DEF 14A of Entera Bio Ltd.
Filed Jun 5, 2025 · FY20240001178913-25-002111
Non-Employee Directors
Non-Employee Directors Gerald Lieberman has served as a member of our Board since April 2014 and became our Chairman in July 2019. Mr. Lieberman is also a member of the Board of Directors of Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA). He serves on the Board of Directors of DosentRx, Ltd., and is a special advisor at Reverence Capital Partners, a private investment firm focused on the middle-market financial services industry. From 2000 to 2009, Mr. Lieberman was an executive at AllianceBernstein L.P. primarily as the President and Chief Operating Officer when he also served as a Board Member. From 1998 to 2000, he was Senior Vice President, Finance and Administration at Sanford C. Bernstein & Co Inc., until it was acquired by Alliance Capital in 2000. Prior to that, he served in various executive positions over six years at Fidelity Investments including Chief Financial Officer and Chief of Administration. Prior to Fidelity, he was in various senior positions over fourteen years at Citicorp including serving as a member of the Policy Committee. Prior to joining Citicorp, he was a certified public accountant with Arthur Andersen. Mr. Lieberman received a B.S. Beta Gamma Sigma with honors in business from the University of Connecticut. Our Board believes that Mr. Lieberman is qualified to serve as director based upon his experience on boards of other pharmaceutical and health care companies and his years of experience working with listed public companies and private companies. Sean Ellis has served as a member of our Board since June 2019. Mr. Ellis brings extensive knowledge of both life science industries and the U.S. financial markets, with a longstanding history in asset management. Mr. Ellis is a fund manager of Centillion Fund, a venture capital fund dedicated to Israeli investments, with a primary focus on investments in the biotech and healthcare industries. Centillion is one of Entera Bio’s earliest investors and largest shareholders. He holds a BA from New York University and MBA from Columbia University. Our Board believes that Mr. Ellis is qualified to serve as a director based upon his years as an investor in healthcare related companies. Yonatan Malca has served as a member of our Board since 2011. Mr. Malca currently serves as Chief Executive Officer and a director of NanoGohst Ltd. From 2009 to 2021, he served as Chief Executive Officer and a director of DNA Biomedical Solutions Ltd. (TASE: DNA). Mr. Malca also serves as a director of Jungo Connectivity Ltd. (TASE: JNGO) and Unicorn Technologies (TASE: UNCT), both Israeli public companies. He also serves as director of BeamMed Ltd, a private medical device company. He previously served as a director of Nextgen-Biomed LTD. (TASE: NXGN) from July 2018 to April 2019, ARKO Holdings Ltd. from August 2014 to December 2020, and Tamda Ltd. from July 2016 to September 2020. Mr. Malca holds a B.A. in Economics and Statistics from Bar-Ilan University and an M.A. in Economics and Finance from Bar Ilan University, Israel. Our Board believes that Mr. Malca is qualified to serve as a director based upon his pharmaceutical industry experience as an executive as well as his experience on boards of multiple pharmaceutical companies. Gerald M. Ostrov has served as a member of our Board since January 2019. Mr. Ostrov consults and invests in new technologies in the medical device and consumer products fields. Mr. Ostrov currently serves on the board of directors of several privately held companies, including Synergio, Addon Optics, and Nuvo Group Ltd. From 2008 to 2010, he served as Chairman and CEO of Bausch & Lomb. There Mr. Ostrov led the stabilization, streamlining and pipeline building of Bausch & Lomb following its going-private transaction. From 1998 until 2006, Mr. Ostrov very successfully served as Company Group Chairman for Johnson & Johnson’s Worldwide Vision Care businesses. From 1991 to 1998, Mr. Ostrov worked for Johnson & Johnson and quickly rose to serve as Company Group Chairman of the Consumer and Personal Care businesses in North America. From 1982 to 1991, he served as President of CIBA Consumer Pharmaceuticals Company. From 1976 to 1982, he worked for the Health Care Division of Johnson & Johnson. From 1973 to 1976, Mr. Ostrov worked at Procter & Gamble. Mr. Ostrov holds a B.S. from Cornell and an M.B.A. from Harvard. Our Board believes that Mr. Ostrov is qualified to serve as a director based upon his years as an investor in healthcare related companies.
Non-Employee Director Nominees
Non-Employee Director Nominees Haya Taitel has served as a member of our Board since June 2023. Ms. Taitel has over 30 years of global C-level biopharma commercial and strategic executive experience. She currently serves as the Head of Sanofi’s Global Transplant Franchise where she is responsible for increasing franchise growth and profitability. Prior to her role at Sanofi, Ms. Taitel served as the Chief Commercial Officer of Kadmon Pharmaceuticals, LLC, where she contributed to the launch of Rezurock®, from 2013 until the company was acquired by Sanofi for $1.9 billion in November 2021. Ms. Taitel also led Kadmon Board’s Executive Commercial Committee. Beginning in 1997, Ms. Taitel had held various commercial leadership positions of increasing seniority at Johnson & Johnson in multiple therapeutic areas, including oncology, immunology, neurology and women’s healthcare. Ms. Taitel holds a Master of Science, Pharmacology, (PharmD equivalence) from Temple University and a Bachelor of Science, Pharmacy and Biology from the Hebrew University School of Pharmacy in Jerusalem, Israel. Our Board believes that Ms. Taitel is qualified to serve as a director based upon her extensive biopharmaceutical industry experience and specific commercial domain expertise in women’s health.
Officer Compensation
Officer Compensation With regard to our executive officers, or “Officers,” (which includes our Named Executive Officers, as defined below) our compensation policy is designed to provide a mix of compensation to reward Officers for individual and company performance as well as to align their interests with the interests of shareholders. We have also designed our compensation policy to provide flexibility. It must take into consideration the fact that the appropriate mix of compensation may vary from period to period and from Officer to Officer. To achieve our goal of appropriately rewarding our Officers for their efforts, our compensation policy generally includes: (i) short-term incentives, such as an annual base salary, benefits and perquisites; (ii) short to medium-term incentives, such as an annual bonus based on target and above-target performance; and (iii) medium to long-term incentives, such as equity-based compensation and retirement benefits.
Bonuses
Bonuses Cash bonuses are generally paid annually and are intended to reward Officers based on the performance of the Company and their individual contributions. The target bonus amount and the performance measures and targets for each Officer are determined by the Compensation Committee and the Board at the beginning of each year for which a bonus may be paid. Additionally, the CEO has the power to determine the annual bonus performance measures and targets for all Officers other than for herself. The performance measures and targets for receiving the annual bonus are intended to be measurable and quantifiable and may include, without limitation: (i) objectives such as capital investment, cash balance relative to equity, obtaining approval from the authorities in the target markets; and (ii) key performance indicators, determined for each Officer separately, according to the Officer’s position. The annual bonus also includes a non-measurable, qualitative component of up to 20% of an Officer’s annual bonus, which is based on an evaluation of such Officer in accordance with qualitative measures provided in the annual bonus grant. In addition to the annual bonus, the Compensation Committee and the Board may elect to pay each Officer a special bonus, based on non-measurable criteria (e.g., criteria or milestones not based on quantifiable measures), in recognition of a significant achievement or for completion of an assignment, such as completion of a major transaction or achieving a major milestone with material impact on our business. Under our compensation policy, a special bonus is limited to six times the monthly base salary for a given Officer, other than our CEO, for whom a special bonus is limited to three times the monthly base salary, determined by non-measurable criteria.
Equity-based Compensation
Equity-based Compensation Our compensation policy also includes an equity incentive component designed to retain Officers, align Officers and shareholders’ interests and incentivize Officers to attain business achievements without taking unreasonable risk, under which the Company may grant Officers options to purchase shares, share appreciation rights, restricted shares, restricted share units, performance awards or other share-based awards (collectively referred to as “equity awards”). The equity awards are determined individually by our Compensation Committee and the Board and awarded from time to time based on, among other elements, each Officer’s (a) contribution to the Company's performance, (b) ability to influence the Company’s future and performance and (c) the Officer’s skills, qualifications, experience, roles and personal responsibilities. Additionally, the Compensation Committee and the Board award equity-based compensation based upon the desired mix of compensation components and the mix of equity awards, as well as the desired competitive levels and dilution or pool limits. Our compensation policy currently limits the annual value of equity awards granted to an Officer, measured at the applicable grant date, to 18 times the monthly base salary of such Officer; should the amended compensation policy be approved by the shareholders, such annual value of equity awards granted to an Officer shall be limited to 25 times the monthly base salary of such Officer. See Proposal Five. These options may be granted with terms of not more than 10 years following the grant date. For option grants and share appreciation rights, the exercise price shall be no less than the fair market value of the underlying Ordinary Shares on the date of grant and subject to applicable law.
Hedging and Pledging
Hedging and Pledging Pursuant to the terms of our compensation policy and Insider Trading Policy, Officers and directors are prohibited from hedging or pledging their equity awards and any other Company securities. The no-hedging policy applies to each director and Officer until one year following termination of such director’s term of office or such Officer’s termination of employment, as applicable. Furthermore, Officers and directors may not pledge or use their equity awards or any other Company securities held by them as collateral for loans unless otherwise approved by the Compensation Committee and Board.
Policies and Practices Related to the Grant of Certain Equity Awards
Policies and Practices Related to the Grant of Certain Equity Awards In response to Item 402(x)(1) of Regulation S-K, we have not granted new awards of stock options, stock appreciation rights, or similar option-like instruments within four business days before or one business day after the release of a Quarterly Report on Form 10-Q, Annual Report on Form 10-K, or Current Report on Form 8-K that discloses material nonpublic information. While the Company does not have a formal policy in place, it is the Company's practice to typically award equity grants to executive officers and non-employee directors at the beginning of each fiscal year, subject to the Company not being in possession of any material non-public information.
Termination
Termination Our Officers are further entitled to certain termination payments and benefits. Officers are entitled to an advance notice period, severance payments and retirement and termination awards. The retirement and termination awards are subject to the Compensation Committee and the Board’s approval, and may be provided only: (a) in certain change of control related cases; (b) if the Officer has made a special contribution to the advancement of the Company’s business during his employment period as shall be determined by the Compensation Committee; or (c) in respect of Officers other than the CEO, if the CEO has recommended granting a retirement bonus.
Director Compensation
Director Compensation The compensation policy provides that non-employee directors’ compensation packages are determined pursuant to the provisions of the Israeli Companies Law in accordance with the Company’s objective to attract and retain talented directors with excellent educational background, qualifications, skills, expertise, professional experience and achievements, by providing a fair and competitive compensation program. Our non-employee directors may be eligible to receive an annual Board membership fee, annual Committee membership fee and equity-based compensation. Non-employee directors may also be entitled to receive insurance, indemnification and release arrangements. The chair of the Board and the chairs of the Board committees may also receive additional annual cash payments for their service in such capacities, subject to the provisions of applicable law. In May 2021, we elected to be exempt from the Israeli Companies Law requirement that we appoint external directors or otherwise comply with the Israeli Companies Law requirements related to the composition of the Audit Committee and Compensation Committee. Our eligibility for that exemption is conditioned upon: (i) the continued listing of our Ordinary Shares on the Nasdaq Capital Market (or one of a few select other non-Israeli stock exchanges); (ii) there not being a controlling shareholder of our company under the Israeli Companies Law; and (iii) our compliance with Nasdaq requirements as to the composition of (a) our Board of Directors, which require that we maintain a majority of independent directors, and (b) the Audit and Compensation Committees, which require that such committees consist solely of independent directors (at least three and two members, respectively). At the time that it was determined to exempt our Company from the external director requirement, our Board affirmatively determined that we met the conditions for exemption from the external director requirement. As of the date hereof, we continue to meet the conditions for exemption from the external director requirement. As a result of our election to be exempt from the external director requirement under the Israeli Companies Law, none of our directors are categorized as external directors; therefore, the requirements and restrictions relating to external directors (including certain compensation related provisions) do not apply.
Summary Compensation Table
Summary Compensation Table The table and summary below outline the compensation granted to our named executive officers (“Named Executive Officers”) during our fiscal years ended December 31, 2024 and December 31, 2023. As a “smaller reporting company,” we are required to provide executive compensation information for the following individuals: (i) all individuals who served as the Company’s principal executive officer (“PEO”), during the last completed fiscal year, regardless of compensation; (ii) the two most highly compensated executive officers (other than the PEO) who were serving as executive officers of the Company at the end of the last completed fiscal year and whose total compensation was greater than $100,000; and (iii) up to two additional persons who served as executive officers (other than as the PEO) during the last completed fiscal year but who were not serving in that capacity at the end of the fiscal year if their total compensation is higher than any of the other two Named Executive Officers in the preceding group. The below figures are represented in thousands.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Award(s) ($)(1) | RSU Award(s) ($)(2) | All Other Compensation ($) | Total ($) | | Miranda Toledano | 2024 | 419 | - | 538 | 156 | 36 | 1,149 | | Chief Executive Officer and director | 2023 | 338 | - | 532 | - | 80 | 950 | | Hillel Galitzer | 2024 | 259 | - | 175 | 54 | 43 | 531 | | Chief Operating Officer | 2023 | 245 | - | 163 | - | 31 | 459 | | Dana Yaacov-Garbeli | 2024 | 226 | - | 158 | 54 | - | 438 | | Chief Finance Officer | 2023 | 193 | | 118 | - | - | 311 |
Summary Compensation Table
| (1) Reflects the associated annual expense recorded in our financial statements based on the grant date fair value of the share-based compensation granted in exchange for the directors’ and officers’ services computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation - Stock Compensation (“ASC Topic 718”). The assumptions used in calculating the amounts are discussed in Note 6 to the Company’s audited financial statements for the year ended December 31, 2024 included in the 2024 Annual Report. The fair value amount is recognized as an expense over the course of the vesting period of the options (subject to any applicable accounting adjustments during that period). |
Summary Compensation Table
| (2) Reflects the associate annual expenses for RSUs granted in place of annual bonus in cash recorded in our financial statements based on the fair value of the share-based compensation grant date market computed in accordance with ASC Topic 718. The fair value amount is recognized as an expense over the course of the vesting period of the RSUs in the Company’s audited financial statements for the year ended December 31, 2024 included in the 2024 Annual Report. |
Outstanding Equity Awards at Fiscal Year End
Outstanding Equity Awards at Fiscal Year End The following table sets forth the outstanding equity awards at December 31, 2024 for our Named Executive Officers.
Outstanding Equity Awards at Fiscal Year End
| | Number of Securities Underlying Unexercised Options | | Option Expiration | | Name | Exercisable | Unexercisable | Date | | Miranda Toledano | 33,638 | - | 17/1/2029 | | Chief Executive Officer and director | 35,852 | - | 1/1/2031 | | | 98,594 | 8,963 | 1/1/2031 | | | 312,500 | 187,500(1) | 16/05/2032 | | | 337,500 | 262,500(2) | 15/07/2032 | | | 131,250 | 218,750(3) | 24/04/2033 | | | - | 500,000(4) | 19/04/2034 | | | 62,016 | 62,061(5) | 19/04/2034 | | Hillel Galitzer | 175,000 | - | 16/3/2030 | | Chief Operating Officer | 109,375 | 15,625(6) | 21/4/2031 | | | 41,250 | 18,750(7) | 24/3/2032 | | | 78,750 | 131,250(8) | 24/04/2033 | | | | 130,000(9) | 19/04/2034 | | | 15,076 | 15,076(10) | 19/04/2034 | | Dana Yaacov-Garbeli | 35,000 | - | 25/06/2030 | | Chief Finance Officer | 105,000 | 15,000(11) | 21/04/2031 | | | 19,688 | 15,313(12) | 31/03/2032 | | | 71,250 | 118,750(13) | 24/04/2033 | | | - | 130,000(14) | 19/04/2034 | | | 15,076 | 15,076(15) | 19/04/2034 |
Outstanding Equity Awards at Fiscal Year End
| (1) The 187,500 unexercisable options as of December 31, 2024 will vest in six equal quarterly installments beginning on February 16, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (2) The 262,500 unexercisable options as of December 31, 2024 will vest in seven equal quarterly installments beginning on January 15, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (3) The 218,750 unexercisable options as of December 31, 2024 will vest in ten equal quarterly installments beginning on January 24, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (4) Of the 500,000 unexercisable options as of December 31, 2024, 25% vest on April 19, 2025, the first anniversary of the grant date, and the remaining 75% vesting in 8 equal quarterly installments over the following two years. |
Outstanding Equity Awards at Fiscal Year End
| (5) The 62,061 unexercisable RSUs as of December 31, 2024 will vest in two equal quarterly installments beginning on January 19, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (6) The 15,625 unexercisable options as of December 31, 2024 will vest in two equal quarterly installments beginning on January 16, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (7) The 18,750 unexercisable options as of December 31, 2024 will vest in five equal quarterly installments beginning on March 31, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (8) The 131,250 unexercisable options as of December 31, 2024 will vest in ten equal quarterly installments beginning January 24, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (9) Of the 130,000 unexercisable options as of December 31, 2024, 25% vest on April 19, 2025, the first anniversary of the grant date, and the remaining 75% vesting in 8 equal quarterly installments over the following two years. |
Outstanding Equity Awards at Fiscal Year End
| (10) The 15,076 unexercisable RSUs as of December 31, 2024 will vest in two equal quarterly installments beginning on January 19, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (11) The 15,000 unexercisable options as of December 31, 2024 will vest in two equal quarterly installments beginning on January 16, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (12) The 10,938 unexercisable options as of December 31, 2024 will vest in five equal quarterly installments beginning on March 31, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (13) The 118,750 unexercisable options as of December 31, 2024 will vest in ten equal quarterly installments beginning January 24, 2025. The 15,076 unexercisable RSUs as of December 31, 2024 will vest in two equal quarterly installments beginning on January 19, 2025. |
Outstanding Equity Awards at Fiscal Year End
| (14) Of the 130,000 unexercisable options as of December 31, 2024, 25% vest on April 19, 2025, the first anniversary of the grant date, and the remaining 75% vesting in 8 equal quarterly installments over the following two years |
Outstanding Equity Awards at Fiscal Year End
| (15) The 15,076 unexercisable RSUs as of December 31, 2024 will vest in two equal quarterly installments beginning on January 19, 2025. |
Director Compensation Table
Director Compensation Table Under the Israeli Companies Law, our directors can be paid for their services as directors to the extent such payments are in accordance with the compensation policy adopted by the Company after approval by the Compensation Committee, our Board and our shareholders by ordinary majority, or, if their compensation deviates from our compensation policy, after approval by the Compensation Committee, our Board and our shareholders by a Special Majority, to the extent applicable, in accordance with the provisions of the Israeli Companies Law. The table below outlines compensation earned by our non-employee directors for the fiscal year ended December 31, 2024, including fees earned in cash and options awarded for services provided as a director. To help the Company maintain sufficient cash for operations, the Company’s shareholders approved a revised compensation structure for non-executive directors, which was implemented to enhance the Company’s financial flexibility and align directors’ interests with those of shareholders. This revised structure involves granting fully vested Ordinary Shares quarterly instead of quarterly cash payments, effective retroactively as of January 1, 2024. Under this arrangement, each non-executive director receives a quarterly grant of fully vested Ordinary Shares. The value of these shares is equivalent to their respective cash compensation for board and committee services, calculated based on the average daily closing share price of the Ordinary Shares during the applicable fiscal quarter. Directors who serve only part of a quarter receive a pro rata portion of the shares.
Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | Option Awards ($)(1) | Equity Awards ($)(2) | All Other Compensation ($) | Total ($) | | Gerald Lieberman | - | 57,162 | 67,736 | - | 124,898 | | Yonatan Malca | - | 57,162 | 55,838 | - | 113,000 | | Gerald M. Ostrov | - | 57,162 | 50,803 | - | 107,965 | | Sean Ellis | - | 57,162 | 44,877 | - | 102,039 | | Roger J. Garceau(3) | - | 3,615 | 33,346 | - | 36,961 | | Ron Mayron(3) | - | 4,409 | 33,346 | - | 37,775 | | Haya Taitel | - | 57,162 | 39,841 | - | 97,003 |
Director Compensation Table
| (1) Reflects the associated annual expense recorded in our financial statements based on the grant date fair value of the share-based compensation granted in exchange for the directors’ and officers’ services computed in accordance with ASC Topic 718. The assumptions used in calculating the amounts are discussed in Note 6 of the Company’s audited financial statements for the year ended December 31, 2024 included in the 2024 Annual Report. The fair value amount is recognized as an expense over the course of the vesting period of the options (subject to any applicable accounting adjustments during that period). |
Director Compensation Table
| (2) Reflects the associated annual expenses for fully vested Ordinary Shares granted in lieu of cash fees during 2024, based on the grant date market value. |
Director Compensation Table
| (3) Former board member whose term expired at the 2024 Annual Meeting of Shareholders. |
Director Compensation Table
The table below sets forth the aggregate number of options to purchase Ordinary Shares of each current non-employee director outstanding as of December 31, 2024:
Director Compensation Table
| Name | Share Options | | Gerald Lieberman | 374,421 | | Yonatan Malca | 374,421 | | Gerald M. Ostrov | 374,421 | | Sean Ellis | 374,421 | | Haya Taitel | 141,971 |
Pay versus Performance
Pay versus Performance We are required by SEC rules to disclose the following information regarding compensation paid to our Principal Executive Officer (the “PEO”) and our other Named Executive Officers (such other Named Executive Officers collectively referred to hereinafter as the “Non-PEO NEOs”). The amounts set forth below under the headings “Compensation Actually Paid to PEO” and “Average Compensation Actually Paid to Non-PEO NEOs” have been calculated in a manner prescribed by the SEC rules and do not necessarily align with how we or the compensation committee views the link between our performance and pay of our named executive officers. The footnotes below set forth the adjustments from the total compensation for each of our NEOs reported in the Summary Compensation Table above. As permitted under the rules applicable to smaller reporting companies, we are including two years of data and are not including a peer group total shareholder return or company-selected measure, as contemplated under Item 402(v) of Regulation S-K. For further information concerning our executive compensation philosophy and how executive compensation is aligned with the Company’s performance, refer to the section entitled “Executive Compensation” included in this proxy statement. PEO and Non-PEO NEOs’ compensation is designed to provide a mix of compensation to reward Officers for individual and company performance as well as to align their interests with the interests of shareholders. To achieve our goal of appropriately rewarding our Officers for their efforts, the compensation generally includes: (i) annual base salary, benefits and perquisites; (ii) annual bonus based on target and above-target performance; and (iii) equity-based compensation and retirement benefits. For the years 2023 and 2024, in order to preserve Company’s cash, PEO and Non-PEO NEOs were granted RSUs in lieu of an annual cash bonus. A significant portion of the PEO and Non-PEO NEOs total compensation is “at-risk” in the form of equity compensation and is directly tied to the Company’s share performance. As a result, this component of compensation aligns the PEO and Non-PEO NEOs interests with those of shareholders by linking potential rewards to long-term stock price appreciation. The following table sets forth additional compensation information of our PEO and Non-PEO NEOs, along with total shareholder return, and net loss results for the years ended December 31, 2024 and 2023:
Pay versus Performance
| Year(1) | Summary Compensation Table Total for PEO (in 000s)(2) | Compensation Actually Paid to PEO (in 000s)(3) | Average Summary Compensation Table Total for Non-PEO NEOs (in 000s)(4) | Average Compensation Actually Paid to Non-PEO NEOs (in 000s)(3) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return(5) | Net Loss (in 000s)(6) | | 2024 | $1,149 | $2,187 | $485 | $849 | $212 | $(9,541) | | 2023 | 950 | 483 | 385 | 314 | 21 | (8,889) |
Pay versus Performance
| (1) The Non-PEO NEOs for both years are Hillel Galitzer and Dana Yaacov-Garbeli. |
Pay versus Performance
| (2) The dollar amounts reported herein represent the amount of total compensation reported for each covered fiscal year in the “Total” column of the Summary Compensation Table for each applicable year. |
Pay versus Performance
| (3) The dollar amounts reported below represent the amount of “compensation actually paid” to our PEO and Non-PEO NEOs (as an average) as computed in accordance with Item 402(v) of Regulation S-K, for each covered fiscal year. The dollar amounts do not reflect the actual amount of compensation earned or received by or paid to the PEOs and Non-PEO NEOs during the applicable fiscal year. For purposes of the equity award adjustments shown below, no equity awards were cancelled due to a failure to meet vesting conditions and no dividends or other earnings paid on share or option awards in the covered fiscal year prior to the vesting date were not otherwise included in the total compensation for the covered fiscal year. In calculating the “compensation actually paid” amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant. The following table details the applicable adjustments that were made to the determine “compensation actually paid” (all amounts are averages for Non-PEO NEOs). |
Pay versus Performance
The below figures are represented in thousands.
Pay versus Performance
| (4) The dollar amounts reported herein represent the average of the amounts of total compensation reported for our Non-PEO NEOs as a group for each covered fiscal year in the “Total” column of the Summary Compensation Table for each applicable year. |
Pay versus Performance
| (5) Cumulative total stockholder return (“TSR”) assumes $100 was invested on December 31, 2022 and is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between our share price at the end and the beginning of the measurement period (December 31, 2022) by our stock price at the beginning of the measurement period. At December 31, 2024, 2023 and 2022, the per share closing prices for our Ordinary Shares were $2.28, $0.60 and $0.73, respectively. No dividends were paid on share or option awards for all periods presented. |
Pay versus Performance
| (6) Net loss is reflected as reported in our audited consolidated financial statements for the applicable fiscal year. |
Pay versus Performance
| | PEO | | Non-PEO NEO Average | | | | 2024 | 2023 | 2024 | 2023 | | Summary Compensation Table Total | $1,149 | $950 | $485 | $385 | | -the fair value of equity awards granted that are reported in the Summary Compensation Table | (742) | (532) | (246) | (141) | | + Fair value as of the end of all awards granted during the covered fiscal year that are outstanding and unvested at the end of the covered year | 360 | 126 | 245 | 72 | | +/- Change in fair value as of the end of the covered fiscal year (from the end of the prior fiscal year) of any awards granted in any prior fiscal year that are outstanding and unvested as of the end of the covered fiscal year | 863 | (81) | 222 | (9) | | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year | 112 | - | 28 | - | | +/- Change in fair value as of the vesting date (from | | | | | | the end of the prior fiscal year) of any awards | | | | | | granted in any prior fiscal year for which all | | | | | | applicable vesting conditions were satisfied at the | | | | | | end of or during the covered fiscal year | 445 | 20 | 115 | 7 | | Compensation Actually Paid | $2,187 | $483 | $849 | $314 |
Pay versus Performance Comparative Disclosure
Pay versus Performance Comparative Disclosure In accordance with SEC rules, the Company is providing the following narrative disclosure regarding the relationships between information presented in the pay versus performance tables above. Compensation Actually Paid and Cumulative Total Shareholder Return During 2023 and 2024, compensation actually paid (“CAP”) to our PEO increased from $483 thousand in fiscal year 2023 to $2,187 thousands in fiscal year 2024. Average compensation actually paid to our Non-PEO NEOs increased from $314 in fiscal year 2023 to $849 thousand in fiscal year 2024. Over the same period, the value of an investment of $100 in our Ordinary Shares on the last trading day of 2022 decreased by $18 to $82 during fiscal 2023 and increased by $230 to $312 during fiscal 2024. The following graph sets forth the relationship between CAP to our PEO, the average of CAP to our Non-PEO NEOs, and our cumulative TSR over the three most recently completed fiscal years. Compensation Actually Paid and Net Loss During 2023 and 2024, CAP to our PEO increase from $483 thousand in fiscal year 2023 to $2,187 thousand in fiscal year 2024. Average CAP to our Non-PEO NEOs increased from $314 in fiscal year 2023 to $849 thousand in fiscal year 2024. Over the same period, our net loss increased by $652 thousand during fiscal year 2024 (from a net loss in fiscal year 2023 of $8,889 thousand to a net loss in fiscal year 2024 of $9,541 thousand).
Pay versus Performance Comparative Disclosure
| PROPOSAL ONE — ELECTION OF DIRECTORS |
Director Nominees
Director Nominees In accordance with the Israeli Companies Law and without derogating from the appointment requirements listed above, each of the nominees has certified to us that he meets all the requirements of the Israeli Companies Law for election as a director of a public company, possesses the necessary qualifications and has sufficient time in order to fulfill his duties as our director, taking into account our size and special needs. Shareholders are being asked to elect the director nominees listed below.
Director Nominees
| Name | Term Expires | | Haya Taitel | 2028 Annual Meeting of shareholders |
Director Nominees
Unless otherwise instructed, the proxy holders will vote the proxies received by them for the director nominees listed above. In the event that any nominee is unable or declines to serve as a director at the time of the Annual Meeting, the proxies will be voted for any nominee who shall be designated by the present Board to fill the vacancy. It is not expected that any nominee will be unable or will decline to serve as a director. The section titled “Directors & Executive Officers” of this proxy contains more information about the leadership skills and other experience that caused the Nominating and Corporate Governance Committee and the Board to determine that Ms. Taitel should serve as the Class II director of the Company. We believe that Ms. Taitel possesses the experience, skills, and qualities to fully perform her duty as a director and contribute to our success. Ms. Taitel has been nominated because she possesses the highest standards of personal integrity, interpersonal and communication skills, is highly accomplished in her field, she understands the interests and issues that are important to our shareholders, and she is able to dedicate sufficient time to fulfilling their obligations as director. Our directors complement each other with their respective experiences, skills, and qualities. While our directors make up a diverse group in terms of age, gender and professional experience, together they comprise a cohesive body in terms of Board process and collaboration.
DIRECTORS AND OFFICERS COMPENSATION POLICY
DIRECTORS AND OFFICERS COMPENSATION POLICY
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 1. | PURPOSE |
DIRECTORS AND OFFICERS COMPENSATION POLICY
This document is designed to determine, describe and detail the policy of Entera Bio Ltd. (the “Company”) with respect to the Terms of Office and Employment of the Company's Office Holders (as defined hereunder), its components and the manner in which they are determined, inter alia, in accordance with the provisions of the Israeli Companies Law, 5759-1999, or "Companies Law" (the “Compensation Policy” or “Policy”).
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 2. | DEFINITIONS |
DIRECTORS AND OFFICERS COMPENSATION POLICY
“Office Holders” - as such term is defined under the Companies Law, including members of the Company's board of directors, or the Company's general manager, chief executive officer (CEO), a deputy chief officer, chief financial officer, and any person holding such position in the Company, irrespective of his or her title, and also any manager who reports directly to the CEO of the Company (i.e., C-level officers). “Officers” - the Company's general manager, CEO, a deputy chief officer, chief financial officer, and any person holding such position in the Company, irrespective of his or her title, and also any manager who reports directly to the CEO of the Company (i.e., C-level officers). “Directors” - members of the Company's board of directors. “Terms of Office and Employment” of Office Holders – as such term is defined under the Companies Law. Terms not otherwise defined herein shall have the meaning ascribed to them in the Companies Law, unless the context dictates otherwise. To the extent any provision herein conflicts with the conditions of any applicable law, the provisions of such applicable law shall prevail over this Policy, and the Company's board of directors (the “Board”) is empowered hereunder to interpret and enforce such prevailing provisions. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 3. | CONSTRUCTION; EFFECT |
DIRECTORS AND OFFICERS COMPENSATION POLICY
This Compensation Policy shall take effect as of the date of its approval by the general meeting for three years, in accordance with the provisions of the Companies Law (the “Effective Date”), and shall apply to the Terms of Office and Employment of Office Holders that are approved following the Effective Date. This Policy shall not apply, shall have no effect with respect to, or derogate from, any Terms of Office and Employment of any Office Holder which are in effect prior to the Effective Date. Nothing in this Policy shall confer upon any person, including, any Office Holder, any rights, entitlements, benefits or remedies whatsoever, including any right or entitlement to any compensation, remuneration or benefits of any kind or nature. The Terms of Office and Employment of an Office Holder shall only be as set in an agreement between such Office Holder and the Company or in a written undertaking of the Company or in a resolution of the Company's Compensation Committee, Board and shareholders (to the extent shareholder approval is required by law) setting forth the Terms of Office and Employment and their applicability to the relevant Office Holder. The provisions of this Policy determine, inter alia, the framework for various components of compensation. Any deviation from this Compensation Policy shall be subject to the approval of the Company’s Compensation Committee, Board and shareholders, to the extent required by law. However, if the applicable corporate organs of the Company determine, with respect to a specific Office Holder, that such Office Holder is entitled to compensation components that are inferior to those indicated herein, such shall not be deemed as deviation from the Compensation Policy. To the extent that after the Effective Date a relief is granted as to the mandatory or minimum requirements prescribed by applicable law to be included in a Compensation Policy, or any limitation contained in this Policy is more stringent than that required by applicable law, then such relief or less stringent limitation shall be deemed incorporated by reference into this Policy notwithstanding anything else to the contrary, unless otherwise determined by the Board.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4. | GENERAL BACKGROUND |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1. | Objectives |
DIRECTORS AND OFFICERS COMPENSATION POLICY
This Compensation Policy is designed to promote and advance the Company's long-term objectives, work plans and policy, and to create appropriate incentives subject to any law, taking into consideration, inter alia, the Company’s risks management policy, in view of the Company's size, the nature of its activities and its financial state. In support of this goal, compensation practices, including variable compensation, for the Company's Office Holders, are designed to meet the following objectives:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.1. | Improve business results and strategy implementation, and support the Company’s work-plans, from a long-term perspective; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.2. | Align Officers’ and Directors' interests with those of the Company and its shareholders and incentivize Officers and Directors to create long- term economic value for the Company; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.3. | Create motivation for Office Holders to attain a high level of business achievements without taking unreasonable risks; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.4. | Create a clear line-of-sight between Officers’ and Directors' compensation and both Company and individual performance; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.5. | Establish an appropriate balance between the various compensation components - fixed vs. variable compensation, quantitative and measurable components vs. discretionary components, short-term vs. long-term components, compensation in cash vs. equity-based compensation and benefits and perquisites, to ensure sustained business performance over time; and |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.1.6. | Utilize market benchmark compensation tools to ensure our Officers and Directors are compensated fairly and best practices are implemented. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.2. | Primary Bodies Involved in Determining the Compensation Policy for Office Holders |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The parties involved in determining the Company's Compensation Policy are:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Compensation Committee – (i) makes recommendations to the Board regarding the approval of the Compensation Policy for Office Holders and any extensions and updates to the Policy to the extent required; (ii) approves the Terms of Office and Employment of Office Holders; and (iii) subject to certain requirements prescribed by the Companies Law, may determine to exempt a transaction from shareholder approval. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Board of directors – (i) approves the Compensation Policy for Office Holders; (ii) periodically reviews the Compensation Policy; and (iii) is responsible for updating it as and when necessary. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The General Meeting (shareholders) - approves the Compensation Policy, as required by law. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Compensation Committee and the Board shall review this Compensation Policy from time to time, as required by the Companies Law. This Compensation Policy shall be brought for reconsideration and re-approval, as required by the Companies Law (currently, every three years).
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 4.3. | Business Environment and its Impact on Compensation of Office Holders |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Compensation Policy was designed, inter alia, to ensure the Company's ability to recruit and retain the highly talented Office Holders with appropriate qualifications, in accordance with and subject to the objectives of the Compensation Policy set forth in Section 4.1, including the promotion of the Company's goals in the long-term.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 5. | OFFICE HOLDER’S COMPENSATION IN VIEW OF COMPANY VALUES AND BUSINESS STRATEGY |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 5.1. | Compensation According to the Office Holder’s Characteristics and Experience |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Office Holder's Terms of Office and Employment shall be determined, for each of the various compensation components, while taking into account the Office Holder’s education, skills, qualifications, expertise, professional experience and accomplishments, as well as the Office Holder's position, areas and scope of responsibilities and his or her prior compensation agreements.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 5.2. | Ratio Between Office Holders Compensation and Compensation of Other Company Employees |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Nevertheless, since the Company employs a relatively small number of employees most of whom have unique professional expertise, the Company attaches importance to the creation of appropriate compensation for all of its employees and in preserving reasonable gaps between the overall cost of the Terms of Office and Employment of Office Holders and the overall cost of salary (including any payment or benefit) of the other Company employees. In determining the Terms of Office and Employment of Office Holders, the Compensation Committee and the Board will examine, inter alia, the ratio between the overall Terms of Office and Employment of Office Holders and the average and median salary of the Company's employees and contractors other than the Company's Office Holders, as well as the possible ramifications of such ratio on the work environment in the Company. The Compensation Committee and the Board have examined the current ratio, and believe that this ratio is appropriate and reasonable, taking into account the size and nature of the Company, its value, scale of business, the mixture of manpower, its field of business and its ramifications on the work environment of the Company.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 5.3. | Relationship Between the Company's Business Results and Office Holders Compensation |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's policy is that the overall Terms of Office and Employment for Officers should be considerably influenced by its business results as well as the individual contribution, responsibility and professional expertise of each Officer to the achievement of these results. The influence of the business results and the individual contribution on the compensation shall increase the higher the Office Holder's position is. In accordance, the higher the position is, the weight of the variable compensation that is performance based in relation to the overall Terms of Office and Employment shall increase, all as specified in Section 4.2 below.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 6. | PRIMARY CONCEPTS OF THE COMPENSATION POLICY |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 6.1. | Overall Compensation Concept |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Compensation Committee and Board believe that the overall compensation of each employee, and in particular of Office Holders, should be comprised of a number of different components, such that each element rewards the employee for a different element of his or her contribution to the Company, thus achieving the objectives of the Company's Compensation Policy:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Base salary - designed to partially reward the Office Holder for his or her devotion and contribution to the performance of his or her role and the daily performance of his or her tasks. The base salary takes into account the Office Holder's skills, experience, expertise, education, professional qualifications etc., and the requirements of the role and the responsibilities and authorities it carries. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Benefits and perquisites - some of which are mandatory according to law (such as pension, severance pay, vacation days, sick leave, recuperation pay, etc.), some of which are common market practice (such as health insurance, further education funds, all which may have certain tax benefits for the employee and the Company) and others are designed to compensate the employee for expenses incurred in fulfilling the position (such as car lease, travel expenses, phone, etc.). |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Variable performance-based awards (e.g. annual bonus) - designed to reward the Office Holder for his or her achievements and contribution to attaining the Company's goals during the course of the period for which the variable compensation is paid and to supplement the base salary. The weight of variable performance-based compensation in relation to the overall compensation shall increase the higher the Officer’s position is. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Equity-based compensation - designed to link long-term shareholder returns and the compensation of Office Holders of the Company. Equity- based compensation creates a correlation between the interests of employees and Office Holders and the interests of the Company’s shareholders, and assists in creating motivation and in retaining the key personnel in the Company. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 6.2. | Ratio Between Variable and Fixed Components of the Compensation Package |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The rate of the annual variable components (including, without limitation, cash bonuses, performance-based awards and equity-based awards) of the Office Holders overall annual compensation package (comprised of the base salary and variable components) shall not exceed the 80% of the Office Holder's total compensation package. A deviation of up to 10% of these terms shall not constitute a deviation or deflection from the compensation policy. Note that this refers to the planned ratio only, assuming the receipt of the target bonus as stated in this policy. The actual ratio between the components of the compensation package, in a given year, may be different due to underperformance or overachievement impacting the variable compensation, as stated in this Policy.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 6.3. | Market comparison (benchmark) |
DIRECTORS AND OFFICERS COMPENSATION POLICY
To determine the salary for the recruitment of our new Office Holders, a comparison shall be made of the acceptable salary in the market for similar positions in companies similar to the Company (“Peer Group”). For purposes of the foregoing comparative studies, companies meeting the following characteristics shall be selected:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Companies operating in the field of biotech, pharmaceutical, drug development or other related fields; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Israeli companies whose shares are traded on the NASDAQ Stock Market or NYSE to the extent practicable, based in Israel, and preferably, with officers residing in the US; if the number of such companies is lower than 10, the Peer Group may also include US companies; and |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Companies of similar size in the following financial dimensions: market cap, shareholder equity, balance sheet, sales turnover, operating profit and/or net profit, as provided in the most updated published information or the Company's last annual report. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company shall make reasonable efforts to include at least 10 companies in the Peer Group (but in no event less than 5 companies). The comparative study shall address all the components of the compensation package and shall include (to the extent the information is available):
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | the acceptable range of base salaries for similar positions (including the split within the range); |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | the acceptable range for annual bonuses; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | the acceptable range for equity-based compensation; and |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | the benefits and perquisites that are acceptable in the market. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7. | COMPENSATION COMPONENTS |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1. | Base Salary |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1.1. | Determination of the base salary for Officers |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The base salary for an Officer shall be determined during the course of negotiations for his or her employment in the Company, which shall be conducted by the person who shall directly supervise the Officer (for the CEO - the chairman of the Board, for any other Officer - the Company's CEO, or whoever is appointed on behalf of the chairman or CEO for such purposes). The Officer’s intended supervisor may determine the base salary within the range determined in the directives of this policy (as detailed in the following table in Section 7.1.1.3 below) and the salary shall be brought before the relevant Company organs for approval, as required by law. In determining the base salary, the Office Holder’s characteristics and experience, as provided in Section 5.1 above, shall be taken into consideration, as well as the acceptable salary conditions for similar positions in Peer Group companies, as other companies which compete with the Company for similar talents. The Company's financial state and cash position at the time of recruitment shall also be taken into consideration. The base salary shall also be subject to any requirements or restrictions prescribed by the Companies Law, U.S. securities laws, NASDAQ rules, any other applicable law from time to time, and (with regard to U.S. based Officers) evolving best practices among shareholder advisory and institutional investor groups. The Company believes that the emphasis of its Compensation Policy should be on performance based compensation, and therefore, the Company's policy is to determine a base salary which is targeted at the median salary in the relevant market for similar positions (including in Peer Group companies), alongside variable performance based compensation and long-term compensation components that will bring the Officer’s overall compensation to a level which will allow the Company to recruit and retain the highly talented management personnel it requires for continuation of its success. Since Officers hold management positions within the meaning of the Hours of Work and Rest Law, 5711-1951, Officers shall not be entitled to compensation for overtime work or work on the day of rest.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1.1.1. | Internal comparison - in determining the salary for the recruitment of a new Officer, the following considerations shall be taken into account, as well as their potential impact on the Company’s labor relations as a whole and within the management team: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The gap between the proposed salary of the Officer and the salary of the other Officers of the Company. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The ratio between the proposed salary of the Officer and the salary of the other employees of the Company. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | If there are Officers with similar positions in the Company - the gap between the proposed salary of the Officer and the salary of Officers in similar positions. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The geographical location of the Officer. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1.1.2. | Geographical Location - To the extent necessary, the Company may employ an Officer outside of Israel. In such case, the process of determination of his or her salary, shall be adjusted to the country where such Officer is employed. In the event that the salary of Officers who are candidates for employment abroad deviates from this policy, the salary shall be considered as deviating from this Policy and shall be subject to the approval process required for compensation in deviation from the Policy. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1.1.3. | The maximum amount of monthly salaries for Company's Officers shall be: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| Rank | Maximum | | CEO | $50,000 | | C-level Officers | $35,000 |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| A deviation of up to 10% above and below the ranges detailed in the table shall not constitute deviation from the Compensation Policy. The base salaries of the Company's Officers shall be linked to the Consumer Price Index (or a similar index customary in the country in which the employee is located, if not Israel). |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.1.2. | Periodical review and update of salary |
DIRECTORS AND OFFICERS COMPENSATION POLICY
In order to retain Office Holders other than non-employee and non-executive Directors, such Office Holders' base salary shall be reviewed annually by the Compensation Committee and the Board, taking into consideration the challenges of the given year and the following year, the complexity of such Office Holders’ roles, their scope and importance to the Company's performance - all based upon the Company's resources and in comparison to the acceptable salary for similar roles in the relevant market. To the extent necessary, a proposal regarding an increase to all or any of the Office Holders' salaries shall be prepared and brought before the Company's relevant organs for approval, as required by law.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2. | Variable Compensation |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Variable compensation components are intended to achieve, inter alia, the following objectives:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | To link Office Holders' compensation to the Company's achievement of business goals and targets and the maximization of its profits, with a long-term view and in accordance with the office holder's position, and align Office Holders’ interests with those of the Company and its shareholders. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Increase the Officers' motivation to attain a high level of business achievements without taking unreasonable risks. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Correlating some of the Company's payroll costs with its performance and enhancing its financial and operational flexibility. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1. | Annual bonus |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Officers shall be entitled to an annual bonus, based upon the annual bonuses plan, which shall be brought before the Compensation Committee and the Board for approval.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1.1. | Principles Annual bonuses for Officers shall be calculated according to an annual bonus plan, to the extent it is determined and approved by the Company's Compensation Committee and Board, at the beginning of each calendar year for which the bonus is paid. The annual bonus plan shall be comprised of the following provisions: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Payment thresholds, based on one or more quantitative financial Company performance measure(s) during the year for which the bonus is paid (such as capital investments, cash balance relative to equity, obtaining approval from the authorities in the target markets, and other quantitative performance measures suitable to the company). The Compensation Committee and the Board shall determine the measure according to the Company's targets for the bonus year, based on the Company's short and long term objectives. If an Officer does not meet the threshold performance measures in a given calendar year, calculated on a weighted average basis, he or she will not be entitled to an annual cash bonus. The lower percentage threshold is 75 % for each Officer. The Compensation Committee and the Board may determine that in respect of any specific year, all or any particular Officer or Officers shall not be entitled to any annual bonus. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Target bonus for each Officer - the target bonus is the annual cash bonus amount to be paid to an Officer upon achievement of 100 % of the Officer's performance measures. The target bonus shall be set in monthly employer salary cost multiplier terms. A target bonus shall be identical for each Officer of a particular rank and shall not exceed the following: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| Rank | Target bonus (multiplier of monthly employer salary cost ) | | CEO | 12 | | C-level Officers | 10 |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Maximum bonus (in terms of a salary multiplier) is the maximum annual cash bonus to be paid to an Officer upon achievement of 125 % of the Officer's performance measures. The maximum bonus (bonus cap) for all Officers shall be 18 times the applicable monthly base salary ; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The measures according to which the bonus shall be calculated for each Officer and their relative weights, in accordance with Section 7.2.1.2 below; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The performance measures and targets, for the bonus year. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1.2. | Determining the bonus plan performance measures and targets Personal targets and performance measures shall be determined by the Compensation Committee and the Board for the CEO, and by the CEO for each of the other Officers of the company. The Officer's performance shall be measured according to such personal targets and performance measures. A weight shall be assigned to each measure for determining the annual bonus for each Officer, and the bonus paid to the Officer shall be determined in accordance with the weighted percentage of meeting the targets, as described below. There shall be three main categories of performance measures for each Officer: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Company measures - economic or strategic quantitative measures, relating to the Company's performance (capital investment, cash balance relative to equity, obtaining approval from the authorities in the target markets and other quantitative performance measures suitable to the company). These measures shall be the same for all Company Officers, and shall determine up to 40% of the total bonus of the Company's Officers. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Personal measures - quantifiable and measurable key performance indicators (KPIs) shall be determined for each Officer separately, according to his or her position. These measures shall determine up to 40% of the total bonus of the Company's Officers. The goals for each Officer's personal measures shall be based, to the extent possible, on performance focusing on the long-term view. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Managerial appraisal - an evaluation of each Officer’s performance in non-measurable terms. The managerial appraisal shall determine up to 20% of the total bonus of any Officer, including the CEO. At the beginning of each year, qualitative measures shall be determined on the basis of which the appraisal of each Officer shall be made. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| The targets in the personal and managerial measures of each Officer shall be determined in accordance with the work plan targets for the bonus year. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1.3. | Determination of the bonus budget The total annual budget for the bonuses of Company's Officers shall be determined according to the sum of the maximum bonuses of all Officers. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1.4. | Bonus calculation mechanism The bonus for each Officer shall be calculated based on the achievement of the targets determined for each Officer for the bonus year. The bonus for meeting each of such targets will be made on the basis of a pro-rata allocation of the Officers' bonus cap in accordance with the respective weight of each target, subject to the "payment line" formula determined in the annual bonus plan for Officers, which shall be multiplied by the target bonus (the personal bonus) of the Officer for the purpose of calculating the actual bonus. The “payment line” shall determine: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The performance threshold, up to which the Officer shall not be paid any bonus whatsoever, as stated above. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The percentage of the target bonus which shall be paid in achieving the lower performance threshold; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | A maximum bonus, as stated above. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| Calculation of the target bonus percentage for each level of performance between the above-mentioned points shall be made by a linear method. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.1.5. | The approval process for the actual bonus |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| At the end of each year, the extent of meeting targets by each of the Officers shall be determined. The extent of meeting targets of the Officer shall be translated into a rate of target bonus, according to the payment line formula. The Compensation Committee and the Board shall have the right to reduce the Officers' annual bonus at their discretion, due to circumstances determined by the Compensation Committee and the Board. The annual bonuses approved by the Compensation Committee and the Board shall be paid to the Officers with the first monthly salary paid after the approval of the annual bonuses by the Board. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.2. | Special bonus |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Compensation Committee and Board shall be authorized to award any of the Company's Officers a one-time special bonus (which is only based on non-measurable criteria) of up to an amount equal to a six month base salary (in addition to the annual bonus), in recognition of a significant achievement or for completion of an assignment, such as completion of a major transaction or achieving a major milestone with material effect over the Company's business, subject to applicable law. Such bonus is individual for any Officer and should be approved by the Company’s Compensation Committee and Board. Notwithstanding the aforesaid, the Company shall be authorized to award a special cash bonus which is only based on non-measurable criteria, only if the annual value of such bonus does not exceed an aggregate three months base salary, subject to applicable law.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.3. | Equity-Based Compensation |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Compensation Committee and Board believe that as part of the Office Holders' total compensation package, it is appropriate to offer a component of equity-based compensation, as customary by companies whose shares are publicly listed on the NASDAQ Stock Market or any other stock exchange, for the purpose of advancing the interests of the Company's shareholders by enhancing the Company's ability to attract, retain and motivate individuals to perform at the highest level. By virtue of the long-term nature of equity-based compensation plans, they support the Company's ability to retain senior managers in their position for the long term. In view of the advantages of equity-based compensation plans, the Company shall offer its Office Holders, including directors (subject to the provisions of the Compensation Regulations), participation in an equity-based compensation plan according to the provision set forth below:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.3.1. | Equity Incentive Plan Subject to the approval of the Company's competent organs, as prescribed by law, the Company may offer Officers and Directors participation in an equity-based compensation plan (“Equity Incentive Plan”), which may include options to purchase shares, share appreciation rights, restricted shares, restricted share units, performance awards or other share-based awards (herein described collectively as “Awards”). The Equity Incentive Plan may provide for granting Awards in compliance with Section 102 of the Israeli Income Tax Ordinance, 5721-1961 in the "capital gains track", as applicable. The Equity Incentive Plan, shall include the following: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The maximum number of securities available for issuance under equity incentive awards, and the dilution rate resulting from grants; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The method of allocating the grants among grantees; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Reserve pool for grants to Office Holders who may join the Company in the future, during the course of the term of the plan; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The vesting conditions for grants under the Equity Incentive Plan will be determined by the administrator and, in the case of restricted shares and restricted share units, will be set forth in the applicable Award documentation. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Options and share appreciation rights will have an exercise price determined by the administrator, that is no less than fair market value of the underlying ordinary shares on the date of grant, and subject to applicable law, unless otherwise approved by the Company’s shareholders from time to time; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The expiration date of the Awards - up to 10 years from the date of grant; and |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Terms upon termination of employment or service (due to dismissal, resignation, death or disability) and change of control. The Equity Incentive Plan shall include a definition of a change of control, and the actions the Compensation Committee may take in the event of a change of control with respect to awards outstanding. In the event of a structural change of the Company (i.e., a transaction in which the Company's shares immediately prior to the transaction are converted into or exchanged for shares that represent at least a majority of the share capital of the surviving corporation, such as a re-domestication of the Company or a share flip), outstanding awards will be exchanged or converted into awards to acquire shares of the Company (if it is the surviving corporation) or the successor company in accordance with the applicable exchange ratio. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.3.2. | Grants |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| Awards shall be granted to Office Holders of the Company in accordance with the terms of the approved Equity Incentive Plan, subject to the approval process required pursuant to the Companies Law. When a new Office Holder joins the Company during the course of a plan, and granted an Award, such Award shall be granted out of the reserve determined in the Equity Incentive Plan. Awards shall be granted from time to time and be individually determined and awarded, inter alia, according to the following considerations: |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Office Holder's contribution to the Company's performance; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Office Holder's ability to influence the Company's future and performance; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The mix of compensation components to which the Office Holder is entitled and the desired mix of Awards; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Office Holder's performance, skills, qualifications, experience, role and personal responsibilities; and |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The desired competitive levels and dilution or pool limits. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.2.3.3. | Maximum Value of Equity-Based Compensation The maximum value of equity-based compensation for all Officers, as of the grant date, shall be up to 25 monthly base salaries. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.3. | Additional Benefits and Perquisites |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.3.1. | Benefits and perquisites (such as medical and health insurance, life insurance, savings, provident fund, vacations and sick days) may be granted to Officers in order, among other things, to comply with legal requirements (compensation packages may vary – based on the residence of the Company's Officers – US or Israel). |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.3.2. | The Company may offer additional benefits and perquisites to Officers, which will be comparable to customary market practices, such as, but not limited to: company car benefits; company cellular phone; meals; etc.; provided however, that such additional benefits and perquisites shall be determined in accordance with the Company's policies and procedures. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 7.3.3. | The Company may determine in its contractual engagement with the Officer that it would bear part, or all, of the expenses incurred by the Officer for the discharge of his or her duties, in accordance with the terms of the Company's policy in this regard. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 8. | TERMINATION OF OFFICE CONDITIONS |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 8.1. | Advance Notice |
DIRECTORS AND OFFICERS COMPENSATION POLICY
An Officer shall be entitled to an advance notice period, in accordance with and subject to the provisions of the employment agreement and/or contractual engagement entered between the Officer and the Company, and in the absence of an advance notice provision in such agreement or engagement, as determined by applicable law. In any event, the advance notice period shall not exceed four months. During the course of the advance notice period, the Officer shall be required to continue to fulfill his or her position, unless the CEO (and in respect of the CEO, the Board) decides to release him or her from this obligation, and he or she shall be entitled to the continuation of all Terms of Office and Employment without change, during such period, with the exception that equity awards continuation shall be subject to the terms of the Equity Incentive Plan.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 8.2. | Severance Payment |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Officers shall be entitled to a severance payment (other than termination under circumstances which deprive the Officers of severance pay under Israeli law) of up the greater of (i) the minimum amount required under applicable law; (ii) any amount provided under the Officer's employment agreement and/or contractual engagement, entered into prior to the Effective Date of this Policy; and (iii) a cap of two times the Officer's monthly salaries per each year of service.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 8.3. | Retirement and Termination Awards |
DIRECTORS AND OFFICERS COMPENSATION POLICY
As a general rule, no retirement and termination awards shall be determined in the Officers' personal employment agreements. The Compensation Committee and the Board (and as required by law, the shareholders), may approve a retirement award to Officers, in an amount not exceeding the following maximum amounts:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Employed by the Company as Officer for up to five years: up to 3 monthly base salaries. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Employed by the Company as Officer for five years or more: up to 6 monthly base salaries. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The retirement bonus may be granted after examining the Terms of Office and Employment during the Officer's employment period and the Company’s performance during such period, and may be approved in one or more of the following cases
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Certain change of control related cases; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | During his or her employment period the Officer has made a special contribution to the advancement of the Company’s business as shall be determined by the Compensation Committee; |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | In respect of any Officer other than the CEO, the CEO has recommended granting a retirement bonus. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Retirement bonus, if such is approved, shall be paid upon termination of employment relationship and shall be equal to the months approved multiplied by the (gross) base salary to which the Officer was entitled upon termination of his or her employment with the Company. Retirement bonus for Officer other than the CEO shall not include associated benefits. The retirement bonus for the CEO shall include accompanying benefits in accordance with the CEO’s employment agreement.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 8.4. | Non-Competition |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Officers shall undertake in writing, at the time they enter into an employment agreement with the Company, to refrain from competing with the Company in accordance with and subject to the provisions of the employment agreement and/or contractual engagement entered between the Officer and the Company. The non-competition provision applies for a period which is generally not less than 12 months following termination of employment. We have entered into written employment agreements with all of our Officers who are employed in the Company at the date of publication of the Policy. Each of these agreements contains provisions regarding confidentiality, non-competition/non-solicitation and ownership of intellectual property.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 9. | NON-EXECUTIVE DIRECTORS' COMPENSATION |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company aims to attract and retain talented directors with excellent educational background, qualifications, skills, expertise, professional experience and achievements, by providing a fair and competitive compensation program. The compensation of non-employee and non-executive Directors of the Company shall be determined pursuant to the provisions of the Companies Law. Elements:
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Board Membership Fee. non-executive Directors will generally be entitled to receive an annual cash payment by virtue of their membership on the Board. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Committee Membership Fee. non-executive Directors will generally be entitled to receive an annual cash payment by virtue of their membership on one or more committees of the Board (which payments may vary by committee). |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Board/Committee Chair Fee. The chair of the Board and/or the chair of the Board committees may also receive additional annual cash payments for their extra service in such capacities. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Equity-Based Compensation. non-executive Directors may also receive equity-based awards, which are intended to align directors’ interests with those of the Company and its shareholders over the long term. Such awards will generally be granted on an annual basis or on such other basis or in such other intervals all as approved by the Company’s shareholders from time to time. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Special Contribution. Any non-executive Director who takes on increased duties on behalf of the Company as determined by the Board, may receive additional payments, in recognition of their increased duties, subject to applicable law. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | Insurance, Indemnification, Release. non-employee and non-executive Directors shall also be entitled to insurance, indemnification and release arrangements, as provided below. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The above compensation is designed to compensate directors for their services to the Company, without payment of additional per-meeting fees. Applicable value-added tax will be added to such compensation in accordance with applicable law. The Company may reimburse or cover its non-executive directors (including travel and related expenses) incurred in connection with Board and its committees meetings or performing their services for the Company.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 10. | OFFICE HOLDERS' INSURANCE, INDEMNIFICATION AND RELEASE |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Office Holders may be covered by Directors' and Officers' liability insurance which the Company shall acquire, from time to time (the “Insurance Policy), in accordance with the Company's Articles of Association and the provisions of applicable law, including the Companies Law and the Companies Regulations (Reliefs Regarding Transaction with Interested Parties), 2000 (the “Relief Regulations”). Subject to the provisions of the Relief Regulations, the approval of the acquisition, extension, renewal or replacement of the Company's Insurance Policy shall only require the approval of the Company’s Compensation Committee provided that the Insurance Policy is on market terms and the Insurance Policy is not likely to materially impact the Company’s profitability, assets or obligations. Such insurance coverage may include “run-off” provisions covering the Directors’ and Officers’ liability following termination of service or employment. The Company will release all current and future Office Holders from liability for actions taken in the performance of or related to the Director’s or Officer’s duties and provide each of them with indemnification to the fullest extent permitted by law and the Company's Articles of Association. The Company awards, and shall continue to award, indemnification undertakings to Office Holders, to the extent permitted by the Companies Law and the Company's Articles of Association.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 11. | GENERAL DISCRETION; CLAWBACK |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 11.1. | General Discretion |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Compensation Committee and the Board may, at their sole discretion, approve compensation terms that are lower than the thresholds and benchmarks described herein. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| • | The Committee and the Board have the right to reduce any variable compensation to be granted to an Office Holder due to any circumstances determined by the Compensation Committee and the Board. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 11.2. | Non-Material Updates |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Subject to the provisions of the Companies Law, (i) a non-material update to the Terms of Office and Employment of an Officer other than the CEO may be approved by the CEO of the Company (and shall not require the approval of the Compensation Committee); and (ii) a non-material update to the Terms of Office and Employment of the CEO may be approved by Compensation Committee (and shall not require the approval of the Board and/or the general meeting) , provided that the updated terms are consistent with this Policy.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 11.3. | Clawback |
DIRECTORS AND OFFICERS COMPENSATION POLICY
The Company's Office Holders are required to return any compensation paid to them (including any incentive-based compensation granted to them) on the basis of results included in financial statements that turned out to be erroneous and were subsequently restated, during the three year period following filing thereof. In such case, compensation amounts will be returned net of taxes that were withheld thereon, unless the Office Holder has reclaimed or is able to reclaim such tax payments from the relevant tax authorities (in which case the Office Holder will also be obligated to return such tax amounts). The Officer shall refund the surplus bonuses sums, within one year from the date of the Company's notice with respect thereto, linked to the consumer price index, and if the Officer has received less, the Company shall pay the missing bonus amounts together with the next monthly salary. The Company, by written notice to the Officer 60 days in advance, may set-off all or part of the surplus bonuses sums from the bonuses owing to the Officer in respect of the following years. For the avoidance of doubt, the terms of this Compensation Policy shall be in addition to, and shall not derogate from, the terms of the Company's Clawback Policy as may adopted or in effect from time to time, in compliance with Rule 10D-1 under the Exchange Act and the appliable Nasdaq rules (the “Clawback Policy”) or Section 304 of the Sarbanes-Oxley Act of 2002. Without limiting the foregoing, in the event of a conflict or inconsistency between the Compensation Policy and the Clawback Policy with respect to clawback's aspects, the Clawback Policy shall prevail.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 12. | HEDGING AND PLEDGING |
DIRECTORS AND OFFICERS COMPENSATION POLICY
Officers and directors are prohibited from hedging or pledging their equity awards and any other Company securities. The no-hedging policy applies to each director and Officer until one year following termination of such director’s term of office or such Officer’s termination of employment, as applicable. Furthermore, Officers and directors may not pledge or use their equity awards or any other Company securities held by them as collateral for loans unless otherwise approved by the Compensation Committee and Board.
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 13. | RESERVED. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 14. | MAINTENANCE OF THE COMPENSATION POLICY |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 14.1. | The Company’s Compensation Committee shall be responsible for maintaining the Compensation Policy updated. |
DIRECTORS AND OFFICERS COMPENSATION POLICY
| 14.2. | Updates to the Compensation Policy shall be approved by the Compensation Committee, the Board and the shareholders, as required under the Companies Law. |