Incredimail 2008 Annual Report Download - page 40

options shall vest in four equal portions on each anniversary of the Annual Grant, commencing with the first anniversary. Any and all other terms
and conditions pertaining to the grant of the options shall be in accordance with, and subject to, the 2003 Israeli Share Option Plan adopted by
IncrediMail in 2003 and our standard Option Agreement. In accordance with this resolution, all directors that are not officers were granted 10,000
options on December 24, 2008 after the 2008 annual general meeting.
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On December 27, 2007, and following approval by our audit committee and board of directors, our shareholders approved a grant to each of
Mr. Ofer Adler and Mr. Yaron Adler, of options to purchase 50,000 Ordinary Shares of the Company, under the following terms: (a) each option
shall be exercisable for one Ordinary Share at an exercise price equal to the closing price of an Ordinary Share on December 27, 2007, as reported
by the Nasdaq Global Market; and (b) the options shall vest in four equal portions on each anniversary of the date of approval of the grant,
commencing with the first anniversary. Any and all other terms and conditions pertaining to the grant of the options hereunder shall be in
accordance with, and subject to, the 2003 Israeli Share Option Plan adopted by the Company in 2003 and the Company’s standard Option
Agreement
1
. See “Item 6.E Share Ownership – Employee Benefit Plans – The 2003 Plan” below.
On July 17, 2008, and following approval by our audit committee and board of directors, our shareholders approved a grant to Ms. Tamar
Gottlieb of options to purchase 10,000 Ordinary Shares of the Company, under the following terms: (a) each option shall be exercisable for one
Ordinary Share at an exercise price equal to the closing price of an Ordinary Share on July 17, 2008, as reported by the Nasdaq Global Market;
and (b) the options shall vest in three equal portions on each anniversary of the date of approval of the grant, commencing with the first
anniversary. Any and all other terms and conditions pertaining to the grant of the options hereunder shall be in accordance with, and subject to, the
2003 Israeli Share Option Plan adopted by the Company in 2003 and the Company’s standard Option Agreement. See “Item 6.E Share Ownership
–
Employee Benefit Plans – The 2003 Plan” below.
Also on July 17, 2008, following approval by our audit committee and board of directors, our shareholders approved a re-pricing of options
to purchase Ordinary Shares, previously granted to Mr. Yaron Adler, the Company’s President and a member of the board of directors of the
Company, such that the exercise price of any previously granted options that exceeded $3.00 per Ordinary Share were reduced to $3.00 per share.
The Company undertook to re-price Mr. Adler’s options as part of the terms of service of Mr. Yaron Adler as the Company’s President, which
terms were approved at the shareholders meeting of the Company held on April 9, 2008. On June 2, 2009, we provided notice to our shareholders
of an extraordinary general meeting to, among other things, vote on amendments to the terms of options granted to the external directors and the
directors of the Company. The meeting is scheduled to be held on July 9, 2009 with such terms as provided in the Notice of Meeting filed on Form
6-K with the SEC. If the proposals relating to compensation of our directors are approved, our directors’ recurring annual stock option grants will
have a vesting period of three years (instead of four years) from the date of their annual stock option grant. Also, upon termination or expiration of
the applicable director’s service with the Company, provided that the termination or expiration is not “for Cause” and not resulting from the
director’s resignation, the stock options granted to such director shall retain their original termination dates, and shall not terminate 90 days after
the applicable termination date, and the next upcoming tranche of stock options, of each grant, that are scheduled to vest immediately subsequent
to the termination date, if any, shall automatically vest and become exercisable immediately prior to the termination date. In addition, to avoid a
possible conflict of interest while discussing a Change of Control of the Company (which may result in the termination of the director’s term of
office), all unvested options held by the director, shall automatically vest and become exercisable upon such “Change of Control” event. “Change
of Control” is defined for these purposes as: (i) merger, acquisition or reorganization of the Company with one or more other entities in which the
Company is not the surviving entity, (ii) a sale of all or substantially all of the assets of the Company; (iii) a transaction or a series of related
transactions as a result of which more than 50% of the outstanding shares or the voting rights of the Company are held by any party (whether
directly or indirectly).
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Board of Directors and Executive Officers
1
The 50,000 options granted to Yaron Adler shall remain in full force and effect in accordance with the terms of the Option Agreement
following the execution of the Amended Agreement. According to the Amended Agreement, despite anything to the contrary contained in the
Option Agreement or in the Company’s 2003 Share Option Plan, if Yaron Adler’s employment with the Company is terminated for any reason
prior to the date on which all of the options have become fully vested, the vesting of all of the unvested options shall be immediately accelerated
and all of such unvested options shall become fully vested and exercisable in accordance with their terms. In addition, upon the termination of
Yaron Adler’s employment with the Company for any reason, the expiration date of the options shall be extended to 12 months following the date
of such termination. In the event that the Company shall re-price downwards the exercise price of the options granted by it to its executive
officers, the Company shall treat the options equally and shall re-price downwards the exercise price of the options to the same new exercise price
of the options held by its executive officers. The Amended Agreement was approved by the shareholders at the Extraordinary General Shareholder
meeting held on April 9, 2008.
C.
BOARD PRACTICES