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The
Israel Securities Authority
Through
the Magna
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The
Tel Aviv Stock Exchange
Through
the Magna
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1.
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On
Tuesday, February 23, 2010, at noon, a shareholders’ meeting will be held
at the offices of the Company’s lawyers, Kantor & Co., 14 Abba Hillel
Silver St., Ramat Gan. The proposed resolutions on the agenda
are as follows:
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A.
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Discussion
of the Board of Directors’ Report and the Company’s financial statements
as of December 31, 2008.
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B.
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The reappointment of a
public accounting firm – Text of the proposed resolution: to ratify
the appointment of Kesselman & Kesselman (PwC Israel) to serve as the
Company’s auditors for year 2009 and to empower the Company’s Board to
determine their fees.
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C.
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The reappointment of
directors – Text of proposed resolution: to approve the
reappointment of Messrs. Marc Allouche, Amit Yonay, Boaz Shweiger and
David Grossman as Company directors until the next annual
meeting. The vote in respect of each director will be taken
separately.
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D.
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Approval of the terms
of employment of Mr. David Grossman, the Company’s CEO and Director,
including the grant of 1,610,000 registered non-marketable options,
exercisable into Company
shares.
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Text
of proposed resolution:
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Pursuant
to the resolution of the Audit Committee and the Company’s Board of
Directors of January 18, 2010, to approve the Company’s engagement under
an employment agreement whereby Mr. David Grossman shall serve as the
Company’s CEO in the scope of a full-time position, subject to the
approval of the Bio-Gal Ltd. Transaction at the Extraordinary General
Meeting of Shareholders, to be held on Tuesday, February 23, 2010 at
10:00, and also allot to Mr. David Grossman 1,610,000 non-marketable,
registered options, exercisable into Company
shares.
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1.
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Monthly Salary –
Commencing January 1, 2010, the CEO shall be entitled to a gross
monthly salary of NIS 28,000 (NIS 336,000 yearly). Should the Company
raise capital in an amount exceeding US$10 million, through the NASDAQ or
any other authorized stock exchange, the CEO’s monthly salary shall be
raised to a gross amount NIS 48,333 (NIS 580,000 yearly). If by
July 1, 2010, the Company does not raise capital as aforesaid, the CEO’s
monthly salary shall be raised to a gross sum of NIS 40,000 (NIS 480,000
yearly), and if the Company does raise capital as aforesaid, the CEO’s
monthly salary shall be raised to a gross sum of NIS 48,333 (NIS 580,000
yearly).
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2.
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Options – As
remuneration for his service as the Company’s CEO, Mr. Grossman shall be
entitled to an allotment of 1,610,000 non-marketable option warrants, free
of charge, exercisable into 1,610,000 Ordinary Shares of NIS 0.1 p.v.
each, subject to the adjustments prescribed in the Company’s Option
Scheme. The exercise price of an option warrant into the
exercise shares is NIS 0.075. 33% of the said option warrants shall vest
immediately upon being granted and 67% of the said option warrants shall
vest and be exercisable into the exercise shares on a monthly basis,
commencing on the date of being granted and for a duration of two years,
subject to the fact that the CEO, during such period, continues to serve
in his position.
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3.
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Signature Grant – As
part of his terms of employment and in view of the fact that CEO has been
in the Company’s employ since February 11, 2009 without receiving any
remuneration, he shall be entitled to a one-time signature grant of NIS
430 thousand, payable in five equal monthly installments commencing on the
Shareholders Meeting approval date.
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4.
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Social Benefits; Company Car;
Severance Pay – In the context of his duties, the CEO shall be
entitled to social benefits such as recuperation pay, senior managers
insurance, professional study fund, car grade 4, cellular phone and
subscription to a daily newspaper, as customary at the Company for senior
office holders.
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Compensation
receiver details
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Compensation
from services
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Other
compensation
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Total
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||||||||||||||||||||||||
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Name
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Role
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Capacity
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Holding
in share capital of the company
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Monthly/
annual salary (Gross)
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Grant
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Share
based payment
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Management
fees |
Consultancy
fees |
Commission
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Other
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Interest
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Rent
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Other
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David
Grossman
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CEO
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100%
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28,000
/ 336,000
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430,000
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458,744
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------
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------
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------
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------
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------
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-------
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------
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1,224,744
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*
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For
details regarding the milestones specified for raising the CEO’s salary –
see Item 1(1)D above.
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**
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Value
of said payment calculated according to “Black & Scholes”
formula.
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E.
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Approval to grant
letter of discharge from liability and undertaking to indemnify Company
directors:
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The
text of the proposed resolution: Approval to grant a letter of discharge
from liability and an undertaking to indemnify all the directors currently
serving at the Company, commencing on the date of their initial
appointment to serve as directors, in accordance with the Company’s
Articles of Association and the Office Holder Indemnity and Exculpation
Agreement of Indemnification attached hereto as Appendix
A.
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F.
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Approval to grant the
directors non-marketable, registered options exercisable into Company
shares - Text of the proposed the resolution: to approve the
allotment of 150,000 non-marketable option warrant, free of charge,
exercisable into 150,000 Ordinary Shares of NIS 0.1
p.v. each, to each of the following
directors:
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2.
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At
the annual general meeting, a legal quorum shall constitute the presence
of at least two (2) shareholders, represented by themselves or by their
proxies, who hold or represent together at least 33.33% of the voting
rights in the Company. If after thirty minutes from the meeting's
scheduled date, the legal quorum is not achieved, the meeting will be
automatically deferred to the same day of the following week, at the same
time and place as scheduled for the original meeting; or to a different
time or place as decided by the board of directors in a notice to the
shareholders. In the deferred meeting, the shareholders shall discuss the
matters for which the original meeting had been convened. If in such
deferred meeting no legal quorum is obtained within thirty minutes from
the scheduled date, two shareholders that are present by themselves or by
a proxy will form a legal quorum and the meeting will be entitled to
discuss the issues on the agenda.
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3.
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The
date for establishing the shareholders' right to vote at the general
meeting, as stipulated in Section 182 of the Companies Law, is January
25th,
2010 ("the meeting
participation record date"). Pursuant to the Companies Regulations
(Proof of Share Ownership for Voting in General Meetings) – 2000, a
Company shareholder whose shares are held by a member of the Stock
Exchange - and such share is included among the shares listed in the
Register in the name of the registration company - who is interested in
voting at the general meeting, shall furnish the Company with an approval
from a member of the Stock Exchange concerning his ownership of the share
on the meeting participation record date, as prescribed by the said
Regulations.
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4.
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The
Company’s shareholders are entitled to participate and vote at the
meeting, themselves or by a duly empowered proxy. A document
appointing proxies to vote (hereafter "the letter of
appointment") as well as the original power of attorney by virtue
of which the letter of appointment (if any) was signed, must be deposited
with the Company's lawyer's office (law offices of Kantor & Co. on 14
Abba Hillel Silver, 12th
floor, Ramat-Gan, Israel Law) 48 hours prior to the start of the
meeting.
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5.
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One
or more shareholders that hold at least 5% of total voting rights and also
hold such rate of total voting rights that are not held by the controlling
shareholder in the Company, as defined in Section 286 to the Companies
Law, are entitled to review the voting papers as detailed in Regulation 10
to the Companies Regulations (Voting Paper and Statements of Position),
2005.
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6.
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The
required majority at the annual general meeting and the deferred annual
meeting (to the extent held) for approval of the resolutions mentioned in
Items 1(A)-1(F) is an ordinary majority of the overall votes of the
shareholders present at the annual general meeting, who are authorized to
vote and have voted therein.
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7.
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The
documents pertaining to this Report may be reviewed at the law offices of
Kantor & Co. on 14 Abba Hillel Silver, 12th
floor, Ramat-Gan, Israel during the customary work hours and after prior
coordination via telephone +972-3-613
3371.
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8.
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The
Company’s representatives responsible for the immediate report are
Advocate Ronen Kantor and/or Ron Soulema, of Kantor & Co. Law Offices,
Abba Hillel Silver Street 14, Floor 12, Ramat Gan, Israel, telephone
+972-3-6133371.
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WHEREAS,
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the
Indemnitee is an Office Holder of the Company (as defined
below);
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WHEREAS,
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both
the Company and Indemnitee recognize the increased risk of litigation and
other claims being asserted against Office Holders of a public
company;
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WHEREAS,
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the
Articles of Association of the Company authorize the Company to indemnify
Office Holders; and
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WHEREAS,
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in
recognition of Indemnitee’s need for substantial protection against
personal liability in order to assure Indemnitee’s continued service to
the Company in an effective manner and Indemnitee’s reliance on the
aforesaid Articles of Association and, in part, to provide Indemnitee with
specific contractual assurance that the protection promised by the
Articles of Association will be available to Indemnitee (regardless of,
among other things, any amendment to or revocation or any change in the
composition of the Company’s Board of Directors or the Company’s
Management or acquisition of the Company), the Company wishes to provide
in this Agreement for the indemnification of and the advancing of expenses
(whether partial or complete) to Indemnitee to the fullest extent
permitted by law and as set forth in this
Agreement.
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1.
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CERTAIN
DEFINITIONS
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1.1
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Expenses: includes
reasonable costs of litigation, including attorney’s fees, expended by the
Indemnitee or for which the Indemnitee has been charged by a court.
Expenses shall also include, without limitation and to the fullest extent
permitted by applicable law, all expenses reasonably incurred in defending
any claim (including investigation and pre-litigation negotiations) and
any security or bond that the Indemnitee may be required to post in
connection with an Indemnifiable Event (as defined
below).
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1.2
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Office
Holder: as such term is defined in the Israeli Companies Law,
5759-1999.
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2.
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INDEMNIFICATION
AND ADVANCEMENT OF EXPENSES
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2.1
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The
Company hereby undertakes to indemnify the Indemnitee to the fullest
extent permitted by applicable law, for any liability and Expense that may
be imposed on Indemnitee, up to an aggregate of $4 million, due to an act
performed or failure to act by him in his capacity as an Office Holder of
the Company or any subsidiary of the Company or any entity in which
Indemnitee serves as an Office Holder at the request of the Company either
prior to or after the date hereof for (the following shall be hereinafter
referred to as “Indemnifiable
Events”):
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2.1.1
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monetary
liability imposed on the Indemnitee in favour of a third party in a
judgment (which third parties include, without limitation and to the
fullest extent permitted by applicable law, any governmental entity),
including a settlement or an arbitration award confirmed by a court, for
an act that the Indemnitee performed by virtue of being an Office Holder
of the Company; and
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2.1.2
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reasonable
costs of litigation, including attorneys’ fees, expended by the Indemnitee
or for which the Indemnitee has been charged by a court, in an action
brought against the Indemnitee by or on behalf of the Company or a third
party, or in a criminal action in which the Indemnitee was found innocent,
or in a criminal offence in which the Indemnitee was convicted and in
which a proof of criminal intent is not
required.
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2.2.
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The
indemnification undertaking made by the Company shall be only with respect
to such events as are described in Schedule
A attached hereto. The maximum amount payable by the Company under
all indemnification agreements with all the non-Executive Directors of the
Company shall not exceed four million US dollars measured promptly after
receipt by the Indemnitee of notice of the commencement of any action,
suit or proceeding to be made against the
Company.
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2.3
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If
so requested by the Indemnitee, the Company shall advance an amount (or
amounts) estimated by it to cover Indemnitee’s reasonable litigation
Expenses with respect to which the Indemnitee is entitled to be
indemnified under Sections 2.1 and 2.2
above.
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2.4
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The
Company’s obligation to indemnify the Indemnitee and advance Expenses in
accordance with this Agreement shall be from the date such Indmenitee
commenced serving as an Office Holder of the Company and for such period
as the Indemnitee shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding or any inquiry or
investigation, whether civil, criminal or investigative, arising out of
the Indemnitee’s service in the foregoing positions, whether or not the
Indemnitee is still serving in such
positions.
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3.
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GENERAL
LIMITATIONS ON INDEMNIFICATION
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4.
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NO
WAIVER
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5.
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SUBROGATION
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6.
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REIMBURSEMENT
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7.
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EFFECTIVENESS
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8.
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NOTIFICATION
AND DEFENSE OF CLAIM
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8.1
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To
the extent that it may wish, the Company jointly with any other
indemnifying party similarly notified will be entitled to assume the
defence thereof, with counsel reasonably satisfactory to the Indemnitee,
provided, however, that the Company will not be entitled to do so if
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and the Indemnitee in the conduct of the
defence of such action.
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8.2
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The
Indemnitee shall have the right to employ his or her own counsel in such
action, suit or proceeding at the expense of the
Company.
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8.3
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The
Company shall not be liable to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any action or claim
effected without its prior written consent – not to be unreasonably
withheld. The Company shall not settle any action or claim in any manner
that would impose any penalty, liability or limitation on the Indemnitee
without the Indemnitee’s prior written consent. Neither the Company nor
the Indemnitee will unreasonably withhold their consent to any proposed
settlement.
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9.
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EXCULPATION
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The
Company hereby exempts the Indemnitee, to the fullest extent permitted by
law, from any liability for damages caused as a result of the Indemnitee’s
breach of the duty of care to the Company, provided that the Indemnitee
shall not be exempt with respect to any action or omission as to which,
under applicable law, the Company is not entitled to exculpate the
Indemnitee.
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10.
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NON-EXCLUSIVITY
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11.
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BINDING
EFFECT
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12.
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SEVERABILITY
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13.
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GOVERNING
LAW
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14.
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ENTIRE
AGREEMENT AND TERMINATION
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XTL
BIOPHARMACEUTICALS LTD.
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THE
DIRECTOR
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By:
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| Name: | ||||
| Title: |
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1.
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Negotiations,
execution, delivery and performance of agreements on behalf of the
Company
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2.
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Anti-competitive
acts and acts of commercial
wrongdoing
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3.
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Acts
in regard to invasion of privacy including with respect to databases and
acts in regard of slander
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4.
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Acts
in regard to copyrights, patents, designs and any other intellectual
property rights, and acts in regard to defects in the Company’s products
or services
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5.
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Approval
of corporate actions including the approval of the acts of the Company’s
management, their guidance and their
supervision
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6.
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Claims
of failure to exercise business judgment and a reasonable level of
proficiency, expertise and care in regard to the Company’s
business
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7.
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Claims
relating to the offering of securities, claims relating to violations of
securities laws of any jurisdiction and claims arising out of the
Company’s status as a publicly-traded company, including, without
limitation, fraudulent disclosure claims, failure to comply with SEC
disclosure rules and other claims relating to relationships with investors
and the investment community
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8.
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Violations
of securities laws of any jurisdiction, including without limitation,
fraudulent disclosure claims and other claims relating to relationships
with investors and the investment
community
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9.
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Violations
of laws requiring the Company to obtain regulatory and governmental
licenses, permits and authorizations in any
jurisdiction
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10.
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Claims
in connection with publishing or providing any information, including any
filings with governmental authorities, on behalf of the Company in the
circumstances required under applicable
laws
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11.
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Violations
of any law or regulation governing domestic and international
telecommunications in any
jurisdiction
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| XTL BIOPHARMACEUTICALS LTD. | |||
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Date:
January 20, 2010
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By:
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/s/ David Grossman | |
| David Grossman | |||
| Chief Executive Officer | |||