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Date Filed : Aug 08, 2022
SECURITIESAND EXCHANGE COMMISSION
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25Recreation Park Drive, Unit 108
NOTICEOF ANNUAL MEETING OF SHAREHOLDERS
TOBE HELD ON SEPTEMBER 21, 2022
NOTICEIS HEREBY GIVEN, that the 2022 Annual Meeting of Shareholders (the “Annual Meeting”) of Microbot Medical Inc. (the “Company”)will be held at 11:00 A.M., Eastern Time on September 21, 2022 at the offices of the Company, located at 25 Recreation Park Drive, Unit108, Hingham, MA 02043. At the Annual Meeting, you will be asked to vote on:
TheBoard of Directors has fixed the close of business on July 25, 2022 as the record date for determining shareholders who are entitledto receive notice of, and to vote at, the Annual Meeting or any adjournment or postponement thereof.
Yourvote is important to us. Whether or not you intend to be present at the meeting, please sign and date the enclosed proxy card and returnit in the enclosed envelope. Returning a proxy will not deprive you of your right to attend the Annual Meeting and vote your shares inperson.
Theforegoing items of business are more fully described in the accompanying proxy statement.
ByOrder of the Board of Directors,
Chairman,President and Chief Executive Officer
Dated:August 8, 2022
2022ANNUAL MEETING OF SHAREHOLDERS
Thisproxy statement and the accompanying proxy card is furnished in connection with the solicitation by the Board of Directors (the “Board”)of Microbot Medical Inc., a Delaware corporation (the “Company”), of proxies for use at the 2022 Annual Meeting of Shareholders(the “Annual Meeting”) to be held at the offices of the Company, located at 25 Recreation Park Drive, Unit 108, Hingham,MA 02043, at 11:00 A.M., Eastern Time, on September 21, 2022, or at any adjournment or postponement thereof, for the purposes set forthin this proxy statement and the accompanying Notice of Annual Meeting of Shareholders.
TheCompany is making available to you over the Internet or delivering paper copies of this proxy statement, a proxy card and the Company’s2022 Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “Annual Report”), in connection with theAnnual Meeting. The Company is using the rules of the Securities and Exchange Commission (“SEC”) that allow companies tofurnish their proxy materials over the Internet. As a result, the Company is mailing to many of its stockholders a notice about the Internetavailability of the proxy materials instead of a paper copy of the proxy materials. All stockholders receiving the notice will have theability to access the proxy materials over the Internet, as well as to request a paper copy by mail or via email, free of charge, byfollowing the instructions in the notice. The notice about the Internet availability of the proxy materials is first being mailed onor about August 9, 2022 to all shareholders of the Company entitled to vote at the Annual Meeting (the “Shareholders”).
TheCompany will bear the cost of solicitation of proxies. Directors, officers and employees of the Company may solicit proxies by telephone,email, facsimile, in person or otherwise for no additional compensation. The Company will pay the entire costs of such solicitation aswell as the costs of printing and filing this proxy statement and proxy card. The Company will reimburse banks, brokerage firms, proxysolicitors, and other custodians, nominees and fiduciaries for reasonable expenses incurred by them in sending proxy materials to thebeneficial owners of shares.
TheBoard of Directors has fixed the close of business on July 25, 2022, as the record date for determining stockholders entitled to noticeof, and to vote at, the Annual Meeting or at any postponement or adjournment thereof. There were 7,108,133 shares of our common stock,$.01 par value, outstanding on July 25, 2022, each of which is entitled to one vote for each share on the matters to be voted upon.
Stockholdersare being asked to vote on two proposals at the Company’s 2022 Annual Meeting. The proposals to be voted on and related recommendationsfrom the Board of Directors are as follows:
Inthe election of directors, which is Proposal Number 1, you may vote “FOR” both of the nominees or your vote may be “WITHHELD”with respect to one or both of the nominees. For Proposal Number 2, you may vote “FOR,” vote “AGAINST” or “ABSTAIN.”If you “ABSTAIN” as to Proposal Number 2, the abstention will have no effect.
Sharesof our common stock represented by proxies in the form enclosed that are properly executed and returned to us and not revoked will bevoted as specified in the proxy by the stockholder. In the absence of contrary instructions, or in instances where no specificationsare made, the shares will be voted:
Anystockholder signing and delivering a proxy may revoke it at any time before it is voted by delivering to the Company’s corporatesecretary a written revocation or a duly executed proxy bearing a date later than the date of the proxy being revoked. Any stockholderattending the Annual Meeting in person may revoke his, her or its proxy and vote his, her or its shares at the Annual Meeting.
Howto vote shares at our 2022 Annual Meeting.
Votingat the Annual Meeting. All Company stockholders are invited to attend the Annual Meeting in person. Any stockholder that attendsthe meeting in person may deliver a completed proxy card in person or vote by completing a ballot, which will be available at the meeting.However, each stockholder intending to vote in person at the Annual Meeting should note that if his, her or its shares are held in thename of a bank, broker or other nominee, such stockholder must obtain a legal proxy, executed in his, her or its favor, from the holderof record to be able to vote at the Annual Meeting. Stockholders should allow enough time prior to the Annual Meeting to obtain thisproxy from the holder of record, if needed.
Whetheryou hold shares directly as a registered stockholder of record or beneficially in street name, you may vote without attending the AnnualMeeting. You may vote by granting a proxy or, for shares held in street name, by submitting voting instructions to your broker or nominee.In most cases, you will be able to do this by telephone, by using the Internet or by mail. Please refer to the summary instructions includedwith proxy materials and on your proxy card. For shares held in street name, the voting instruction card will be included in the materialsforwarded by the broker or nominee. If you have telephone or Internet access, you may submit your proxy by following the instructionswith your proxy materials and on your proxy card. You may submit your proxy by mail by signing your proxy card or, for shares held instreet name, by following the voting instructions with your proxy materials and on your proxy card. You may submit your proxy by mailby signing your proxy card or, for shares held in street name, by following the voting instruction card included in the materials forwardedby your stockbroker or nominee and mailing it in the enclosed, postage paid envelope. If you provide specific voting instructions, yourshares will be voted as you have instructed.
Theshares voted electronically or represented by the proxy cards received, properly marked, dated, signed and not revoked, will be votedat the Annual Meeting.
Quorum,Required Votes and Method of Tabulation
Consistentwith Delaware law and the Company’s amended and restated by-laws, a majority of the votes entitled to be cast on a particular matter,present in person or represented by proxy, constitutes a quorum as to such matter. Proxies received but marked as “ABSTAIN”or “WITHHOLD”, if any, and broker non-votes (described below), if applicable, will be included in the calculation of thenumber of shares considered to be present at the Annual Meeting for quorum purposes. If a quorum is not present, we will be requiredto reconvene the Annual Meeting at a later date. The Company will appoint one or more election inspectors for the meeting to count votescast by proxy or in person at the Annual Meeting.
Ifyou hold shares beneficially in street name and do not provide your broker or nominee with voting instructions, your shares may constitute“broker non-votes.” Generally, broker non-votes occur on a matter when a broker is not permitted to vote on that matter withoutinstructions from the beneficial owner and instructions have not been given. If you hold shares beneficially in street name and do notvote your shares, your broker or nominee can vote your shares at its discretion on Proposal Number 2. In tabulating the voting resultfor any proposal for which the required vote is based on the number of shares present, shares that constitute broker non-votes are notconsidered entitled to vote on that proposal. However, for proposals for which the required vote is based on the number of shares ofcommon stock issued and outstanding, broker non-votes have the same effect as a vote “AGAINST” the proposal.
WhatVote is Required to Approve Each Item?
Electionof directors by stockholders, which is Proposal Number 1, will be determined by a plurality of the votes cast by the stockholders entitledto vote at the election that are either present in person or represented by proxy. Consequently, any shares not voted at the annual meeting,whether due to abstentions, broker non-votes or otherwise, will have no impact on the election of directors.
ForProposal Number 2, the affirmative “FOR” vote is required by the holders of a majority of the votes cast by the stockholdersentitled to vote at the Annual Meeting in person or by proxy and voting. Abstentions and broker non-votes will have no effect on theoutcome of this proposal as they are not considered to be “votes cast” for purposes of this proposal.
Managementdoes not know of any matters to be presented at this year’s Annual Meeting other than those set forth in this proxy statement andin the notice accompanying this proxy statement. Stockholders will have no appraisal rights under Delaware law with respect to any ofthe matters expected to be voted on at the Annual Meeting. If other matters should properly come before the meeting, the proxy holderswill vote such matters in their discretion. Any stockholder has the right to revoke his, her or its proxy at any time until it is voted.
SECURITYOWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Thefollowing table shows the number of shares of our common stock beneficially owned, as of August 5, 2022, by (i) each of our directorsand director nominees, (ii) each of our named executive officers, (iii) all of our current directors and executive officers as a group,and (iv) all those known by us to be a beneficial owner of more than 5% of the Company’s common stock. In general, “beneficialownership” refers to shares that an individual or entity has the power to vote or dispose of, and any rights to acquire commonstock that are currently exercisable or will become exercisable within 60 days of August 5, 2022. We calculated percentage ownershipin accordance with the rules of the SEC. the percentage of common stock beneficially owned is based on 7,108,133 shares outstanding asof August 5, 2022. In addition, shares issuable pursuant to options or other convertible securities that may be acquired within 60 daysof August 5, 2022 are deemed to be issued and outstanding and have been treated as outstanding in calculating and determining the beneficialownership and percentage ownership of those persons possessing those securities, but not for any other persons.
Thistable is based on information supplied by each director, officer and principal stockholder of the Company. Except as indicated in footnotesto this table, the Company believes that the stockholders named in this table have sole voting and investment power with respect to allshares of Common Stock shown to be beneficially owned by them, based on information provided by such stockholders. Unless otherwise indicated,the address for each director, executive officer and 5% or greater stockholders of the Company listed is: c/o Microbot Medical Inc.,25 Recreation Park Drive, Unit 108, Hingham, MA 02043.
Number of Shares Beneficially
Percentage of Common Stock Beneficially
Wecurrently have seven directors serving on our Board. The following table lists the names, ages and positions of the individuals who serveas directors of the Company, as of August 5, 2022:
Becausewe have a classified Board, with each of our directors serving a staggered three-year term, only our Class I Directors are standing forelection at our 2022 Annual Meeting. The following table shows the current composition of the three classes of our Board:
ClassI Directors (terms scheduled to expire in 2022):
ClassII Directors (term scheduled to expire in 2023):
ClassIII Directors (term scheduled to expire in 2024):
Theindependent members of our Board, as determined by the Board in accordance with the existing Nasdaq Listing rules, are Messrs. Bornstein,Burell, Madden, Laxminarain and Wenderow, and Ms. Stockburger.
TheBoard held approximately seven regular and special meetings during the fiscal year ended December 31, 2021 and acted by unanimous writtenconsent four times. Each of our then-directors attended all such meetings of the Board, except on three occasions when one director wasabsent and one occasion when two directors were absent. While we encourage our directors to attend the Company’s annual shareholdermeeting, we do not have a policy requiring that they do so. All of our then-directors attended in person or by telephone the Company’s2021 annual stockholder meeting.
Thematrix below reflects our Board’s gender and racial characteristics and LGBTQ+ status, based on the self-identification of ourdirectors. Each of the categories listed below has the meaning as it is used in Nasdaq Rule 5605(f).
Committeesof the Board of Directors
Presently,the Board has three standing committees — the Audit Committee, the Compensation and Stock Option Committee (the “CompensationCommittee”), and the Corporate Governance and Nominating Committee (the “Corporate Governance Committee”). All membersof the Audit Committee, the Compensation Committee, and the Corporate Governance Committee are, and are required by the charters of therespective committees to be, independent as determined under Nasdaq Listing rules.
TheAudit Committee is composed of Messrs. Burell, Madden and Bornstein. Each of the members of the Audit Committee is independent, and theBoard has determined that Mr. Burell is an “audit committee financial expert,” as defined in SEC rules. The Audit Committeeacts pursuant to a written charter which is available through our website at www.microbotmedical.com. The Audit Committee held four meetingsduring the fiscal year ended December 31, 2021 and acted by unanimous written consent one time.
Theprimary function of the Audit Committee is to assist the Board of Directors in fulfilling its oversight responsibilities. The Audit Committeedoes this primarily by reviewing the Company’s financial reports and other financial information as well as the Company’ssystems of internal controls regarding finance, accounting, legal compliance, and ethics that management and the Board of Directors haveestablished. The Audit Committee also assesses the Company’s auditing, accounting and financial processes more generally. The AuditCommittee recommends to the Board of Directors the appointment of a firm of independent auditors to audit the financial statements ofthe Company and meets with such personnel of the Company to review the scope and the results of the annual audit, the amount of auditfees, the company’s internal accounting controls, the Company’s financial statements contained in this proxy statement, andother related matters.
TheCompensation Committee is composed of Messrs. Madden (Chairman) and Bornstein and Ms.Stockburger. Each of the members ofthe Compensation Committee is independent. The Compensation Committee acts pursuant to a written charter which is available through ourwebsite at www.microbotmedical.com. The Compensation Committee held four meetings during the fiscal year ended December 31, 2021 andacted by unanimous written consent one time.
TheCompensation Committee acts pursuant to a written charter. The Compensation Committee makes recommendations to the Board of Directorsand management concerning salaries in general, determines executive compensation and approves incentive compensation for employees andconsultants.
TheCorporate Governance Committee is composed of Messrs. Laxminarain, Burell and Wenderow. Each of the members of the Corporate GovernanceCommittee is independent. The Corporate Governance Committee acts pursuant to a written charter which is available through our websiteat www.microbotmedical.com. The Corporate Governance Committee acted by unanimous written consent one time during the fiscal year endedDecember 31, 2021.
TheCorporate Governance Committee oversees nominations to the Board and considers the experience, ability and character of potential nomineesto serve as directors, as well as particular skills or knowledge that may be desirable in light of the Company’s position at anytime. From time to time, the Corporate Governance Committee may engage the services of a paid search firm to help the Corporate GovernanceCommittee identify potential nominees to the Board. The Corporate Governance Committee and Board seek to nominate and appoint candidatesto the Board who have significant business experience, technical expertise or personal attributes, or a combination of these, sufficientto suggest, in the Board’s judgment, that the candidate would have the ability to help direct the affairs of the Company and enhancethe Board as a whole. The Corporate Governance Committee may identify potential candidates through any reliable means available, includingrecommendations of past or current members of the Board from their knowledge of the industry and of the Company. The Corporate GovernanceCommittee also considers past service on the Board or on the board of directors of other publicly traded or technology focused companies.The Corporate Governance Committee has not adopted a formulaic approach to evaluating potential nominees to the Board; it does not havea formal policy concerning diversity, for example. Rather, the Corporate Governance Committee weighs and considers the experience, expertise,intellect, and judgment of potential nominees irrespective of their race, gender, age, religion, or other personal characteristics. TheCorporate Governance Committee may look for nominees that can bring new skill sets or diverse business perspectives. Potential candidatesrecommended by security holders will be considered as provided in the company’s “Policy Regarding Shareholder Candidatesfor Nomination as a Director,” which sets forth the procedures and conditions for such recommendations. This policy is availablethrough our website at www.microbotmedical.com.
Themembers of the Corporate Governance Committee have approved the nomination of the Class I directors standing for election or reelection,as the case may be, at our 2022 Annual Meeting.
DirectorOversight and Qualifications
Whilemanagement is responsible for the day-to-day management of the risks the company faces, the Board, as a whole and through its committees,has responsibility for the oversight of risk management. An important part of risk management is not only understanding the risks facingthe company and what steps management is taking to manage those risks, but also understanding what level of risk is appropriate for thecompany. In support of this oversight function, the Board receives regular reports from our Chief Executive Officer and members of seniormanagement on operational, financial, legal, and regulatory issues and risks. The Audit Committee additionally is charged under its charterwith oversight of financial risk, including the company’s internal controls, and it receives regular reports from management, thecompany’s internal auditors and the company’s independent auditors. The chairman of the Board and independent members ofthe Board work together to provide strong, independent oversight of the company’s management and affairs through its standing committeesand, when necessary, special meetings of directors.
Webelieve each of our directors brings valuable skills, experience, judgment, and perspectives to our company. The Board took the followingqualifications into consideration, among other things, when nominating or appointing our current directors:
HarelGadot, became President, Chief Executive Officer and Chairman of the Company’s Board following the consummation of the mergerof C&RD Israel Ltd, a wholly owned subsidiary of the Company, with and into Microbot Medical Ltd. (“Microbot Israel”),with Microbot Israel surviving as a wholly owned subsidiary of the Company (the “Merger”). Mr. Gadot is a co-founder of MicrobotIsrael and has served as Microbot Israel’s Chief Executive Officer since Microbot Israel was founded in November 2010. He has beenthe Chairman of Microbot Israel’s board of directors since July 2014. He also serves as the Executive Chairman and Presidentof XACT Robotics Ltd., an Israel-based private company seeking to develop a novel platform technology for robotic needle steeringin minimally invasive interventional procedures such as biopsies and ablations, since August 2013 and MEDX Xelerator L.P., a medicaldevice and digital health Israeli incubator, since July 2016. From December 2007 to April 2010 Mr. Gadot was a Worldwide Group MarketingDirector at Ethicon Inc., a Johnson and Johnson Company, where he was responsible for the global strategic marketing of the Company.Mr. Gadot also held management positions, as well as leading regional strategic position for Europe, Middle-East and Africa, as wellas In Israel, while at Johnson and Johnson. Mr. Gadot served as director for ConTIPI Ltd. from August 2010 until November 2013 when ConTIPILtd. was acquired by Kimberly-Clark Corporation. Mr. Gadot holds a B.Sc. in Business from Siena College, Loudonville NY, and an M.B.A.from the University of Manchester, UK. The Company believes that Mr. Gadot is qualified to serve as Chairman of the Board and as Presidentand Chief Executive Officer of the Company due to his extensive experience in strategic marketing and general management in the medicaldevice industry.
YosephBornstein, became a director of the Company following the Merger. Mr. Bornstein is a co-founder of Microbot Israel and has been amember of the Board of Directors since Microbot Israel was founded in November 2010. Mr. Bornstein founded Shizim Ltd., a life scienceholding group in October 2000 and has served as its president since then. Mr. Bornstein is the Chairman of GCP Clinical Studies Ltd.,a provider of clinical research services and educational programs in Israel since January 2002. He is the Chairman of Biotis Ltd., aservice company for the bio-pharmaceutical industry, since June 2000. In addition, he is the Chairman of Dolphin Medical Ltd., whichsupplies the medical device industry, since April 2012, and the Chairman of ASIS Enterprises B.B.G. Ltd., a business development companyfocusing on creating business ties between Israeli and Japanese entities, since August 2007. Mr. Bornstein is a co-founder and directorof XACT Robotics, which is developing a novel platform technology for robotic needle steering in minimally invasive interventional procedures.In October 1992, Mr. Bornstein founded Pharmateam Ltd., an Israeli company that specialized in representing international pharmaceuticalcompanies which was sold in 2000. Mr. Bornstein is also a founder of a number of other privately held life-science companies. Mr. Bornsteinserved as the Biotechnology Committee Chairman of the Unites States-Israel Science & Technology Commission (the “USISTC”)from September 2002 to February 2005 as well as a consultant for USISTC from September 2002 to February 2005. He is also the founderof ILSI-Israel Life Science Industry Organization (who was integrated into IATI) and ITTN-Israel Tech Transfer Organization. He foundedin July 2014 ShizimXL Ltd., an international medical device innovation center, and founded in January 2020 ShizimVS Ltd., a digital healthinnovation center. Mr. Bornstein was nominated in August 2021 to be an external director in Can-fit BioPharma Ltd. (Nasdaq:CANF). TheCompany believes that Mr. Bornstein is qualified to serve as a member of the Board due to his extensive experience in, and knowledgeof, the life sciences industry and international business.
ScottR. Burell, became a director of the Company following the Merger. Since August 1, 2018, Mr. Burell has been the Chief Financial Officerand Secretary of AIVITA Biomedical, Inc., an Irvine California-based immuno-oncology company focused on the advancement of commercialand clinical-stage programs utilizing curative and regenerative medicines. From November 2006 until its sale to Invitae Corp. (NYSE:NVTA) in November 2017, he was the Chief Financial Officer, Secretary and Treasurer of CombiMatrix Corporation (NASDAQ: CBMX), a familyhealth-focused clinical molecular diagnostic laboratory specializing in pre-implantation genetic screening, prenatal diagnosis, miscarriageanalysis, and pediatric developmental disorders. He successfully led the split-off of CombiMatrix in 2007 from its former parent, hasled several successful public and private debt and equity financing transactions as well as CombiMatrix’s reorganization in 2010.Prior to this, Mr. Burell had served as CombiMatrix’s Vice President of Finance since November 2001 and as its Controller fromFebruary 2001 to November 2001. From May 1999 to first joining CombiMatrix in February 2001, Mr. Burell was the Controller for NetworkCommerce, Inc. (NASDAQ: SPNW), a publicly traded technology and information infrastructure company located in Seattle. Prior to this,Mr. Burell spent nine years with Arthur Andersen’s Audit and Business Advisory practice in Seattle. During his tenure in publicaccounting, Mr. Burell worked with many clients, both public and private, in the high-tech and healthcare markets, and was involved innumerous public offerings, spin-offs, mergers and acquisitions. Mr. Burell obtained his Washington state CPA license in 1992 and is acertified public accountant (currently inactive). He holds Bachelor of Science degrees in Accounting and Business Finance from CentralWashington University. The Company believes Mr. Burell’s qualifications to serve on the Board include his experience as an executiveof a public life sciences company and knowledge of financial accounting in the medical technology field.
MartinMadden, has been a director of the Company since February 6, 2017. Mr. Madden has held various positions at Johnson & Johnsonand its affiliates from 1986 to January 2017, most recently as Vice President, Research & Development of DePuy Synthes, a Johnson& Johnson Company, from February 2016 to January 2017. Prior to that, from July 2015 to February 2016, Mr. Madden was the Vice President,New Product Development of Johnson & Johnson Medical Devices. From January 2012 to July 2015, Mr. Madden was the Vice President,Research & Development of Johnson & Johnson’s Global Surgery Group. During his thirty-year tenure with Johnson & Johnson’sMedical Device organization, he was an innovator and research leader for nearly every medical device business including Cardiology, Electrophysiology,Peripheral Vascular Surgery, General and Colorectal Surgery, Aesthetics, Orthopaedics, Sports Medicine, Spine, and Trauma. As an executiveof Johnson & Johnson, Mr. Madden served on the management boards of Johnson & Johnson’s Global Surgery Group, Ethicon,Ethicon Endo-Surgery, DePuy-Synthes, and Cordis, with responsibility for research and development – inclusive of organic and licensed/acquiredtechnology. He was also Chairman of J&J’s Medical Device Research Council, with responsibility for talent strategy and technologyacceleration. Mr. Madden serves on the Board of Directors of Novocure (NASDAQ: NVCR), a global oncology company, and is an advisor tonumerous medical device start-ups. Mr. Madden holds a MBA from Columbia University, a M.S. from Carnegie Mellon University in MechanicalEngineering, and a B.S. from the University of Dayton in Mechanical Engineering. The Company believes that Mr. Madden is qualified toserve as a member of the Board due to his extensive experience in research and development, portfolio planning, technology assessmentand assimilation, and project management and budgeting.
PrattipatiLaxminarain, has been a director of the Company since December 6, 2017. From April 2006 through October 2017, Mr. Laxminarain servedas Worldwide President at Codman Neuro, a global neurosurgery and neurovascular company that offers a portfolio of devices for hydrocephalusmanagement, neuro intensive care and cranial surgery and other technologies, and which was part of DePuy Synthes Companies of Johnson& Johnson. Mr. Laxminarain is currently the CEO of Deinde Medical Corporation, and is a Board Member of Oculogica Inc., Millar Inc.,and GT Medical Inc. He has a degree in Mechanical Engineering from Osmania University, Hyderabad, India and an MBA from Indian Instituteof Management. The Company believes that Mr. Laxminarain is qualified as a Board member of the Company because of his extensive experienceworking with medical device companies and knowledge of the industries in which the Company intends to compete.
AileenStockburger was appointed by the Board on March 26, 2020 to fill a vacancy on the Board and to serve as a Class II director of theCompany, with a term commencing on April 1, 2020. Since February 2018, Ms. Stockburger has provided M&A consulting and advisory servicesthrough Aileen Stockburger LLC. Prior to that, from 1989 through January 2018, Ms. Stockburger held various positions in Johnson &Johnson, most recently as Vice President, Worldwide Business Development & Strategic Planning for the DePuy Synthes Group of Johnson& Johnson, and as a member of its Worldwide Board and Group Operating Committee, from 2010-2018. In that role, she oversaw the group’smerger and acquisition activities, including deal structuring, negotiations, contract design and review, and deal terms. Before joiningJohnson & Johnson, Ms. Stockburger spent several years at PriceWaterhouseCoopers, and earned her CPA certification. She is also aNon-Executive Director of Next Science Limited (ASX: NXS), a medical technology company headquartered in Sydney, Australia, with a primaryfocus in the development and continued commercialization of its proprietary technology to reduce the impact of biofilm based infectionsin human health. She also serve on the Audit Committee and the People, Culture and Remuneration Committee of the Board of Directors ofNext Science Limited. Ms. Stockburger received her MBA and BS from The Wharton School, University of Pennsylvania. The Company believesthat Ms. Stockburger is qualified as a Board member of the Company because of her extensive experience in strategizing, managing andclosing sizable, complex worldwide mergers and acquisitions, licensing agreements and divestitures, as well as her expertise in businessdevelopment, strategic planning and finance.
TalWenderow was appointed by the Board on July 29, 2020 to fill a vacancy on the Board and to serve as a Class I director of the Company,with a term commencing on August 1, 2020. Since September 2021, Mr. Wenderow serves as the Venture Partner at Genesis MedTech, a globalmedical device company. Previously, from February 2019, Mr. Wenderow served as the President and CEO of Vocalis Health Inc., an AI healthtechcompany pioneering the development of vocal biomarkers. Previously, Mr. Wenderow co-founded Corindus Vascular Robotics in 2002, whichwas a New York Stock Exchange-listed company upon its acquisition by Siemens Healthineers in 2019. Mr. Wenderow held various positionsat Corindus from founder, Chief Executive Officer and director at inception, Executive Vice President Product & Business Developmentto his most recent role as Executive Vice President of International & Business Development. Mr. Wenderow received a B.Sc. in MechanicalEngineering at the Technion – Israel Institute of Technology, Haifa, Israel. The Company believes that Mr. Wenderow is qualifiedas a Board member of the Company because of his extensive knowledge of the medical robotics space with specific focus on interventionalprocedures, as well as his medical devices start up experience.
Followingare the name, age and other information for our executive officers, as of March 29, 2022. All company officers have been appointed toserve until their successors are elected and qualified or until their earlier resignation or removal. Information regarding Harel Gadot,our Chairman, President and Chief Executive Officer, is set forth above under “Board of Directors.”
RachelVaknin, became the Company’s Chief Financial Officer as of April 1, 2022. Ms. Vakninhas been the Vice President-Finance, of the Company since January 2022. Prior to that, she was the Chief Financial Officer of Imagry,an Israeli-American autonomous technologies software provider, from September 2017 through December 2021. From April 2004 through December2016, Ms. Vaknin was the FP&A Department Manager at Mellanox Technologies Ltd., an Israeli-American multinational supplier of computernetworking products acquired by Nvidia in 2020, where she was responsible, among other things, for budget planning, budget control, buildingand maintaining business intelligence key performance indicators, leading teams with respect to preparing quarterly financial statements,obtaining and managing grant monies, and Sarbanes-Oxley controls.
SimonSharon, has served as the Company’s Chief Technology Officer since April 2018 and as the General Manager of Microbot Israelsince April 2021. From August 2016 to March 2018, Mr. Sharon served as the Chief Technology Officer at MEDX Xelerator, an Israel-basedmedical device and digital health incubator. He is also a director of XACT Robotics Ltd., a private Israeli company developing a novelplatform robotic technology for needle steering in minimally invasive interventional procedures. Mr. Harel Gadot, the Company’sPresident, CEO and Chairman, is the Chairman of each of XACT and MEDX Xelerator. Prior to this, Mr. Sharon held the position of ChiefOperating Officer at Microbot Israel before it became a publicly traded company from February 2013 to August 2016. Prior to joining MicrobotIsrael, Mr. Sharon was the Vice President of Research & Development with IceCure Medical, a TASE traded company developing a portfolioof cryogenic ablation systems. Prior to IceCure, he held roles of increasing responsibility at Rockwell Automation–Anorad IsraelLtd., a leading linear motor-based, precision positioning equipment manufacturer. Prior to Rockwell, Mr. Sharon was the Research &Development Manager at Disc-O-Tech Medical Technologies Ltd., a private orthopedic venture that was acquired by Kyphon (currently partof Medtronic), and before this was the Research & Development Manager at CI Systems, a worldwide supplier of a wide range of electro-opticaltest and measurement equipment.
EyalMorag, has served as the Company’s Chief Medical Officer (“CMO”) since May 2020. As CMO, Dr. Morag leads the developmentand execution of the clinical strategy of the Company, including its current development of the SCS and LIBERTY products as well as itsfuture pipeline. Dr. Morag is a member of the Company’s Scientific Advisory Board since November 1, 2017. Dr. Morag is certifiedby the American Board of Radiology, and from March 2017 through May 2020 has been the Chairman of Radiology at Assuta Ashdod MedicalCenter, Ashdod, Israel. Previously, from July 2014 through March 2017, he was the senior Radiologist at URG Teleradiology LLC, the largestprovider of subspecialty radiology and teleradiology services in New Jersey. He is a graduate of Boston University School of Medicineand completed both his Radiology residency and Fellowship in Cardiovascular & Interventional Radiology at the Beth Israel DeaconessMedical Center & Harvard Medical School. Following his clinical training, Dr. Morag then joined a private practice in western Massachusetts,where he served as Chief of Radiology at Holyoke Medical Center for several years. He has also served as the Regional Radiology Directorat Mercy Health Partners Hospitals in Toledo, Ohio, and was a member of the University Radiology Group where he headed the InternationalInvestment efforts for the Ventures division. Dr. Morag’s international experience developing and establishing radiology-relatedbusinesses includes teleradiology, interventional Radiology services, and free-standing imaging centers. During his fellowship, Dr. Moragco-founded InTek Technology, a medical device startup company. Later he founded Global Versa Radiology (“GVR”), an Israeliand U.S. based teleradiology company. GVR has established imaging centers in Russia and Ukraine and provided teleradiology services incountries outside the U.S. and Israel. Dr. Morag served as GVR’s Chief Medical Officer and Vice-President. He continues to be involvedin several startup companies ranging from AI to medical devices. Dr. Morag is also a member of the Advisory Board of MEDX Xelerator,a medical device and digital health incubator, of which Mr. Gadot is Chairman.
Section16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) requires our executive officers, directors,and persons who own more than 10% of a registered class of our equity securities, to file with the SEC reports of ownership of our securitiesand changes in reported ownership. Executive officers, directors and greater than 10% beneficial owners are required by SEC rules tofurnish us with copies of all Section 16(a) reports they file. Based solely on a review of the copies of such forms furnished to us,or written representations from the reporting persons that no Form 5 was required, we believe that, during the fiscal year ended December31, 2021, with the exception of one untimely Form 4 (detailing a single transaction) for each of Messrs. Bornstein, Burell, Madden, Laxminarainand Wenderow and Ms. Stockburger, all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficialowners have been met.
Codeof Business Conduct and Ethics
Wehave adopted a Code of Ethics and Conduct that applies to all of our directors, officers, employees, and consultants. A copy of our codeof ethics is posted on our website at www.microbotmedical.com. We intend to disclose any substantive amendment or waivers to this codeon our website. There were no substantive amendments or waivers to this code in 2021.
LegalProceedings Involving Directors
Therewere no legal proceedings involving the nominees to the Board.
Thefollowing table sets forth information regarding each element of compensation that was paid or awarded to the named executive officersof the Company for the periods indicated.
OutstandingEquity Awards at Fiscal Year-End
Thefollowing table presents the outstanding equity awards held by each of the named executive officers as of the end of the fiscal yearended December 31, 2021.
HarelGadot Employment Agreement
TheCompany entered into an employment agreement (the “Gadot Agreement”) with Harel Gadot on November 28, 2016, to serve as theCompany’s Chairman of the Board of Directors and Chief Executive Officer, on an indefinite basis subject to the termination provisionsdescribed in the Agreement. The Gadot Agreement was amended most recently on January 26, 2022. Mr. Gadot’s annual base salary for2021 was $500,000, and has been increased to $515,000 for 2022. The salary is reviewed on an annual basis by the Compensation Committeeof the Company to determine potential increases taking into account such performance metrics and criteria as established by Mr. Gadotand the Company.
Effectiveas of January 1, 2020, Mr. Gadot shall also be entitled to receive a target annual cash bonus of up to a maximum amount of 60% of basesalary, which maximum amount was paid for the 2021 fiscal year.
Mr.Gadot shall be further entitled to a monthly automobile allowance and tax gross up on such allowance of $1,150, and shall be grantedoptions to purchase shares of common stock of the Company representing 5% of the issued and outstanding shares of the Company, basedon vesting and other terms to be determined by the Compensation Committee of the Board of Directors.
Inthe event Mr. Gadot’s employment is terminated as a result of death, Mr. Gadot’s estate would be entitled to receive anyearned annual salary, bonus, reimbursement of business expenses and accrued vacation, if any, that is unpaid up to the date of Mr. Gadot’sdeath.
Inthe event Mr. Gadot’s employment is terminated as a result of disability, Mr. Gadot would be entitled to receive any earned annualsalary, bonus, reimbursement of business expenses and accrued vacation, if any, incurred up to the date of termination.
Inthe event Mr. Gadot’s employment is terminated by the Company for cause, Mr. Gadot would be entitled to receive any compensationthen due and payable incurred up to the date of termination.
Inthe event Mr. Gadot’s employment is terminated by the Company without cause, he would be entitled to receive (i) any earned annualsalary; (ii) 12 months’ pay and full benefits, (iii) a pro rata bonus equal to the maximum target bonus for that calendar year;(iv) the dollar value of unused and accrued vacation days; and (v) applicable premiums (inclusive of premiums for Mr. Gadot’s dependents)pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended, for twelve (12) months from the date of terminationfor any benefits plan sponsored by the Company. In addition, 100% of any unvested portion of his stock options shall immediately vestand become exercisable.
Theagreement contains customary non-competition and non-solicitation provisions pursuant to which Mr. Gadot agrees not to compete and solicitwith the Company. Mr. Gadot also agreed to customary terms regarding confidentiality and ownership of intellectual property.
RachelVaknin Employment Agreement
TheCompany entered into an employment agreement (the “Agreement”), dated November 22, 2021, with Ms. Vaknin, to serve as theCompany’s Vice President of Finance, on an indefinite basis subject to the termination provisions described in the Agreement. Therewere no changes or revisions to the Agreement as a result of Ms. Vaknin’s elevation and promotion to Chief Financial Officer.
Pursuantto the terms of the Agreement, Ms. Vaknin receives a base salary of NIS32,000 per month plus “global compensation” of NIS8,000per month for overtime. Ms. Vaknin is also entitled to receive an annual cash bonus of up to 20% of annual salary, contingent on meetingtargets as shall be determined from time to time by the Company at its sole discretion.
Ms.Vaknin shall be further entitled to reimbursement of commuting expenses in the amount of NIS1,000 per month or, alternatively, a leasedmotor vehicle. In the event Ms. Vaknin elects to receive the motor vehicle, her base salary shall be adjusted to NIS29,600 per monthand her global compensation shall be reduced to NIS7,400 per month.
Ms.Vaknin was initially granted options in January 2022 to purchase 20,000 shares of common stock of the Company.
Pursuantto the Agreement, the Company pays to an insurance company or a pension fund, for Ms. Vaknin, an amount equal to 8.33% of the salary,which shall be allocated to a fund for severance pay, and an additional amount equal to 6.5% of the salary, which shall be allocatedto a provident fund or pension plan. The Company also pays an additional sum for disability insurance to insure Ms. Vaknin for up to75% of the salary, and 7.5% of each monthly payment to be allocated to a “study fund.”
Eitherthe Company or Ms. Vaknin may terminate the Agreement without cause (as determined pursuant to the Agreement) by providing the otherparty with sixty days prior written notice.
TheCompany may terminate the Agreement for cause at any time by written notice without any advance notice.
TheAgreement contains customary non-competition and non-solicit provisions pursuant to which Ms. Vaknin agrees not to compete with, or solicitthird parties with respect to business activities relating to, the Company. Ms. Vaknin also agreed to customary terms regarding confidentialityand ownership of intellectual property.
DavidBen Naim Services Agreement
Weentered into a services agreement (the “Services Agreement”) with DBN Finance Services effective October 31, 2016, to provideoutsourced CFO services. Pursuant to the terms of the Services Agreement, DBN Finance Services will provide its services exclusivelythrough Mr. David Ben Naim, who will serve as the principal financial and accounting officer of Microbot Israel and the Company. Mr.Ben Naim’s engagement will continue on an indefinite basis subject to the termination provisions described in the Agreement.
Pursuantto the Agreement, the Company shall pay the Service Provider a fixed fee of NIS 22,000, or the equivalent of approximately $7,097 permonth based on an exchange rate of $.32 for NIS1.0, plus VAT per month, and the Company shall reimburse DBN Finance Services for reasonableand customary out of pocket expenses incurred by it or Mr. Ben Naim connection with the performance of the duties under the ServicesAgreement. In addition, the Company shall maintain for the benefit of Mr. Ben Naim, a Directors and Officers insurance policy, accordingto the Company’s policy for other directors and officers of the Company.
Boththe Company and DBN Finance Services shall have the right to terminate the Agreement for any reason or without reason at any time byfurnishing the other party with a 30-day notice of termination. The Company shall further be entitled to terminate the Services Agreementfor “cause” without notice, in which case neither DBN Finance Services nor Mr. Ben Naim shall be entitled to any compensationdue to such early termination.
DBNFinance Services and Mr. Ben Naim agreed to customary provisions regarding confidentiality and intellectual property ownership. The ServicesAgreement also contains customary non-competition and non-solicitation provisions pursuant to which DBN Finance Services and Mr. BenNaim agree not to compete and solicit with the Company during the term of the Agreement and for a period of twelve months following thetermination of the Agreement.
OnApril 1, 2022, Mr. Ben Naim resigned from his position as Chief Financial Officer and the Services Agreement terminated. The non-competitionand non-solicitation provisions of the Services Agreement survived the termination of the Services Agreement.
SimonSharon Employment Agreement
TheCompany entered into an employment agreement, dated as of March 31, 2018 and amended pursuant to a First Amendment to Employment Agreementdated as of April 19, 2021 (as so amended, the “Sharon Agreement”), with Mr. Sharon, to serve as the Company’s ChiefTechnology Officer and the General Manager of Microbot Israel, on an indefinite basis subject to the termination provisions describedin the Sharon Agreement.
Thesalary is reviewed on an annual basis by the Compensation Committee of the Company to determine potential increases taking into accountsuch performance metrics and criteria as established by the Company.
Pursuantto the terms of the Sharon Agreement, Mr. Sharon will receive in 2022 a combined base salary and overtime payment of NIS72,000 per month.Mr. Sharon is also entitled to receive an annual cash bonus of up to 35% of the annual combined salary and overtime payment, based oncertain performance factors established and assessed by the Compensation Committee of the Board of Directors of the Company.
Mr.Sharon shall be further entitled to a monthly automobile allowance plus a tax gross up to cover taxes relating to the grant of such motorvehicle, and pursuant to the Sharon Agreement was initially granted options in 2018 to purchase 150,000 shares (pre-stock split) of commonstock of the Company.
Pursuantto the Sharon Agreement, the Company pays to (unless agreed otherwise by the parties) an insurance company or a pension fund, for Mr.Sharon, an amount equal to 8.33% of the base salary and overtime payments, which shall be allocated to a fund for severance pay, andan additional amount equal to 6.5% of the base salary and overtime payments, which shall be allocated to a provident fund or pensionplan. The Company also pays an additional sum for disability insurance to insure Mr. Sharon for up to 75% of base salary and overtimepayments, and 7.5% of each monthly payment to be allocated to an educational fund.
Eitherthe Company or Mr. Sharon may terminate the Sharon Agreement without cause (as defined in the Sharon Agreement) by providing the otherparty with ninety days prior written notice.
TheCompany may terminate the Sharon Agreement for cause at any time by written notice without any advance notice.
TheSharon Agreement contains customary non-competition and non-solicit provisions pursuant to which Mr. Sharon agrees not to compete andsolicit with the Company. Mr. Sharon also agreed to customary terms regarding confidentiality and ownership of intellectual property.
EyalMorag Employment Agreement
Weentered into an employment agreement (the “Morag Agreement”), as of February 18, 2020, with Dr. Morag, to serve as the Company’sChief Medical Officer, on an indefinite basis subject to the termination provisions described in the Morag Agreement. The salary is reviewedon an annual basis by the Compensation Committee of the Company to determine potential increases taking into account such performancemetrics and criteria as established by the Company. Pursuant to the terms of the Morag Agreement, Dr. Morag shall receive a base salaryin 2022 of NIS64,000 per month plus Global Overtime (as defined in the Morag Agreement) of NIS16,000 per month.
Dr.Morag shall also be entitled to receive a target annual cash bonus, based on certain milestones, of up to a maximum amount of 30% ofhis annual salary.
Dr.Morag shall be further entitled to a monthly automobile allowance not to exceed NIS 4,800 per month plus expenses and applicable taxes,and shall be granted options to purchase 25,000 shares of common stock of the Company based on vesting and other terms set forth in theMorag Agreement.
Pursuantto the Morag Agreement, the Company shall pay an amount equal to 8.33% of Dr. Morag’s salary to be allocated for severance pay,6.5% of Dr. Morag’s salary to be allocated for pension savings and 7.5% to be allocated to an educational fund. The Company mayhave additional payment obligations for disability insurance as specified in the Morag Agreement.
Eitherthe Company or Dr. Morag may terminate the Morag Agreement at its discretion at any time by providing the other party with six monthsprior written notice of termination (the “Advance Notice Period”).
TheCompany may terminate the Morag Agreement “For Cause” (as defined in the Morag Agreement) at any time by written notice withoutthe Advance Notice Period.
TheMorag Agreement contains customary non-competition and non-solicit provisions pursuant to which Dr. Morag agrees not to compete and solicitwith the Company. Dr. Morag also agreed to customary terms regarding confidentiality and ownership of intellectual property.
TheCompany generally enters into indemnification agreements with each of its directors and executive officers. Pursuant to the indemnificationagreements, the Company has agreed to indemnify and hold harmless these current and former directors and officers to the fullest extentpermitted by the Delaware General Corporation Law. The agreements generally cover expenses that a director or officer incurs or amountsthat a director or officer becomes obligated to pay because of any proceeding to which he is made or threatened to be made a party orparticipant by reason of his service as a current or former director, officer, employee or agent of the Company, provided that he actedin good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company. The agreements alsoprovide for the advancement of expenses to the directors and officers subject to specified conditions. There are certain exceptions tothe Company’s obligation to indemnify the directors and officers, and, with certain exceptions, with respect to proceedings thathe initiates.
Limitson Liability and Indemnification
Weprovide directors and officers insurance for our current directors and officers.
Ourcertificate of incorporation eliminate the personal liability of our directors to the fullest extent permitted by law. The certificateof incorporation further provide that the Company will indemnify its officers and directors to the fullest extent permitted by law. Webelieve that this indemnification covers at least negligence on the part of the indemnified parties. Insofar as indemnification for liabilitiesunder the Securities Act may be permitted to our directors, officers, and controlling persons under the foregoing provisions or otherwise,we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressedin the Securities Act of 1933 and is therefore unenforceable.
TheCompany adopted in January 2021 an amended compensation package for the non-management members of its Board, pursuant to which each suchBoard member would receive for his or her services $35,000 per annum. Furthermore, each member of the Audit Committee of the Board receivesan additional $10,000 per annum ($20,000 if Chairman), each member of the Compensation Committee of the Board receives an additional$7,500 per annum ($15,000 if Chairman) and each member of the Corporate Governance and Nominating Committee of the Board receives anadditional $5,000 per annum ($10,000 if Chairman). Board members are also entitled to receive equity awards. Upon joining the Board,a member would receive an initial grant of $190,000 of stock options (calculated as the product of the exercise price on the date ofgrant multiplied by the number of shares underlying the stock option award required to equal $190,000), with an additional grant of stockoptions each year thereafter, to purchase such number of shares of the Company’s common stock equal to $95,000, computed on a similarbasis.
Thefollowing table summarizes cash and equity-based compensation information for our outside directors, for the year ended December 31,2021:
Mr.Gadot received compensation for his services to the Company as set forth under the summary compensation table above.
CERTAINRELATIONSHIPS AND RELATED TRANSACTIONS
Relatedparties can include any of our directors or executive officers, certain of our stockholders and their immediate family members. Eachyear, we prepare and require our directors and executive officers to complete Director and Officer Questionnaires identifying any transactionswith us in which the officer or director or their family members have an interest. This helps us identify potential conflicts of interest.A conflict of interest occurs when an individual’s private interest interferes, or appears to interfere, in any way with the interestsof the company as a whole. Our code of ethics requires all directors, officers and employees who may have a potential or apparent conflictof interest to immediately notify our general counsel, who serves as our compliance officer. In addition, the Corporate Governance Committeeis responsible for considering and reporting to the Board any questions of possible conflicts of interest of Board members. Our codeof ethics further requires pre-clearance before any employee, officer or director engages in any personal or business activity that mayraise concerns about conflict, potential conflict or apparent conflict of interest. Copies of our code of ethics and the Corporate GovernanceCommittee charter are posted on the corporate governance section of our website at www.microbotmedical.com.
Therehave been no related party transactions or any other transactions or relationships required to be disclosed pursuant to Item 404 of RegulationS-K.
PRINCIPALACCOUNTANT FEES AND SERVICES
Auditand Tax Fees
TheBoard, upon the recommendation of the Audit Committee, has selected the independent accounting firm of Brightman Almagor Zohar &Co., a Member of Deloitte Touche Tohmatsu Limited, to audit the accounts of the Company for the year ending December 31, 2021.
TheAudit Committee considered the tax compliance services provided by Brightman Almagor Zohar & Co. and Deloitte Israel & Co., concludedthat provision of such services is compatible with maintaining the independence of the independent accountants, and approved the provisionby Brightman Almagor Zohar & Co. of tax compliance services with respect to the year ending December 31, 2021.
TheAudit Committee received the following information concerning the fees of the independent accountants for the years ended December 31,2021 and 2020, has considered whether the provision of these services is compatible with independence of the independent accountants,and concluded that it is:
For the Years Ended
Auditand tax fees include administrative overhead charges and reimbursement for out-of-pocket expenses.
Pre-ApprovalPolicies and Procedures
TheAudit Committee has adopted policies and procedures for pre-approving all services (audit and non-audit) performed by our independentauditors. In accordance with such policies and procedures, the Audit Committee is required to pre-approve all audit and non-audit servicesto be performed by the independent auditors in order to assure that the provision of such services is in accordance with the rules andregulations of the SEC and does not impair the auditors’ independence. Under the policy, pre-approval is generally provided upto one year and any pre-approval is detailed as to the particular service or category of services and is subject to a specific budget.In addition, the Audit Committee may pre-approve additional services on a case-by-case basis.
REPORTOF THE AUDIT COMMITTEE
TheAudit Committee oversees our accounting and financial reporting processes and the audits of our financial statements on behalf of theBoard and selects an independent public accounting firm to perform these audits. Management has the primary responsibility for establishingand maintaining adequate internal control over financial reporting, preparing the financial statements, and establishing and maintainingadequate controls over public reporting. Our independent registered public accounting firm for fiscal 2021, Deloitte, had responsibilityfor conducting an audit of our annual financial statements in accordance with the standards of the Public Company Accounting OversightBoard (United States) and expressing an opinion on the conformity of those audited financial statements with generally accepted accountingprinciples.
TheAudit Committee oversaw the independent public accounting firm’s qualifications and independence, as well as its performance. TheAudit Committee assisted the Board in overseeing the preparation of the Company’s financial statements, the Company’s compliancewith legal and regulatory requirements, and the performance of the Company’s internal audit function. The Audit Committee met withpersonnel of the Company and Deloitte to review the scope and the results of the annual audit, the amount of audit fees, the Company’sinternal accounting controls, the Company’s financial statements contained in the Company’s Annual Report to Shareholdersand other related matters.
TheAudit Committee has reviewed and discussed with management the financial statements for fiscal year 2021 audited by Deloitte, as wellas management’s report on internal control over financial reporting, using the criteria set forth by the Committee of SponsoringOrganizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework. The Audit Committee has discussed withDeloitte various matters related to the financial statements, including those matters required to be discussed by SAS 114 (The Auditor’sCommunication with Those Charged with Governance). The Audit Committee has also discussed with Deloitte its report on internal controlover financial reporting, has received the written disclosures and the letter from Deloitte required by Public Company Accounting OversightBoard (PCAOB) Ethics and Independence Rule 3526, Communication with Audit Committees Concerning Independence (Rule 3526), andhas discussed with Deloitte its independence.
Basedupon such review and discussions, the Audit Committee recommended to the Board of Directors, and the Board approved the recommendation,that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ending December31, 2021 for filing with the SEC.
Theforegoing Audit Committee Report shall not be deemed incorporated by reference into any filing under the Securities Act of 1933 or theSecurities Exchange Act of 1934, and shall not otherwise be deemed filed under these acts, except to the extent we specifically incorporateby reference into such filings.
PROPOSAL1: NOMINEES FOR ELECTION OF CLASS III DIRECTORS
Thenumber of directors is currently fixed at seven. Both our restated certificate of incorporation, as amended to date, and our amendedand restated by-laws provide for the classification of the Board into three classes (Class I, Class II and Class III), as nearly equalin number as possible, with the term of office of one class expiring each year.
Unlessotherwise instructed, the enclosed proxy will be voted to elect the nominees named below as Class I directors for a term of three yearsexpiring at the 2025 Annual Meeting of Shareholders and until their successors are duly elected and qualified. All three Class I directornominees have been recommended by the Corporate Governance Committee because of their past experience serving on the Company’sBoard, the breadth of their business expertise, sound judgment, and demonstrated leadership, among other things. Proxies cannot be votedfor a greater number of persons than the number of nominees named below. It is expected that the nominees will be able to serve, butif any are unable to serve, the proxy will be voted for a substitute nominee or nominees designated by the Board.
TheCorporate Governance Committee has recommended and the Board has nominated Harel Gadot, Tal Wenderow, and Martin Madden forelection as the Company’s Class I directors to serve as Class I Directors until the 2025 Annual Meeting of Shareholders.
THEBOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THIS PROPOSAL 1 TO ELECT AS DIRECTORS THE THREE NOMINEES DESCRIBED ABOVE.
PROPOSAL2: RATIFICATION OF INDEPENDENT REGISTERED ACCOUNTING FIRM
TheCompany is asking the stockholders to ratify the selection of Deloitte, or its U.S. affiliate, as the Company’s independent publicaccountants for the fiscal year ending December 31, 2022. The affirmative vote of the holders of a majority of the shares representedand voting at the Annual Meeting will be required to ratify the selection of Deloitte or its U.S. affiliate.
Inthe event the stockholders fail to ratify the appointment, the Audit Committee of the Board of Directors will consider it as a recommendationto select other auditors for the subsequent year, which the Audit Committee would then take under advisement. Even if the selection isratified, the Audit Committee of the Board at its discretion could decide to terminate the engagement of Deloitte or its U.S. affiliateand engage another firm at any time if the Audit Committee determines that such a change would be necessary or desirable in the bestinterests of the Company and its stockholders.
Arepresentative of Deloitte is expected to attend the Annual Meeting telephonically and is not expected to make a statement, but willbe available to respond to appropriate questions and may make a statement if such representative desires to do so.
THEBOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THIS PROPOSAL 2 TO RATIFY THE SELECTION OF DELOITTE OR ITS U.S. AFFILIATEAS THE COMPANY’S INDEPENDENT PUBLIC ACCOUNTANTS FOR THE YEAR ENDING DECEMBER 31, 2022.
Shareholderswho wish to present proposals for inclusion in the Company’s proxy materials for the 2023 Annual Meeting of Shareholders may doso by following the procedures prescribed in Rule 14a-8 under the Exchange Act. To be eligible, the Shareholder proposals must be receivedby our corporate secretary on or before April 10, 2023.
Shareholderswho wish to make a proposal at the 2023 Annual Meeting of Shareholders, other than one that will be included in our proxy materials,must notify us in a timely manner, but no later than June 24, 2023. If a Shareholder who wishes to present a proposal at the 2023 AnnualMeeting of Shareholders fails to notify us by June 24, 2022, the proxies that management solicits for the meeting will confer discretionaryauthority to vote on the Shareholder’s proposal if it is properly brought before the meeting.
Inaddition, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees otherthan the Company’s nominees must provide notice that sets for the information required by Rule 14a-19 under the Exchange Act nolater than July 23, 2023.
ShareholderNominations of Directors
Ashareholder entitled to vote for the election of directors at a meeting may nominate persons for election as directors by giving timelynotice thereof in proper written form to the secretary accompanied by a petition signed by at least 100 record holders of capital stockof the Company which shows the class and number of shares held by each person and which represent in the aggregate 1% or more of theoutstanding shares entitled to vote in the election of directors. The submission must be in writing and delivered to Microbot MedicalInc., Attn: Secretary, Board of Directors, 25 Recreation Park Drive, Unit 108, Hingham, MA 02043, in accordance with the advance noticeprocedures and other requirements set forth in Section 3.2 of our bylaws for nominees to be considered for nomination at the 2023 annualmeeting. These requirements are separate from, and in addition to, the requirements discussed above to have the shareholder nominationor other proposals included in our proxy statement and form of proxy/voting instruction card pursuant to the SEC’s rules. Submissionsmust include the name, address and number of shares of common stock beneficially owned by each participant in the Nominating Shareholdergroup, a representation that the Nominating Shareholder meets the requirements described in the Board policy and will continue to meetthem through the date of the annual meeting, a description of all arrangements or understandings between or among the Nominating Shareholdergroup (or any participant in the Nominating Shareholder group) and the candidate or any other person or entity regarding the candidate,all information regarding the candidate that the Company would be required to disclose in a proxy statement under SEC rules, includingwhether the candidate is independent or, if not, a description of the reasons why not, the consent of the candidate to serve as a director,and representations by the candidate regarding his or her performance of the duties of a director. Full details may be obtained fromthe secretary of the Board at the address above. The Corporate Governance Committee will consider and evaluate up to two candidates recommendedin accordance with this policy in connection with any annual meeting. The Corporate Governance Committee will consider and evaluate candidatesrecommended by Shareholders on the same basis as candidates recommended by other sources.
Inaddition, the Company’s by-laws provide that a Shareholder entitled to vote for the election of directors at a meeting may nominatepersons for election as directors by giving timely notice thereof in proper written form to the Secretary accompanied by a petition signedby at least 100 record holders of capital stock of the Company representing in the aggregate 1% or more of the outstanding shares entitledto vote in the election of directors, which petition must show the class and number of shares held by each person. To be timely, suchnotice and petition must be received at the principal executive offices of the Company not less than 60 days nor more than 90 days priorto the meeting, except if less than 70 days notice of the date of the meeting is given to Shareholders, in which case the notice andpetition must be received not later than the close of business on the tenth day following the day on which notice of the date of themeeting was mailed or public disclosure of such date was made. The requesting Shareholder is required to provide information with respectto the nominee(s) for director similar to that described above, as more fully set forth in the Company’s by-laws.
TheCompany’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the SEC, is available without chargeupon request by writing to Microbot Medical Inc. at 25 Recreation Park Drive, Unit 108, Hingham, MA 02043, Attention: Investor Relations.A copy of this report is also available through our website at www.microbotmedical.com or, alternatively, at www.sec.gov.
“Householding”of Proxy Materials
Somebanks, brokers and other nominee record holders may be participating in the practice of “householding” proxy statements andannual reports. This means that only one copy of our proxy statement and annual report, or the notice of Internet availability of theproxy statement, to shareholders may have been sent to multiple shareholders in your household. The Company will promptly deliver a separatecopy of either document to you if you contact the Secretary at the following address or telephone number: Microbot Medical Inc., 25 RecreationPark Drive, Unit 108, Hingham, MA 02043; telephone: (781) 875-3605. In addition, copies of both documents may be obtained from our website(www.microbotmedical.com, click on the button “Investors” and then “Presentation + Resources”). If you want toreceive separate copies of the proxy statement, annual report or notice of Internet availability to shareholders in the future, or ifyou are receiving multiple copies and would like to receive only one copy per household, you should contact your bank, broker or othernominee record holder, or you may contact the Company at the above address or telephone number.
TheBoard knows of no business that will come before the meeting for action except as described in the accompanying Notice of Meeting. However,as to any such business, the persons designated as proxies will have authority to act in their discretion.