Exhibit 99.1

Maris-Tech Ltd.

Notice of A SPECIAL General Meeting of shareholders

Notice is hereby given that a Special General Meeting of Shareholders (the “Meeting”) of Maris-Tech Ltd. (the “Company”) will be held on June 21, 2022 at 3:00 p.m. Israel time at the Company’s office, located at 2 Yitzhak Modai Street, Rehovot, Israel 7608804.

The Meeting is being called for the following purposes:

1.	To approve the adoption of a compensation policy for the Company’s directors and officers;
2.	To approve a fixed fee for Mr. Joseph Gottlieb, a member of the Company’s board of directors (the “Board”); and
3.	To approve an update of the terms of compensation of and employment agreement with Mr. Israel Bar, the Company’s Chief Executive officer and a member of the Board.

Board Recommendation

The Board unanimously recommends that you vote in favor of all the proposed resolutions, which are described in the attached proxy statement.

Record Date

Shareholders of record at the close of business on May 24, 2022 (the “Record Date”), are entitled to notice of and to vote at the Meeting, either in person or by appointing a proxy to vote in their stead at the Meeting (as detailed below).

How You Can Vote?

A form of proxy for use at the Meeting is attached to this Proxy Statement, together with a return envelope, will be sent to holders of the Company’s ordinary shares, no par value (the “Ordinary Shares”). By appointing “proxies,” shareholders may vote at the Meeting whether or not they attend. If a properly executed proxy in the attached form is received by the Company at least four (4) hours prior to the Meeting, all of the Ordinary Shares represented by the proxy shall be voted as indicated on the form. Subject to applicable law and the rules of the Nasdaq Stock Market, in the absence of instructions, the Ordinary Shares represented by properly executed and received proxies will be voted “FOR” all of the proposed resolutions to be presented at the Meeting for which the Board recommends a “FOR”. Shareholders may revoke their proxies or voting instruction form (as applicable) in accordance with section 9 of the Israeli Companies Law, 5799-1999 regulations (proxy and position statement), by filing with the Company a written notice of revocation or duly executed proxy or voting instruction form (as applicable) bearing a later date.

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If your shares are registered directly in your name with our transfer agent, VStock Transfer, LLC, you are considered, with respect to those shares, the shareholder of record. In such case, these proxy materials are being sent directly to you. As the shareholder of record, you have the right to use the proxy card included with this Proxy Statement to grant your voting proxy directly to Nir Bussy, Chief Financial Officer or Israel Bar, Chief Executive Officer, of the Company (mail address: israel@maris-tech.com ; nir@maris-tech.com), or to vote in person at the Meeting.

If your shares are held through a bank, broker or other nominee, they are considered to be held in “street name” and you are the beneficial owner with respect to those shares. A beneficial owner as of the Record Date has the right to direct the bank, broker or nominee how to vote shares held by such beneficial owner at the Meeting, and must also provide the Company with a copy of their identity card, passport or certification of incorporation, as the case may be. If your shares were held in “street name,” as of the Record Date, these proxy materials are being forwarded to you by your bank, broker or nominee who is considered, with respect to those shares, as the shareholder of record, together with a voting instruction card for you to use in directing the bank, broker or nominee how to vote your shares. You also may attend the Meeting. Because a beneficial owner is not a shareholder of record, you may not vote those shares directly at the Meeting unless you obtain a “legal proxy” from the bank, broker or other nominee that holds your shares directly, giving you the right to vote the shares at the Meeting. Absent specific instructions from the beneficial owner of the shares, brokers are not allowed to exercise their voting discretion, among other things, with respect to the election of directors or any matter that relates to executive compensation; and therefore, a “broker non-vote” occurs with respect to such uninstructed shares. Therefore, it is important for a shareholder that holds Ordinary Shares through a bank or broker to instruct its bank or broker how to vote its shares, if the shareholder wants its shares to count for all proposals.

Sincerely,

Joseph Weiss

Chairman of the Board of Directors

May 17, 2022

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Maris-Tech Ltd.

Rehovot, ISRAEL

PROXY STATEMENT 

SPECIAL GENERAL MEETING OF SHAREHOLDERS

TO BE HELD ON June 21, 2022

The enclosed proxy is being solicited by the board of directors (the “Board”) of Maris-Tech Ltd. (the “Company”) for use at the Company’s special general meeting of shareholders (the “Meeting”) to be held on June 21, 2022, at 3:00p.m. Israel time, or at any adjournment or postponement thereof.

Upon the receipt of a properly executed proxy in the form enclosed, the persons named as proxies therein will vote the ordinary shares, no par value, of the Company (the “Ordinary Shares”), covered thereby in accordance with the directions of the shareholders executing the proxy. In the absence of such directions, and except as otherwise mentioned in this proxy statement, the Ordinary Shares represented thereby will be voted in favor of each of the proposals described in this Proxy Statement.

As a foreign private issuer, we are permitted to comply with Israeli corporate governance practices instead of certain requirements of The Nasdaq Listing Rules (the “Nasdaq Rules”), provided that we disclose those Nasdaq Rules with which we do not comply and the equivalent Israeli requirement that we follow instead (the “Foreign Private Issuer Exemption”). We currently rely on this Foreign Private Issuer exemption with respect to the quorum requirement for meetings of our shareholders. As permitted under the Israeli Companies Law, 5799-1999 (the “Companies Law”), two or more shareholders present, personally or by proxy, holding in the aggregate not less than twenty five percent (25%) of the outstanding Ordinary Shares, shall constitute a quorum for the Meeting. If within half an hour from the time the Meeting is convened a quorum is not present, the Meeting shall stand adjourned until June 21, 2022, at 5:00p.m. Israel time (the “Adjourned Meeting”). At the Adjourned Meeting, any number of shareholders present personally or by proxy shall be deemed a quorum, and shall be entitled to deliberate and to resolve in respect of the matters for which the Meeting was convened. Abstentions and broker non-votes are counted for the purpose of determining a quorum.

Proposal No. 1 and Proposal No. 3 described hereinafter, are subject to one of the following voting requirements as stated in section 267A(b) of the Companies Law: (i) the affirmative vote of the majority of the Ordinary Shares, excluding abstentions, shall include a majority of the affirmative votes of shareholders who are not controlling shareholders or do not have a personal interest (as defined below) in the Proposal; or (ii) the total number of Ordinary Shares held by shareholders mentioned in clause (i) above that are voted against such proposal does not exceed two percent (2%) of the total voting rights in the Company (a “Special Majority”).

Subject to the approval of Proposal No. 1 of the agenda, regarding the compensation policy, then Proposal No. 2 described hereinafter, requires the affirmative vote of shareholders present at the Meeting, in person or by proxy, and holding Ordinary Shares amounting in the aggregate to at least a majority of the votes actually cast by shareholders with respect to such proposal (a “Simple Majority”). If Proposal No. 1 is not approved by the shareholders, Proposal No. 2 will require a Special Majority as well.

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For this purpose, “personal interest”, as defined under the Companies Law is: (1) a shareholder’s personal interest in the approval of an act or a transaction of the company, including (i) the personal interest of any of his or her relatives (which includes for these purposes foregoing shareholder’s spouse, siblings, parents, grandparents, descendants, and spouse’s descendants, siblings, and parents, and the spouse of any of the foregoing); (ii) a personal interest of a corporation in which a shareholder or any of his/her aforementioned relatives serve as a director or the chief executive officer, owns at least 5% of its issued share capital or its voting rights or has the right to appoint a director or chief executive officer; and (iii) a personal interest of an individual voting via a power of attorney given by a third party (even if the empowering shareholder has no personal interest), and the vote of an attorney-in-fact shall be considered a personal interest vote if the empowering shareholder has a personal interest, and all with no regard as to whether the attorney-in-fact has voting discretion or not; but (2) excludes a personal interest arising solely from the fact of holding shares in the company.

For this purpose, a “controlling shareholder” is any shareholder that has the ability to direct the company’s activities (other than by means of being a director or office holder of the company). A person is presumed to be a controlling shareholder if he or she holds or controls, by himself or together with others, one half or more of any one of the “means of control” of a company; in the context of a transaction with an interested party, a shareholder who holds 25% or more of the voting rights in the company if no other shareholder holds more than 50% of the voting rights in the company, is also presumed to be a controlling shareholder. “Means of control” as defined under the Companies Law, are one of the following: (i) the right to vote at a general meeting of a company, or (ii) the right to appoint directors of a company or its chief executive officer.

Shareholders wishing to express their position on an agenda item for this Meeting may do so by submitting a written statement (a “Position Statement”) to the Company’s offices at 2 Yitzhak Modai Street Rehovot, Israel 7608804. Any Position Statement received will be furnished to the U.S. Securities and Exchange Commission (“SEC”) on a Report on Form 6-K and will be made available to the public on the SEC’s website at www.sec.gov. Position Statements should be submitted to the Company no later than June 10, 2022. A shareholder is entitled to contact the Company directly and receive the text of the proxy card and any Position Statement. The Board’ response to the Position Statement will be submitted no later than June 16, 2022.

One shareholder or more holding Ordinary Shares which reflect five percent (5%) or more of the Company’s issued and outstanding share capital and voting rights (i.e., 390,943 Ordinary Shares) is entitled to examine the proxy and voting material.

It is noted that there may be changes on the agenda after publishing this Proxy Statement, and there may be Position Statements which can be published. Therefore, the most updated agenda will be furnished to the SEC on a Report on Form 6-K and will be made available to the public on the SEC’s website at www.sec.gov.

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PROPOSAL 1

TO APPROVE THE ADOPTION OF A COMPENSATION POLICY FOR THE COMPANY’S
DIRECTORS AND OFFICERS

Pursuant to the Companies Law, all public Israeli companies are required to adopt a written compensation policy for their executives, which addresses certain items prescribed by the Companies Law and serves as a flexible framework for executive and director compensation. Accordingly, on April 26, 2022 and April 28, 2022, the Compensation Committee of the Board (the “Compensation Committee”) and the Board, respectively, reviewed the terms of the proposed compensation policy (the “Compensation Policy”), in depth, compared different components of compensation to companies similar to the Company using a benchmark analysis performed by an independent consultant, and approved, and voted to recommended that the shareholders of the Company approve, the adoption of the Compensation Policy, substantially in the form attached hereto as Exhibit A.

The purpose of the Compensation Policy is to meet the changing legal and business environment where the Company operates and the compensation needs of its directors and officers. In addition, under section 267A(d) of the Companies Law, the Company is required to review, update (if necessary) and approve the Compensation Policy every three (3) years. Notwithstanding the above, under regulation 1(c) of the Companies Law regulations regarding exemptions from the obligation to set a compensation policy, the Compensation Policy is required to be approved within five (5) years following the consummation of an Initial Public Offering (“IPO”). The Company completed its IPO on February 4, 2022.

When considering the Compensation Policy, the Compensation Committee and the Board considered numerous factors, including the advancement of the Company’s objectives, the Company’s business plan and its long-term strategy, and creation of appropriate incentives for directors and executive officers. The Compensation Committee and the Board also considered, among other things, the Company’s risk management, size and the nature of its operations, and reviewed various data and information they deemed relevant.

The Compensation Policy is designed to promote retention and motivation of directors and executive officers, incentivize superior individuals’ excellence, align the interests of the Company’s directors and executive officers with the long-term performance of the Company and provide a risk management tool.

Pursuant to the Compensation Policy, the compensation that may be granted to an executive officer may include base salary, annual performance bonus, special bonus, equity-based compensation, benefits and termination of employment arrangements.

The shareholders of the Company are requested to adopt the following resolution:

“RESOLVED, to adopt the Compensation Policy for the Company’s directors and officers, in the form attached as Exhibit A to the Proxy Statement.”

The approval of this proposal, as described above, requires the affirmative vote of a Special Majority (as defined in this proxy statement).

Please note that we consider it highly unlikely that any of our shareholders is a controlling shareholder or has a personal interest in this proposal. However, as required under Israeli law, the enclosed form of proxy requires that you specifically indicate that you are not a controlling shareholder and do not have a personal interest in this proposal. Without indicating to this effect – we will not be able to count your vote with respect to this proposal.

The Board unanimously recommends that the shareholders vote FOR the above proposal.

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PROPOSAL 2

TO APPROVE A FIXED FEE FOR MR. JOSEPH GOTTLIEB, A MEMBER OF THE BOARD

Background

Mr. Joseph Gottlieb has served as a member of the Board since March 2021, prior to the listing of the Ordinary Shares on the Nasdaq Stock Market LLC on February 1, 2022 (the “Listing Date”) and before the appointment of the other directors (other than Mr. Israel Bar). In light of Mr. Gottlieb’s contribution to the Company and his role as Company’s director, the Company wishes to pay Mr. Gottlieb a fixed fee according to the fix fee paid to all other non-executive directors in the Company, as of the Listing Date, subject to the required approvals.

Therefore, On April 26, 2022 and April 28, 2022, the Compensation Committee and the Board, respectively, approved and voted to recommend that the Company’s shareholders approve, the payment of a fixed fee in the amount of NIS 25,000 per quarter (NIS 100,000 per year) (approximately $29,400 per year) to Mr. Joseph Gottlieb, in consideration for his services as a member of the Board (the “Fee”).

Accordingly, the Compensation Committee and the Board have considered and discussed all relevant matters required under the Companies Law and the regulations promulgated thereunder, including without limitations, the position, responsibilities, background, and experience of Mr. Gottlieb, Mr. Gottlieb’s comprehensive knowledge of the Company’s business, the fair and reasonable value for Mr. Gottlieb’ duties, and have resolved to approve the payment of the Fee.

The shareholders of the Company are requested to adopt the following resolution:

“RESOLVED, to approve the payment of a fixed fee to Mr. Gottlieb, in the amount of NIS 100,000 per year, to be paid as set forth in the Proxy Statement.”

Subject to the approval of Proposal No.1 of the agenda, regarding the compensation policy, then Proposal No. 2, requires the approval of a Simple Majority.

If Proposal No. 1 is not approved, approval of Proposal No. 2 will require approval by a Special Majority.

Please note that we consider it highly unlikely that any of our shareholders is a controlling shareholder, or has a personal interest in this proposal. However, as required under Israeli law, the enclosed form of proxy requires that you specifically indicate that you are not a controlling shareholder and do not have a personal interest in this proposal. Without indicating to this effect – we will not be able to count your vote with respect to this proposal.

The Board unanimously recommends a vote FOR on the above proposal.

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PROPOSAL 3

To approve AN UPDATE TO THE TERMS OF COMPENSATION and employment
agreeemEnt WITH MR. ISRAEL BAR, THE COMPANY’S CHIEF EXECUTIVE OFFICER AND A
MEMBER OF THE COMPANY’S BOARD

Background

Under the Companies Law and the position statements by the Israeli Securities Authority, arrangements concerning compensation for Company’s chief executive officer, in accordance to or which exceed the terms of the Company’s compensation policy, require the approval by the Compensation Committee, the Board and Company’s shareholders (by a Special Majority, as defined above), in that order.

We now seek the shareholder’s approval to update Mr. Bar’s terms of compensation, which will include an updated monthly salary as well as entitlement to annual bonuses subject to achievement of measurable goals, all in accordance with the Company’s Compensation Policy, a copy of which is attached hereto as Exhibit A.

General

Mr. Bar founded the Company in May 2008 and served as the Company’s Chief Executive Officer and director since then. The Board has determined that Mr. Bar has made substantia contributions to the Company’s business and growth. The Compensation Committee and the Board believe that Mr. Bar performs a significant role in the planning, establishment and implementation of the Company’s business, corporate and financing aspects, and will continue to play a key role in the Company’s pursuit to enhance its business and growth opportunities.

Taking into account numerous factors, including the provisions of the Compensation Policy and other relevant information and materials presented to them, the Compensation Committee and the Board approved on April 26, 2022 and April 28, 2022, respectively, and the Board voted to recommend that the shareholders approve to amend Mr. Bar’s Employment Agreement in accordance with the proposed Compensation Policy, as follows (“Mr. Bar’s New Terms of Compensation”):

Eligibility for Annual Bonuses

Mr. Bar will be eligible to receive an annual bonus for each year in accordance with the maximum amount stated in the Compensation Policy, as may be from time to time, without the need for further shareholder approval, subject to meeting certain measurable targets which will be determined at the beginning of each year by the Compensation Committee and the Board.

Monthly Salary

Mr. Bar’s monthly salary will be increased from a monthly fee of NIS 49,010 (approximately $14,415), to a monthly fee of NIS 64,000 (approximately $18,800) effective as of Listing Date.

Notice Period

Mr. Bar will be entitled to 120 days notice in the event of termination of his employment with the Company.

In making its recommendation with regard to the approval of Mr. Bar’s New Terms of Compensation, the Compensation Committee and the Board each have considered: (i) factors included in the Compensation Policy, including, the position, responsibilities, background and experience of Mr. Bar; (ii) a benchmark work compared to similar companies (in size and/or market value) performed by an external consultant; and (iii) that Mr. Bar’s New Terms of Compensation reflect a fair and reasonable value of his contribution to the Company.

The shareholders of the Company are requested to adopt the following resolution:

“RESOLVED, to approve Mr. Israel Bar’s New Terms of Compensation and amend his employment agreement accordingly, all as set forth in the Proxy Statement.”

The approval of this proposal, as described above, requires the affirmative vote of a Special Majority (as defined in this proxy statement).

Please note that we consider it highly unlikely that any of our shareholders is a controlling shareholder, or has a personal interest in these proposals. However, as required under Israeli law, the enclosed form of proxy requires that you specifically indicate that you are not a controlling shareholder and do not have a personal interest in these proposals. Without indicating to this effect – we will not be able to count your vote with respect to these proposals.

The Board unanimously recommends a vote FOR on the above proposal.

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Your vote is important! Shareholders are urged to complete and return their proxies promptly in order to, among other things, ensure action by a quorum and to avoid the expense of additional solicitation. If the accompanying proxy is properly executed and returned in time for voting, and a choice is specified, the shares represented thereby will be voted as indicated thereon. EXCEPT AS MENTIONED OTHERWISE IN THIS PROXY STATEMENT, IF NO SPECIFICATION IS MADE, THE PROXY WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS DESCRIBED IN THIS PROXY STATEMENT.

Proxies and all other applicable materials should be sent to:

VStock Transfer, LLC.

18 Lafayette Place

Woodmere, New York 11598

ADDITIONAL INFORMATION

The Company is subject to the informational requirements of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), as applicable to foreign private issuers. Accordingly, the Company files reports and other information with the SEC. All documents which the Company will file on the SEC’s EDGAR system will be available for retrieval on the SEC’s website at http://www.sec.gov.

As a foreign private issuer, the Company is exempt from the rules under the Exchange Act prescribing certain disclosure and procedural requirements for proxy solicitations. In addition, the Company is not required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently or as promptly as United States companies whose securities are registered under the Exchange Act. The Notice of the Special General Meeting of Shareholders and the proxy statement have been prepared in accordance with applicable disclosure requirements in the State of Israel.

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROXY STATEMENT OR THE INFORMATION FURNISHED TO YOU IN CONNECTION WITH THIS PROXY STATEMENT WHEN VOTING ON THE MATTERS SUBMITTED TO SHAREHOLDER APPROVAL HEREUNDER. THE COMPANY HAS NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT FROM WHAT IS CONTAINED IN THIS DOCUMENT. THIS PROXY STATEMENT IS DATED MAY 17, 2022. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS DOCUMENT IS ACCURATE AS OF ANY DATE OTHER THAN MAY 17, 2022, AND THE MAILING OF THIS DOCUMENT TO SHAREHOLDERS SHOULD NOT CREATE ANY IMPLICATION TO THE CONTRARY.

By Order of the Board of Directors

Maris-Tech Ltd.

Joseph Weiss, Chairman of the Board of Directors

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Maris-Tech LTD.

PROXY

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Mr. Israel Bar, Chief Executive Officer of the Company and Nir Bussy, Chief Financial Officer of the Company, and each of them, as agents and proxies of the undersigned, with full power of substitution to each of them, to represent and to vote on behalf of the undersigned all the ordinary shares, no par value, of Maris-Tech Ltd. (the “Company”) which the undersigned is entitled to vote at the Special General Meeting of Shareholders (the “Meeting”) to be held on June 21, 2022 at 3:00p.m. Israel time, and at any adjournments or postponements thereof, upon the following matters, which are more fully described in the Notice of Special General Meeting of Shareholders and proxy statement relating to the Meeting.

This Proxy, when properly executed, will be voted in the manner directed herein by the undersigned. If no direction is made with respect to any matter, this Proxy will be voted FOR such matter. Any and all proxies heretofore given by the undersigned are hereby revoked.

(Continued and to be signed on the reverse side)

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MARIS-TECH LTD.

SPECIAL GENERAL MEETING OF SHAREHOLDERS

Date of Meeting: June 21, 2022

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE
MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE ☒

1 To approve the adoption of the Compensation Policy for the Company’s directors and officers.

☐ FOR ☐ AGAINST ☐ ABSTAIN

1a. Do you confirm that you are NOT a controlling shareholder of the Company and/or do NOT have a personal interest (as such terms are defined in the Companies Law and in the Proxy Statement) in Proposal No. 1?*

*If you do not indicate a response YES for this item 1a, YOUR SHARES WILL NOT BE VOTED for Proposal No. 1.

☐ YES    I/We confirm that I am/ we are NOT a controlling shareholder of the Company and/or do NOT have a personal interest in Proposal No. 1.

2. To approve a fixed fee for Mr. Joseph Gottlieb, a member of the Board, as set forth in the Proxy Statement.

☐ FOR ☐ AGAINST ☐ ABSTAIN

2a. In case Proposal No. 1 will not be approved, do you confirm that you are NOT a controlling shareholder of the Company and/or do NOT have a personal interest (as such terms are defined in the Companies Law and in the Proxy Statement) in Proposal No. 2?*

*If you do not indicate a response YES for this item 2a, YOUR SHARES WILL NOT BE VOTED for Proposal No. 2.

☐ YES    I/We confirm that I am/ we are NOT a controlling shareholder of the Company and/or do NOT have a personal interest in Proposal No. 2.

3. To approve Mr. Israel Bar’s New Terms of Compensation and to amend his employment agreement accordingly, all as set forth in the Proxy Statement.

☐ FOR ☐ AGAINST ☐ ABSTAIN

3a Do you confirm that you are NOT a controlling shareholder of the Company and/or do NOT have a personal interest (as such terms are defined in the Companies Law and in the Proxy Statement) in Proposal No. 3?*

*If you do not indicate a response YES for this item 3a, YOUR SHARES WILL NOT BE VOTED for Proposal No. 3.

☐ YES    I/We confirm that I am/ we are NOT a controlling shareholder of the Company and/or do NOT have a personal interest in Proposal No. 3.

In their discretion, the proxies are authorized to vote upon such other matters as may properly come before the Meeting or any adjournment or postponement thereof.

NAME	SIGNATURE	DATE
NAME	SIGNATURE	DATE

Please sign exactly as your name appears on this Proxy. When shares are held jointly, each holder should sign. When signing as executor, administrator, trustee or guardian, please give full title as such. If the signed is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by authorized person.

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Maris-Tech Ltd

(“the Company”)

Compensation Policy for Company’s Office Holders

Dated: June 2022

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Introduction

1.1 Pursuant to the provisions of the Companies Law, 1999 (hereafter – “the Companies Law”), on April 26, 2022 and April 28, 2022, the Company’s Compensation Committee and the Company’s Board of Directors, respectively, approved a compensation policy (hereafter – the “Policy”) with respect to the terms of service and / or employment of Company’s office holders (as defined below) (hereafter - the “office holders”), after discussing and considering the recommendations of the Company’s Compensation Committee regarding this matter.

1.2 The provisions of the Policy shall be subject to the provisions of any cogent law applicable to the Company and its office holders in any territory.

1.3 The underlying principles and purposes of the Policy are as follows: (a) promoting the Company’s goals, its work plan and its policy for the long-term; (b) compensating and providing incentives to office holders, while considering the risks that the Company’s activities involve; (c) adjusting the compensation package to the size of the Company and the nature and scope of its activities; (d) creating incentives that are suitable to Company’s office holders by compensating those entitled for compensation under the Policy in accordance with their positions, areas of responsibility and contribution to the development of the Company’s business, the promotion of its targets and the maximization of profits in the short and long-term, taking into account, among other things, the need to recruit and retain qualified, highly-skilled officers in a global and competitive market; and (e) adjusting the compensation of office holders to the contribution of the office holder to the achievement of the Company’s goals.

1.4 This Policy is a multi-annual policy that will be effective for a period of three years from the date of its approval. This policy shall be brought forward for re-approval by the Company’s Compensation Committee, the Company’s Board of Directors and the general meeting of its shareholders after three years have elapsed since the date of approval thereof and so forth, unless any changes need to be made to the Policy in accordance with the law and/or in accordance with the Company’s needs.

1.5 Without derogating from the provisions set out in Section 1.4 above, the Company’s Compensation Committee and Board of Directors shall check, from time to time, whether the compensation that is granted under this policy, does, indeed, comply with the terms of this policy and the parameters set therein for each Company office holder.

1.6 This Policy is based, among other things, on the Company’s assessments as to the competitive environment in which it operates and the challenge it faces in recruiting and retaining high-quality officers in such an environment; it is also based on employment terms generally accepted in public companies operating in the Company’s area of activity and on existing employment agreements between the Company and its office holder, which – in order to remove any doubt – this policy cannot change.

2. The Policy

2.1 Definitions

Office holder- as defined in the Companies Law- 5759-1999, i.e., Chief Executive Officer (CEO), deputy CEO, Directors, Chairmen, Subordinate office holder, any person filling any of these positions in the Company even if he holds a different title, and any other manager directly subordinate to the CEO.

Subordinate office holder- Office holder subordinate reporting directly to the CEO.

Foreign office holder- Office holder who his / her residency is outside of Israel.

2.2 Components of the Policy

In accordance with the Policy, the compensation of the Company’s office holders shall be based on all or some of the following components:

2.2.1 Basic salary component– refers to the monthly salary of that employee, excluding any social benefits and related benefits, and in respect to compensation paid as consultancy fee or equivalent (to a non-employee office holder) – the monthly gross consultation fees, excluding VAT (if applicable);

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2.2.2 Social and related benefits - social benefits as prescribed by local law (pension savings, contributions towards severance pay, contributions towards training fund, vacation pay, sick leave, recreation pay, etc.) and related benefits, such as company vehicle/vehicle maintenance, telephone expenses, laptop, meals at the workplace, gifts on public holidays, etc.

2.2.3 Variable cash compensation (bonus) – short and medium-term compensation, which includes annual bonuses, which are based on results and achievement of targets. The Company may also determine that a certain office holder will be paid discretionary annual bonuses, considering his/her contribution to the Company and the restrictions placed under this policy.

2.2.4 Variable equity-based compensation– share-based payment or another long-term compensation (subject to the existence of valid long-term compensation plans and provided that the Company decides to award such compensation).

(The components in sections 2.2.3 and 2.2.4 above shall be called hereafter: “the variable components”).

At the time of approval of the compensation package of an office holder, the Compensation Committee and Board of Directors of the Company shall assess the compliance of each of those components and of the total cost of employment and/or consultancy fee with the criteria set out in this plan.

2.3 Parameters for reviewing compensation terms

Generally, some or all of the following parameters will be considered when reviewing the compensation terms of a Company office holder.

2.3.1 Education, skills, expertise, tenure (specifically in the Company and in the office holder’s field of expertise in general), professional experience and achievements of the office holder;

2.3.2 The role of the office holder, his areas of responsibility and his employment or services terms under previous wage agreements entered into with this office holder;

2.3.3 The office holder’s contribution to the Company’s business, the achievement of its strategic goals and implementation of its work plans, the maximization of its profits and the enhancement of its strength and stability.

2.3.4 The extent of responsibility delegated to the office holder.

2.3.5 The Company’s need to recruit or retain an office holder with unique skills, knowledge, or expertise.

2.3.6 Whether a material change has been made to the role or function of the office holder, or to the Company’s requirements from this office holder.

2.3.7 The size of the Company and the nature of its activities.

2.3.8 As to service and employment terms that include retirement grants – the term of service or employment of the office holder, the terms of his service and employment over the course of this period, the Company’s performances in the said period, the office holder’s contribution to the achievement of the Company’s goals and the circumstances of the retirement.

2.3.9 (a) The market conditions of the industry in which the Company operates at any relevant time, including the office holder’s salary compared to the salaries of other office holders working in similar positions (or in position of comparable level) in companies whose characteristics are similar to those of the Company in terms of its activity (as described in section 2.3.1 below); (b) the availability of suitable candidates that can serve as office holders in the Company, the recruitment and retainment of the office holders and the need to offer an attractive compensation package in a global competitive market; and (c) changes in the Company’s area of activity and in the scope and complexity of its activities.

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2.4 Payroll review

2.4.1 For the purpose of determining the payroll that can be offered to an office holder upon recruitment, the Company will review from time to time the payroll generally accepted in the relevant markets for similar positions in companies which are similar to the Company in terms of its area of activity/scope of activity/complexity of activity/market value/revenues and other relevant parameters (if such companies exist).

2.4.2 The payroll review will be conducted by the Company itself, or by an external advisor, at the Company’s discretion, after the Compensation Committee has issued its recommendations regarding this matter.

2.5 Basic salary, benefits and other related benefits

2.5.1 The basic salary of a new Company office holder shall be determined taking into accounts the parameters described in section 2.3 above and the conclusions of the payroll review described in section 2.4 above (should such a review will be conducted).

2.5.2 The basic salary shall be in absolute numbers. The Company may determine that an office holder’s salary shall be linked to a certain currency or index.

2.5.3 In any case, the basic monthly salary, or alternatively, the monthly consultation fees shall not exceed the maximum amount set out below (linked to the Consumer Price Index commencing April 2022)***:

Position	Maximum basic salary* in $
Active Chairmen of the Board of Directors (“Active Chairmen”)	12,000$
Company’s CEO (“CEO”)**	23,000$
Subordinate office holders**	17,000$
Foreign office holders**	17,000$

* An amount paid to an office holder other than an Active Chairman, as monthly consultation fees (in respect of which an invoice is issued), which is up to 1.4 times higher than the maximum basic salary set for his position, shall not be considered to be a deviation from the Policy.

** The amounts presented above are in respect of a full-time position (other than the Active Chairman); those amounts shall change in proportion to the scope of position of the office holder.

*** Based on USD/NIS exchange rate of 1/3.23.

2.5.4 Social benefits¹, related benefits, reimbursement of expenses

The compensation package may include benefits that are generally acceptable in the market where employee serves, such as vacation pay², contributions towards pension, life insurance, education fund, training fund saving, health insurance, social rights and benefits, mobile phone (including grossing up of the taxable value of the phone), internet and landline, gifts on public holidays, recreation, medical tests, medical insurance and/or undertaking such an insurance policy and other expenses, all as approved by the Compensation Committee and the Company’s Board of Directors, at their discretion and in accordance with the applicable Company policy.

¹ As to an office holder that has entered into engagement with the Company whereby no employer-employee relationship exists, the Company may pay the social benefits described above on top of his monthly fee in lieu of the said expenses.

² An office holder shall be entitled to annual leave as prescribed by law, but the Company may grant him further paid leave up to a maximum of 24 working days per year. The Company may allow the office holder to accumulate vacation days over his term of office in accordance with Company’s procedures.

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2.5.5 Vehicle

Company office holders shall be entitled to receive a Company vehicle (including by way of leasing) in the following costs:

· CEO- By way of leasing in the amount of up to $3,000 per month excluding VAT, linked to the consumer price index.

· Subordinate office holders- By way of leasing in the amount of up to $2,000 per month before VAT, linked to the consumer price index.

Such entitlement may include grossing up the taxable value of this benefit, fuel expenses, licensing, insurance and other related expenses.

The Company may add an amount equal to the vehicle costs as additional salary to the office holder, provided that the total payroll will be in accordance to the limitation of the Policy.

2.5.6 Insurance, indemnification, and exemption

Insurance

2.5.6.1 Company’s office holders shall be entitled to insurance coverage, including “run-off” and/or SIDE A type policies, to be provided by a liability insurance policy of directors and office holders, including the controlling shareholders, which the Company will purchase from time to time, subject to the approvals required by law.

2.5.6.2 Subject to the provisions of the law, as amended from time to time, and without detracting from the provisions of section 2.5.6.1 above, the Company’s office holders shall be entitled to benefit from coverage provided by a liability insurance of directors and office holders, which the Company will purchase from time to time, subject to the approval of the Compensation Committee alone (and the approval of the Board of Directors, if required by law), provided that the insurance policy meets the following criteria and provided that the engagement with the insurer is entered into under market conditions and will not have a material effect on the Company’s profitability, its assets or liabilities:

a. The limit of insurer’s liability under the insurance policy shall not exceed $10 million per claim and during the insurance period covered by that policy, plus reasonable litigation expenses in excess of the abovementioned limit.

b. The insurance policy may include an entity cover that will cover the Company itself in case of lawsuits filed against it under the securities law (whether those lawsuits are filed only against the Company and whether they are filed against the Company and office holder thereof or an office holder in its related companies). Such cover will be subject to priorities for payment of any insurance benefits according to which the rights of the Directors and Officers to receive indemnity from the Insurer’s take precedence over the right of the Company itself.

c. Without derogating Section 2.5.6.2(b) above, the total annual premium that the Company will pay to an insurance company for the office holders liability insurance as described above, shall be (i) in market conditions and in an immaterial cost; or (ii) shall not exceed a total of $1 million.

d. In case of a material change in risk, or a change in control, or in case the policy is not renewed, the Company shall be entitled to purchase a Run-Off coverage of up to 7 years (the “Run Off period”), for a premium for the Run Off period in the rate of up to 250% of the last paid annual premium.

e. The excess amounts set in the insurance policies shall not exceed the amounts normally applicable in the insurance market for policies of this type as of the date of purchasing and renewing the insurance on a periodic basis.

f. In this section 2.5.6.2, if the overages do not exceed 10%, this will not be considered as an exemption of the Policy.

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Indemnification and Exemption

2.5.6.3 The Company’s office holders may be entitled to an indemnification arrangement in accordance with arrangements that are normally acceptable and subject to the provisions of the law and the Company’s articles of association. The overall amount of indemnification per event to each office holder and to all office holders together, individually or in aggregate, shall not exceed the greater of: (i) 25% of the effective shareholders’ equity of the Company; and (ii) $5,000,000 (the maximum indemnification amount).

For that purpose, the “effective shareholders’ equity of the Company” means the amount of the Company’s shareholders’ equity in accordance with the last consolidated audited or reviewed financial statements of the Company (as applicable) at the time of actual payment of the indemnification. It is hereby clarified that the indemnification shall be paid in excess of any amount paid under the liability insurance of directors and office holders, which the Company has purchased or will purchase from time to time.

2.5.6.4 Company office holders may be entitled to an exemption arrangement in accordance with arrangements that are normally acceptable and subject to the provisions of the law and the Company’s articles of association.

2.6 Compensation in connection with termination of employment

2.6.1 Advance notice period

2.6.1.1 An office holder may be entitled to advance notice period or payment in lieu of advance notice period, as follows:

Chairmen- up to 90 days advance notice period.

CEO- up to 120 days advance notice period.

Subordinate office holder- up to 60 days advance notice period.

2.6.1.2 Over the course of the advance notice period, the office holder shall continue to do his job in the Company at the request of the Company, unless the Company decides that he will not do so, in which case the office holder may be entitled to continue and receive over the advance notice period all employment and service terms, which were agreed upon in his employment agreement.

2.6.1.3 The service or employment terms of the office holders may include a provision whereby the Company may terminate the services or employment of the office holder without an advance notice period in cases which deny eligibility for severance pay according to the law, including the following cases: (a) conviction of an offence involving moral turpitude; (b) an office holder who will conduct himself in a disloyal and/or unreliable and/or dishonest manner in his relations with the Company and/or while carrying out actions on its behalf and/or will harm the Company’s reputation; (c) in case the office holder will breach the confidentiality duty towards the Company and/or his duty to protect the Company rights which were developed due to or as part of his work at the Company; (d) Any other case in which the Company is legally entitled to refrain from payment of severance pay.

2.6.2 Severance pay

Office holders, who are Company’s employees, will be entitled to severance pay in accordance with the provisions of the local law.

2.7 Annual bonus

In addition to the basic salary, the compensation package of Company’s office holders may include eligibility to an annual bonus that is based on measurable targets and to an annual discretionary bonus (hereafter jointly: “the annual bonus”).

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For the purpose of this Annual bonus section, whenever the term “salary” is used, it means (i) in the case of an employed office holder – the gross salary in terms of employer cost as paid to the office holder for the month of December in the relevant year and (ii) in the case of office holder with no employer-employee relationship – the fee paid to the office holder for the month of December in the relevant year, excluding VAT (if applicable).

2.7.1 Components of the annual bonus

The Company may grant an Office holder an annual bonus up to the maximum annual bonus as described in the table in section 2.7.7 below, based on the compensation plan which will be approved by the compensation committee and the Board of Directors for each year in advance.

At the end of each year, the Compensation Committee and Board of Directors will review the office holders’ meeting their measurable targets in order to determine that component of the annual bonus, which is based on measurable targets. The Compensation Committee and Board of Directors may determine to pay only part of the component of the annual bonus, which is based on measurable targets, if the office holder meets only some of the targets.

According to the rates stated below, the components for each of the Office holders of the annual bonus will be:

(i) Measurable Company Targets (from the categories in the list below);

(ii) Measurable Personal Targets (from the categories in the list below); and

(iii) Discretionary Bonus (according to the limitations set forth herein)

	Measurable Company Targets	Measurable Personal Targets	Discretionary Bonus
Active Chairmen / CEO	0-100%	0-100%	0-25% (by Board of Directors), see section 2.7.3(1) below
Subordinate Office holders	0-100%	0-100%	0-25% (by CEO), see section 2.7.3(2) below.

2.7.2 Measurable Targets (Company and Personal)

Set forth below are several suggested criteria for the annual bonus that is based on measurable targets. It should be clarified that this list is not a closed and binding list. The Compensation Committee and the Board of Directors may consider adding or removing some of those criteria, considering the role of each office holder, his areas of responsibility and the Company’s activity. a bonus that is based on meeting principal and personal performance metrics that are quantified and set out in the Company’s work plan and attributed to the relevant office holder. These performance metrics may include, among other things:

Active Chairmen and CEO Measurable Targets Criteria

(a) Sales and marketing targets.

(b) Increase of revenue targets.

(c) Engagement in contracts with revenue potential in a determined amount.

(d) Engagement in collaboration contracts.

(e) Engagement of material contracts and/or strategic contracts.

(f) Achievement of product development milestones.

(g) Reducing costs.

(h) Achievement of targets/milestones relating to Company’s products and projects.

(i) Promotion of strategic plans and targets, including targets which were set for the office holder, and which are relevant to the relevant office holder’s area of activity.

(j) Achievement of regulatory approvals.

(k) Achievement of financial indicators targets: gross margin, operational profit/loss, net profit/loss, cash balance, revenue.

(l) Achievement of funding targets: raising loans, private placement, public or rights offering of shares, bonds, etc.

(m) Achievement of achieving new and/or innovative technologies.

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Subordinate Measurable Targets Criteria

(a) Sales and marketing targets.

(b) Increase of revenue targets.

(c) Engagement in contracts with revenue potential in a determined amount.

(d) Engagement in collaboration contracts.

(e) Engagement of material contracts and/or strategic contracts.

(f) Achievement of product development milestones.

(g) Reducing costs.

(h) Achievement of targets/milestones relating to Company’s products and projects.

(i) Promotion of strategic plans and targets, including targets which were set for the office holder, and which are relevant to the relevant office holder’s area of activity.

(j) Achievement of regulatory approvals.

(k) Budget and work plan related targets.

(l) Inventory and Production related targets.

(m) Achievement of financial indicators targets: gross margin, operational profit/loss, net profit/loss, cash balance, revenue.

(n) Achievement of funding targets: raising loans, private placement, public or rights offering of shares, bonds, etc.

(o) Achievement of achieving new and/or innovative technologies.

2.7.3 Discretionary bonus

(1) With regard to the Company’s CEO and an active Chairmen of the Board of Directors – most of the annual bonus will be based on measurable targets and an immaterial portion of the annual bonus (for that purpose “immaterial portion” – the higher of (a) a total of 3 (gross) monthly salaries or (b) 25% of the variable components of the bonus (actual bonus and equity-based payment) shall be a discretionary bonus that is based on qualitative criteria.

Notwithstanding the above, if in a specific year the Company does not pay the CEO or the active Chairman (as applicable) an annual bonus that is based on measurable targets (i.e., if the discretionary annual bonus paid to the CEO or the active Chairman (as applicable) constitutes the total annual bonus paid on that year), then the amount of the discretionary bonus that the Company may pay to the CEO and to the active Chairman (as applicable and separately) shall not exceed three (3) gross monthly salaries of that office holder.

(2) With regard to Subordinate Office Holders/Foreign office holders– subject to the provisions of the law, Subordinate Office Holders, may be eligible to an annual bonus that is based on measurable targets and to a discretionary annual bonus. It should be clarified that the amount of the discretionary bonus that the Company may pay to Subordinate Office Holders, shall not exceed three (3) gross monthly salaries of the Subordinate Office Holder.

The amount of the annual bonus that is based on measurable targets shall be calculated based on measurable criteria, that will be determined (if they are determined) for each and every office holder at a time close to the date of the discussion held by the Board of Directors for review of the Company’s budget for the forthcoming year, in accordance with the role of the relevant office holder, by the competent organs of the Company (in accordance with the provisions of the law and the positions of the Securities Authority, as amended from time to time), provided that the targets applicable to Subordinate Office Holders/Foreign office holders, shall be determined by the Company’s Compensation Committee and Board of Directors, at the recommendation of the CEO.

2.7.4 Neutralization of one-off events

As part of the calculation of the eligibility to annual bonus that is based measurable targets on the basis of financial statements data (if such targets are set) the Board of Directors or the Compensation Committee will be authorized to neutralize the effect of “one-off events”, or alternatively to decide that such events should not be neutralized in a certain year, as applicable.

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2.7.5 The Company’s competent organs shall approve this component based, among other things, on data presented by the Company’s management and based on personal assessment and recommendation issued by the Company’s CEO (with regard to Subordinate office holders/Foreign office holders) and by the Company’s Board of Directors with regard to active Chairman and the CEO, while listing the underlying reasons for their recommendation.

Notwithstanding the foregoing, subject to applicable law, the Company’s competent organs shall be entitled to approve payment of discretionary bonus on an Annual, quarterly, monthly, or otherwise basis.

2.7.6 Annual bonus that is based on measurable targets only

2.7.6.1 Subject to the provisions of the law and the positions of the Israeli Securities Authority (as amended from time to time):

a. The Compensation Committee and Board of Directors alone will be allowed to determine the measurable targets applicable to active Chairman of the Board of Directors or any other director, if one of the following (1) or (2) is fulfilled:

(1) All of the following conditions are met: (a) the resolution is in line with the Policy; (b) the grant in question is based only on measurable targets; (c) the amount of the potential grant is immaterial (up to three salaries); and (d) the targets were pre-determined by the Compensation Committee and the Board.

(2) All of the following conditions are met: (a) the resolution is in line with the Policy; (b) the office holder in question serves both as a director and in an operational role in the Company; (c) The Compensation Committee and Board of Directors approved the targets, other than the said directors, who receive from the Company a bonus based on measurable targets, did not take part in the approval of those targets (whether in their capacity as directors or in their capacity as other office holders in the Company).

b. The Compensation Committee and Board of Directors alone will be allowed to determine the measurable targets applicable to an office holder, who is a controlling shareholder or a relative thereof (as these terms are defined in the Companies Law), if one of the following (1) or (2) is fulfilled:

(1) All of the following conditions are met: (a) the resolution is in line with the Policy; (b) the grant in question is based only on measurable targets; (c) the amount of the potential grant is immaterial (up to three salaries); and (d) the targets were pre-determined by the Compensation Committee and the Board.

(2) The Board of Directors has determined a clear target that is based on financial statements data and which applies in the same manner to the controlling shareholder and his relative and to other office holders, who are not related to the controlling shareholder.

2.7.7 The maximum annual bonus of office holders as of date of payment thereof (both in respect of Discretionary Bonus and in respect of bonus based on Measurable Targets):

Role	Maximum Annual Bonus3
Active Chairman	Up to 12 salaries (subject to the provisions of section 2.7.3(1) above)
CEO	Up to 12 salaries (subject to the provisions of section 2.7.3(1) above)
Other Subordinate office holders/ Foreign office holders	Up to 4 salaries

³ The maximum values are in respect of the aggregate annual bonus – bonus based on measurable targets and discretionary bonus.

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2.7.8 The Compensation Committee and Board of Directors may decide to pay the annual bonus in cash and/or equity.

2.7.9 The Compensation Committee and Board of Directors may decide to postpone the payment of the annual bonus or reduce the amount of the annual bonus to which the office holder is entitled, at their own discretion.

2.7.10 The Company may pay an office holder, who has not completed a full year of employment, a proportionate share of the bonus according to the period of employment of the office holder.

2.7.11 The office holder shall repay to the Company that portion of the bonus he received, which was based on measurable targets, should it be determined that this component was paid to him on the basis of erroneous data and/or data that were restated in the Company’s financial statements, provided that the date of restatement of the financial statements does not fall later than three (3) years after the original approval of the relevant financial statements.

2.8 One-Time Bonus

The Board of Directors, subject to the recommendation of the Compensation Committee and the officer’s direct supervisor, may decide to grant a one-time bonus (beyond the Annual Bonus, as described in Section 2.7 above), to an office holder, including the chairmen and directors, in respect of special efforts performed by the officer and / or in respect of the significant contribution of the officer to the Company’s operations, special projects or extra ordinary achievements which are not in the Company’s general course of business (the “One-Time Bonus”).

The aggregate amount of One-Time Bonus and Annual Bonus, shall not exceed 18 monthly base salaries.

2.9 Special Bonus- merger or sale or assignment by the Company of all or substantially all of its shares or assets.

The Board of Directors, subject to the recommendation of the Compensation Committee and the officer’s direct supervisor, may decide to grant a special bonus (beyond the Annual Bonus, as described in Section 2.7 above), to an office holder, including board members and chairmen, in case of a consummation of a merger, or sale or assignment by the Company of all or substantially all of the issued and outstanding shares of the Company and/or all or substantially all of the Company’s assets (the “Special Bonus”). The Special Bonus for all office holders together will be subject to a limit of 5% of the Transaction value, and in accordance with applicable law (the “Special Bonus”).

The Special Bonus is separate from the One-Time Bonus and the Annual Bonus.

2.10 Commissions

The CEO, may decide to grant Office holders that are providing services of sales and/or business development for the Company, with commissions, as shall be determined in their employment agreement (the “Sales Office holders” and “Commission”, respectively). The purpose of granting Commissions to Sales Office holders is to incentivize Sales Office holders to increase the amount of sales of Company’s products. For each Sales Office holder, the aggregate amount of Commissions paid by the Company in each calendar year shall be up to 10% from direct contribution to the Company’s income from sales, and in any case, the amount paid for each Sales Office holder shall not exceed $1 million. The Commissions will be paid on either a monthly, quarterly or annual basis. The maximum amount of Commissions shall be considered from time to time.

The Commission paid to a Sales Office holder shall be separate from the Annual Bonus and/or Special Bonus given to them, or instead of Annual Bonus and/or Special Bonus, as suggested by in each case by the CEO and approved by the Compensation committee.

The Commission shall be limited by the ratio between the fixed compensation and variable compensation, as further specified in section 2.12 herein

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2.11 Long-term compensation

2.11.1 The purpose of granting long-term compensation is to create an identity of interests between the company’s long-term business results and the office holder’s compensation. In addition, granting long term compensation is a tool for preserving good personnel. The principles for the long-term compensation are as follows:

2.11.1.1 The Company will provide equity-based compensation, which can include options, Restricted Share Units (“RSUs”) and or any other equity-based compensation in accordance with the Option Plan, to office holders, from time to time at the Board’s discretion.

2.11.1.2 Vesting Period- The vesting period will not be less than one year, except in cases of acceleration, in accordance with the Policy, the employment agreement and / or services with the office holder and as will be from time to time, or in case the vesting depends on milestones.

2.11.1.3 Acceleration Mechanism- The Board of directors (and in relation to the CEO or directors, as required by applicable law) may allow immediate acceleration for any unvested options and/or RSUs granted to office holders, upon closing of a Deemed Liquidation (as defined below):

“Deemed Liquidation” - shall mean: (i) the acquisition of the Company by, or the merger of the Company with another entity, consolidation, reorganization and/or recapitalization; provided that any of the said events results in an event prescribed under subsection (iii) below; (ii) sale, assignment or disposal by the Company of all or substantially all of the issued and outstanding shares of the Company; (iii) any other transaction or series of transactions following which the shareholders of the Company prior to the closing of such transaction own, directly or indirectly, less than 50% (fifty percent) of the voting power of the surviving entity (except in connection with public offering).

It is clarified that the Company’s Board of Directors will be entitled to reduce the definition of “Deemed Liquidation” at the time of the equity-based grant, and to determine that “a deemed liquidation is one or more of the aforementioned criteria.”

2.11.1.4 Exercise Price- The exercise price of the equity-based compensation will be determined according to the average price of the last 30 trading days share price, prior to the grant date.

2.11.1.5 Expiration date - up to ten (10) years from the date of grant.

2.11.1.6 The grant of equity-based compensation will be granted as far as possible under section 102 of the Income Tax Ordinance to employees employed in Israel (in cases of workers abroad under the existing law in those countries).

2.11.1.7 the equity-based compensation is subject to the following principles (and in any case- the lowest of):

1. The value of compensation in accordance with number of monthly salaries as specified below. The maximum compensation value is for one-year term and shall be calculated on a linear basis.

2. The maximum rate of dilution for shareholders which will not exceed the rate listed below.

Maximum amounts as follows:

Role	Chairmen	CEO	Subordinate Office holder/Foreign office holders
Maximum Monthly Salaries	12	20	4
Maximum Dilution Rate	3%	5%	1%

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2.11.1.8 Other conditions for long-term compensation will be in accordance with the Maris-Tech Ltd. 2021 Share Option Plan (the “Plan”) or any other long-term compensation plan that will be adopted by the Company.

2.12 The ratio between the variable components and the basic salary component⁴

Role	The ratio between the variable components and the total compensation
Active Chairman of the Board of Directors	Up to 150%
CEO	Up to 250%
Subordinate office Holders, if any	Up to 100%
Foreign office holders	Up to 100%
VP of Sales and Marketing	Up to 500%

2.13 Extending the term of existing agreements with Company office holders and making amendments to those agreements

2.13.1 Prior to extending the term of the services or employment agreement with a Company office holder (whether this involves changes to the terms of employment or not), the office holder’s existing compensation package will be assessed in relation to the parameters set out in section 2.3 above and bearing in mind the payroll review, which was conducted by the Company as per section 2.4 above.

2.13.2 Subject to the provisions of the law and the positions of the Israeli Securities Authority, as amended from time to time, immaterial changes (as defined below) made to the service or employment terms of the Company’s CEO will need to be approved by the Compensation Committee alone, if it approves that the changes are, indeed, immaterial and the change complies with the provisions of this Policy.

2.13.3 Subject to the provisions of the law and the positions of the Israeli Securities Authority, as amended from time to time, immaterial changes made to the service or employment terms of the Subordinate office Holders / Foreign officer holders shall be approved by the Company’s CEO alone, and the approval of the Compensation Committee will not be required, provided that the service and employment terms of that office holder comply with the provisions of this Policy.

In sections 2.13.2 and 2.13.3 above, “immaterial changes to the service and employment terms” are changes, the aggregate value of which does not exceed 5% of the overall annual cost of compensation of the office holder.

2.14 Compensation of directors

2.14.1 The directors of the Company (other than an Active Chairman) will be entitled to a fix annual fee (including participation compensation) which will not exceed $60,000..

2.14.2 In addition, the directors of the Company will be entitled to compensation of travel and parking expenses. In the case of a director (except for external directors, if applicable) with additional expertise in the Company’s operations and / or in other areas where the Board has decided that they are necessary for the Company, the Company will be entitled, to award that director, solely that the aggregate amount of the annual compensation to which the director is entitled, does not exceed $120,000.

2.14.3 The Company may grant equity-based compensation to directors (other than the Active Chairman), including external directors and independent directors, from time to time, all in accordance with applicable law. The fair annual value of securities granted to directors at the grant date, as reflected in the Company’s financial statements, will be calculated on the basis of accepted valuation methods (such as Black & Scholes / Intermediate), and will not exceed one of the follows: (i) 25% of the total annual compensation given to directors in the 12 months preceding grant date; (ii) $20,000 annual value.

2.14.4 All other provisions regarding the long-term compensation that apply to the officers under this Policy, will also apply to the long-term compensation granted to directors.

⁴ For that purpose, the “variable components” include the annual bonus, one-time bonus, special bonus and annual value of the share-based payment.

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2.15 Recoupment Policy

The Company may seek reimbursement of all, or a portion of any compensation paid to an Office Holder based on financial data included in Company’s financial statements in any fiscal year that are found to be inaccurate and are subsequently restated.

In any such event, Company will seek reimbursement from the Office holders to the extent such Office Holders would not have been entitled to all or a portion of such compensation, based on the financial data included in the restated financial statements. 

The Compensation Committee will be responsible for approving the amounts to be recouped and for setting terms for such recoupment from time to time.

2.16 Exchange Rate

Monetary amounts in this Policy are quoted in $, yet subject to the currency exchange rate as mentioned above.

2.17 The ratio between the salary of office holders and the salary of all other Company employees as of the date of the compensation policy

The ratio of the average and median salary between the officers to the other full-time employees (in practice as of the date of approval of the compensation policy):

Role	Ratio to the average salary5	Ratio to Median salary
CEO	1.85	1.69
Subordinate office holders/Foreign officer holders	1.31	1.19

As of the date of the compensation policy in the Company, there are 4 full-time employees who are not office holders. It is clarified that for the purpose of calculating the aforesaid ratios, only the employees of Maris-Tech Ltd. were included.

At the time of approval of the compensation policy, the compensation committee examined the existing gaps between the officers and the other employees and found that in light of the nature and structure of the Company, the above ratios will not affect the existing employment relationship in the company. In addition, the compensation committee and the Board of Directors believe that these data have a limited effect on determining the salaries of the Company’s officers, given the structure of the Company.

2.18 Retention grant

The company will be entitled to pay its officers a retention grant in special cases, at the discretion of the Board of Directors and the compensation committee and subject to their approval, which will not exceed 4 monthly base salaries of the officer.

The Company’s Compensation Committee finds it appropriate to be able to grant a retention grant payment for the company’s office holders, in light of the competition in the industry in relation to quality work force. The Board emphasizes that a retention grant will be approved in special cases only. The Board of Directors will examine the circumstances in which this grant will be awarded, including the contribution of the office holder to the success of the company, its position and the company’s financial.

3 The powers of the Compensation Committee and the Company’s Board of Directors regarding the Policy

3.1 The Company’s Board of Directors is charged with the management of the Policy and all actions required for management thereof, including the power to interpret the provisions of the Policy where doubts arise as to the manner of its implementation.

3.2 The Company’s Compensation Committee and Board of Directors will assess, from time to time, the Policy and the need to adjust it, inter alia, in accordance with the considerations and principles set out in this policy, while taking into account the changes in the Company’s goals, market conditions, Company’s profits and revenues in previous periods in in real time and any other relevant information.

3.3 In order to assess the Company’s Policy, the Company’s Compensation Committee and its Board of Directors will monitor the implementation of the Policy in the Company.

⁵ The ratio to the average salary and the median salary refers to the salary cost of the employees of Maris-Tech Ltd. only, and does not include the cost of the salaries of the officers.

***

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