT.
THE COMPANY AND ITS AFFILIATES (INCLUDING THE EMPLOYER) SHALL NOT HAVE ANY LIABILITY OR OBLIGATION OF ANY NATURE IN THE EVENT THAT AN
AWARD DOES NOT QUALIFY FOR ANY PARTICULAR TAX TREATMENT, REGARDLESS WHETHER THE COMPANY COULD HAVE OR SHOULD HAVE TAKEN ANY ACTION TO
CAUSE SUCH QUALIFICATION TO BE MET AND SUCH QUALIFICATION REMAINS AT ALL TIMES AND UNDER ALL CIRCUMSTANCES AT THE RISK OF THE GRANTEE.
THE COMPANY DOES NOT UNDERTAKE OR ASSUME ANY LIABILITY TO CONTEST A DETERMINATION OR INTERPRETATION (WHETHER WRITTEN OR UNWRITTEN) OF
ANY TAX AUTHORITIES, INCLUDING IN RESPECT OF THE QUALIFICATION UNDER ANY PARTICULAR TAX REGIME OR RULES APPLYING TO PARTICULAR TAX TREATMENT.
IF THE AWARDS DO NOT QUALIFY UNDER ANY PARTICULAR TAX TREATMENT IT COULD RESULT IN ADVERSE TAX CONSEQUENCES TO THE GRANTEE.
18.5.       The
Company or any Subsidiary or Affiliate (including the Employer) may take such action as it may deem necessary or appropriate, in its discretion,
for the purpose of or in connection with withholding of any taxes and compulsory payments which the Trustee, the Company or any Subsidiary
or Affiliate (including the Employer) (or any applicable agent thereof) is required by any Applicable Law to withhold in connection with
any Awards, including, without limitations, any income tax, social benefits, social insurance, health tax, pension, payroll tax, fringe
benefits, excise tax, payment on account or other tax-related items related to the Grantee’s participation in the Plan and applicable
by law to the Grantee (collectively, “
Withholding Obligations
”). Such actions may include (i) requiring a Grantees
to remit to the Company or the Employer in cash an amount sufficient to satisfy such Withholding Obligations and any other taxes and compulsory
payments, payable by the Company or the Employer in connection with the Award or the exercise or (if applicable) the vesting thereof;
(ii) subject to Applicable Law, allowing the Grantees to surrender Shares to the Company, in an amount that at such time, reflects a value
that the Committee determines to be sufficient to satisfy such Withholding Obligations; (iii) withholding Shares otherwise issuable upon
the exercise of an Award at a value which is determined by the Company to be sufficient to satisfy such Withholding Obligations; or (iv)
any combination of the foregoing. The Company shall not be obligated to allow the exercise, vesting or settlement (as applicable) of any
Award by or on behalf of a Grantee until all tax consequences arising therefrom are resolved in a manner acceptable to the Company.
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18.6.       Each
Grantee shall notify the Company in writing promptly and in any event within ten (10) days after the date on which such Grantee first
obtains knowledge of any tax authority inquiry, audit, assertion, determination, investigation, or question relating in any manner to
the Awards granted or received hereunder or Shares issued thereunder and shall continuously inform the Company of any developments, proceedings,
discussions and negotiations relating to such matter, and shall allow the Company and its representatives to participate in any proceedings
and discussions concerning such matters. Upon request, a Grantee shall provide to the Company any information or document relating to
any matter described in the preceding sentence, which the Company, in its discretion, requires.
18.7.       With
respect to 102 Non-Trustee Options, if the Grantee ceases to be employed by the Company, Parent, Subsidiary or any Affiliate (including
the Employer), the Grantee shall extend to the Company and/or the Employer a security or guarantee for the payment of taxes due at the
time of sale of Shares, all in accordance with the provisions of Section 102 of the Ordinance and the Rules.
18.8.       If
a Grantee makes an election under Section 83(b) of the Code to be taxed with respect to an Award of Restricted Shares as of the date of
transfer of Shares rather than as of the date or dates upon which the Grantee would otherwise be taxable under Section 83(a) of the Code,
such Grantee shall deliver a copy of such election to the Company upon or prior to the filing such election with the U.S. Internal Revenue
Service. Neither the Company nor any Affiliate (including the Employer) shall have any liability or responsibility relating to or arising
out of the filing or not filing of any such election or any defects in its construction.
19.
RIGHTS AS A SHAREHOLDER; VOTING AND DIVIDENDS
.
19.1.       Subject
to Section ‎11.4, a Grantee shall have no rights as a shareholder of the Company with respect to any Shares covered by an Award until
the Grantee shall have exercised any such vested Award, or settled, as applicable, the Award, paid any Exercise Price (if applicable)
therefor and becomes the record holder of the subject Shares. In the case of 102 Awards, the Trustee shall have no rights as a shareholder
of the Company with respect to the Shares covered by such Award until the Trustee becomes the record holder for such Shares for the Grantee’s
benefit, and the Grantee shall not be deemed to be a shareholder and shall have no rights as a shareholder of the Company with respect
to the Shares covered by the Award until the date of the release of such Shares from the Trustee to the Grantee and the transfer of record
ownership of such Shares to the Grantee (provided, however, that the Grantee shall be entitled to receive from the Trustee any cash dividend
or distribution made on account of the Shares held by the Trustee for such Grantee’s benefit and such cash dividends or distributions
shall be subject to the same vesting terms and other conditions as relate to the original Shares underlying the Award, subject to any
tax withholding and compulsory payment). The Committee may apply any additional restrictions to such dividends that the Committee deems
appropriate. No adjustment shall be made for dividends (ordinary or extraordinary, whether in shares or other securities, cash or other
property, or rights, or any combination thereof) or distribution of other rights for which the record date is prior to the date on which
the Grantee or Trustee (as applicable) becomes the record holder of the Shares covered by an Award, except as provided in Section ‎14
hereof.
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19.2.       With
respect to all Awards issued in the form of Shares hereunder or upon the exercise, vesting or settlement (as applicable) of Awards hereunder,
any and all voting rights attached to such Shares shall be subject to Section ‎6.10, and other than Awards of Options and SARs, the
Grantee shall be entitled to receive dividends distributed with respect to such Shares and such cash dividends or distributions shall
be subject to the same terms and conditions as relates to the original Shares underlying the Award, subject to the provisions of the Company’s
Articles of Association, as amended from time to time, and subject to any Applicable Law.
19.3.       The
Company may, but shall not be obligated to, register or qualify the sale of Shares under any applicable securities law or any other Applicable
Law.
19.4.       The
Committee may grant dividend equivalents based on the dividends declared on Shares that are subject to any Award (other than an Option
or SAR). Any dividend equivalents may be credited as of the dividend payment dates, during the period between the grant date of the Award
and the date the Award becomes payable or terminates or expires, as determined by the Committee; however, dividend equivalents shall not
be payable unless and until the Award becomes payable, and shall be subject to forfeiture to the same extent as the underlying Award.
Dividend equivalents may be subject to any additional limitations and/or restrictions determined by the Committee. Dividend Equivalents
shall be payable in cash, Shares or converted to full-value Awards, calculated based on such formula, as may be determined by the Committee.
20.
NO REPRESENTATION BY COMPANY
.
By granting the Awards, the Company is not, and shall not be deemed
as, making any representation or warranties to the Grantee regarding the Company, its business affairs, its prospects or the future value
of its Shares and such representations and warranties are hereby disclaimed. The Company shall not be required to provide to any Grantee
any information, documents or material in connection with the Grantee’s considering an exercise of an Award. To the extent that
any information, documents or materials are provided, the Company shall have no liability with respect thereto. Any decision by a Grantee
to exercise an Award shall solely be at the risk of the Grantee.
21.
NO RETENTION RIGHTS
.
Nothing in this Plan, any Award Agreement or in any
Award granted or agreement entered into pursuant hereto shall confer upon any Grantee the right to continue in the employ of, or be in
the service of the Company or any Subsidiary or Affiliate thereof as a Service Provider or to be entitled to any remuneration or benefits
not set forth in this Plan or such agreement, or to interfere with or limit in any way the right of the Company or any such Subsidiary
or Affiliate to terminate such Grantee’s employment or service (including, any right of the Company or any of its Affiliates to
immediately cease the Grantee’s employment or service or to shorten all or part of the notice period, regardless of whether notice
of termination was given by the Company or its Affiliates or by the Grantee). Awards granted under this Plan shall not be affected by
any change in duties or position of a Grantee, subject to Sections ‎6.6 through ‎6.7. No Grantee shall be entitled to claim and
the Grantee hereby waives any claim against the Company or any Subsidiary or Affiliate that he or she was prevented from continuing to
vest Awards as of the date of termination of his or her employment with, or services to, the Company or any Subsidiary or Affiliate. No
Grantee shall be entitled to any compensation in respect of the Awards which would have vested had such Grantee’s employment or
engagement with the Company (or any Subsidiary or Affiliate) not been terminated.
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22.
PERIOD DURING WHICH AWARDS MAY BE GRANTED.
Awards may be granted pursuant to this Plan from
time to time within a period of ten (10) years from the Effective Date. From and after such date (as extended) no grants of Awards may
be made and this Plan shall continue to be in full force and effect with respect to Awards or Shares issued thereunder that remain outstanding.
23.
AMENDMENT OF THIS PLAN AND AWARDS
.
23.1.       The
Board at any time and from time to time may suspend, terminate, modify or amend this Plan, whether retroactively or prospectively. Any
amendment effected in accordance with this Section shall be binding upon all Grantees and all Awards, whether granted prior to or after
the date of such amendment, and without the need to obtain the consent of any Grantee. No termination or amendment of this Plan shall
affect any then outstanding Award unless expressly provided by the Board.
23.2.       Subject
to changes in Applicable Law that would permit otherwise, without the approval of the Company’s shareholders, there shall be (i)
no increase in the maximum aggregate number of Shares that may be issued under this Plan as Incentive Stock Options (except by operation
of the provisions of Section ‎14.1), (ii) no change in the class of persons eligible to receive Incentive Stock Options, and (iii)
no other amendment of this Plan that would require approval of the Company’s shareholders under any Applicable Law. Unless not permitted
by Applicable Law, if the grant of an Award is subject to approval by shareholders, the date of grant of the Award shall be determined
as if the Award had not been subject to such approval. Failure to obtain approval by the shareholders shall not in any way derogate from
the valid and binding effect of any grant of an Award that is not an Incentive Stock Option, subject to Applicable Law.
23.3.       The
Board or the Committee at any time and from time to time may modify or amend any Award theretofore granted, including any Award Agreement,
whether retroactively or prospectively.
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24.
APPROVAL
.
24.1.       This
Plan shall take effect upon its adoption by the Company’s shareholders (the “
Effective Date
”).
24.2.       102
Awards are conditional upon the filing with or approval by the ITA, if required, as set forth in Section ‎‎9. Failure to so file
or obtain such approval shall not in any way derogate from the valid and binding effect of any grant of an Award, which is not a 102 Award.
25.
RULES PARTICULAR TO SPECIFIC COUNTRIES; SECTION 409A
.
25.1.       Notwithstanding
anything herein to the contrary, the terms and conditions of this Plan may be supplemented or amended with respect to a particular country
or tax regime by means of an appendix to this Plan, and to the extent that the terms and conditions set forth in any appendix conflict
with any provisions of this Plan, the provisions of such appendix shall govern. Terms and conditions set forth in such appendix shall
apply only to Awards granted to Grantees under the jurisdiction of the specific country or such other tax regime that is the subject of
such appendix and shall not apply to Awards issued to a Grantee not under the jurisdiction of such country or such other tax regime. The
adoption of any such appendix shall be subject to the approval of the Board or the Committee, and if determined by the Committee to be
required in connection with the application of certain tax treatment, pursuant to applicable stock exchange rules or regulations or otherwise,
then also the approval of the shareholders of the Company at the required majority.
25.2.       This
Section ‎25.2 shall only apply to Awards granted to Grantees who are subject to United States Federal income tax.
25.2.1       It
is the intention of the Company that no Award shall be deferred compensation subject to Section 409A of the Code unless and to the extent
that the Committee specifically determines otherwise as provided in Section ‎25.2.2, and the Plan and the terms and conditions of
all Awards shall be interpreted and administered accordingly.
25.2.2       The
terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules
for payment or elective or mandatory deferral of the payment or delivery of Shares or cash pursuant thereto, and any rules regarding treatment
of such Awards in the event of a Merger/Sale, shall be set forth in the applicable Award Agreement and shall be intended to comply in
all respects with Section 409A of the Code, and the Plan and the terms and conditions of such Awards shall be interpreted and administered
accordingly.
25.2.3       The
Company shall have complete discretion to interpret and construe the Plan and any Award Agreement in any manner that establishes
an exemption from (or compliance with) the requirements of Section 409A of the Code.  If for any reason, such as imprecision in drafting,
any provision of the Plan and/or any Award Agreement does not accurately reflect its intended establishment of an exemption from (or compliance
with) Code Section 409A, as demonstrated by consistent interpretations or other evidence of intent, such provision shall be considered
ambiguous as to its exemption from (or compliance with) Section 409A of the Code and shall be interpreted by the Company in a manner
consistent with such intent, as determined in the discretion of the Company. If, notwithstanding the foregoing provisions of
this Section ‎25.2.3, any provision of the Plan or any such agreement would cause a Grantee to incur any additional tax or interest
under Section 409A of the Code, the Company may reform such provision in a manner intended to avoid the incurrence by such Grantee of
any such additional tax or interest;
provided
that the Company shall maintain, to the extent reasonably practicable, the original
intent and economic benefit to the Grantee of the applicable provision without violating the provisions of Section 409A of the Code. For
the avoidance of doubt, no provision of this Plan shall be interpreted or construed to transfer any liability for failure to comply with
the requirements of Section 409A from any Grantee or any other individual to the Company or any of its affiliates, employees or agents.
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25.2.4       Notwithstanding
any other provision in the Plan, any Award Agreement, or any other written document establishing the terms and conditions of an Award,
if any Grantee is a “specified employee,” within the meaning of Section 409A of the Code, as of the date of his or her “separation
from service” (as defined under Section 409A of the Code), then, to the extent required by Treasury Regulation Section 1.409A-3(i)(2)
(or any successor provision), any payment made to such Grantee on account of his or her separation from service shall not be made before
a date that is six months after the date of his or her separation from service. The Committee may elect any of the methods of applying
this rule that are permitted under Treasury Regulation Section 1.409A-3(i)(2)(ii) (or any successor provision).
25.2.5       Notwithstanding
any other provision of this Section ‎25.2 to the contrary, although the Company intends to administer the Plan so that Awards will
be exempt from, or will comply with, the requirements of Section 409A of the Code, the Company does not warrant that any Award under the
Plan will qualify for favorable tax treatment under Section 409A of the Code or any other provision of federal, state, local, or non-United
States law. The Company shall not be liable to any Grantee for any tax, interest, or penalties the Grantee might owe as a result of the
grant, holding, vesting, exercise, or payment of any Award under the Plan.
26.
GOVERNING LAW; JURISDICTION
.
This Plan and all determinations made and actions
taken pursuant hereto shall be governed by the laws of the State of Israel, except with respect to matters that are subject to tax laws,
regulations and rules of any specific jurisdiction in which the Grantee is employed or engaged by the Company or an Affiliate thereof,
which shall be governed by the respective laws, regulations and rules of such jurisdiction. Certain definitions, which refer to laws other
than the laws of such jurisdiction, shall be construed in accordance with such other laws. The competent courts located in Tel-Aviv-Jaffa,
Israel shall have exclusive jurisdiction over any dispute arising out of or in connection with this Plan and any Award granted hereunder.
By signing any Award Agreement or any other agreement relating to an Award, each Grantee irrevocably submits to such exclusive jurisdiction.
B -
42
27.
NON-EXCLUSIVITY OF THIS PLAN
.
The adoption of this Plan shall not be construed
as creating any limitations on the power or authority of the Company to adopt such other or additional incentive or other compensation
arrangements of whatever nature as the Company may deem necessary or desirable or preclude or limit the continuation of any other plan,
practice or arrangement for the payment of compensation or fringe benefits to employees generally, or to any class or group of employees,
which the Company or any Affiliate now has lawfully put into effect, including any retirement, pension, savings and stock purchase plan,
insurance, death and disability benefits and executive short-term or long-term incentive plans.
28.
MISCELLANEOUS
.
28.1.
Survival
.
The Grantee shall be bound by and the Shares issued upon exercise, vesting or settlement, as applicable, of any Awards granted hereunder
shall remain subject to this Plan after the exercise or (if applicable) the vesting of Awards, in accordance with the terms of this Plan,
whether or not the Grantee is then or at any time thereafter employed or engaged by the Company or any of its Affiliates.
28.2.
Additional
Terms
. Each Award awarded under this Plan may contain such other terms and conditions not inconsistent with this Plan as may be determined
by the Committee, in its sole discretion.
28.3.
Fractional
Shares
. No fractional Share shall be issuable upon exercise, vesting or settlement, as applicable, of any Award. Unless a different
rounding rule is applied by the Company, the number of Shares to be issued shall be rounded down to the nearest whole Share, with any
Share remaining at the last vesting date due to such rounding to be issued upon exercise at such last vesting date.
28.4.
Severability
.
If any provision of this Plan, any Award Agreement or any other agreement entered into in connection with an Award shall be determined
to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable
and enforceable in accordance with their terms, and all provisions shall remain enforceable in any other jurisdiction. In addition, if
any particular provision contained in this Plan, any Award Agreement or any other agreement entered into in connection with an Award shall
for any reason be held to be excessively broad as to duration, geographic scope, activity or subject, it shall be construed by limiting
and reducing such provision as to such characteristic so that the provision is enforceable to fullest extent compatible with Applicable
Law as it shall then appear.
28.5.
Captions
and Titles
. The use of captions and titles in this Plan or any Award Agreement or any other agreement entered into in connection with
an Award is for the convenience of reference only and shall not affect the meaning or interpretation of any provision of this Plan or
such agreement.
* * *
B - 43

----- exhibit_99-2.htm -----
EX-99.2
3
exhibit_99-2.htm
EXHIBIT 99.2
Exhibit 99.2
VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the cut - off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e - mail or the Internet . To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years . VOTE BY PHONE - 1 - 800 - 690 - 6903 Use any touch - tone telephone to transmit your voting instructions up until 11 : 59 p . m . Eastern Time the day before the cut - off date or meeting date . Have your proxy card in hand when you call and then follow the instructions . VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage - paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717 . CAESARSTONE LTD. KIBBUTZ SDOT - YAM MP MENASHE 3780400 ISRAEL TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: V80513 - P39700 KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. CAESARSTONE LTD. The Board of Directors recommends you vote FOR the following proposals: 1. Approval of the re - election of each of Maxim Ohana, Eran Cohen and Yuval Beeri, and the election of each of Aviv Ben Horin and Yaron Arzi, as a director of the Company to hold office until the close of the next annual general meeting. Abstain Against For Nominees: տ տ տ 1a. Maxim Ohana տ տ տ 1b. Eran Cohen տ տ տ 1c. Yuval Beeri տ տ տ 1d. Aviv Ben Horin տ տ տ 1e. Yaron Arzi 2. Approval of the re - election of Ms. Lily Ayalon, and the election of Ms. Hanna Yanovsky, to serve as external directors of the Company, each for a three - year term commencing on December 1, 2026, and approval of their respective terms of compensation. Abstain Against For Nominees: տ տ տ 2a. Lily Ayalon տ տ տ 2b. Hanna Yanovsky
տ տ տ 3 . Approval of an amended and restated Compensation Policy for the Company’s Executive Officers and Directors, effective as of the date of the annual general meeting for a period of three years . տ տ տ 4 . Approval of an increase in the total number of ordinary shares reserved for issuance as incentive stock options under the Company’s 2020 Share Incentive Plan . տ տ տ 5 . Approval of the grant of equity - based compensation to Yuval Beeri, Yaron Arzi, Lily Ayalon and Hanna Yanovsky, subject to each such director’s election or re - election, as applicable, as a director at the Meeting and to the actual commencement of his or her term of office . տ տ տ 6 . Approval of the grant of equity - based compensation to Eran Cohen, Aviv Ben Horin and Maxim Ohana, who are currently affiliates of controlling shareholders of the Company, subject to each such director’s election or re - election, as applicable, as a director at the Meeting . տ տ տ 7 . Approval of the terms of employment of Mr . Eran Cohen in his role as the Company’s ROW Sales Director, subject to his election as a director at the Meeting . տ տ տ 8 . Approval of the reappointment of Kost, Forer, Gabbay & Kasierer (a member of Ernst & Young Global) as the Company’s independent auditors for the year ending December 31 , 2026 , and its service until the annual general meeting of shareholders to be held in 2027 and to authorize the Company’s board of directors (or, the audit committee, if authorized by the board of directors, subject to the ratification of the board of directors), upon recommendation of the audit committee of the Company, to determine the compensation of the independent auditors in accordance with the volume and nature of their services and receive an update regarding the Company’s independent auditors’ remuneration for the past year . By signing and returning this proxy card, the undersigned confirms that the undersigned is NOT a controlling shareholder and does NOT have a personal interest in the approval of Proposals No . 2 , 3 , 5 , 6 and 7 , as applicable (an “Interested Shareholder”), as such terms are defined in the Company’s Proxy Statement . If the undersigned is an Interested Shareholder, please notify the Company’s General Counsel, Ron Mosberg, at AGM@caesarstone . com, as described in the Proxy Statement, in which case the undersigned’s vote will be counted for or against the ordinary majority only, and not for or against the special tally under such Proposals . Shareholders entitled to notice of and to vote at the meeting shall be determined as of the close of business on October 20 , 2026 , the record date fixed by the Board of Directors for such purpose . The signer hereby revokes all previous proxies given by the signer to vote at the annual general meeting or any adjournments thereof . Please sign exactly as your name(s) appears on the Proxy . If held in joint tenancy, the shareholder named first in the Company's register must sign . Trustees, Administrators, etc . , should include title and authority . Corporation should provide full name of corporation and title of authorized officer signing the Proxy . PLEASE BE SURE TO RETURN THE ENTIRE PROXY ALONG WITH PROOF OF IDENTITY AS DESCRIBED IN THE COMPANY'S PROXY STATEMENT . Date Signature (Joint Owners) Date Signature [PLEASE SIGN WITHIN BOX]
2026 ANNUAL GENERAL MEETING OF SHAREHOLDERS OF CAESARSTONE LTD. NOVEMBER 25, 2026 5:00 P.M. (Israel time) Important Notice Regarding the Availability of Proxy Materials for the Annual General Meeting: The Notice and Proxy Statement is available at www.proxyvote.com. ↓ Please detach along perforated line and mail in the envelope provided. ↓ CAESARSTONE LTD. 2026 ANNUAL GENERAL MEETING OF SHAREHOLDERS NOVEMBER 25, 2026 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned, a shareholder of Caesarstone Ltd . (the “Company”), an Israeli company, hereby appoints Mr . Nahum Trost, Mr . Ron Mosberg and Idan Gur, and each of them acting individually, as the attorney and proxy of the undersigned, with full power of substitution, for and in the name of the undersigned, to vote and otherwise act on behalf of the undersigned at the annual general meeting of shareholders of the Company to be held at the offices of the Company, Kibbutz Sdot - Yam, MP Menashe 3780400 , Israel, on November 25 , 2026 , at 5 : 00 p . m . Israel time ( 10 : 00 a . m . Eastern time), or at any adjournment(s) or postponement(s) thereof, with respect to all of the ordinary shares, par value NIS 0 . 04 per share, of the Company (the “Shares”) which the undersigned would be entitled to vote, with all powers the undersigned would possess if personally present, provided said proxies are authorized and directed to vote as indicated with respect to the matters set forth below this Proxy . Subject to applicable law and the rules of Nasdaq, in the absence of such instructions, the Shares represented by properly executed and received proxies will be voted “FOR” Proposals No . 1 , 4 , and 8 to be presented to the annual general meeting or any adjournment(s) or postponement(s) thereof . This proxy also delegates, to the extent permitted by applicable law, discretionary authority to vote with respect to any other business which may properly come before the annual general meeting or any adjournment(s) or postponement(s) thereof . WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN THIS FORM OF PROXY AND MAIL THE ENTIRE PROXY PROMPTLY, ALONG WITH PROOF OF IDENTITY IN ACCORDANCE WITH THE COMPANY’S PROXY STATEMENT, IN THE ENCLOSED ENVELOPE IN ORDER TO ASSURE REPRESENTATION OF THESE SHARES . NO POSTAGE NEED BE AFFIXED IF THE PROXY IS MAILED IN THE UNITED STATES . (Continued and to be signed on the reverse side)

----- zk2636245.htm -----
6-K
1
zk2636245.htm
6-K
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.  20549
______________________
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of October 2026
Commission File Number: 001-35464
Caesarstone
Ltd.
(Translation of registrant’s name into English)
Kibbutz Sdot Yam
MP Menashe
Israel 3780400
(Address of principal executive offices)
Indicate by check mark whether
the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form
20-F ☒      Form 40-F ☐
EXPLANATORY NOTE
On October 20, 2026, the board
of directors of Caesarstone Ltd. (the “Company”) resolved to hold its annual general meeting of shareholders (the “Meeting”)
on November 25, 2026, with a record date on October 20, 2026. The Company hereby furnishes the following documents:
(i)
Notice and Proxy Statement with respect to the Meeting to be held on November 25, 2026, describing the proposals to be voted upon at the Meeting, the procedure for voting in person or by proxy at the Meeting and various other details related to the Meeting.
(ii)
Proxy Card whereby holders of ordinary shares of the Company may vote at the Meeting without attending in person.
This Form 6-K is incorporated
by reference into the Company’s Registration Statements on Form S-8 (Files Nos. 333-180313, 333-210444, 333-251642 and 333-295843).
EXHIBIT INDEX
Exhibit
Description
99.1
Notice and Proxy Statement of the 2026 Annual General Meeting of Shareholders
99.2
Proxy Card relating to the 2026 Annual General Meeting of Shareholders
SIGNATURE
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
CAESARSTONE LTD.
Date: October 21, 2026
By:
/s/ Nahum Trost
Name:  Nahum Trost
Title:    Chief Financial Officer