OPTIBASE LTD.
8 Hamenofim Street Herzliya, Israel
+972-73-7073700
Dear Shareholder,
You are cordially invited to attend the Extraordinary General Meeting of Shareholders of Optibase Ltd. (the "Company") to be held at 4:00 p.m., Israel time, on Wednesday, November 24, 2021, at the Company’s offices at 8 Hamenofim Street, Herzliya, Israel.
The purpose of this meeting is set forth in the accompanying Notice of Meeting and Proxy Statement.
For the reasons set forth in the accompanying Proxy Statement, the Company’s board of directors recommends that you vote "FOR" Proposals No. 1 and 2 as specified on the enclosed form of proxy.
We look forward to greeting personally those shareholders who are able to be present at the meeting. However, whether or not you plan to attend the meeting, it is important that your shares be represented. Accordingly, you are kindly requested to sign, date and mail the enclosed proxy in the envelope provided at your earliest convenience so that it will be received not later than two business days before the meeting.
Thank you for your continued cooperation.
| Very truly yours,
Alex Hillman, Executive Chairman of the Board of Directors |
Herzliya, Israel
October 19, 2021
AS A FOREIGN PRIVATE ISSUER, WE ARE EXEMPT FROM THE RULES UNDER THE SECURITIES EXCHANGE ACT RELATED TO THE FURNISHING AND CONTENT OF PROXY STATEMENTS. THE CIRCULATION OF THIS PROXY STATEMENT SHOULD NOT BE TAKEN AS AN ADMISSION THAT WE ARE SUBJECT TO THOSE PROXY RULES.
OPTIBASE LTD.
8 Hamenofim Street Herzliya, Israel
+972-73-7073700
NOTICE OF EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS
Notice is hereby given that an Extraordinary General Meeting of Shareholders (the "Meeting") of Optibase Ltd. (the "Company") will be held at 4:00 p.m., Israel time, on Wednesday, November 24, 2021, at the Company’s offices at 8 Hamenofim Street, Herzliya, Israel, for the following purposes:
1. To approve a new compensation policy for the Company's directors and officers, in the form attached hereto as Annex A (marked to show changes against the existing compensation policy); and
2. To approve a bonus grant to Ms. Yakir Ben-Naim, the Company's Chief Financial Officer.
Shareholders may present proposals for consideration at the Meeting by submitting their proposals to the Company no later than October 26, 2021.
Finally, the shareholders may consider and act upon such other business as may properly come before the Meeting and any adjournment thereof.
Only shareholders of record at the close of the trading day of October 25, 2021, are entitled to notice of, and to vote at, the Meeting and any adjournment thereof. All shareholders are cordially invited to attend the Meeting in person. Shareholders who are unable to attend the Meeting in person are requested to complete, date and sign the enclosed form of proxy and return it promptly in the pre-addressed envelope provided.
Your proxy may be revoked at any time before it is voted by you returning a later-dated proxy card or by voting your shares in person at the Meeting. Shareholders who hold their shares in "street name", meaning in the name of a bank, broker or other record holder, must either direct the record holder of their shares on how to vote their shares or obtain a legal proxy from the record holder to vote the shares at the Meeting on behalf of the record holder together with a proof of such record holder with respect to the holding of the shares on the record date. You should follow the directions provided by your broker or nominee regarding how to instruct them to vote your shares.
Joint holders of shares should note that, pursuant to the articles of association of the Company, the vote of the senior of joint holders of any share who votes such share, whether in person or by proxy, will be accepted to the exclusion of the vote(s) of the other registered holder(s) of such share, and for this purpose seniority will be determined by the order in which the names of the joint holders appear in the Company’s register of shareholders. The appointment of a proxy to vote shares held by joint holders shall be executed by the signature of the senior of the joint holders on the proxy card.
| By Order of the Board of Directors,
Alex hillman, Executive Chairman of the Board of Directors |
Herzliya, Israel
October 19, 2021
OPTIBASE LTD.
8 Hamenofim Street Herzliya, Israel
+972-73-7073700
PROXY STATEMENT
This Proxy Statement is being furnished to the holders of Ordinary Shares, New Israeli Shekels 0.65 nominal value (the "Shares"), of Optibase Ltd. (the "Company") in connection with the solicitation of proxies by the management and board of directors of the Company (the "Board of Directors") for use at the Extraordinary General Meeting of Shareholders (the "Meeting") to be held at 4:00 p.m., Israel time, on Wednesday, November 24, 2021, at the Company’s offices at 8 Hamenofim Street, Herzliya, Israel, or at any adjournment thereof, pursuant to the accompanying notice of meeting (the "Notice").
At the Meeting, the shareholders will be asked to consider and vote on the following matters:
1. To approve a new compensation policy for the Company's directors and officers, in the form attached hereto as Annex A (marked to show changes against the existing compensation policy); and
2. To approve a bonus grant to Ms. Yakir Ben-Naim, the Company's Chief Financial Officer.
Shareholders may present proposals for consideration at the Meeting by submitting their proposals to the Company no later than October 26, 2021.
Finally, the shareholders may consider and act upon such other business as may properly come before the Meeting and any adjournment thereof.
Currently, we are not aware of any other matters that will come before the Meeting. If any other matters properly come before the Meeting, the persons designated as proxies intend to vote in accordance with their best judgment on such matters. As more fully described in the Proxy Statement, shareholders may present proposals for consideration at the Meeting by submitting their proposals to the Company no later than October 26, 2021. If we determine that a shareholder proposal is appropriate for inclusion in the Meeting agenda, we will publish a revised agenda in the manner set forth in the section entitled "Proposals of Shareholders" below.
The approval of each of Proposals No. 1 and 2 requires the affirmative vote of shareholders participating in the voting at the Meeting in person or by proxy; provided, that (i) such majority vote at the Meeting shall include a majority of the total votes of shareholders participating in the voting at the Meeting in person or by proxy who are neither (a) the controlling shareholders of the Company, nor (b) have a personal interest in the approval of the proposal (votes abstaining shall not be taken into account in counting the above-referenced shareholders' votes); or (ii) the total number of Shares of the 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.
Under the Israeli Companies Law of 1999 (the "Companies Law"), each shareholder that attends the Meeting in person shall, prior to exercising such shareholder's voting rights at the Meeting, advise the Company whether or not that shareholder is a controlling shareholder of the Company with respect to the approval of each of Proposals No. 1 and 2, and whether or not that shareholder has a personal interest (as defined herein), with respect to the approval of Proposal No. 1 and 2. Each shareholder that delivers a signed proxy to the Company must indicate on the proxy whether or not that shareholder is a controlling shareholder of the Company with respect to the approval of each of Proposals No. 1 and 2, and whether or not that shareholder has a personal interest (as defined herein) with respect to the approval of Proposal No. 1 and 2. Shareholders who do not so indicate will not be eligible to vote their Shares as to such proposals.
The Companies Law defines a "personal interest" as a personal interest of a person in an act or transaction of a company, including:
(i) a personal interest of that person's relative (i.e. spouse, sibling, parent, grandparent, child, child sibling and parent of such person's spouse or the spouse of any of the above); or
(ii) a personal interest of another entity in which that person or his or her relative (as defined above) holds 5% or more of such entity's issued shares or voting rights, has the right to appoint a director or the chief executive officer of such entity, or serves as director or chief executive officer of such entity.
A personal interest resulting merely from holding a company's shares will not be deemed a personal interest.
The term "controlling shareholder" shall carry the meaning ascribed to it in the Companies Law.
Each Share is entitled to one vote upon each matter to be voted on at the Meeting. No less than two shareholders present in person or by proxy, or who have sent the Company a voting instrument indicating the way in which they are voting, and holding or representing at least thirty three and one third percent (33.33%) of the voting rights in the Company, shall constitute a quorum. If no quorum is present within half an hour of the time fixed for the Meeting, the Meeting shall stand adjourned for seven days, to the same day of the week at the same time and place, without further notice being given thereof, or to such other date, time and place as prescribed by the Board of Directors in notice to the shareholders, and the adjourned Meeting shall discuss those matters for which the first meeting was called. If no quorum is present at the adjourned Meeting, two shareholders, at least, present in person or by proxy, shall constitute a quorum, subject to the provisions of section 79(b) of the Companies Law.
VOTING PROCEDURES; EXPRESSING POSITIONS
Registered Shareholders
Shareholders registered in the Company's shareholders register ("Registered Shareholders") may vote their Shares by attending the Meeting and voting their Shares in person, or by completing the enclosed proxy card, signing and dating it and mailing it either in the enclosed postage prepaid envelop or to the Company's offices. Registered Shareholders who vote their Shares by proxy must also provide the Company with a copy of their identity card, passport or certificate of incorporation, as the case may be.
Shareholders in "Street Name" whose Shares are held through CEDE & Co.
Shareholders who hold their Shares in "street name" meaning in the name of a bank, broker or other record holder, through CEDE & Co., must either direct the record holder of their Shares how to vote their Shares or obtain a legal proxy from the record holder to vote at the Meeting on behalf of the record holder together with a proof of such record holder with respect to the holding of the Shares on the record date. You should follow the directions provided by your broker or nominee regarding how to instruct them to vote your shares.
Shareholders in "Street Name" whose Shares are held through Members of the Tel Aviv Stock Exchange ("TASE")
Shareholders who hold their Shares in "street name" meaning in the name of a bank, broker or other record holder, through members of the TASE, may vote their Shares either (i) in person or by proxy delivered to the Company together with an ownership certificate confirming their ownership of the Company’s Shares on the record date, which certificate must be approved by a recognized financial institution, as required by the Israeli Companies Regulations (Proof of Ownership of Shares for Voting at General Meeting) of 2000, as amended; or (ii) electronically via the electronic voting system of the Israel Securities Authority which vote shall be cast no later than November 24, 2021 at 10:00 a.m. Israel time. You may receive guidance on the use of the electronic voting system from the TASE member through which you hold your Shares.
Note for Shareholders Voting via Proxy Card
Shareholders who vote their Shares via proxy card may use the form of proxy and the return envelope enclosed. Shares represented by executed and unrevoked proxies will be voted at the Meeting. If a shareholder instructs in a proxy to abstain from voting on a specific proposal, the Shares represented by such proxy will be deemed not to have been cast for the purpose of that particular proposal and, accordingly, such Shares shall not be counted in calculating the percentage of affirmative votes required for approval of such proposal, but they will be counted for the purpose of determining a quorum.
Shareholders may revoke their proxies at any time before the effective exercise thereof by returning a later-dated proxy card or by voting their Shares in person at the Meeting if the Shareholders are the record holder of the Shares and can provide evidence of such (i.e., a copy of certificate(s) evidencing their Shares). If a shareholder’s proxy is not received by the Company no later than November 24, 2021 at 12:00 p.m. Israel time, it shall not be valid at the Meeting. Notwithstanding the aforesaid, the chairman of the Meeting may, at his or her discretion, accept proxies after such time if he or she so deems fit.
Position Statements
Shareholders are permitted to express their position on the proposal on the agenda of the Meeting by submitting a written statement, through the Company, to the other shareholders (the "Position Statement"). Position Statements should be submitted to the Company at its registered offices, at 8 Hamenofim Street, Herzliya, Israel, to the attention of Mr. Amir Philips, Chief Executive Officer of the Company, no later than November 14, 2021. Reasonable costs incurred by the Company in dealing with a Position Statement shall be borne by the submitting shareholder.
Management and the Board of Directors are soliciting proxies for use at the Meeting. Proxies will be mailed to shareholders on or about October 26, 2021 and will be solicited primarily by mail; however, additional solicitations may be made by telephone, facsimile or other means of contact by certain directors, officers, employees or agents of the Company, none of whom will receive additional compensation therefore. The entire expense of solicitation, including the cost of preparing, printing, assembling and mailing the proxy materials will be borne by the Company. The Company will also reimburse the reasonable expenses of brokerage firms and others for forwarding materials to beneficial owners of Shares.
OUTSTANDING SHARES AND VOTING RIGHTS
The Company had 5,216,256 Shares outstanding as of October 15, 2021, excludes 17,895 ordinary shares held by us or for our benefit with no voting or equity rights as of October 15, 2021, or within 60 days thereafter. Each Share is entitled to one vote upon each proposal to be presented at the Meeting.
BENEFICIAL OWNERSHIP OF SECURITIES BY CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of October 15, 2021, the number of Shares owned by (i) all shareholders known to the Company to own 5% or more of the Shares and (ii) all current directors and officers of the Company as a group:
| Name of Beneficial Owner | No. of Ordinary Shares Beneficially Owned(1) | Percentage of Ordinary Shares Beneficially Owned |
The Capri Family Foundation (2) | 4,097,201 | 78.82% |
Shareholding of all directors and officers as a group (8 persons)(3) | 197,865 | 3.81% |
| (1) | Number of shares and percentage ownership is based on 5,216,256 ordinary shares outstanding as of October 15, 2021. Excludes 17,895 ordinary shares held by us or for our benefit. Beneficial ownership is determined in accordance with rules of the SEC and includes voting and investment power with respect to such shares. Shares subject to options that are currently exercisable or exercisable within 60 days of October 15, 2021, are deemed to be outstanding and to be beneficially owned by the person holding such options for the purpose of computing the percentage ownership of such person, but are not deemed to be outstanding and to be beneficially owned for the purpose of computing the percentage ownership of any other person. All information with respect to the beneficial ownership of any principal shareholder has been furnished by such shareholder and, unless otherwise indicated below, we believe that persons named in the table have sole voting and sole investment power with respect to all the shares shown as beneficially owned, subject to community property laws, where applicable. The shares beneficially owned by the directors include the ordinary shares owned by their family members to which such directors disclaim beneficial ownership. |
| (2) | The information is accurate as of May 29, 2019 and is based on Amendment No. 7 to Schedule 13D filed with the SEC on June 19, 2019, by The Capri Family Foundation. According to such Amendment No. 7 to Schedule 13D, Capri directly owns 4,097,201 of our ordinary shares. The core activity of Capri is the holding of investments. In addition, the beneficiaries of Capri are the children of Mr. Tom Wyler, the Chief Executive Officer of our subsidiary, Optibase Inc. |
| (3) | Includes 159,225 ordinary shares held directly by the directors and officers and 38,640 ordinary shares which are held by a trustee for the benefit of our directors and executive officers under our 2006 Plan, which have vested on October 15, 2021 or within 60 days thereafter. Other than Shlomo (Tom) Wyler, all of our directors or executive officers hold less than 1% of our shares. |
Proposal No. 1
APPROVAL OF A NEW COMPENSATION POLICY
Under the Companies Law, a public company is required to adopt a compensation policy, which sets forth the terms of service and employment of office holders, including the grant of any benefit, payment or undertaking to provide payment, any exemption from liability, insurance or indemnification, and any severance payment or benefit. The compensation policy must be approved at least once every three years, by the board of directors, after considering the recommendations of the compensation committee, and by the shareholders by a special majority (as described above).
Our current Compensation Policy, approved by our shareholders on February 14, 2019, and as amended on February 14, 2020, and December 30, 2020, was drafted and approved in accordance with the requirements of the Companies Law.
Our Board of Directors, following the recommendation of the Compensation Committee, approved, subject to shareholder approval, a new compensation policy. The principal change in the newly proposed compensation policy compared to the existing compensation policy are detailed below is allowing directors to provide to the Company additional service, which is not related to their service as directors, at a total consideration which shall not exceed Euro 50,000 per annum.
A copy of the proposed compensation policy marked to show changes to the existing Compensation Policy is attached hereto as Annex A.
In the event the newly proposed compensation policy is not approved by the Company's shareholders, the existing compensation policy shall continue to apply until the end of its term as prescribed by the Companies Law.
The considerations which guided the Compensation Committee and Board of Directors in approving the proposed compensation policy were: promoting the Company's interests, its work plan and policy from a long-term perspective considering, inter alia, the Company's risk management policy, size and nature of its operations and - with regard to terms of office and employment which include variable components - the officer's contribution to achieving the Company's objectives and to maximizing its earnings, all from the long-term perspective and in accordance with the officer's role.
The principles of the proposed compensation policy were established after internal discussions by the Compensation Committee and by the Board of Directors. In designing the principles of the proposed compensation policy, the Compensation Committee and the Board of Directors took into consideration, inter alia: (a) the education, qualifications, expertise, professional experience and achievements of each officer; (b) the role of the officer, areas of responsibility and previous compensation agreements entered into with him; (c) the ratio between the terms of compensation of the officers as may be provided under the compensation policy and the terms of compensation of other employees of the Company, considering also the average and median annual cost of the fixed component payable to all Company full time team members; and (d) regarding terms of compensation that include variable components - the possibility of reducing the variable components at the discretion of the Board of Directors and the possibility to limit the exercise value of any equity based variable component. In addition, the Compensation Committee and the Board of Directors concluded that the Compensation Policy is fair and reasonable and to the benefit of the Company, based, among other things, a benchmark study of compensation of comparable companies prepared by an external independent third party.
The proposed compensation policy shall be reviewed from time to time by the Compensation Committee and Board of Directors in order to ensure its adequacy and its fitness to the Company's financial position and results of operation.
It is proposed that the following resolution be adopted at the Meeting:
"RESOLVED, that the proposed compensation policy for the Company's directors and officers, in the form attached hereto as Annex A, having been approved by the Compensation Committee and Board of Directors be, and hereby is, approved and adopted." |
The Board of Directors recommends a vote FOR approval of this proposed resolution.
Proposal No. 2
APPROVAL OF A BONUS GRANT TO THE COMPANY'S CHIEF FINANCIAL OFFICER,
MS. YAKIR BEN-NAIM
The Board of Directors, following the approval of the Compensation Committee approved on May 31, 2021 and on October 18, 2021 the grant of an annual bonus to Ms. Yakir Ben-Naim, the Company’s Chief Financial Officer, in an amount equal to four (4) monthly base salaries for her performance and achievements in 2020.
Under the Companies Law a bonus for a Chief Financial Officer is required to be made based on measurable criteria and only a non-material portion of which may be made upon discretion. A non-material portion is customarily interpreted as the higher of (i) three monthly base salaries; or (ii) 25% of the total variable compensation. In light of the fact that no measurable criteria were determined for the payment of bonuses to the Company's Chief Executive Officer for 2020, the Compensation Committee and Board of Directors approved the grant of an annual bonus to the CFO for the year 2020 equal to four (4) monthly base salaries, out of which an amount equal to 3 monthly base salaries was paid to Ms. Ben-Naim on a discretionary basis and the remaining one (1) monthly base salaries is brought for shareholder approval
For details regarding the compensation terms of Ms. Ben-Naim as the Company’s Chief Financial Officer, see Item 6.B. of our 2020 Annual Report.
Summary of the Compensation Committee and Board of Directors’ Reasons for the Approval of the grant of a bonus to the Company's Chief Financial Officer
The Compensation Committee and Board of directors stated in their approval of the bonus grant to Ms. Ben-Naim that the grant of bonus is intended to compensate Ms. Ben-Naim for her continued services as the Company's Chief Financial Officer, her achievements, and her continued contribution to the Company's success. The Compensation Committee and Board of Directors further noted that had measurable criteria were determined for Ms. Ben-Naim for 2020, the proposed bonus grant would have been in compliance with the existing compensation policy of the Company and the also the newly proposed compensation policy.
In light of all of the above, the Compensation Committee and the Board of Directors concluded that the proposed compensation is to the benefit of the Company.
It is proposed that the following resolution be adopted at the Meeting:
| “RESOLVED, that the bonus grant to Ms. Yakir Ben-Naim, the Company’s Chief Financial Officer, of one (1) monthly base salaries for her achievements in 2020, having been approved by the Compensation Committee and the Board of Directors, and as presented to the shareholders, be, and the same hereby is, approved.” |
The Board of Directors recommends a vote FOR approval of this proposed resolution.
OTHER BUSINESS
Management knows of no other business to be acted upon at the Meeting. However, if any other business properly comes before the Meeting, the persons named in the enclosed proxy will vote upon such matters in accordance with their best judgment.
The prompt return of your proxy will be appreciated and helpful in obtaining the necessary vote. Therefore, whether or not you expect to attend the Meeting, please sign the form of proxy provided herewith and return it in the enclosed envelope, so that it is received by the Company not later than November 24, 2021, at 12:00 p.m. Israel time.
| By Order of the Board of Directors,
Alex hillman, Executive Chairman of the Board of Directors |
October 19, 2021
