M-WISE, INC.
ISRAEL SHARE OPTION PLAN (2001)
OPTION AGREEMENT
made and entered into on the day of , 2000
Between
M-WISE, INC.
(the "Company")
and
ISRAEL
(the "Employee")
WHEREAS: The Employee is an employee of the Company and/or of a subsidiary
and/or of an affiliated company of the
Company (each a "Related Company" and collectively, "Related Companies"); and
WHEREAS: The Company desires to grant the Employee options to purchase shares in
the Company, and/or issue to the Employee shares in the Company and the Employee
is interested in receiving the aforesaid options and/or purchasing the aforesaid
shares, all in accordance with and subject to the Company's Employee Share
Option Plan (2000) and the annexes thereto (the "Plan") and the provisions of
this Agreement, and their intention is that the provisions of Section 102 of the
Income Tax Ordinance and the Income Tax Rules (Tax Relief on Shares Issued to
Employees), 5749-1989 (hereinafter, the "Law", and the "Rules", respectively)
shall apply to the shares issued and/or options granted; and
WHEREAS: The Employee has read the Rules and the Plan, wishes to be bound by
them and desires that they apply to
the options and shares which shall be granted to him hereunder; and
WHEREAS: As a condition to receiving the options and/or shares the Employee
desires to waive a portion of his
salary as provided for in this Agreement.
NOW, THEREFORE, it is agreed as follows:
Preamble
The preamble to this Agreement is the basis and constitutes an integral
part thereof.
Application of the Provisions of the Plan
2.1 The Employee hereby declares that he has carefully read the Plan and that he
acknowledges and agrees to all of the provisions, conditions, limitations,
authorizations, declarations and commitments included therein.
2.2 The Employee declares and agrees that this Agreement and the Plan prevail
over any previous agreement, arrangement and/or understanding, whether written
or oral between the Employee and the Company and/or any Related Company, or the
officers and/or directors and/or the shareholders thereof with respect to the
matters herein included, and with respect to the Company's shares and/or any
option to purchase shares in the Company which have not yet been actually issued
or granted, and that any agreement, arrangement and/or understanding as
aforesaid are null and void and of no further force or effect.
2.3 All of the provisions, conditions, limitations and declarations included and
specified in the Plan, as the same shall be amended from time to time, are
hereby incorporated herein by reference and constitute an integral part of this
Agreement and of the Employee's commitments hereunder. Except and to the extent
otherwise expressly provided herein, nothing in this Agreement or in the
provisions hereof shall derogate from anything contained in the Plan.
2.4 The Employee declares, covenants and agrees that the Law and the Rules, as
the same shall be amended from time to time, including the trust deed between
the Company and the trustee (the conditions whereof are accepted by the Employee
and upon signing this Agreement he approves them as an integral part of this
Agreement) and the notice to the Assessing Officer about the allotment, are
fully binding on the Employee and shall prevail in case of contradiction, over
any other provision in the Agreement or in the Plan.
2.5 A copy of the Plan is attached hereto and constitutes an integral part
hereof.
3. Grant of Option; Vesting
3.1 Subject to this Agreement and the Plan, the Company shall grant to the
Employee, by an "approved issue" within the meaning of the Law, an option (the
"Option") to purchase ___ Common Stock of the Company (the "Shares") at an
exercise price of $0.01 per share, at the time and in the manner hereinafter
provided.
The term of the Option shall be 8 years from the date hereof or such
shorter period as is prescribed in
Section 3.3 below.
3.2 The following are the dates as of which the Option may be exercised (each an
"Exercise Date") by the Trustee pursuant to the Employee's instructions and the
number of Shares which may be purchased thereunder on each such Exercise Date:
3.2.1 Commencing as of______, 200, _______ Shares.
3.2.2 Commencing as of_________, 200, ________ additional Shares.
3.2.3 Commencing as of _______, 200, ________ additional Shares.
3.3 The consideration shall be paid on the date of the exercise of the Option.
The Option shall be exercisable by the Trustee on behalf of the Employee in
progressive stages on the Exercise Dates as aforesaid provided that the Employee
shall have been continuously employed by the Company and/or a Related Company,
from the date hereof until such date of exercise.
In the event of termination of the Employee's employment by the
Company, not for Cause (as such term is defined below) and subject to the
provisions of Section 7.7 of the Plan, prior to the complete exercise of the
Option, the Employee may exercise the Option within 30 days thereafter, to the
extent that the Option is vested on the date of termination (but in no event
later than the expiration of the term of the Option as prescribed in this
Agreement).
Notwithstanding any of the abovementioned, in the event that the
employment of the Employee with the Company is terminated for cause, any
unexercised portion of the Option shall immediately expire and be of no further
force or effect upon the earlier of such termination or notice of termination.
For the purposes of this section 3, a termination for "Cause" is a
termination due to: (i) the Employee's conviction of any felony that entails
moral turpitude; (ii) the Employee's embezzlement of funds of the Company; (iii)
the Employee's material breach of the terms and conditions of this Agreement;
(iv) the Employee's involvement with an act which constitutes breach of trust
between him and the Company or which constitutes breach of discipline; or (v)
the Employee's conduct causing grave injury to the Company, monetarily or
otherwise.
3.4 As a condition to his receipt of the Shares and the Option, the Employee
agrees to waive the amount of $0.01 for each Share which may be purchased
pursuant to the Option i.e., an aggregate of $___ as a one-time waiver from his
salary, and the Employee hereby instructs the Company to deduct from his wages
such aggregate sum.
The Employee hereby agrees and acknowledges that the aforesaid sum
shall not be returned to him even if the Option is not exercised for any reason.
4. Non Assignability
The Employee's rights to: (a) receive and exercise the Option; (b)
receive all or part of the Shares from the Trustee; (c) require that the same
shall be registered in his name; and (d) request that the Trustee sell Shares on
his behalf, are subject to the Plan and are personal and not transferable (other
than pursuant to the laws of inheritance), and may not be made subject to any
pledge, lien, attachment or other charge whether voluntary or by law, and no
power of attorney or a Transfer deed shall be given in respect thereof, whether
it is to be effective immediately or in the future, whether directly or
indirectly, and any such transfer shall be null and void.
The Employee acknowledges and hereby agrees that, in addition to the
limitations on transferability of the Shares, pursuant to the Company's
incorporation documents, as shall be in effect from time to time, for as long as
the Company is a private company or a public company whose shares are not traded
on any stock exchange, the Employee's shares in the Company shall not be
transferable, without the prior approval of the Company's Board of Directors,
which approval may be withheld at its absolute discretion.
5. Employee Representations, Warranties and Covenants
Without derogating in any manner from the provisions of the Plan or
this Agreement, the Employee hereby represents, warrants, agrees and undertakes
as follows:
5.1 The Shares are being purchased for the Employee's own account for investment
purposes only and not with a view for resale or transfer not including IPO (as
such term is defined above), and that all the rights pertaining to the Shares,
by law or equity, shall be purchased and possessed by the Employee (through the
trustee) for the Employee exclusively other than IPO.
5.2 That he acknowledges that the Company's shares are not publicly traded and
understands that the Company bears no responsibility and has made no commitment
to register its shares, or the Options or Shares allotted to the Employee, for
trading or to offer its shares to the public in any manner.
5.3 The Employee acknowledges and agrees that no income or gain which the
Employee may be credited with or which purports to be credited to the Employee
as a result of the grant of the Option, the issue of the Shares, the transfer
into the Employee's name thereof or the sale thereof, if any, shall in any
manner be taken into account in the calculation of the basis for the Employee's
entitlements from the Company or any Related Company or in the calculation of
any social welfare right or other rights or benefits arising out of the
employee/employer relationship, including without limitation, social security,
manager's insurance, educational fund, pension funds, severance pay, holiday
pay, etc.
In the event that the Company and/or any Related Company shall be
required, pursuant to any law, to take into account for purposes of calculating
any such benefits, any of the aforesaid elements of income or gain actually or
theoretically credited to the Employee, the Employee shall promptly indemnify
the Company and/or any Related Company against any expense caused to it in this
regard, and any such amount shall be deemed a debt of the Employee to the
Company and/or any Related Company, which may be deducted or set off from any
amounts payable to the Employee.
5.4 The Employee acknowledges that nothing in this Agreement and/or in the Plan
shall be interpreted as a commitment and/or an agreement by the Company and/or
any Related Company to employ the Employee, whether for a certain period or
otherwise, and that nothing in this Agreement and/or the Plan or any option
granted pursuant hereto or thereto shall be interpreted as conferring upon the
Employee any right to continue in the employment of the Company or any Related
Company or as obliging the Company or any Related Company to employ the Employee
or as restricting the rights of the Company and/or any Related Company to
terminate the Employee's employment, at any time, at its sole discretion and in
accordance with law. The Employee shall have no claim whatsoever against the
Company and/or any Related Company as a result of the termination of his
employment, even if such termination causes the Option or any other options, in
whole or in part, to expire and/or prevents him from exercising the Option in
whole or in part and/or from receiving or retaining the Shares pursuant hereto
or to any other agreement between him and the Company, or results in any loss
due to any imposition of tax liability (including any early imposition) pursuant
to applicable law.
5.5 The Employee acknowledges that the grant of the Option and the issue of the
Shares, the execution of this Agreement and the Employee's participation in the
Plan shall have tax consequences to the Employee, and that the Company is not
able to ensure or represent to the Employee the nature and extent of such tax
consequences.
The Employee acknowledges and agrees that pursuant to the Plan, the
Employee shall be liable to pay all taxes, of every nature, including duties,
fines and any other payment which may be imposed by the tax authorities, whether
in Israel or abroad, and all expenses arising out of the Plan, including every
obligatory payment of whatever source in respect of the Option, the Shares
(including, without limitation, upon the exercise of the Option, the sale of the
Shares or the registration of the Shares in the Employee's name) or dividends or
any other benefit in respect thereof, and/or all other charges which may accrue
to the Employee, the Company, any Related Company and/or the trustee in
connection with the Plan, whether or not the provisions of the Law or the
Commissioner's Rules apply. Furthermore, the Employee acknowledges that the
Employee shall not have, and the Employee hereby waives, any complaint and/or
cause of action the same has or shall have in the future against the trustee
and/or against the Company in any way connected to any taxation resulting from
the grant of the Option, the exercise thereof, the transfer of Shares into the
Employee's name, the sale of Shares by the Employee and/or by the trustee and/or
any other matter which is in any manner whatsoever connected to the Option, the
Shares and/or the participation of the Employee in the Plan.
The Employee further acknowledges and agrees that, without derogating
from the Employee's obligation to pay all taxes payable with respect to the
Option and the Shares, the Company and/or any Related Company and/or the trustee
shall at their absolute sole discretion be entitled (and/or obliged pursuant to
the Law), to deduct at source from all the payments due to the Employee,
including dividends, consideration for the sale of shares or from any other
source, any tax payments due to the tax authorities in respect of the Option or
the Shares pursuant to any law.
5.6 The Employee acknowledges that he is aware of, and clearly understands: (a)
the rights and limitations attached to the Shares as set forth in the Company's
Articles of Association, the Plan and this Agreement; (b) the limitations on
transferability thereof set forth in the Articles of Association, the Plan and
this Agreement; (c) that the Company's Articles of Association may be amended
from time to time as permitted by law; and (d) that the provisions of the
Articles of Association of the Company which shall apply to the Shares shall be
the provisions which shall be in effect from time to time; and that, as a
result, inter alia, of these limitations, it may be difficult or impossible for
the Employee to realize his investment and/or to sell or otherwise transfer the
Shares.
5.7 In the event that the Company's Articles of Association, now or at any time
hereafter, provide for a right of first refusal to purchase shares of the
Company which are offered for sale by other shareholders of the Company and/or a
pre-emptive right to purchase shares which are being allotted or shall in the
future be allotted by the Company, the Employee hereby waives such rights. For
the purpose of the approval of any transfer or the execution of any issue as
aforesaid, this Agreement shall constitute an authorization, for the benefit of
the Company and the Company's shareholders, to the trustee, until the
consummation of the initial public offering of the Company's shares pursuant to
an effective registration statement, prospectus or similar document in any
jurisdiction as is determined by the Board of Directors of the Company (the
"IPO"), to sign any confirmation or waiver in the name of the Employee and on
his behalf. The Employee shall not sell, and shall not instruct the Trustee to
sell, the Shares or any part thereof to any third party, unless such third party
signs a waiver and a power of attorney as aforesaid.
5.8 The shares issued with respect to the Option granted hereunder will be held
by the Trustee and registered in his name until the consummation of the IPO.
5.9 The Employee shall have none of the rights of a shareholder of the Company,
for as long as the Option has not been exercised and, once exercised, for as
long as the Shares have not been transferred and registered in the Employee's
name in the Company's register of members pursuant to the Plan.
5.10 For as long as any shares are held by the Trustee or registered in his name
or for as long as the certificates representing any shares are held by the
Trustee, the Trustee alone shall be entitled to receive every notice to which a
shareholder is entitled, and he alone shall be entitled to exercise every right
of the shareholders vis-a-vis the Company or to demand any information, and any
financial and/or other report to which a shareholder is entitled from the
Company, and he alone shall have the right to participate in all shareholders'
meetings. The Employee shall not be entitled to exercise any of these rights as
shareholder nor make any demand or request of the Trustee in this regard.
Without derogating from the generality of the above, the Employee shall not have
nor exercise any voting rights with respect to the Shares until they are
transferred and registered in his name in the Company's register of members
pursuant to the Plan.
5.11 Until the consummation of the IPO, the Employee shall provide at the
Company's request, any certificate, declaration or other document and shall
perform any full act which the Company shall consider to be necessary or
desirable pursuant to any law, whether local or foreign (including any
undertaking on the part of the grantee not to sell his or her shares during any
period which shall be required by an underwriter (lock up period) or investment
bank or advisor of the Company for the purpose of any share issue whether
private or public and including any certificate or agreement which the Company
shall require, if any, from the Employee as a member of a class of
shareholders), or any certificate, declaration or other document the obtaining
of which shall be deemed by the Board to be appropriate or necessary for the
purpose of raising capital for the Company, of merging the Company with another
company (whether the Company is the surviving entity or not), or of
reorganization of the Company, including, in the event of a consolidation or
merger of the Company or any sale, lease, exchange or other transfer of all or
substantially all of the assets or shares of the Company, the sale or exchange,
as the case may be, of any shares or rights to purchase shares the Employee (or
the Trustee on his behalf) may have purchased or been granted hereunder all as
shall be deemed necessary or desirable by the Board.
In order to guarantee, and without derogating from, the aforesaid, and
because the rights of the Company and the other shareholders are dependent
thereon, the Employee shall, upon signing this Agreement and as a condition to
the grant of any options hereunder, execute the Proxy and Power of Attorney
attached to the Plan as Appendix C, or in such other form as shall be approved
by the Board, irrevocably empowering the Trustee, until consummation of the IPO,
to sign in his name as aforesaid on any document as aforesaid, and the Employee
shall have no complaint or claim against the trustee in respect of such
signature. The Employee will authenticate his signature in the presence of a
notary if he shall be asked to do so by the Company, in order to give full
validity to the power of attorney.
5.12 The Employee has received a copy of the Plan, has examined it, and
acknowledges and agrees to all the
provisions and conditions thereof.
5.13 The Employee has full knowledge of the Company and its activities, and is
aware that the Company operates in a sophisticated, high tech and high risk
sector, and that the market thereof is restricted and highly competitive, and
that the exercise of the Option constitutes an economic risk. The Employee
undertakes that he shall not have any claim against the Company and/or any
Related Company or any of its or their officers, employees, shareholders or
advisors if the Employee's investment in the Shares shall fail or for the
payment of any tax due or for any other reason.
6. Taxes; Indemnification of the Company, the Trustee and the Legal
Advisor
6.1 The Employee hereby covenants, whether the provisions of the Law shall apply
to the Employee or not, to bear all tax obligations, levies, fines and other
payments concerning the Employee which shall be imposed by the tax authorities
(whether in Israel or abroad) and any other obligation from whatever source
including but no limited to the obligations of the Employee and/or the Company
and/or any Related Company and/or the trustee arising out of the Plan (including
granting of the Option, exercise of the Option, issue of the Shares, transfer of
the Shares into the Employee's name and the sale thereof by the Employee and/or
by the trustee). Without derogating from the generality of the aforesaid the
Employee's obligations in this regard shall include, income tax, stamp tax,
employer's tax, capital gains tax, social security insurance and any other tax,
levy or payment which the Employee or the Company and/or any Related Company is
or shall be obliged to pay because of the Option or the Shares (including
deductions at source which the Company is obliged to make for tax imposed upon
the Employee) and the Employee shall indemnify the Company and/or any Related
Company and/or the Trustee for every charge or payment as aforesaid, which may
be deducted or set off from any amounts payable to the Employee.
6.2 Subject to the provisions of the Plan, the Employee hereby covenants to pay
the Company and/or the Trustee promptly upon their first request in writing, any
sum for which they are responsible (or, in the Board of Directors' opinion, they
might be responsible for), and which is payable by the Employee as set forth in
Section 6.1 hereof to the income tax authorities and/or any other governmental
or administrative authority, whether in Israel or abroad (including for
deduction of tax at source) pursuant to the Plan, and/or in respect of the
Employee's participation in the Plan, whether the Trustee's responsibility as
aforesaid shall arise directly or in respect of any responsibility of the
Employee for such payment. The Employee covenants to promptly indemnify the
Company and/or any Related Company and/or the Trustee for any charge or payment
as aforesaid, which may be deducted or set off from any amounts payable to the
Employee.
6.3 In no event shall the Trustee or the Company's legal counsel be liable to
the Company and/or the Employee and/or to any third party (including, without
derogating from the generality of the aforesaid, the income tax authorities and
any other governmental or administrative authority, whether in Israel or abroad)
or a purchaser of Shares from the Employee (or the trustee), with respect to any
act which has been or which shall be carried out and/or any opinion which has
been or shall be given in relation to the Plan and any matter connected thereto
or arising therefrom. The Company and/or any Related Company and the Employee
covenant, upon signing this Agreement, that they will not make, and they each
hereby waive, any and all claims against the trustee and the Company's legal
counsel as aforesaid and each of the Company, Related Company and the Employee
expressly agree that if either shall make any claim against the trustee or the
Company's legal counsel the same shall then be entitled on the grounds of this
Section alone to apply to the competent court for dismissal of the action
against them with costs. The Company covenants and agrees that if a claim is
brought by any third party against the trustee or the Company's legal counsel,
the same will be entitled without objection by the Company, to join the Company
as a third party to any such action and any judgment against them shall be paid
by the Company.
The Company and the Employee hereby covenant to indemnify the trustee
and/or the Company's legal counsel against any liability in relation to any
claim and/or demand made against the trustee and/or the Company's legal counsel
by any person whatsoever, including the tax authorities, in relation to their
acts or omissions in connection with the Plan.
The provisions of this Section and the other provisions of this
Agreement and the Plan which grant any right, power, immunity or any authority
to the trustee and/or to the Company's legal counsel, shall operate in favor of
the trustee and the Company's legal counsel and they shall be entitled to act
pursuant to and enforce such provisions, and the Company and the Employee shall
be liable to the trustee and the Company's legal counsel as if they were parties
to this Agreement.
7. Amendments to the Plan and/or Replacement thereof
The Employee acknowledges, agrees and confirms that the Plan may be
amended as provided for therein and the Employee hereby agrees and covenants not
to raise any objection to any such amendment as aforesaid and that the Employee
shall sign any document which according to the Company's legal counsel is
necessary or desirable in order to give full force and effect to the amendment
of the Plan. The Employee understands that any amendment to the Plan or any
document connected to the Plan, shall bind him as if he were a party thereto.
8. Substitution of the Trustee
The parties acknowledge and agree that the Company is entitled to
replace the trustee and/or to nominate another person to serve as a trustee in
lieu of the existing trustee if the same is no longer capable or willing to
fulfill his duties and that the new trustee shall have the same powers and
authority which the Plan and this Agreement grant the trustee.
9. Governing Laws
This Agreement shall be governed by and construed in accordance with the laws of
the State of Israel and, subject to the provisions of Section 10 below, the
competent courts in the district shall have exclusive jurisdiction with respect
to any matter or conflict with respect thereto.
10. Disputes
As a condition of the granting of the Option, the Employee and the
Employee's successors and assigns agree that any dispute or disagreement which
shall arise under or as a result of this Agreement shall be determined by the
Board of Directors of the Company (the "Board"), or any committee designated by
the Board pursuant to the Plan, in its sole discretion and judgment and that any
such determination and any interpretation by the Board or any such committee of
the terms of this Agreement shall be final and shall be binding and conclusive
for all purposes.
In making any such determination or interpretation the Board or any
such committee shall be bound by the rules and provisions of applicable
Arbitration Law.
11. The Employee's Confirmation pursuant to Section 4(b) of the
Commissioner's Rules
The Employee hereby confirms and covenants to the Company, the trustee,
the Assessing Officer and the Income Tax Commissioner, in accordance with the
Rules that he agrees that the arrangement set forth in Section 102 to the Law
shall apply to him and that he shall not request any tax exemption pursuant to
Sections 97(a) or 104 of the Income Tax Ordinance or pursuant to an exemption
from taxes in the context of a merger of corporations for the transfer of the
Shares before the termination of the restricted period as defined in the Law.
The trustee and the Company shall give notice, pursuant to Section 4(b) to the
Rules, to the Assessing Officer, at the office where the Company's file is
administered as to this commitment of the Employee.
The form of this Commitment of the Employee is attached hereto as
Appendix 11 and shall be signed by the Employee upon signing this Agreement
together with the other annexes attached to the Plan.
12. Notices and/or Instructions
(a) Every notice and/or instruction required or permitted to be given pursuant
to this Agreement shall be given in writing and shall be deemed to have been
delivered on the date of its delivery to the addressee by hand or 3 (three) days
after having been sent by registered mail. The parties addresses for the purpose
of this Section shall be, if a party hasn't communicated another address by a
written notice 10 (ten) days in advance, as follows:
The Company: m-Wise, Inc.
==============
The Employee: _______________
ISRAEL
(b) A stamp or a receipt on behalf of the postal service which evidences the
time of delivery of the notice shall constitute conclusive evidence as to the
date of delivery and no party shall claim that a notice delivered as aforesaid
has not been received by such party.
------------------------- -------------------------
m-Wise, Inc. Employee
m-Wise, Inc.
M-WISE, INC.
IRREVOCABLE PROXY AND POWER OF ATTORNEY
I, the undersigned, ________, hereby appoint ______________ or whoever shall
replace him as trustee pursuant to m-Wise, Inc..'s Employee Share Option Plan
(hereinafter: the "Trustee", the "Company" and the "Plan" respectively) as my
proxy to participate and vote (or abstain) for me and on my behalf as he at his
sole discretion of shall deem appropriate, on all matters at all meetings of
shareholders of the Company (whether ordinary, extraordinary or otherwise), on
behalf of all the shares and/or options of the Company held by the Trustee on my
behalf and hereby authorize and grant a power of attorney to the Trustee as
follows:
I hereby authorize and grant power of attorney to the Trustee for as long as any
shares or options which were allotted or granted on my behalf are held by the
Trustee or registered in his name, or for as long as the certificates
representing any shares are held by the Trustee, to exercise every right, power
and authority with respect to the shares and/or options and to sign in my name
and on my behalf any document (including any agreement, including a merger
agreement of the Company or an agreement for the purchase or sale of assets or
shares (including the shares of the Company held on my behalf) and any and all
documentation accompanying any such agreements, such as, but not limited to,
decisions, requests, instruments, receipts and the like), and any affidavit or
approval with respect to the shares and/or options or to the rights which they
represent in the Company in as much as the Trustee shall deem it necessary or
desirable to do so. In addition and without derogating from the generality of
the foregoing, I hereby authorize and grant power of attorney to the Trustee to
sign any document as aforesaid and any affidavit or approval (such as any waiver
of rights of first refusal to acquire shares which are offered for sale by other
shareholders of the Company and/or any preemptive rights to acquire any shares
being allotted by the Company, in as much as such rights shall exist pursuant to
the Company's Articles of Association as shall be in existence from time to
time) and/or to make and execute any undertaking in my name and on my behalf if
the Trustee shall, at his sole discretion, deem that the document, affidavit or
approval is necessary or desirable for purposes of any placement of securities
of the Company, whether private or public (including lock-up arrangements and
undertakings), whether in Israel or abroad, for purposes of a merger of the
Company with another entity, whether the Company is the surviving entity or not,
for purposes of any reorganization or recapitalization of the Company or for
purposes of any purchase or sale of assets or shares of the Company.
This Proxy and Power of Attorney shall be interpreted in the widest possible
sense, in reliance upon the Plan and upon the goals and intentions thereof, and
in accordance with the instructions of the Board of Directors of the Company
(the "Board") (including any committee designated by the Board pursuant to the
Plan) and its determinations.
This Proxy and Power of Attorney shall expire and cease to be of force and
effect immediately after the consummation of the initial public offering of the
Company's shares, pursuant to an effective registration statement, prospectus or
similar document in Israel or such other jurisdiction as is determined by the
Board and shall be irrevocable until such time as the rights of the Company and
the Company's shareholders are dependent hereon. The expiration of this Power of
Attorney shall in no manner effect the validity of any document (as aforesaid),
affidavit or approval which has been signed or given as aforesaid prior to the
expiration hereof and in accordance herewith.
IN WITNESS WHEREOF, I have executed this Proxy and Power of Attorney on the __
day of _______, 2001.
----------------
CONFIRMATION
I, the undersigned, ________, hereby confirm the signature of __________ which
appears above.
---------------
Appendix 11
M-WISE, INC.
Date: ______________
The Income Tax Commissioner
Assessing Officer
m-Wise, Inc. ("m-Wise")
__________________ or whoever shall
replace him as trustee pursuant
to m-Wise's Israel
Share Option Plan (2001) (the "Trustee")
Dear Sir/Madam,
Re: Letter of Consent, Approval and Undertaking
I hereby confirm as follows:
1. I agree that the arrangement provided for in Section 102 of the Income Tax
Ordinance shall apply in its entirety to the options and the shares due to me
from m-Wise and to myself.
2. I hereby give my written consent to that which appears in the trust
documents signed on _______ between
m-Wise and the Trustee (hereinafter: the "Trust Documents").
3. I agree that should bonus shares be issued with respect to the shares which
were allotted on my behalf by way of an "approved allotment" or which are
subject to the options which were granted to me, such bonus shares shall be
allotted to the Trustee and shall be registered in his name and the provisions
of Section 102 of the Income Tax Ordinance (the "Ordinance") and the Income Tax
Rules (Tax Relief on Shares Issued to Employees), 5749-1989 (the "Commissioner's
Rules") shall apply to the said shares as if they were the original shares with
respect to which they were allotted and that the Trustee's undertakings pursuant
to the Trust Documents shall also apply accordingly to the bonus shares.
4. I hereby undertake to the Income Tax Commissioner and the assessing officer
neither to request nor demand a tax exemption pursuant to Sections 97(a) or 104
of the Income Tax Ordinance or pursuant to an exemption from taxes in the
context of a merger of corporations for the transfer of shares allotted to me or
which are subject to the options granted to me pursuant to the plan, prior to my
payment of the applicable tax with respect to these shares pursuant to the
Ordinance and the Commissioner's Rules and likewise I undertake not to transfer
the shares, by way of a transfer which is exempt from tax prior to the payment
of the applicable tax.
5. I agree that the Trustee and m-Wise shall inform the assessing officer
pursuant to Section 4(b) of the Commissioner's Rules that they are holding this
approval.
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