Exhibit 3.6
ARTICLES OF ASSOCIATION
OF
ENZYMOTEC LTD.
A COMPANY LIMITED BY SHARES
UNDER THE COMPANIES LAW - 1999
1. INTERPRETATION.
1.1. In
these Articles, unless the context requires another meaning the words in the first column of the following table shall have the
meanings set opposite them in the second column:
| “Articles” |
these Articles of Association, as amended from time to time
by a Resolution (as defined below); |
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| “Auditors” |
the auditors of the Company; |
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| “Board of Directors” |
all of the directors of the Company holding office pursuant to these
Articles, including alternates, substitutes or proxies; |
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| “Chief Executive Officer” |
chief executive officer of the Company; |
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| “Chairman of the Board of Directors” |
as defined in Article 81; |
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| “Companies Law” or the “Law” |
the Companies Law, 5759-1999, of the State of Israel, as amended from
time to time, or any other law which may come in its stead, including all amendments made thereto; |
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| “Company” |
Enzymotec Ltd.; |
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|
| "Compensation |
|
| Committee" |
as defined in the Companies Law; |
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| “Effective Time” |
the closing of the initial underwritten public offering of the Company’s
Ordinary Shares, at which time these Articles shall first become effective. |
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| “Director/s” |
a member or members of the Board of Directors elected to hold office
as director(s); |
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| “External Directors” |
as defined in the Companies Law; |
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| “General Meetings” |
all annual and extraordinary meetings of the Shareholders; |
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| “Incapacitated Person” |
according to the meaning thereof under the Legal Capacity and Guardianship Law, 5722-1962,
of the State of Israel, as amended from time to time, including a minor who has not yet attained the age of 18 years, a person
unsound of mind and a bankrupt in respect of whom no rehabilitation has been granted; |
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| “Month” or “Year” |
according to the Gregorian calendar. |
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| “NIS” |
New Israeli Shekels. |
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| “Office” |
the registered office of the Company at that time; |
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| “Office Holder” |
as defined in the Companies Law; |
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| “Person” |
includes an individual, corporation, company, cooperative society, partnership, trust
of any kind or any other body of persons, whether incorporated or otherwise; |
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| “Register” |
the Register of Shareholders administered in accordance with Section 127 of the Law; |
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| “Resolution” |
a resolution of Shareholders. Except as required under the
Law or these Articles, any Resolution shall be adopted by a majority of the voting power present and voting at the applicable
General Meeting, in person or by proxy; |
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| “Shareholder(s)” |
shall mean the shareholder(s) of the Company, at any given time; |
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| “U.S. Rules” |
the rules of the NASDAQ Stock Market and the U.S. securities rules and regulations, as amended
from time to time; |
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|
| “writing” |
handwriting, typewriting, photography, telex, email or any other legible form of writing. |
1.2. Subject
to the provisions of this Article 1, in these Articles, unless the context necessitates another meaning, terms and expressions
which have been defined in the Companies Law shall have the meanings ascribed to them therein.
1.3. Words
in the singular shall also include the plural, and vice versa. Words in the masculine shall include the feminine and vice versa,
and words which refer to persons shall also include corporations, and vice versa.
1.4. The
captions to articles in these Articles are intended for the convenience of the reader only, and no use shall be made thereof in
the interpretation of these Articles.
LIMITED LIABILITY
2. The
Company is a limited liability company and therefore each shareholder’s obligations for the Company’s obligations
shall be limited to the payment of the nominal value of the shares held by such shareholder, subject
to the provisions of the Companies Law.
THE COMPANY’S OBJECTIVES
3. The
Company’s objectives are to conduct all types of business as are permitted by law. The
Company may donate a reasonable amount of money for any purpose that the Board of Directors finds appropriate, even if the donation
is not for business considerations or for the purpose of achieving profits for the Company.
THE BUSINESS
4. Any
branch or type of business that the Company is authorized to engage in, either expressly or implied, may be commenced or engaged
in by the Board of Directors at all or any time as it deems fit. The Board of Directors shall be entitled
to cease the conduct of any such branch or type of business, whether or not the actual conduct thereof has commenced at its own
discretion.
REGISTERED OFFICE
5. The
registered office shall be at such place as is decided from time to time by the Board of Directors.
SHARE CAPITAL
6. The
share capital of the Company shall consist of NIS 1,000,000 divided into 100,000,000 Ordinary Shares, of a nominal
value of NIS 0.01 each (the “Ordinary Shares. Such number of shares reflects (i) the automatic conversion
of all preferred shares of the Company in accordance with the Company's articles of association as in effect immediately prior
to the Effective Time into Ordinary Shares, (ii) the conversion of all options, warrants, rights or other convertible securities
("Convertible Securities") outstanding immediately prior to the Effective Time into Convertible Securities exercisable
for, or convertible into, Ordinary Shares.
7. RIGHTS
ATTACHING TO THE ORDINARY SHARES.
7.1. The
Ordinary Shares in respect of which all calls have been fully paid shall confer on the holders thereof the right to attend and
to vote at General Meetings of the Company, both ordinary as well as extraordinary meetings.
7.2. The
Ordinary Shares shall confer on a holder thereof the right to receive a dividend, to participate in a distribution of bonus shares
and to participate in the distribution of the assets of the Company upon its winding-up, pro rata to the nominal amount paid up
on the shares or credited as paid up in respect thereof, and without reference to any premium which may have been paid in respect
thereof.
8. MODIFICATION
OF CLASS RIGHTS.
8.1. Subject
to applicable law, if at any time the share capital of the Company is divided into different classes of shares and unless the
terms of issue of such class of shares otherwise stipulate, the rights attaching to any class of shares
(including rights prescribed in the terms of issue of the shares) may be altered, modified or canceled, by a Resolution passed
at a separate General Meeting of the Shareholders of that class.
8.2. The
provisions contained in these Articles with regard to General Meetings shall apply, mutatis mutandis as the case may
be, to every such General Meeting of the holders of each such class of the Company’s shares.
8.3. Unless
otherwise provided by these Articles, the increase of an authorized class of shares, or shares, or the issuance of additional
shares thereof out of the authorized and unissued share capital, shall not be deemed, for purposes of this Article 8,
to modify or abrogate the rights attached to previously issued shares of such class or of any other class.
9. UNISSUED
SHARE CAPITAL
The unissued shares in the
capital of the Company shall be under the control of the Board of Directors, which shall be entitled to allot or otherwise grant
the same to such persons under such restrictions and conditions as it shall deem fit, whether for consideration or otherwise,
and whether for consideration in cash or for consideration which is not in cash, above their nominal value or at a discount, all
on such conditions, in such manner and at such times as the Board of Directors shall deem fit, subject to the provisions of the
Law. The Board of Directors shall be entitled, inter alia, to differentiate between Shareholders with regard to the amounts
of calls in respect of the allotment of shares (to the extent that there are calls) and with regard to the time for payment thereof.
The Board of Directors may also issue options or warrants for the purchase of shares of the Company and prescribe the manner of
the exercise of such options or warrants, including the time and price for such exercise and any other provision which is relevant
to the method for distributing the issued shares of the Company amongst the purchasers thereof.
10. The
Board of Directors shall be entitled to prescribe the times for the issue of shares of the Company and the conditions therefore
and any other matter which may arise in connection with the issue thereof.
11. In
every case of a rights offering the Board of Directors shall be entitled, in its discretion, to resolve any problems and difficulties
arising or that are likely to arise in regard to fractions of rights, and without prejudice to the generality of the foregoing,
the Board of Directors shall be entitled to specify that no shares shall be allotted in respect of fractions of rights, or that
fractions of rights shall be sold and the (net) proceeds shall be paid to the persons entitled to the fractions of rights, or,
in accordance with a decision by the Board of Directors, to the benefit of the Company.
INCREASE OF AND ALTERATIONS TO CAPITAL
12. The
Company may, from time to time, by a Resolution, increase its share capital by way of the creation of new shares, whether or not
all the existing shares have been issued up to the date of the resolution, whether or not it has been decided to issue same, and
whether or not calls have been made on all the issued shares.
13. The
increase of capital shall be in such amount and divided into shares of such nominal value, and with such restrictions and conditions
and with such rights and privileges as the Resolution dealing with the creation of the shares prescribes, and if no provisions
are contained in the Resolution, then as the Board of Directors shall prescribe.
14. Unless
otherwise stated in the Resolution approving the increase of the share capital, the new shares shall be subject to those provisions
in regard to issue, allotment, alteration of rights, payment of calls, liens, forfeiture, transfer, transmission and other provisions
which apply to the shares of the Company.
15. By
Resolution, the Company may, subject to any applicable provisions of the Law:
15.1. consolidate
its existing share capital, or any part thereof, into shares of a larger denomination than the existing shares:
15.2. sub-divide
its share capital, in whole or in part, into shares of a smaller denomination than the nominal value of the existing shares and
without prejudice to the foregoing, one or more of the shares so created may be granted any preferred or deferred rights or any
special rights with regard to dividends, participation in assets upon winding-up, voting and so forth, subject to the provisions
of these Articles;
15.3. reduce
its share capital; or
15.4. cancel
any shares which on the date of passing of the Resolution have not been issued and to reduce its share capital by the amount of
such shares.
16. In
the event that the Company shall adopt any of the Resolutions described in Article 15 above, the Board of Directors shall be entitled
to prescribe arrangements necessary in order to resolve any difficulty arising or that are likely to arise in connection with
such Resolutions, including in the event of a consolidation, in which it shall be entitled to (i) prescribe which shares shall
be consolidated into a particular class of share; (ii) allot, in contemplation of or subsequent to such consolidation or other
action, shares or fractional shares sufficient to preclude or remove fractional share holdings; (iii) redeem, in the case of redeemable
shares, and subject to applicable law, such shares or fractional shares sufficient to preclude or remove fractional share holdings;
(iv) round up, round down or round to the nearest whole number, any fractional shares resulting from the consolidation or from
any other action which may result in fractional shares; or (v) cause the transfer of fractional shares by certain Shareholders
to other Shareholders thereof so as to most expediently preclude or remove any fractional shareholdings, and, cause the transferees
of such fractional shares to pay the transferors thereof the fair value thereof, and the Board of Directors is hereby authorized
to act in connection with such transfer, as agent for the transferors and transferees of any such fractional shares, with full
power of substitution, for the purposes of implementing the provisions of this Article 16
SHARE
CERTIFICATES
17. To
the extent shares are certificated, share certificates evidencing title to the shares of the Company shall be issued under the
seal or rubber stamp of the Company, and together with the signatures of two members of the Board of Directors, or one director
together with the Chief Executive Officer. The Board of Directors shall be entitled to decide that the signatures be effected
in any mechanical or electronic form, provided that the signature shall be effected under the supervision of the Board of Directors
in such manner as it prescribes.
18. Every
shareholder shall be entitled, free of charge, to one certificate in respect of all the shares of a single class registered in
his name in the Register.
19. The
Board of Directors shall not refuse a request by a shareholder to obtain several certificates in place of one certificate, unless
such request is, in the opinion of the Board of Directors, unreasonable. Where a shareholder has sold or transferred some of his
shares, he shall be entitled, free of charge, to receive a certificate in respect of his remaining shares, provided that the previous
certificate is delivered to the Company before the issuance of a new certificate.
20. Every
share certificate shall specify the number of the shares in respect of which such certificate is issued and also the amounts which
have been paid up in respect of each share.
21. No
person shall be recognized by the Company as having any right to a share unless he is the registered owner of the shares in the
Register. The Company shall not be bound by and shall not recognize any right or privilege pursuant to the laws of equity, or
a fiduciary relationship or a chose in action, future or partial, in any share, or a right or privilege to a fraction of a share,
or (unless these Articles otherwise direct) any other right in respect of a share, except the absolute right to the share as a
whole, where same is vested in the owner registered in the Register.
22. A
share certificate registered in the names of two or more persons shall be delivered to one of the joint holders, and the Company
shall not be obliged to issue more than one certificate to all the joint holders of shares and the delivery of such certificate
to one of the joint holders shall be deemed to be delivery to all of them.
23. If
a share certificate should be lost, destroyed or defaced, the Board of Directors shall be entitled to issue a new certificate
in its place, provided that the certificate is delivered to it and destroyed by it, or it is proved to the satisfaction of the
Board of Directors that the certificate was lost or destroyed and security has been received to its satisfaction in respect of
any possible damages and after payment of such amount as the Board of Directors shall prescribe.
CALLS ON SHARES
24. The
Board of Directors may from time to time, in its discretion, make calls on Shareholders in respect of amounts which are still
unpaid in respect of the shares held by each of the Shareholders (including premiums), and the terms of issue which do not prescribe
that same be paid at fixed times, and every shareholder shall be obliged to pay the amount of the call made on him, at such time
and at such place as stipulated by the Board of Directors.
25. In
respect of any such call, prior notice of at least 14 (fourteen) business days shall be given, stating to whom the amount called
is to be paid, the time for payment and the place thereof, provided that prior to the due date for payment of such call, the Board
of Directors may, by written notice to the Shareholders to which the call was made, cancel the call or extend the date of payment
thereof.
26. If
according to the terms of issue of any share, or otherwise, any amount is required to be paid at a fixed time or in installments
at fixed times, whether the payment is made on account of the share capital in respect of the share or in form of a premium, every
such payment or every such installment shall be paid as if it was a call duly made by the Board of Directors, in respect of which
notice was duly given, and all the provisions contained in these Articles in regard to calls shall apply to such amount or to
such installment.
27. Joint
holders of a share shall be jointly and severally liable for the payment of all installments and calls due in respect of such
share.
28. In
the event that a call or installment due on account of a share is not paid on or before the date fixed for payment thereof, the
holder of the share, or the person to whom the share has been allotted, shall be obliged to pay linkage differentials and interest
on the amount of the call or the installment, at such rate as shall be determined by the Board of Directors, commencing from the
date fixed for the payment thereof and until the date of actual payment. The Board of Directors may, however, waive the payment
of the linkage differentials or the interest or part thereof.
29. A
shareholder shall not be entitled (i) to receive a dividend and (ii) to exercise any right as a shareholder, including but not
limited to, the right to attend and vote at a General Meeting of any type and to transfer the shares to another; unless he has
paid all the calls payable from time to time and which apply to any of his shares, whether he holds same alone or jointly with
another, plus linkage differentials, interest and expenses, if any.
30. The
Board of Directors may, if it deems fit, accept payment from a shareholder wishing to advance the payment of all moneys which
remain unpaid on account of his shares, or part thereof which are over and above the amounts which have actually been called,
and the Board of Directors shall be entitled to pay such shareholder linkage differentials and interest in respect of the amounts
paid in advance, or that portion thereof which exceeds the amount called for the time being on account of the shares in respect
of which the advance payment is made, at such rate as is agreed upon between the Board of Directors and the shareholder, with
this being in addition to dividends payable (if any) on the paid-up portion of the share in respect of which the advance payment
is made.
The Board of Directors may,
at any time, repay the amount paid in advance as aforesaid, in whole or in part, in its sole discretion, without premium or penalty.
Nothing in this Article 30 shall derogate from the right
of the Board of Directors to make any call for payment before or after receipt by the Company of any such advance.
FORFEITURE AND LIEN
31. If
a shareholder fails to make payment of any call or other installment on or before the date fixed for the payment thereof, the
Board of Directors may, at any time thereafter and for as long as the part of the call or installment remains unpaid, serve on
him a notice demanding that he make payment thereof, together with the linkage differentials and interest at such rate as is specified
by the Board of Directors and all the expenses incurred by the Company in consequence of such non-payment.
32. The
notice shall specify a further date, which shall be at least 14 business days after the date of the delivery of the notice, and
a place or places at which such call or installment is to be paid, together with linkage differentials and interest and expenses
as aforesaid. The notice shall further state that, if the amount is not paid on or before the date specified, and at the place
mentioned in such notice, the shares in respect of which the call was made, or the installment is due, shall be liable to forfeiture.
33. If
the demands contained in such notice are not complied with the Board of Directors may treat the shares in respect of which the
notice referred to in Articles 31 and 32 was given as forfeited. Such forfeiture shall include all dividends, bonus shares and
other benefits which have been declared in respect of the forfeited shares which have not actually been paid prior to the forfeiture.
34. Any
share so forfeited or waived shall be deemed to be the property of the Company and the Board of Directors shall be entitled, subject
to the provisions of these Articles and the Law, to sell, re-allot or otherwise dispose thereof, as it deems fit, whether the
amount paid previously in respect of that share is credited, in whole or in part.
35. The
Board of Directors may, at any time before any share forfeited as aforesaid is sold or re-allotted or otherwise dispose of, cancel
the forfeiture on such conditions as it deems fit.
36. Any
person whose shares have been forfeited shall cease to be a shareholder in respect of the forfeited shares, but shall, nonetheless
remain liable for the payment to the Company of all calls, installments, linkage differentials, interest and expenses due on account
of or in respect of such shares on the date of forfeiture, in respect of the forfeited shares, together with interest on such
amounts reckoned from the date of forfeiture until the date of payment, at such rate as the Board of Directors shall from time
to time specify. However, his liability shall cease after the Company has received all the amounts called in respect of the shares
as well as any expenses incurred by the Company relating to collecting the amounts called. The Board of Directors shall be entitled
to collect the moneys which have been forfeited, or part thereof, as it shall deem fit, but it shall not be obliged to do so.
37. The
provisions of these Articles in regard to forfeiture shall also apply to cases of non-payment of any amount, which, according
to the terms of issue of the share, or which under the conditions of allotment the due date for payment of which fell on a fixed
date, whether this be on account of the nominal value of the share or in the form of a premium, as if such amount was payable
pursuant to a call duly made and notified.
38. The
Company shall have a first and paramount lien over all the shares which have not been fully paid up and which are registered in
the name of any shareholder (whether individually or jointly with others) and also over the proceeds of the sale thereof, as security
for the debts and obligations of such shareholder to the Company and his contractual engagements with it, either individually
or together with others. This right of lien shall apply whether or not the due date for payment of such debts or the fulfillment
or performance of such obligations has arrived, and no rights in equity shall be created in respect of any share, over which there
is a lien as aforesaid. The aforesaid lien shall apply to all dividends or benefits which may be declared, from time to time,
on such shares, unless the Board of Directors shall decide otherwise.
39. In
order to foreclose on such lien, the Board of Directors may sell the shares under lien at such time and in such manner as, it
shall deem fit, but no share may be sold unless the period referred to below has elapsed and written notice has been given to
the shareholder, his trustee, liquidator, receiver, the executors of his estate, or anyone who acquires a right to shares in consequence
of the bankruptcy of a shareholder, as the case may be, stating that the Company intends to sell the shares, if he or they should
fail to pay the aforesaid debts, or fail to discharge or fulfill the aforesaid obligations within 14 business days from the date
of the delivery of the notice.
40. The
net proceeds of any such sale of shares, as contemplated by Article 39 above, after deduction of the expenses of the sale, shall
serve for the discharge of the debts of such shareholder or for performance of such shareholder’s obligations (including
debts, undertaking and contractual engagements due date for the payment or performance of which has arrived) and the surplus,
if any, shall be paid to the shareholder, his trustee, liquidator, receiver, guardians, the executors of his estate, or to his
successors-in-title.
41. In
every case of a sale following forfeiture or waiver, or for purposes of executing a lien by exercising all of the powers conferred
above, the Board of Directors shall be entitled to appoint a person to sign an instrument of transfer of the shares sold, and
to arrange for the registration of the name of the buyer in the Register in respect of the shares sold.
42. An
affidavit signed by the Chairman of the Board of Directors that a particular share of the Company was forfeited, waived or sold
by the Company by virtue of a lien, shall serve as conclusive evidence of the facts contained therein as against any person claiming
a right in the share. The purchaser of a share who relies on such affidavit shall not be obliged to investigate whether the sale,
re-allotment or transfer, or the amount of consideration and the manner of application of the proceeds of the sale, were lawfully
effected, and after his name has been registered in the Register he shall have a full right of title to the share and such right
shall not be adversely affected by a defect or invalidity which occurred in the forfeiture, waiver, sale, re-allotment or transfer
of the share.
TRANSFER AND TRANSMISSION OF SHARES
43. No
transfer of shares shall be registered unless a proper instrument of transfer is delivered to the Company or to such other place
specified for this purpose by the Board of Directors. Subject to the provisions of these Articles, an instrument of transfer of
a share in the Company shall be signed by the transferor and the transferee. The transferor shall be deemed to remain the holder
of the share up until the time the name of the transferee is registered in the Register in respect of the transferred share.
44. Insofar
as the circumstances permit, the instrument of transfer of a share shall be drawn up in the form set out below, or in any other
form that the Board of Directors may approve (the “Deed of Transfer”).
I _______________, I.D. _______________
of _______________ (the “Transferor”), in consideration for an amount of NIS _______________ (in words) paid
to me by _______________ I.D. _______________ of _______________ (hereinafter: the “Transferee”), hereby transfer
to the Transferee _______________ ______________ shares of nominal value NIS _______________ each, marked with the numbers _______________
to _______________ (inclusive) of a company known as Enzymotec Ltd., to be held by the Transferee, the acquires of his rights
and his successors-in title, under all the same conditions under which I held same prior to the signing of this instrument, and
I, the Transferee, hereby agree to accept the aforementioned share in accordance with the above mentioned conditions.
In witness whereof we have
hereunto signed this _____ day of _______ 20__.
Transferor _______________
Transferee _______________
Witnesses to Signature _______________
45. The
Company may close the transfer registers and the Register for such period of time as the Board of Directors shall deem fit.
46. Every
instrument of transfer shall be submitted to the Office or to such other place as the Board of Directors shall prescribe, for
purposes of registration, together with the share certificates to be transferred, or if no such certificate was issued, together
with a letter of allotment of the shares to be transferred, and/or such other proof as the Board of Directors may demand in regard
to the transferor’s right of title or his right to transfer the shares. The Board of Directors shall have the right to refuse
to recognize an assignment of shares until the appropriate securities under the circumstances have been provided, as shall be
determined by the Board of Directors in a specific case or from time to time in general. Instruments of transfer which serve as
the basis for transfers that are registered shall remain with the Company.
47. Every
instrument of transfer shall relate to one class of shares only, unless the Board of Directors shall otherwise agree.
48. The
executors of the will or administrator of a deceased shareholder’s estate (such shareholder not being one of a joint owners
of a share) or, in the absence of an administrator of the estate or executor of the will, shall be entitled to demand that the
Company recognize them as owners of rights in the share . The provisions of Article 46 above shall apply, mutatis mutandis,
also in regard to this Article.
49. In
the case of a share registered in the names of two or more Persons, the Company shall recognize only the surviving owners as Persons
having rights in the share. However, the aforementioned shall not be construed as releasing the estate of a deceased joint shareholder
from any and all undertakings in respect of the shares. Any Person who shall become an owner of shares following the death of
a shareholder shall be entitled to be registered as owner of such shares after having presented to an officer of the Company to
be designated by the Chief Executive Officer an inheritance order or probation order or order of appointment of an administrator
of estate and any other proof as required - if these are sufficient in the opinion of such officer - testifying to such Person’s
right to appear as shareholder in accordance with these Articles, and which shall testify to his title to such shares. The provisions
of Article 46 above shall apply, mutatis mutandis, also in regard to this Article.
50. The
receiver or liquidator of a shareholder who is a company or the trustee in bankruptcy or the official receiver of a shareholder
who is bankrupt, upon presenting appropriate proof to the satisfaction of an officer of the Company to be designated by the Chief
Executive Officer that he has the right to appear in this capacity and which testifies to his title, may, with the consent of
the Board of Directors (the Board of Directors shall not be obligated to give such consent) be registered as the owner of such
shares. Furthermore, he may assign such shares in accordance with the rules prescribed in these Articles. The provisions of Article
46 above shall apply, mutatis mutandis, also in regard to this Article.
51. A
Person entitled to be registered as a shareholder following assignment pursuant to these Articles shall be entitled, if approved
by the Board of Directors and to the extent and under the conditions prescribed by the Board of Directors, to dividends and any
other monies paid in respect of the shares, and shall be entitled to give the Company confirmation of the payments; however, he
shall not be entitled to be present or to vote at any General Meeting of the Company or, subject to the provisions of these Articles,
to make use of any rights of Shareholders, until he has been registered as owner of such shares in the Register.
GENERAL MEETING
52. A
General Meeting shall be held at least once in every year, not later than 15 (fifteen) months after the last General Meeting,
at such time and at such place as the Board of Directors shall determine. Such General Meeting shall be called an annual meeting,
and all other meetings of the Shareholders shall be called extraordinary meetings.
53. The
Board of Directors may call an extraordinary meeting whenever it sees fit to do so.
54. The
Board of Directors shall be obliged to call an extraordinary meeting upon a requisition in writing in accordance with the Law.
55. The
Company shall provide prior notice in regard to the holding of an annual meeting or an extraordinary meeting in accordance with
the requirements of these Articles, the Law and the regulations promulgated thereunder. Subject to the provisions of the Law and
the regulations promulgated thereunder, in counting the number of days of prior notice given, the day of publication of notice
shall not be counted, but the day of the meeting shall be counted. The notice shall specify those items and contain such information
as shall be required by the Companies Law, the regulations promulgated thereunder and any other applicable law and regulations.
56. Any
Shareholder or Shareholders of the Company requesting to add an item to the agenda of a General Meeting may submit such a request
(a “Proposal Request”) in accordance with the Law. Subject to any requirements under the Law, to be considered
timely and thereby be added to such agenda, a Proposal Request must be delivered, either in person or by certified mail, postage
prepaid, and received at the principal executive office of the Company, (i) in the case of a General Meeting that is an annual
meeting, no less than sixty (60) days nor more than one-hundred twenty (120) days prior to the date of the first anniversary of
the preceding year’s annual meeting, provided, however, that, in the event that the date of the annual meeting is advanced
more than thirty (30) days prior to or delayed by more than thirty (30) days after the anniversary of the preceding year’s
annual meeting, notice by the Proposing Shareholder to be timely must be so received not earlier than the close of business one-hundred
twenty (120) days prior to such annual meeting and not later than the close of business on the later of ninety (90) days prior
to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such meeting is first
made, and (ii) in the case of a General Meeting that is an extraordinary meeting, no earlier than one-hundred twenty (120) days
prior to such extraordinary meeting and no later than sixty (60) days prior to such extraordinary meeting or the tenth (10th)
day following the day on which public announcement of the date of such meeting is first made, subject to applicable law. In no
event shall the public announcement of an adjournment or postponement of a meeting commence a new time period (or extend any time
period) for the giving of a stockholder’s notice as described above. Subject to any requirements under the Law, nominations
of persons for election to the Board of Directors may only be made at an extraordinary meeting if directors are to be elected
at such meeting (a) by or at the direction of the Board of Directors or (b) by any shareholder who is entitled to vote at the
meeting and who complies with the notice procedures set forth in this Article. Such request shall also set forth: (i) the name
and address of the Shareholder making the request; (ii) a representation that the Shareholder is a holder of record of shares
of the Company entitled to vote at such meeting and intends to appear in person or by proxy at the meeting; (iii) a description
of all arrangements or understandings between the Shareholder and any other person or persons (naming such person or persons)
in connection with the subject which is requested to be included in the agenda; (iii) a description of all Derivative Transactions
(as defined below) by the Proposing Shareholder during the previous twelve (12) month period, including the date of the transactions
and the class, series and number of securities involved in, and the material economic terms of, such Derivative Transactions;
and (iv) a declaration that all the information that is required under the Companies Law and any other applicable law to provided
to the Company in connection with such subject, if any, has been provided. Furthermore, the Board of Directors, may, in its discretion,
to the extent it deems necessary, request that the Shareholder(s) making the request provide additional information necessary
so as to include a subject in the agenda of a General Meeting, as the Board of Directors may reasonably require. A “Derivative
Transaction” means any agreement, arrangement, interest or understanding entered into by, or on behalf or for the benefit
of, any Proponent or any of its affiliates or associates, whether record or beneficial: (w) the value of which is derived in whole
or in part from the value of any class or series of shares or other securities of the company, (x) which otherwise provides any
direct or indirect opportunity to gain or share in any gain derived from a change in the value of securities of the corporation,
(y) the effect or intent of which is to mitigate loss, manage risk or benefit of security value or price changes, or (z) which
provides the right to vote or increase or decrease the voting power of, such Proponent, or any of its affiliates or associates,
with respect to any securities of the corporation, which agreement, arrangement, interest or understanding may include, without
limitation, any option, warrant, debt position, note, bond, convertible security, swap, stock appreciation right, short position,
profit interest, hedge, right to dividends, voting agreement, performance-related fee or arrangement to borrow or lend shares
(whether or not subject to payment, settlement, exercise or conversion in any such class or series), and any proportionate interest
of such Proponent in the securities of the corporation held by any general or limited partnership, or any limited liability company,
of which such Proponent is, directly or indirectly, a general partner or managing member. The information required pursuant to
this Article 56 shall be updated as of the record date of the General Meeting, five Business Days before the General Meeting and
the General Meeting, and any adjournment or postponement thereof.
57. Subject
to Article 65 below, in the event that the Company has established that an adjourned meeting shall be held on such date which
is later than the date provided for in Section 78(b) of the Law, such later date shall be included in the notice. The Company
may add additional places for Shareholders to review the full text of the proposed resolutions, including an internet site. The
notice shall be provided in the manner prescribed below under the heading “Notices” in Articles 128 to 131 below.
PROCEEDINGS AT GENERAL MEETING
58. No
business shall be conducted at a General Meeting unless a quorum is present, and no resolution shall be passed unless a quorum
is present at the time the resolution is voted on. Except in cases where it is otherwise stipulated, a quorum shall be constituted
when there are personally present, or represented by proxy, at least two (2) Shareholders who hold, in the aggregate, at least
25% of the voting rights in the Company. A proxy may be deemed to be two (2) or more Shareholders pursuant to the number of Shareholders
he represents.
59. If
within half an hour from the time appointed for the meeting, a quorum is not present, without there being an obligation to notify
the Shareholders to that effect, the meeting shall be adjourned to the same day, in the following week, at the same hour and at
the same place or to a later time and date if so specified in the notice of the meeting, unless such day shall fall on a statutory
holiday (either in Israel or in the U.S.), in which case the meeting will be adjourned to the first business day afterwards which
is not a statutory holiday.
If the original meeting was
convened upon requisition under Section 63 of the Law, one or more Shareholders, present in person or by proxy, and holding the
number of shares required for making such requisition, shall constitute a quorum at the adjourned meeting, but in any other case
any two (2) Shareholders present in person or by proxy, shall constitute a quorum at the adjourned meeting.
60. The
Chairman of the Board of Directors, or any other Person appointed for this purpose by the Board of Directors, shall preside at
every General Meeting. If within fifteen (15) minutes from the time appointed for the meeting, the designated chairman for the
meeting shall not be present, the Shareholders present at the meeting shall elect one of their number to serve as chairman of
the meeting.
61. Resolutions
at the General Meeting shall be passed in accordance with the definition of "Resolution" set forth in Article 1.1 above,
unless otherwise required by Law or these Articles. Every vote at a General Meeting shall be conducted according to the number
of votes to which each Shareholder is entitled on the basis of the number of Ordinary Shares held by such Shareholder (in accordance
with the provisions of Article 7.1 above).
62. Where
a poll has been demanded, the chairman of the meeting shall be entitled - but not obliged - to accede to the demand. Where the
chairman of the meeting has decided to hold a poll, such poll shall be held in such manner, at such time and at such place as
the chairman of the meeting directs, either immediately or after an interval or postponement, or in any other way, and the results
of the vote shall be deemed to be the Resolution at the meeting at which the poll was demanded. A person demanding a poll may
withdraw his demand prior to the poll being held.
63. A
demand for the holding of a poll shall not prevent the continued business of the meeting on all other questions apart of the question
in respect of which a poll was demanded.
64. The
announcement by the chairman of the meeting that a Resolution has been passed unanimously or by a particular majority, or has
been rejected, and a note recorded to that effect in the Company’s minute book, shall serve as prima facie proof
of such fact, and there shall be no necessity for proving the number of votes or the proportion of votes given for or against
the Resolution.
65. The
chairman of a General Meeting may adjourn the meeting from time to time and from place to place if approved by a consent of the
holders of a majority of the voting power represented in person or by proxy and voting on the question of adjournment (and shall
if so directed by the meeting), but at an adjourned meeting no other matters shall be considered or decided apart from the matters
which were on the agenda of the meeting at which it was decided on the adjournment and in respect of which no Resolution was taken.
The Company shall not deliver nor shall it be required to give notice in regard to the adjournment or in regard to the matters
on the agenda of the adjourned meeting, unless the adjourned meeting is to be held more than 30 (thirty) days after the date of
the original meeting, in which case a notice shall be published by the Company.
VOTES OF SHAREHOLDERS
66. The
voting rights of every shareholder entitled to vote at a General Meeting shall be as set forth in Article 7 of these Articles.
67. In
the case of joint Shareholders, the vote of the senior joint holder, given personally or by proxy, shall be accepted, to the exclusion
of the vote of the remaining joint Shareholders, and for these purposes the senior of the joint Shareholders shall be the Person
amongst the joint holders whose name appears first in the Register.
68. A
Shareholder who is an Incapacitated Person may vote solely through his guardian or other person who fulfills the function of such
guardian and who was appointed by a court, and any guardian or other person as aforesaid shall be entitled to vote by way of a
proxy, or in such manner as the court directs.
69. Any
corporation which is a Shareholder of the Company shall be entitled, by way of resolution of its directors or another organ which
manages said corporation, to appoint such person which it deems fit, whether or not he is a shareholder of the Company, to act
as its representative at any General Meeting of the Company or at a meeting of a class of shares in the Company which such corporation
is entitled to attend and to vote thereat, and the appointed as aforesaid shall be entitled, on behalf of the corporation whom
he represents, to exercise all of the same powers and authorities which the corporation itself could have exercised had it been
a natural person holding shares of the Company.
70. Every
Shareholder of the Company who is entitled to attend and vote at a General Meeting of the Company, shall be entitled to appoint
a proxy. A proxy can be appointed by more than one Shareholder, and he can vote in different ways on behalf of each principal.
The instrument appointing
a proxy shall be in writing signed by the Person making the appointment or by his authorized representative, and if the Person
making the appointment is a corporation, the power of attorney shall be signed in the manner in which the corporation signs on
documents which bind it, and a certificate of an attorney with regard to the authority of the signatories to bind the corporation
shall be attached thereto. The proxy need not be a shareholder of the Company.
71. The
instrument appointing a proxy, or a copy thereof certified by an attorney, shall be lodged at the Office, or at such other place
as the Board of Directors shall specify, not less than forty-eight (48) hours prior to the meeting at which the proxy intends
to vote on the strength of such instrument of proxy. Notwithstanding the above, the chairman of the meeting shall have the right
to waive the time requirement provided above with respect to all instruments of proxies and to accept any and all instruments
of proxy until the beginning of a General Meeting. A document appointing a proxy shall be valid for every adjourned meeting of
the meeting to which the document relates.
72. Every
instrument appointing a proxy, whether for a meeting specifically indicated, or otherwise, shall, as far as circumstances permit,
be in the following form, or in any other form approved by the Board of Directors:
I ______________ of ______________
being a shareholder holding voting shares in Enzymotec Ltd., hereby appoint Mr. ______________ of ______________ or failing him,
Mr. ______________ or ______________, or failing him, Mr. ______________ of ______________, to vote in my name, place and stead
at the (ordinary/extraordinary) General Meeting of the Company to be held on the ____ of ______ 20__, and at any adjourned meeting
thereof.
In witness whereof I have
hereto set my hand on the _____ day of _____
73. No
shareholder shall be entitled to vote at a General Meeting unless he has paid all of the calls and all of the amounts due from
him, for the time being, in respect of his shares.
74. A
vote given in accordance with the instructions contained in an instrument appointing a proxy shall be valid notwithstanding the
death or bankruptcy of the appointer, or the revocation of the proxy, or the transfer of the share in respect of which the vote
was given as aforesaid, unless notice in writing of the death, revocation or transfer is received at the Office of the Company,
or by the chairman of the meeting, prior to such vote.
75. Subject
to the Law, an instrument appointing a proxy shall be deemed revoked (i) upon receipt by the Company or the chairman of the meeting,
subsequent to receipt by the Company of such instrument, of written notice signed by the person signing such instrument or by
the Shareholder appointing such proxy canceling the appointment thereunder (or the authority pursuant to which such instrument
was signed) or of an instrument appointing a different proxy, provided such notice of cancellation or instrument appointing a
different proxy were so received at the place and within the time for delivery of the instrument revoked thereby as referred to
in Article 71 hereof, or (ii) if the appointing shareholder is present in person at the meeting for which such instrument of proxy
was delivered, upon receipt by the Chairman of such meeting of written notice from such shareholder of the revocation of such
appointment, or if and when such shareholder votes at such meeting. A vote cast in accordance with an instrument appointing a
proxy shall be valid notwithstanding the revocation or purported cancellation of the appointment, or the presence in person or
vote of the appointing shareholder at a meeting for which it was rendered, unless such instrument of appointment was deemed revoked
in accordance with the foregoing provisions of this Article 75 at or prior to the time such vote was cast.
THE BOARD OF DIRECTORS
76. Unless
otherwise resolved by a Resolution, the prescribed number of directors of the Company shall be between seven (7) and eleven (11),
(including the External Directors). At any time the minimum number of directors (other than the External Directors) shall not
fall below five (5). Any director shall be eligible for re-election upon termination of his term of office.
77. Classified
Board
77.1. The
directors of the Company, excluding the External Directors, shall be classified, with respect to the term for which they severally
hold office, into three classes, as nearly equal in number as possible, the first class, designated “Class I,” to
hold office initially for a term expiring at the annual General Meeting to be held in 2014, the second class, designated “Class
II,” to hold office initially for a term expiring at the annual General Meeting to be held in 2015, and the third class,
designated “Class III,” to hold office initially for a term expiring at the annual General Meeting to be held in 2016,
with members of each class to hold office until their successors are elected and qualified. At each annual General Meeting of
the Company, the successors to the class of directors whose term expires at that meeting shall be elected to hold office for a
term expiring at the annual General Meeting held in the third year following the year of their election. If the number of directors
(excluding External Directors) that constitutes the Board of Directors is changed, any newly created directorships or decrease
in directorships shall be so apportioned by the Board of Directors among the classes as to make all classes as nearly equal in
number as is practicable, provided that no decrease in the number of directors constituting the Board of Directors shall shorten
the term of any incumbent director.
77.2. Prior
to every annual General Meeting of the Company, and subject to Article 77.1 above, the Board of Directors of the Company (or a
Committee of Directors, as hereinafter defined) shall select, via a resolution adopted by a majority of the Board of Directors
(or such committee), a number of persons to be proposed to the Shareholders for election as directors of the Company at such annual
General Meeting for service until the annual General Meeting to be held in the third year following the year of their election
(the “Nominees”). Any shareholder entitled under applicable Law to nominate one or more persons for election
as directors at a General Meeting (each such person, an “Alternate Nominee”) may make such nomination
only if a written notice of such shareholder’s intent to make such nomination or nominations has been given to the Secretary
of the Company (or, if there is no such Secretary, the Chief Executive Officer). Each such notice shall set forth: (a) the name
and address of the shareholder who intends to make the nomination and of the Alternate Nominees; (b) a representation that the
shareholder is a holder of record of shares of the Company entitled to vote at such meeting (including the number of shares held
of record by the shareholder) and intends to appear in person or by proxy at the meeting to nominate the Alternate Nominees; (c)
a description of all arrangements or understandings between the shareholder and each Alternate Nominee and any other person or
persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the shareholder; and
(d) the consent of each Alternate Nominee to serve as a director of the Company if so elected and a declaration signed by each
Alternate Nominee declaring that there is no limitation under the Law for the appointment of such a nominee and that all of the
information that is required under the Law to be provided to the Company in connection with such an appointment has been provided.
The Board of Directors may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedure.
77.3. The
Nominees or Alternate Nominees shall be elected by a Resolution at the annual General Meeting at which they are subject to election.
77.4. Every
director shall hold office until the end of the third annual General Meeting following the annual General Meeting at which he
was elected, unless his office is vacated in accordance with Article 79 or Article 82 below. If, at an annual General Meeting,
no Nominees or Alternate Nominees are elected, the directors then in office shall continue to hold office until the convening
of a General Meeting at which Nominees or Alternate Nominees shall be elected.
77.5. If
the office(s) of members(s) of the Board of Directors shall be vacated, the remaining members of the Board of Directors shall
be entitled to appoint additional director(s) in place of the director(s) whose office(s) have been vacated, for a term of office
equal to the remaining period of the term of office of the director(s) whose office(s) have been vacated.
77.6. Notwithstanding
anything else herein to the contrary, the provisions of this Article 77 may only be amended, replaced or suspended by a Resolution
adopted by a majority of 65% of the voting power in the Company.
78. The
directors in their capacity as such shall be entitled to receive remuneration as shall be determined in compliance with the Law
and the regulations promulgated thereunder. The conditions (including remuneration) of the terms of office of members of the Board
of Directors shall be decided by the Board of Directors, but the same shall be valid only if ratified in the manner required under
the Law. The remuneration of directors may be fixed as an overall payment or other consideration and/or as a payment or other
consideration in respect of attendance at meetings of the Board of Directors. In addition to his remuneration, each director shall
be entitled to be reimbursed, retroactively or in advance, in respect of his reasonable expenses connected with performing his
functions and services as a director. Such entitlement shall be determined in accordance with, and shall be subject to, a specific
resolution or policy adopted by the Board of Directors regarding such matter.
79.
79.1. Subject
to the provisions of the Law with regard to External Directors and subject to Articles 77 above and Article 82 below, the office
of a member of the Board of Directors shall be vacated in any one of the following events:
79.1.1. if
he resigns his office by way of a letter signed by him, lodged at the Office of the Company;
79.1.2. if
he is declared bankrupt;
79.1.3. if
he becomes insane or unsound of mind;
79.1.4. upon
his death;
79.1.5. if
he is prevented by applicable law from serving as a director of the Company;
79.1.6. if
the Board terminates his office according to Section 231 of the Law;
79.1.7. if
a court order is given in accordance with Section 233 of the Law;
79.1.8. if
he is removed from office by a Resolution at a General Meeting of the Company adopted by a majority of 65% of the voting power
in the Company; or
79.1.9. if
his period of office has terminated in accordance with the provisions of these Articles.
79.2. If
the office of a member of the Board of Directors should be vacated, the remaining members of the Board of Directors shall be entitled
to act for all purposes, for as long as their number does not fall below the minimum, for the time being, specified for the directors,
as prescribed in Article 76 above. Should their number fall below the aforesaid minimum, the directors shall not be entitled to
act, except for the appointment of additional directors, or for the purpose of calling a General Meeting for the appointment of
additional directors, or for the purpose of calling a General Meeting for the appointment of a new Board of Directors.
79.3. The
office of an External Director shall be vacated only in accordance with the provisions for the vacation of office and the removal
of External Directors under the Law.
OTHER PROVISIONS
REGARDING DIRECTORS
80.
80.1. Subject
to any mandatory provisions of applicable law, a director shall not be disqualified by virtue of his office from holding another
office in the Company or in any other company in which the Company is a shareholder or in which it has any other form of interest,
or of entering into a contract with the Company, either as seller or buyer or otherwise. Likewise, no contract made by the Company
or on its behalf in which a director has any form of interest may be nullified and a director shall not be obliged to account
to the Company for any profit deriving from such office, or resulting from such contract, merely by virtue of the fact that he
serves as a director or by reason of the fiduciary relationship thereby created, but such director shall be obliged to disclose
to the Board of Directors the nature of any such interest at the first opportunity.
A general notice to the effect
that a director is a shareholder or has any other form of interest in a particular firm or a particular company and that he must
be deemed to have an interest in any business with such firm or company shall be deemed to be adequate disclosure for purposes
of this Article in relation to such director, and after such general notice has been given, such director shall not be obliged
to give special notice in relation to any particular business with such firm or such company.
80.2. Subject
to the provisions of the Law and these Articles, the Company shall be entitled to enter into a transaction in which an Office
Holder of the Company has a personal interest, directly or indirectly, and may enter into any contract or otherwise transact any
business with any third party in which contract or business an Office Holder has a personal interest, directly or indirectly.
81. The
Board of Directors shall elect one (1) or more of its members to serve as the Chairman of the Board of Directors (the "Chairman
of the Board of Directors"), provided that, subject to the provisions of Section 121(c) of the Law, the Chief Executive
Officer of the Company shall not serve as Chairman of the Board of Directors. The office of Chairman of the Board of Directors
shall be vacated in each of the cases mentioned in Articles 79.1 above and 82 below. The Board of Directors may also elect (a)
member(s) to serve as Vice Chairman, who shall have such duties and authorities as the Board of Directors may assign to him or
her.
82. Subject
to the relevant provisions of the Law, the Company may, in a General Meeting, by a Resolution adopted by a majority of 65% of
the voting power in the Company, dismiss any Director within the meaning thereof under Article 1.1 of these Articles, prior to
the end of his term of office and the Board of Directors shall be entitled, with the exception of the External Directors who shall
be appointed and removed in accordance with the Law, to appoint by a Resolution another individual in his place as a director
of the Company. The individual so appointed shall hold such office only for that period of time during which the director whom
he replaces would have held office.
83. A
director shall not be obliged to hold any share in the Company.
CHIEF EXECUTIVE OFFICER
84.
84.1. The
Board of Directors shall, from time to time, appoint a Chief Executive Officer and subject to the provisions of the Law delineate
his powers and authorities and his remuneration. Subject to any contract between the Chief Executive Officer and the Company,
the directors may dismiss him or replace him at any time they deem fit.
84.2. A
Chief Executive Officer need not be a director or shareholder of the Company.
Subject to the provisions of
any contract between the Chief Executive Officer and the Company, all of the same provisions with regard to appointment, resignation
and removal from office shall apply to the Chief Executive Officer if he is also a director, as apply to the Directors.
84.3. The
directors shall be entitled from time to time to delegate to the Chief Executive Officer for the time being such of the powers
they have pursuant to these Articles as they deem appropriate, and they shall be entitled to grant such powers for such period
and for such purposes and on such conditions and with such restrictions as they deem expedient, and they shall be entitled to
grant such powers without renouncing the powers and authorities of the Board of Directors in such regard, and they may, from time
to time, revoke, annul and alter such delegated powers and authorities, in whole or in part.
84.4. Subject
to the provisions of any applicable law, the remuneration of the Chief Executive Officer shall be fixed from time to time by the
Board of Directors (and, so long as required by the Law, shall be approved by the Compensation Committee and by the Shareholders
unless exempted from Shareholders approval) and such remuneration may be in the form of a fixed salary or commissions or a participation
in profits, or in any other manner which may be decided by the Board of Directors (and approved according to this Article 84.4).
PROCEEDINGS OF THE BOARD OF DIRECTORS
85.
85.1. The
Board of Directors shall convene for a meeting at least once every fiscal quarter.
85.2. The
Board of Directors may meet in order to exercise its powers pursuant to Section 92 of the Law, including without limitation to
supervise the Company’s affairs, and it may, subject to the provisions of the Law, adjourn its meetings and regulate its
proceedings and operations as it deems fit. It may also prescribe the quorum required for the conduct of business. Until otherwise
decided a quorum shall be constituted if a majority of the directors holding office for the time being are present.
85.3. Should
a director or directors be barred from being present and voting at a meeting of the Board of Directors by virtue of the contents
of Section 278 of the Law, the quorum shall be a majority of the directors entitled to be present and to vote at the meeting of
the Board of Directors.
86. Any
director, the Chief Executive Officer or the auditor of the Company in the event stipulated in Section 169 of the Law, may, at
any time, demand the convening of a meeting of the Board of Directors. The Chairman of the Board shall be obliged, on such demand,
to call such meeting on the date requested by the director or Chief Executive Officer soliciting such a meeting, provided that
proper notice pursuant to Article 87 is given.
87. Every
director shall be entitled to receive notice of meetings of the Board of Directors, and such notice may be in writing or by facsimile,
telegram or electronic mail, sent to the last address (whether physical or electronic) or facsimile number given by the director
for purposes of receiving notices, provided that the notice shall be given at least a reasonable amount of time prior to the meeting
and in no event less than 48 (forty eight) hours prior notice, unless the urgency of the matter(s) to be discussed at the meeting
reasonably require(s) a shorter notice period.
88. Every
meeting of the Board of Directors at which a quorum is present shall have all the powers and authorities vested for the time being
in the Board of Directors.
89. Questions
which arise at meetings of the Board of Directors shall be decided by a simple majority of the members of the Board of Directors
attending such meeting and voting on such matter. In the case of an equality of votes of the Board of Directors, the Chairman
of the Board of Directors shall not have a second or casting vote, and the proposal shall be deemed to be defeated.
If the Chairman of the Board
of Directors is not present within 30 (thirty) minutes after the time appointed for the meeting, the directors present shall elect
one of their members to preside at such meeting.
90. The
Board of Directors may adopt resolutions, without convening a meeting of the Board of Directors, in any manner permitted by the
Law.
91. The
Board of Directors may hold meetings by use of any means of communication, on condition that all participating directors can hear
each other at the same time. In the case of a resolution passed by way of a telephone call or any such other means of communication,
a copy of the text of the resolution shall be sent, as soon as possible thereafter, to the directors.
GENERAL POWERS OF THE BOARD OF DIRECTORS
92. The
supervision of the Company’s affairs shall be in the hands of the Board of Directors, which shall be entitled to exercise
all of the powers and authorities to perform any act and deed which the Company is entitled to exercise and to perform in accordance
with these Articles or according to law, and in respect of which there is no provision or requirement in these Articles, or in
the Law or/and in the U.S. Rules, that such powers and authorities may be exercised or done by the Shareholders in a General Meeting
or by a Committee of Directors.
93. The
Board of Directors may, as it deems fit and subject to any applicable law, delegate to a committee (a “Committee of Directors”)
certain of its powers and authorities, in whole or in part (as appropriate). The curtailment or revocation of the powers and authorities
of a Committee of Directors by the Board of Directors shall not invalidate a prior act of such Committee of Directors or an act
taken in accordance with its instructions, which would have been valid had the powers and authorities of the Committee of Directors
not been altered or revoked by the Board of Directors. Subject to applicable law, a Committee of Directors may be comprised of
one (1) director or of several directors, and in the case of a Committee of Directors that is appointed to advise the Board of
Directors only, persons who are not directors may be appointed to it.
94. The
meetings and proceedings of every such Committee of Directors which is comprised of 2 (two) or more members shall be conducted
in accordance with the provisions contained in these Articles in regard to the conduct of meetings and proceedings of the Board
of Directors to the extent that the same are suitable for such committee, and so long as no provisions have been adopted in replacement
thereof by the Board of Directors.
RATIFICATION OF ACTIONS
95. Subject
to the Law, all acts taken in good faith by the Board of Directors and/or a Committee of Directors or by an individual acting
as a member thereof shall be valid even if it is subsequently discovered that there was a defect in the appointment of the Board
of Directors, the Committee of Directors or the member, as the case may be, or that the members, or one of them, was/were disqualified
from being appointed as a director/s or to a Committee of Directors.
96.
96.1. The
Board of Directors or any Committee of Directors may ratify any act the performance of which at the time of the ratification was
within the scope of the authority of the Board of Directors or the relevant Committee of Directors.
96.2. The
General Meeting shall be entitled to ratify any act taken by the Board of Directors and/or any Committee of Directors without
authority or which was tainted by some other defect.
96.3. From
the time of the ratification, every act ratified as aforesaid, shall be treated as though lawfully performed from the outset.
97. The
Board of Directors may, from time to time, in its absolute discretion, borrow or secure any amounts of money required by the Company
for the conduct of its business.
98. The
Board of Directors shall be entitled to raise or secure the repayment of an amount obtained by them, in such way and on such conditions
and times as they deem fit. The Board of Directors shall be entitled to issue documents of undertaking, such as options, debentures
or debenture stock, whether linked or redeemable, convertible debentures or debentures convertible into other securities, or debentures
which carry a right to purchase shares or to purchase other securities, or any mortgage, pledge, collateral or other charge over
the property of the Company and its undertaking, in whole or in part, whether present or future, including the uncalled share
capital or the share capital which has been called but not yet paid.
The deeds of undertaking,
debentures of various types or other forms of collateral security may be issued at a discount, at a premium or otherwise and with
such preferential or deferred or other rights, as the Board of Directors shall, from time to time, decide.
SIGNING POWERS
99. Subject
to any other resolution on the subject passed by the Board of Directors, the Company shall be bound only pursuant to a document
in writing bearing its seal or its rubber stamp or its printed name, and the signature of whomever may be authorized by the Board
of Directors, which shall be entitled to empower any person, either alone or jointly with another, even if he is not a shareholder
of the Company or a director, to sign and act in the name and on behalf of the Company.
100. The
Board of Directors shall be entitled to prescribe separate signing power in regard to different businesses of the Company and
in respect of the limit of the amounts in respect of which various persons shall be authorized to sign.
SECRETARY, OFFICE-HOLDERS, CLERKS AND
REPRESENTATIVES
101. The
Board of Directors shall be entitled, from time to time, to appoint, or to delegate to the Chief Executive Officer, either alone
or together with other persons designated by the Board of Directors, the ability to appoint Office Holders (other than directors),
a Secretary for the Company, employees and agents to such permanent, temporary or special positions, and to specify and change
their titles, authorities and duties, and may set, or delegate to the Chief Executive Officer, either alone or together with other
persons designated by the Board of Directors, the ability to set salaries, bonuses and other compensation of any employee or agent
who is not an Office Holder. Salaries, bonuses and compensation of Office Holders who are not directors shall be determined and
approved by the Chief Executive Officer, and/or in such other manner as may be required from time to time under the Law. The Board
of Directors, or the Chief Executive Officer, either alone or together with other persons designated by the Board of Directors,
(in the case of any Office Holder, employee or agent appointed thereby), shall be entitled at any time, in its, his or their (as
applicable) sole and absolute discretion, to terminate the services of one of more of the foregoing persons (in the case of a
director, however, subject to compliance with Article 79 above).
102. The
Board of Directors and the Chief Executive Officer may from time to time and at any time, subject to their powers under these
Articles and the Law, empower any person to serve as representative of the Company for such purposes and with such powers and
authorities, instructions and discretions for such period and subject to such conditions as the Board of Directors (or the Chief
Executive Officer, as the case may be) shall deem appropriate. The Board of Directors (or the Chief Executive Officer, as the
case may be) may grant such person, inter alia, the power to transfer the authority, powers and discretions vested in him,
in whole or in part. The Board of Directors may (or the Chief Executive Officer, as the case may be), from time to time, revoke,
annul, vary or change any such power or authority, or all such powers or authorities collectively.
DIVIDENDS, BONUS SHARES, FUNDS AND CAPITALIZATION
OF FUNDS AND PROFITS
103. Unless
otherwise permitted by the Law, no dividends shall be paid other than out of the Profits of the Company as such term is defined
in the Law.
104. The
Board of Directors may decide on the payment of a dividend or on the distribution of bonus shares.
105. A
dividend in cash or bonus shares shall be paid or distributed, as the case may be, equally to the holders of the Ordinary Shares
registered in the Register, pro rata to the nominal amount of capital paid up or credited as paid up on par value of the shares,
without reference to any premium which may have been paid thereon. However, whenever the rights attached to any shares or the
terms of issue of the shares do not provide otherwise, an amount paid on account of a share prior to the payment thereof having
been called, or prior to the due date for payment thereof, and on which the Company is paying interest, shall not be taken into
account for purposes of this Article as an amount paid-up on account of the share.
106. Unless
other instructions are given, it shall be permissible to pay any dividend by way of a check or payment order to be sent by post
to the registered address of the shareholder or the Person entitled thereto, or in the case of joint Shareholders being registered,
to the shareholder whose name stands first in the Register in relation to the joint shareholding. Every such check shall be made
in favor of the person to whom it is sent. A receipt by the person whose name, on the date of declaration of the dividend, was
registered in the Register as the owner of the shares, or in the case of joint holders, by one of the joint holders, shall serve
as a discharge with regard to all the payments made in connection with such share.
The directors shall be entitled
to invest any dividend which has not been claimed for a period of one (1) year after having been declared, or to make use thereof
in any other way for the benefit of the Company until such time as it is claimed. The Company shall not be obliged to pay interest
or linkage in respect of an unclaimed dividend.
107. Unless
otherwise specified in the terms of issue of shares or of securities convertible into, or which grant a right to purchase, shares,
any shares that are fully paid-up or credited as paid-up shall at any time confer on their holders the right to participate in
the full dividends and in any other distribution for which the determining date for the right to receive the same is the date
at which the aforesaid shares were fully paid-up or credited as fully paid-up, as the case may be, or subsequent to such date.
108. A
dividend or other beneficial rights in respect of shares shall not bear interest.
109. The
Board of Directors shall be entitled to deduct from any dividend or other beneficial rights, all amounts of money which the holder
of the share in respect of which the dividend is payable or in respect of which the other beneficial rights were given, may owe
to the Company in respect of such share, whether or not the due date for payment thereof has arrived.
110. The
Board of Directors shall be entitled to retain any dividend or bonus shares or other beneficial rights in respect of a share in
relation to which the Company has a lien, and to utilize any such amount or the proceeds received from the sale of any bonus shares
or other beneficial rights, for the discharge of the debts or liabilities in respect of which the Company has a lien.
111. The
Board of Directors may decide that a dividend is to be paid in whole or in part, by way of a distribution of assets of the Company
in kind, including by way of debentures or debenture stock of the Company, or shares or debentures or debenture stock of any other
company, or in any other way.
112.
112.1. The
Board of Directors may, at any time and from time to time, decide that any portion of the amounts standing for the time being
to the credit of any capital fund (including a fund created as a result of a revaluation of the assets of the Company), or which
are held by the Company as Profits available for distribution, shall be capitalized for distribution subject to and in accordance
with the provisions of the Law and of these Articles, amongst those Shareholders who are entitled thereto and pro rata to their
entitlement under these Articles, provided that the same shall not be paid in cash but shall serve for the payment up in full
either at par or with a premium as prescribed by the Company, of shares which have not yet been issued or of debentures of the
Company which shall be allotted and distributed amongst the Shareholders in the aforesaid ratio as fully paid-up shares or debentures.
112.2. The
Board of Directors shall be entitled to distribute bonus shares and to decide that the bonus shares shall be of the same class
which confers on the Shareholders or the Persons entitled thereto the right to participate in the distribution of bonus shares,
or may decide that the bonus shares shall be of a uniform class to be distributed to each of the Shareholders or Persons entitled
to shares as aforesaid, without reference to the class of shares conferring the right to participate in the distribution on the
holders of the shares or the Persons entitled thereto as aforesaid.
113.
113.1. In
every case that the Company issues bonus shares by way of a capitalization of profits or funds at a time at which securities issued
by the Company are in circulation and confer on the holders thereof rights to convert the same into shares in the share capital
of the Company, or options to purchase shares in the share capital of the Company (such rights of conversion or options shall
henceforth be referred to as the “Rights”), the Board of Directors shall be entitled (in a case that the Rights
or part thereof shall not be otherwise adjusted in accordance with the terms of their issue) to transfer to a special fund designated
for the distribution of bonus shares in the future (to be called by any name that the Board of Directors may decide on and which
shall henceforth be referred to as the “Special Fund”) an amount equivalent to the nominal amount of the share
capital to which some or all of the Rights holders would have been entitled as a result of the issue of bonus shares, had they
exercised their Rights prior to the determining date for the right to receive bonus shares, including rights to fractions of bonus
shares, and in the case of a second or additional distribution of bonus shares in respect of which the Company acts pursuant to
this Article, including entitlement stemming from a previous distribution of bonus shares.
113.2. In
the case of the allotment of shares by the Company as a consequence of the exercise of entitlement by the owners of shares in
those cases in which the Board of Directors has made a transfer to the Special Fund in respect of the Rights pursuant to Article
113.1 above, the Board of Directors shall allot to each such shareholder, in addition to the shares to which he is entitled by
virtue of having exercised his rights, such number of fully paid-up shares the nominal value of which is equivalent to the amount
transferred to the Special Fund in respect of his rights, by way of a capitalization to be effected by the Board of Directors
of an appropriate amount out of the Special Fund. The Board of Directors shall be entitled to decide on the manner of dealing
with rights to fractions of shares in its sole discretion.
113.3. If
after any transfer to the Special Fund has been made the Rights should lapse, or the period should end for the exercise of Rights
in respect of which the transfer was effected without such Rights being exercised, then any amount which was transferred to the
Special Fund in respect of the aforesaid unexercised Rights shall be released from the Special Fund, and the Company may deal
with the amount so released in any manner it would have been entitled to deal therewith had such amount not been transferred to
the Special Fund.
114. For
the implementation of any resolution regarding a distribution of shares or debentures by way of a capitalization of profits as
aforesaid, the Board of Directors may:
114.1. Resolve
any difficulty which arises or may arise in regard to the distribution in such manner as it deems fit and may take all of the
steps that it deems expedient in order to overcome such difficulty.
114.2. Issue
certificates in respect of fractions of shares, or decide that fractions of less than an amount to be decided by the Board of
Directors shall not be taken into account for purposes of adjusting the rights of the Shareholders or may sell the fractions of
shares and pay the proceeds (net) to the Persons entitled thereto.
114.3. Sign,
or appoint a Person to sign, on behalf of the Shareholders on any contract or other document which may be required for purposes
of giving effect to the distribution, and, in particular, shall be entitled to sign or appoint a Person who shall be entitled
to appoint and submit a contract as referred to in Sections 291 and 292 of the Law.
114.4. Make
any arrangement or other scheme which is required in the opinion of the Board of Directors in order to facilitate the distribution.
115. The
Board of Directors shall be entitled, as it deems appropriate and expedient, to appoint trustees or nominees for those registered
Shareholders who have failed to notify the Company of a change of their address and who have not applied to the Company in order
to receive dividends, shares or debentures out of capital, or other benefits during the aforesaid period. Such trustees or nominees
shall be appointed for the use, collection or receipt of dividends, shares or debentures out of capital and rights to subscribe
for shares which have not yet been issued and which are offered to the Shareholders but they shall not be entitled to transfer
the shares in respect of which they were appointed, or to vote on the basis of holding such shares. In all of the terms and conditions
governing such trusts and the appointment of such nominees it shall be stipulated by the Company that upon the first demand by
a beneficial holder of a share being held by the trustee or nominee, such trustee or nominee shall be obliged to return to such
shareholder the share in question and/or all of those rights held by it on the shareholder’s behalf (all as the case may
be). Any act or arrangement effected by any such nominees or trustee and any agreement between the Board of Directors and a nominee
or trustee shall be valid and binding in all respects.
116. The
Board of Directors may from time to time prescribe the manner for payment of dividends or the distribution of bonus shares and
the arrangement connected therewith. Without derogating from the generality of the foregoing, the Board of Directors shall be
entitled to pay any dividends or moneys in respect of shares by sending a check via the mails to the address of the holder of
registered shares according to the address registered in the register of Shareholders. Any dispatch of a check as aforesaid shall
be done at the risk of the shareholder.
In those cases in which the
Board of Directors specifies the payment of a dividend, distribution of shares or debentures out of capital, or the grant of a
right to subscribe for shares which have not yet been issued and which are offered to the Shareholders against the delivery of
an appropriate coupon attached to any share certificate, such payment, distribution or grant of right to subscribe against a suitable
coupon to the holder of such coupon, shall constitute a discharge of the Company’s debt in respect of such operation as
against any person claiming a right to such payment, distribution or grant of right to subscribe, as the case may be.
117. If
two (2) or more Persons are registered as joint holders of a share, each of them shall be entitled to give a valid receipt in
respect of any dividend, share or debenture out of capital, or other moneys, or benefits, paid or granted in respect of such share.
BOOKS OF THE COMPANY
118. The
Board of Directors shall comply with all the provisions of the Law in regard to the recording of charges and the keeping and maintaining
of a register of directors, register of Shareholders and register of charges.
119. Any
book, register and record that the Company is obliged to keep in accordance with the Law or pursuant to these Articles shall be
recorded in a regular book, or by technical, mechanical or other means, as the Board of Directors shall decide.
120. Subject
to and in accordance with the provisions of Sections 138 to 139, inclusive, of the Law, the Company may cause supplementary registers
to be kept in any place outside Israel as the Board of Directors may think fit, and, subject to all applicable requirements of
law, the Board of Directors may from time to time adopt such rules and procedures as it may think fit in connection with the keeping
of such branch registers.
BOOKS OF ACCOUNT
121. The
Board of Directors shall keep proper books of account in accordance with the provisions of the Law. The books of account shall
be kept at the Office, or at such other place or places as the Board of Directors shall deem expedient, and shall at all times
be open to the inspection of members of the Board of Directors. A shareholder of the Company who is not a member of the Board
of Directors shall not have the right to inspect any books or accounts or documents of the Company, unless such right has been
expressly granted to him by the Law, or if he has been permitted to do so by the Board of Directors or by the Shareholders based
on a Resolution adopted at a General Meeting.
122. The
Board of Directors shall from time to time arrange and submit to the General Meeting a balance sheet and statement of income of
the Company.
A copy of the balance sheet
and the statement of income shall be delivered to the Shareholders registered in the Register in the manner prescribed in regard
to the giving of notices, at least seven days prior to the meeting.
The provisions of this Article
shall not make it obligatory to send a copy of the aforesaid documents to a shareholder whose address is unknown to the Company,
or to more than one joint holder of a share. Any shareholder to whom a copy of the aforesaid documents is not sent, and also a
person who produces to the Company a certificate from a bank to the effect that shares of the Company are held for him at such
bank, shall be entitled to request to receive copies of such documents at the Office of the Company.
123. At
least once each year the accounts of the Company and the correctness of the statement of income and the balance sheet shall be
audited and confirmed by an independent auditor or auditors.
124. The
Company shall, in an annual General Meeting, appoint an independent auditor or auditors who shall hold such position until the
next annual General Meeting, and their appointment, remuneration and rights and duties shall be subject to the provisions of the
Law, provided, however, that in exercising its authority to fix the remuneration of the auditor(s), the Shareholders in an annual
General Meeting may, by a Resolution, act (and in the absence of any action in connection therewith shall be deemed to have so
acted) to authorize the Board of Directors to fix such remuneration subject to such criteria or standards, if any, as may be provided
in such Resolution, and if no such criteria or standards are so provided, such remuneration shall be fixed in an amount commensurate
with both the volume and nature of the services rendered by the auditor(s). By an act appointing such auditors, the Company may
appoint the auditor(s) to serve for a period of up to the end of completion of the audit of the yearly financial statements for
the three (3) year period then ended.
125. The
auditors shall be entitled to receive notices of every General Meeting of the Company and to attend such meetings and to express
their opinions on all matters pertaining to their function as the auditors of the Company.
126. Subject
to the provisions of the Law and the U.S. Rules, any act carried out by the auditors of the Company shall be valid as against
any person doing business in good faith with the Company, notwithstanding any defect in the appointment or qualification of the
auditors.
127. For
as long as the Company is a Public Company, as defined in the Law, it shall appoint an internal auditor possessing the authorities
set forth in the Law. The internal auditor of the Company shall present all of its proposed work plans to the Audit Committee
of Directors, which shall have the authority to approve them, subject to any modifications in its discretion.
NOTICES
128.
128.1. The
Company may serve any written notice or other document on a shareholder by way of delivery by hand, by facsimile transmission
or by dispatch by prepaid registered mail to his address as recorded in the Register, or if there is no such recorded address,
to the address given by him to the Company for the sending of notices to him.
128.2. Any
shareholder may serve any written notice or other document on the Company by way of delivery by hand at the Office, by facsimile
transmission to the Company or by dispatch by prepaid registered mail to the Company at the Office.
128.3. Any
notice or document which is delivered or sent to a shareholder in accordance with these Articles shall be deemed to have been
duly delivered and sent in respect of the shares held by him (whether in respect of shares held by him alone or jointly with others),
notwithstanding the fact that such shareholder has died or been declared bankrupt at such time (whether or not the Company knew
of his death or bankruptcy), and shall be deemed to be sufficient delivery or dispatch to heirs, trustees, administrators or transferees
and any other persons (if any) who have a right in the shares.
128.4. Any
such notice or other document shall be deemed to have been served:
128.4.1. in
the case of mailing, 48 hours after it has been posted, or when actually received by the addressee if sooner than 48 hours after
it has been posted;
128.4.2. in
the case of overnight air courier, on the next day following the day sent, with receipt confirmed by the courier, or when actually
received by the addressee if sooner;
128.4.3. in
the case of personal delivery, when actually tendered in person to such shareholder;
128.4.4. in
the case of facsimile or other electronic transmission (including email), the next day following the date on which the sender
receives automatic electronic confirmation by the recipient’s facsimile machine or computer or other device that such notice
was received by the addressee; or
128.4.5. in
the case a notice is, in fact, received by the addressee, when received, notwithstanding that it was defectively addressed or
failed, in some other respect, to comply with the provisions of this Article 128.
129. Any
shareholder whose address is not described in the Register, and who shall not have designated in writing an address for the receipt
of notices, shall not be entitled to receive any notice from the Company. In the case of joint holders of a share, the Company
shall be entitled to deliver a notice by dispatch to the joint holder whose name stands first in the Register in respect of such
share.
130. Whenever
it is necessary to give notice of a particular number of days or a notice for another period, the day of delivery shall be counted
in the number of calendar days or the period, unless otherwise specified.
131. Notwithstanding
anything to the contrary contained herein, notice by the Company of a General Meeting, containing the information required to
be set forth in such notice under these Articles, which is published, within the time otherwise required for giving notice of
such meeting, in:
131.1. at
least two daily newspapers in the State of Israel shall be deemed to be notice of such meeting duly given, for the purposes of
these Articles, to any shareholder whose address as registered in the Register (or as designated in writing for the receipt of
notices and other documents) is located in the State of Israel; and
131.2. one
daily newspaper in the City of New York and in one international wire service shall be deemed to be notice of such meeting duly
given, for the purposes of these Articles, to any shareholder whose address as registered in the Register (or as designated in
writing for the receipt of notices and other documents) is located outside the State of Israel.
INSURANCE, INDEMNITY AND EXCULPATION
132. Subject
to the provisions of the Law, the Company shall be entitled to enter into a contract to insure all or part of the liability of
an Office Holder of the Company, imposed on him in consequence of an act which he has performed by virtue of being an Office Holder,
in respect of any of the following:
132.1. The
breach of a duty of care to the Company or to any other Person;
132.2. The
breach of a fiduciary duty to the Company, provided that the Office Holder acted in good faith and had reasonable grounds for
believing that the action would not adversely affect the best interests of the Company;
132.3. A
pecuniary liability imposed on him in favor of any other person in respect of an act done in his capacity as an Office Holder.
132.4. Any
other circumstances arising under the law with respect to which the Company may, or will be able to, insure an Office Holder.
133. Subject
to the provisions of the Law, the Company shall be entitled to indemnify an Office Holder of the Company, to the fullest extent
permitted by applicable law. Subject to the provisions of the Law, including the receipt of all approvals as required therein
or under any applicable law, the Company may resolve retroactively to indemnify an Office Holder with respect to the following
liabilities and expenses, provided, in each of the below cases, that such liabilities or expenses were incurred
by such Office Holder in such Office Holder’s capacity as an Office Holder of the Company:
133.1. a
monetary liability imposed on him in favor of a third party in any judgment, including any settlement confirmed as judgment and
an arbitrator’s award which has been confirmed by the court, in respect of an act performed by the Office Holder by virtue
of the Office Holder being an Office Holder of the Company; provided, however, that: (a) any indemnification undertaking
with respect to the foregoing shall be limited (i) to events which, in the opinion of the Board of Directors, are foreseeable
in light of the Company’s actual operations at the time of the granting of the indemnification undertaking and (ii) to an
amount or by criteria determined by the Board of Directors to be reasonable in the given circumstances; and (b) the events that
in the opinion of the Board of Directors are foreseeable in light of the Company’s actual operations at the time of the
granting of the indemnification undertaking are listed in the indemnification undertaking together with the amount or criteria
determined by the Board of Directors to be reasonable in the given circumstances;
133.2. reasonable
litigation expenses, including legal fees, paid for by the Office Holder, in an investigation or proceeding conducted against
such Office Holder by an agency authorized to conduct such investigation or proceeding, and which investigation or proceeding:
(i) concluded without the filing of an indictment against such Office Holder and without there having been a monetary liability
imposed against such Office Holder in lieu of a criminal proceeding; (ii) concluded without the filing of an indictment against
such Office Holder but with there having been a monetary liability imposed against such Office Holder in lieu of a criminal proceeding
for an offense that does not require proof of criminal intent; or (iii) involves financial sanction; and
133.3. reasonable
litigation expenses, including legal fees, paid for by the Office Holder, or which the Office Holder is obligated to pay under
a court order, in a proceeding brought against the Office Holder by the Company, or on its behalf, or by a third party, or in
a criminal proceeding in which the Office Holder is found innocent, or in a criminal proceeding in which the Office Holder was
convicted of an offense that does not require proof of criminal intent.
133.4. Any
other event, occurrence or circumstances in respect of which the Company may lawfully indemnify an Office Holder of the Company
(including, without limitation, indemnification with respect to the matters referred to under Section 56h(b)(1) of the Israeli
Securities Law 5728-1968, as amended (the "Securities Law").
133.5. For
purposes of Article 133.2 above:
133.5.1. the
“conclusion of a proceeding without the filing of an indictment” regarding a matter in which a criminal proceeding
was initiated, means the closing of a file pursuant to Section 62 of the Israeli Criminal Procedure Law [Consolidated Version],
5742-1982 (the “Criminal Procedure Law”) or a stay of process by Israel’s Attorney General pursuant to
Section 231 of the Criminal Procedure Law; and
133.5.2. a
“monetary liability imposed…in lieu of a criminal proceeding” means a monetary obligation imposed
by law as an alternative to a criminal proceeding, including, without limitation, an administrative fine pursuant to the Israeli
Administrative Offenses Law, 5746-1982, a fine for committing an offense categorized as a finable offense pursuant to the provisions
of the Criminal Procedure Law, or a penalty.
133.6. The
Company may undertake to indemnify an Office Holder as aforesaid: (i) prospectively, provided that the undertaking is limited
to categories of events which in the opinion of the Board of Directors can be foreseen when the undertaking to indemnify is given,
and to an amount set by the Board of Directors as reasonable under the circumstances, and (ii) retroactively.
134. Subject
to the provisions of the Companies Law including the receipt of all approvals as required therein or under any applicable law,
the Company may, to the maximum extent permitted by law, exempt and release, in advance, any Office Holder from any liability
for damages arising out of a breach of a duty of care towards the Company.
135.
135.1. Any
amendment to the Companies Law adversely affecting the right of any Office Holder to be indemnified or insured pursuant to Articles
132 to 134
and any amendments to Articles 132 to 134
shall be prospective in effect, and shall not affect the Company’s obligation or ability to indemnify or insure an Office
Holder for any act or omission occurring prior to such amendment, unless otherwise provided by applicable law.
135.2. The
provisions of Articles 132 to 134
are not intended, and shall not be interpreted so as to restrict the Company, in any manner, in respect of the procurement of
insurance and/or in respect of indemnification and/or exculpation, in favor of any person who is not an Office Holder, including,
without limitation, any employee, agent, consultant or contractor of the Company who is not an Office Holder; and/or any Office
Holder to the extent that such insurance and/or indemnification is not specifically prohibited under law.
WINDING-UP AND REORGANIZATION
136. Should
the Company be wound up and the assets of the Company made available for distribution among Shareholders be insufficient to repay
all of the Company’s paid-up capital, such assets shall be divided in a manner whereby the losses shall, as far as possible,
be borne by the Shareholders pro rata to the nominal value of the paid-up capital on the shares held by each of them, and, if
at the time of the winding-up, the property of the Company available for distribution among the Shareholders should exceed the
amount sufficient for the repayment of the full nominal value of the paid-up capital at the time of commencement of the winding-up,
the surplus shall be distributed to the Shareholders pro rata to the paid-up capital held by each of them. In furtherance of the
foregoing, the holders of Ordinary Shares shall be entitled to share equally, on a per share
basis, all assets of the Company of whatever kind available for distribution to the holders of Ordinary Shares upon such winding
up.
137. Upon
the sale of the Company’s assets, the directors may, or in the case of a liquidation, the liquidators may, if authorized
to do so by a Resolution of the Company, accept fully or partly paid-up shares, or securities of another company, Israeli or non-Israeli,
whether in existence at such time or about to be formed, in order to purchase the property of the Company, or part thereof, and
to the extent permitted under the Law, the directors may (or in the case of a liquidation, the liquidators may) distribute the
aforesaid shares or securities or any other property of the Company among the Shareholders without realizing the same, or may
deposit the same in the hands of trustees for the Shareholders, and the General Meeting by a Resolution may decide, subject to
the provisions of the Law, on the distribution or allotment of cash, shares or other securities, or the property of the Company
and on the valuation of the aforesaid securities or property at such price and in such manner as the Shareholders at such General
Meeting shall decide, and all of the Shareholders shall be obliged to accept any valuation or distribution determined as aforesaid
and to waive their rights in this regard, except, in a case in which the Company is about to be wound-up and is in the process
of liquidation, for those legal rights (if any) which, according to the provisions of the Law, may not be changed or modified.
