Incredimail 2008 Annual Report Download - page 41

We are deemed a “limited liability public company” under the Israeli Companies Law. As a limited liability public company, we are
managed by a board of directors and by our executive officers. Under the Israeli Companies Law and our articles of association, the board of
directors is responsible, among other things, for:
Our board of directors also appoints and may remove our chief executive officer and may appoint or remove other executive officers, subject
to any rights that the executive officers may have under employment agreements.
Upon the closing of our initial public offering (meaning, January 30, 2006), all previously existing special rights to appoint or serve as
directors had terminated and our articles of association were amended to remove these special rights.
Our board of directors generally consists of seven directors, two of whom qualify as “external directors” for Israeli law purposes and have
been determined by our board of directors to qualify as “independent” for Nasdaq Stock Market Purposes as well. Other than external directors,
who are subject to special election requirements under Israeli law, our directors are elected in three staggered classes by the vote of a majority of
the ordinary shares present and entitled to vote at meetings of our shareholders at which directors are elected. The members of only one staggered
class will be elected at each annual meeting for a three-year term, so that the regular term of only one class of directors expires annually. At our
annual general meeting held in 2007, the term of the second class, consisting of Ofer Adler and Yair M. Zadik, expired and they were re-
elected at
that meeting for a three-year term. At our annual general meeting held in 2008, the term of the third class, consisting of Gittit Guberman, expired
and she did not stand for reelection. Arik Ramot was elected in her place for a three-year term. At our annual general meeting to be held in 2009,
the term of the first class, consisting of Tamar Gottlieb and Yaron Adler, will expire and the directors elected at that meeting will be elected for a
three-year term. The external directors will not be assigned a class and will serve in accordance with Israeli law. On March 30, 2009 the term of
one of our external directors, Mr. James H. Lee, expired. Since then the board of directors consists of six directors, only one of whom qualifies as
an external director. The Company has scheduled an extraordinary shareholder meeting for approving the nomination of another director that
qualifies as an external director. See Item 4.A. – “Recent Developments”.
If the number of directors constituting the board is changed, any increase or decrease shall be apportioned among the classes so as to
maintain the number of directors in each class as nearly equal as possible, but in no case will a decrease in the number of directors constituting the
board shorten the term of any incumbent director.
The board may appoint any other person as a director, whether to fill a vacancy or as an addition to the then current number of directors,
provided that the total number of directors shall not at any time exceed seven directors. Any director so appointed shall hold office until the annual
general meeting of our shareholders at which the term of his or her class expires, unless otherwise stated in the appointing resolution.
There is no limitation on the number of terms that a director may serve. As described below, external directors may serve two terms of three
years each and, subject to certain conditions, an unlimited number of subsequent three-year terms.
Nominations for the election of directors may be made by our board of directors in view of the recommendation of the nominating and
governance committee or, subject to the Companies Law, by any of our shareholders. However, any shareholder or shareholders holding at least
5% of the voting rights in our issued share capital may nominate one or more persons for election as directors at a general meeting only if a
written notice of such shareholder’
s intent to make such nomination or nominations has been given to our secretary and each such notice sets forth
all the details and information as required to be provided under our articles of association.
Shareholders may remove a director who is not an external director from office only by a resolution approved by shareholders holding more
than two-thirds of the voting power of the issued and outstanding share capital of IncrediMail.
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The board of directors appoints its chairperson from among its members in accordance with our articles of association and subject to the
provisions of the Companies Law. Pursuant and subject to our articles of association, the chairperson convenes and presides over the meetings of
the board. The quorum required for meetings of the board is a majority of the members of the board who are lawfully entitled to participate and
vote at the meeting, and resolutions are approved by a vote of the majority of the members present. If the board of directors meeting is adjourned
for failure to obtain a quorum and at the adjourned meeting a quorum is not present, then the quorum shall be constituted by the presence of two
directors then in office who are lawfully entitled to participate and vote at that meeting. A director may appoint an alternate director to attend a
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establishing our policies and overseeing the performance and activities of our chief executive officer;
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convening shareholders' meetings;
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preparing and approving our financial statements;
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determining our plans of action, principles for funding them and the priorities among them, our organizational structure and wage
policy and examining our financial status;
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issuing securities and distributing dividends.