CAMTEK LTD.
EXECUTIVE SHARE OPTION PLAN
1. Definitions
As used herein the following terms shall have the meanings hereinafter set
forth, unless the context clearly indicates the contrary.
(A) "Company" - Camtek Ltd.
(B) "Board" - the Board of Directors of the Company.
(C) "Share(s)" - Ordinary Shares of the Company, each with a par value
of NIS 0.01.
(D) "Option(s)" - an Option or Options granted within the framework of
this Plan each of which imparts the right to purchase one Share per
Option.
(E) "Grantee" - a director or other Officer Holder of the Company or any
Subsidiary to whom Options are granted or to whom the Company
decides to grant Options and who is not entitled to receive options
under Section 102 of the Israeli Income Tax Ordinance (New Version),
1961 and/or under the Company's Employee Share Option Plans for
employees.
(F) "Plan" - the Company's Office Holders Year 2000 Share Option Plan as
provided hereunder, and as may be amended from time to time by the
Board, as set forth hereinbelow.
(G) "Option Agreement" - the Agreement to be executed between the
Company and the Grantee under which Option(s) are to be granted.
(H) "Vested Option(s)" - that portion of the Options which the Grantee
is entitled to exercise in accordance with the provisions of Section
7.2 of the Plan or the provisions of the Option Agreement executed
with such Grantee.
(I) the "Exercise Period" - the period during which the Vested Options
may be exercised, as provided in Section 7.3 of the Plan.
(J) "Exercise Price" - the price which the Grantee must pay to exercise
each Option.
(K) "Exercised Shares" - the Shares that are issued upon the exercise of
the Options.
(L) "Law" - the Companies' Law - 1999.
(M) "Office Holder" - as defined in the Law.
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(N) "Subsidiary" - any company in which, at the time of granting an
Option, the Company owns, directly or indirectly, at least fifty
percent (50%)of the total combined voting power of all classes of
shares of such company.
(O) the "Trustee" - the trustee who may be appointed by the Company for
the purposes of this Plan.
2. The Plan
2.1 Purpose
The purpose and intent of the Plan is to grant to directors and
other selected Office Holders of the Company, who are not entitled
to receive options under Section 102 of the Israeli Income Tax
Ordinance (New Version), 1961 and/or under the Company's Employee
Share Option Plans for employees, an opportunity to purchase Shares
of the Company by way of granted Options in order to provide an
additional incentive to such directors and Office Holders to remain
in the engagement of the Company, to encourage the sense of
proprietorship of such directors and Office Holders, and to
stimulate their active interest in the success of the Company.
2.2 Effective Date
The Plan shall become effective as of the date on which it has been
adopted by the Board.
3. Administration
3.1 The Plan shall be administered by the Board or by a committee
appointed by the Board, subject to the provisions of the Law, the
regulations promulgated thereunder, including with respect to any
required corporate actions and approvals, if any, and any applicable
tax laws and/or tax authorities' directives (such tax laws and/or
directives shall be referred to hereinafter as the "Tax Laws").
3.2 Subject to the provisions of the Law and any regulations promulgated
thereunder, including with respect to any required corporate actions
and approvals, if any, the Board shall have sole and full discretion
and sole authority to administer the Plan and all actions therunder
or related thereto, including to perform any and all of the
following, from time to time and at any time:
3.2.1 to designate Grantees;
3.2.2 to determine the number of Options to be granted in favor of
each Grantee, the Exercise Price thereof, and the conditions
under which such Options may be exercised, including the
Exercise Period and the terms of vesting;
3.2.3 to interpret the Plan;
3.2.4 to determine the terms of the Option Agreements;
3.2.5 to perform any action required or advisable for the
administration of the Plan; and
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3.2.6 to prescribe, amend, modify (including by adding new terms and
rules), and to rescind and terminate the Plan or any of its
terms.
3.3 Any amendment or modification of the Plan, if any, shall be
applicable to the relationship between the Grantee and the Company,
including under the Option Agreements and such amendment or
modification shall be deemed to have been included in the Plan and
the Option Agreements, ab initio, unless the amendment or
modification adversely affects the rights of a Grantee under the
Vested Options.
4. Eligibility
The persons who shall be eligible to receive grants pursuant to this Plan
shall be such directors or other Officer Holders of the Company or any
Subsidiary who are not entitled to receive options under Section 102 of
the Israeli Income Tax Ordinance (New Version), 1961 and/or under the
Company's Employee Share Option Plans for employees, as the Company shall,
from time to time, determine.
5. Reserved Shares
The total number of Options to be granted to the Grantees pursuant to the
Plan shall be determined from time to time by the Board.
The Company shall at all times reserve such number of authorized but
unissued Shares which equals the number of Shares to which all of the then
outstanding Options may be converted upon exercise.
6. Grant of Options and Issuance of Shares in Trust
6.1 The Options shall be granted in favor of the Grantee for no
consideration.
6.2 The Options and the Grantee's rights thereunder shall be subject to
the execution of an Option Agreement between the Company and the
Grantee, which Option Agreement shall set forth the terms and
conditions of the Options, as determined by the Company, including
without limitation, the number of Options granted thereunder, the
terms of exercise thereof (including the Exercise Price) and any
other term the Board may deem necessary.
6.3 In addition, the Options shall be subject to the execution of a
trust agreement, if applicable, and to the execution of all the
other documents that the Company may find to be required in order to
comply with the Tax Laws or otherwise (the Option Agreement and said
documents shall be hereinafter referred to as: the "Documents").
6.4 The Company shall provide the Grantee with the Documents for
signature after the a resolution to grant Options in favor of such
Grantee is adopted in accordance with all necessary corporate
actions and after all the necessary approvals, if any, have been
obtained, and the Company shall sign such Documents after they have
been duly signed and returned by such Grantee.
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It is hereby clarified that the execution of the said Documents by
the Grantee does not exempt the Grantee from signing any other
document as may be required by the Company at a later stage.
6.5 During the Restricted Period (as defined below) and until the
Exercised Shares are released (as provided below), the Options
granted hereunder shall be held by the Trustee and registered in the
Trustee's name, and the Exercised Shares shall be issued to the
Trustee and registered in the name of the Trustee, who shall hold
the Options and/or the Exercised Shares in trust for a period of two
years, or a shorter period as may be determined by the Board with
respect to any specific grant, or, in the absence of such
determination of a shorter period, until such time at which the
Grantee requests from the Company and the Board approves such
release at its discretion (hereinafter: the "Restricted Period").
After the lapse of the Restricted Period, the Options and/or the
Exercised Shares shall be held by the Trustee until such time as
they are released, as hereinafter provided; provided however that
the Board may determine with respect to all of the Grantees or with
respect to a particular Grantee that Options granted under this Plan
and the Exercised Shares issued by virtue thereof shall not be
entrusted with a Trustee and shall be issued and registered directly
in the favor of such Grantee.
7. Terms of Options
7.1 The number of Options and the Exercise Price for each Grantee shall
be determined by the Board and shall be specified in the Option
Agreement; provided, however, that in no event shall the Exercise
Price be less than the fair market value of the Shares on the date
of the grant of the Options. For as long as the Company's shares are
traded on Nasdaq, said fair market value shall be determined by the
closing value of the Shares listed on Nasdaq at the close of the
last day of trading prior to the date of the Board resolution
granting such Options to the Grantee.
7.2 Unless otherwise determined by the Board with respect to any
specific Grantee, the right of a Grantee to exercise the Options
granted in such Grantee's favor during the Exercise Period shall be
vested with such Grantee as follows:
(a) If the Grantee remains in the engagement of the Company or any
Subsidiary for a period of not less than one (1) year from the
date of the resolution of the Board regarding the issuance of
the Options to the Grantee (hereinafter: the "Date of the
Grant") - the Grantee shall be entitled to exercise 25% of all
the Options granted in such Grantee's favor.
(b) If the Grantee remains in the engagement of the Company or any
Subsidiary for a period of more than one (1) year from the
Date of Grant - the Grantee shall be entitled to exercise the
remaining 75% of the Options on a monthly basis in equal
portions over an additional period of three (3) years, such
that 1/36 of the remaining Options shall vest at the
conclusion of each month thereafter.
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7.3 Exercise Period
Each Vested Option shall remain exercisable until the lapse of five
(5) years following the date on which such Option became vested,
unless terminated prior to such time, as provided in Section 10.3
below.
7.4 Effect of A Merger
In the event of a merger of the Company with or into another
corporation, or the sale of all or substantially all the assets or
the shares of the Company (such merger or sale: the "Merger
Transaction"), the surviving or the acquiring entity, as the case
may be, or their respective parent or subsidiary (the "Successor
Entity"), may either assume the Company's rights and obligations
under outstanding Options or substitute for outstanding Options
substantially equivalent options for the Successor Entity's shares.
For purposes of this Section 7.4, the outstanding Options shall be
deemed assumed or substituted by the Successor Entity if, following
the consummation of the Merger Transaction, the outstanding Options
confer the right to purchase or receive in accordance with their
terms, for each share subject to any outstanding Option immediately
prior to the consummation of the Merger Transaction, the
consideration (whether shares, cash or other securities or property)
to which a holder of a share on the effective date of consummation
of the Merger Transaction was entitled; provided however, that if
such consideration is not solely securities of the Successor Entity,
the Board may, with the consent of the Successor Entity, provide for
the consideration to be received upon the exercise of the
outstanding Options, to be solely securities of the Successor Entity
equal in their market value to the per share consideration received
by the holders of shares in the Merger Transaction.
In the event that the Successor Entity does not assume or substitute
for all of the outstanding Options of a Grantee, then the Grantee
shall have a period of fifteen (15) days, from the date designated
in a written notice to be given to the Grantee by the Company, to
exercise all the Vested Options of the Grantee; provided, however,
that if the Merger Transaction occurs within the first one year
period of vesting, a proportionate quantity of the Options granted
to the Grantee which are to be vested at the end of the first one
year period, relative to such Grantee's engagement period out of
such one-year period, shall become vested and may be exercised by
the Grantee within said 15-day period.
All Options which are neither assumed or substituted for by the
Successor Entity nor exercised as of the date of the end of the said
15 day period shall expire and terminate effective as of the date of
the consummation of the Merger Transaction, shall become null and
void and shall not entitle the Grantee to any right in or towards
the Company.
7.5 Vested Options may be exercised at one time or from time to time
during the Exercise Period, by giving written notice to the Company
at its principal office, of the exercise of Vested Options,
specifying the number of Vested Options being exercised and
accompanied by payment in full of the Exercise Price for such Vested
Options, by personal check or cashier's check payable to the order
of the Company (such written instructions accompanied by full
payment shall be called hereinafter: the "Exercise
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Notice"); provided however, that in case of payment by personal
check (and not by cashier's check), the Options shall not be deemed
exercised, and the Company shall not issue the Exercised Shares in
respect thereof, until the personal check shall have been fully and
irrevocably honored by the bank on which it was drawn and further
provided that the Company shall not issue the shares and the Options
shall not be deemed exercised until the Company has been provided
with the tax authorities' confirmation which either waives the tax
withholding obligation and/or confirms the payment of the tax with
respect to such exercise and/or has reached another arrangement with
the Grantee, regarding the tax amounts, if any, that are to be
withheld by the Company under the law with respect to such exercise,
which is satisfactory to the Company, and if such arrangement
requires the approval of the Trustee, is also satisfactory to the
Trustee. Vested Options that are held by the Trustee shall be
exercised only by the Trustee, who shall give the Company an
Exercise Notice following receipt by the Trustee of an Exercise
Notice from the Grantee.Vested Options that are held by the Grantee
shall be exercised by the Grantee.
7.6 In the event the the Options were entrusted with a Trustee, the
Exercised Shares underlying such Options shall be issued in the name
of the Trustee who shall hold same until their release as
hereinafter provided.
7.7 A Grantee whose engagement with the Company was terminated for any
reason (including death or disability) shall be entitled only to the
Exercised Shares, and subject to Section 10.3 below, to the Vested
Options; the remaining Options (i.e. non-Vested Options) shall
expire and terminate and become null and void and shall not entitle
the Grantee to any right in or to the Company.
8. Transferability
8.1 The Options and all rights related thereto shall not be assignable,
transferable, subjected to an attachment, lien or encumbrance of any
kind.
8.2 Notwithstanding the foregoing, the Vested Options shall be
transferable by will or intestacy, provided that the Company
receives written notice thereof, accompanied by a certified copy of
the Will or Intestacy Order and/or other evidence deemed acceptable
by the Board, and accompanied by the transferee(s) written consent
to the provisions and rules of the Tax Laws, the Plan, and the
Option Agreement.
8.3 Following the exercise of the Vested Options, the Exercised Shares
shall be transferable, subject to all applicable securities
regulations and lock-up provisions, and in the event the Options are
held by the Trustee, after the Restricted Period. Further, to the
extent that applicable law provides for concurrent payment of taxes
by the transferor upon transfer, the Exercised Shares shall only be
transferable once payment of all taxes required to be paid in
connection with a sale or transfer of Exercised Shares shall have
been made to the tax assessor and confirmation of same shall have
been received by the Trustee or the Company, as applicable, and the
conditions set forth in Section 9 hereunder shall have been
fulfilled.
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8.4 Without derogating from the foregoing, in the event the majority of
the shareholders of the Company, which majority shall be determined
according to the pro rata share of each selling shareholder of the
issued share capital of the Company, not including shareholders who
purchased shares under an employee share option plan or an office
holder share option plan (hereinafter: the "Selling Shareholders")
intend to sell all or substantially all of their shares in the
Company, and to the effect that the Grantee was asked to do so by
the Selling Shareholders, the Grantee shall be obligated to join in
the sale and to sell his Shares, under the same conditions as the
Selling Shareholders are selling their shares; and if requested by
the purchasers in such sale, at the purchasers' sole discretion, the
Grantee shall sell to such purchasers the Vested Options, under the
same terms as if the Grantee had exercised same immediately prior to
the sale, it being clarified that the Exercise Price shall be
deducted from the sale price under such terms and that the remaining
Options (i.e. non-Vested Options) shall expire and terminate and
become null and void and shall not entitle the Grantee to any right
in or to the Company.
9. Release
Upon the lapse of the Restricted Period, the Trustee may, pursuant to the
written request of the Grantee, release and transfer the Exercised Shares
to the Grantee, or to any third party to whom the Grantee wishes to sell
the Exercised Shares, as indicated in the Grantee's written notice,
provided however that all the following conditions will have been
fulfilled prior to such transfer: (i) payment to the tax assessor of all
taxes required to be paid upon the release and transfer of the Exercised
Shares and confirmation of same received by the Trustee, if any; and (ii)
receipt by the Trustee of written confirmation issued by the Company to
the Trustee stating that all requirements for said release and transfer
have been fulfilled according to the terms of the Articles, the Tax Laws,
the Plan and the Option Agreement. The date on which the Exercised Shares
shall be released and transferred to the Grantee shall hereinafter be
referred to as the "Date of Release".
10. Termination
10.1 Notwithstanding anything to the contrary herein, any Option granted
in favor of a Grantee not exercised by such Grantee within the
Exercise Period and in strict accordance with the terms of the Plan
and the Option Agreement shall, upon the lapse of the Exercise
Period, immediately expire and terminate, become null and void, and
shall not entitle the Grantee to any right in or toward the Company
in connection with same; and all interests and rights of the Grantee
in and to same shall expire.
10.2 Notwithstanding anything to the contrary herein, upon the issuance
of a court order declaring the bankruptcy of a Grantee, or the
appointment of a receiver or a provisional receiver for a Grantee or
over his assets, or any material part thereof, or upon making a
general assignment for the benefit of his creditors, any Option
issued and registered in favor of such Grantee which was not yet
exercised by the Grantee shall immediately expire and terminate,
become null and void and shall not entitle the Grantee, his
receiver, successors, creditors or assignees, to any right in or
towards the Company in connection with same; and all interests and
rights of the Grantee, his receiver, successors, creditors and/or
assignees, in and to same, if any, shall expire.
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10.3 Notwithstanding anything else to the contrary herein, but
specifically subject to Section 7.4 above, after the date of
termination of the Grantee's engagement by the Company or any
Subsidiary as a director or an Office Holder, the Grantee shall be
entitled to exercise the Vested Options during an additional period
of time beyond the date of such termination, only if: (i)
termination is without Cause (as defined below), in which event any
Vested Options still in force and unexpired may be exercised within
a period of three (3) months from the date of such termination; (ii)
termination is the result of the death or disability of the Grantee,
in which event any Vested Options still in force and unexpired may
be exercised within a period of eighteen (18) months from the date
of termination in the event of death and twelve (12) months from the
date of termination in the event of disability, or (iii) prior to
the date of such termination, the Board shall authorize an extension
of the terms of all or part of the Vested Options beyond the date of
such termination for a period not to exceed the period during which
the Vested Options by their terms would otherwise have been
exercisable. Vested Options not exercised in accordance with the
above shall immediately expire and terminate, become null and void,
and shall not entitle the Grantee to any right in or toward the
Company in connection with the same, and all interests and rights of
the Grantee in and to the same shall expire.
The term "Cause" shall mean (i) conviction for any felony which
involves moral turpitude or which affects the Company or a
Subsidiary; (ii) any refusal to carry out a reasonable directive of
the Company or a Subsidiary, if applicable, which was within the
scope of the duties of the Grantee and which involves the business
of the Company or its affiliates and was capable of being lawfully
performed; (iii) embezzlement of funds of the Company or its
affiliates; (iv) any breach of the Grantee's fiduciary duties or
breach in bad faith of such Grantee's duties of care to the Company
or a Subsidiary, if applicable; including without limitation
disclosure of confidential information of the Company or a
Subsidiary; and (v) any conduct not in good faith reasonably
determined by the Board to be materially detrimental to the Company
or to a Subsidiary.
11. Rights as Shareholder
11.1 It is hereby clarified that a Grantee shall not, by virtue of the
Plan, the Option Agreement or any Option granted in favor of him
thereunder, have any of the rights of a shareholder with respect to
any Shares represented by the Options, until the Options have been
exercised.
Furthermore, the Grantee shall not have any rights by virtue of the
Exercised Shares until same shall have been transferred to the
Grantee by registering same in the Grantee's name, and only then
shall the Grantee have the rights of a shareholder with respect to
the shares so registered; provided however, that in the event that
Exercised Shares are held by the Trustee, the only right of the
Grantee by virtue of such Exercised Shares shall be to receive
dividends as provided in Setion 12.1 hereinafter.
11.2 For so long as the Exercised Shares are held by the Trustee, the
Company shall consider only the Trustee as the owner of such shares
for all purposes whatsoever (including without limitation, for the
purpose of delivering notices); the Trustee, however, shall not
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exercise the voting rights conferred by such Exercised Shares in any
way whatsoever, and shall not issue a proxy to any person or entity
to vote such shares.
11.3 The Grantee shall not have, and hereby waives the right to have, by
virtue of the Exercised Shares, any pre-emptive rights to purchase,
along with the other shareholders in the Company, a pro rata portion
of any securities proposed to be offered by the Company prior to the
offering thereof to any third party and any rights of first refusal
to purchase any securities of the Company offered by the other
shareholders of the Company.
12. Dividends and Bonus Shares
12.1 Cash dividends, if any, paid or distributed with respect to the
Exercised Shares held by the Trustee, shall be remitted directly to
the Grantee who is entitled to the Exercised Shares for which the
dividends are being paid or distributed.
12.2 All bonus shares to be issued by the Company, if any, with regard to
the Exercised Shares, shall, if the Exercised Shares are registered
to the Trustee, be registered in the name of the Trustee and, if the
Exercised Shares are registered to the Grantee, be registered in the
name of the Grantee. All provisions applying to the Exercised
Shares, shall apply to the bonus shares, mutatis mutandis.
12.3 The Trustee shall transfer the said bonus shares upon the transfer
of the Exercised Shares with respect to which the bonus shares were
issued.
13. Adjustments
The number of Shares to which each outstanding Option is exercisable,
shall be proportionately adjusted in the event of a reorganization of the
share capital of the Company by a stock split, reverse stock split,
combination or reclassification of the shares, as well as for a
distribution of bonus shares. Such adjustment shall be made by the Board,
whose determination in this matter shall be final and binding.
All provisions applying to the Exercised Shares shall apply to all shares
received as a result of an adjustment as described above.
14. Rights to Changes
The Plan or the Option Agreement shall not affect in any way the rights,
powers or freedoms of the Company or its shareholders to make or
authorize: (a) any sale, transfer or any change whatsoever in all or any
part of the Company's assets, obligations or business, or any other
business, commercial or corporate act or proceeding, whether of a similar
character or otherwise; (b) any adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or
business; (c) any merger or consolidation of the Company; (d) any issue of
bonds, debentures, shares (including preferred or prior preference shares
ahead of or affecting the existing shares of the Company, including the
shares into which the Options granted hereunder are exercisable or the
Exercised Shares or the rights thereof, etc.); or (e) the dissolution or
liquidation of the Company; and none of the above acts or authorizations
shall entitle the Grantee to any right or remedy, including without
limitation any right of
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compensation for any dilution resulting from any issuance of any shares or
of any other securities in the Company to any person or entity whatsoever.
15. No Engagment Obligations
Nothing in the Plan, the Option Agreements or in any Option granted
hereunder shall guarantee the Grantee's engagement by the Company and no
obligation of the Company as to the length of engagement of the Grantee or
as to any other term of engagement shall be implied by same; the Company
reserves the right to terminate the engagement of any Grantee pursuant to
such Grantee's terms of engagement and pursuant to any applicable law.
16. No Representation
The Company does not and shall not, through this Plan or through any
Option Agreement, make or be deemed to make any representation toward any
Grantee with regard to the Company or any Subsidiary, its business, its
value or with regard to the Company's shares in general, and the Exercised
Shares in particular, their value or rights.
The Grantee, upon entering the Option Agreement, represents and warrants
toward the Company, that such Grantee's consent to the grant of the
Options issued in favor of the Grantee and their exercise (if so
exercised), is, in no respect, made on the basis of any representation or
warranty made by the Company or by any of its directors, officers,
shareholders or employees, and is made based only upon his examination and
expectations of the Company, on an "as is" basis. The Grantee waives any
claim whatsoever of "non conformity" of any kind or any other cause of
action or claim of any kind with respect to the Options and/or the Shares
exercised thereupon.
17. Tax Consequences
All tax consequences arising from the grant or exercise of any Option, the
payment for or the transfer of the Exercised Shares to the Grantee, or
from any other event or act (of the Company or the Grantee) hereunder,
shall be borne solely by the Grantee, and the Grantee shall indemnify the
Company and hold it harmless from and against any and all liability for
any such tax or interest or penalty.
The Company and/or the Trustee may withhold, as applicable, from any
payment or other right to which the Grantee may be entitled to from the
Company, the amount of the tax and/or other mandatory payment the
withholding of which is required with respect to the Options and/or the
Exercised Shares under any applicable law and the Tax Laws.
18. Subordination
It is clarified that the grant of the Options hereunder is subject to the
approval of the Plan and/or the Trustee, if necessary, by the relevant tax
authorities, in accordance with, inter alia, the Tax Laws. It is also
clarified that the Plan and the Option Agreement are subject to the
provisions of the Tax Laws which accordingly, shall be deemed an integral
part of each, and which shall prevail over any term that is not consistent
with the Tax Laws.