The termination event was defined in the Holdback Agreement as follows:
"Termination Event" means the cessation of Holdback Participant's continuous service with the Buyer or any affiliate thereof at any time prior to the Release Date for any reason.
The Release Date was set as the first anniversary of the closing of the deal. In view of the date of closing the transaction as aforesaid, the first anniversary of the closing of the transaction is June 24, 2025.
- An examination of the language of the agreement with respect to the event of the dismissal reveals that the plaintiff is entitled to the acceleration amount deposited with the paying trustee (PLACE), only if his continuous employment is terminated, i.e., dismissed, by the purchaser (akamai) or any company related to it, Before a year had passed From the date of completion of the purchase transaction, which is not due to "Cause". In any other case, this sum shall be distributed to the shareholders of the Benonis, in accordance with their pro rata shares, represented by the SRS, where the claimant will be entitled to a bonus of only ILS 625,000 out of this amount.
- Since the closing date of the transaction occurred on June 24, 2024, and the event of the plaintiff's actual termination of employment did not occur within 12 months of the date of closing the transaction (June 24, 2025), but on July 16, 2025, when there is no dispute that the summons to the hearing was served to the plaintiff on July 1, 2025, the plaintiff is not prima facie entitled to the acceleration amount. Because the plaintiff was fired After The end of the protection period stipulated in the agreement.
- The language of the provision is clear, as stated, but an exemption without anything is not possible, and we will also examine its purpose.
- In paragraph 4 of the statement of claim, it is claimed that "the mechanism is intended to ensure that senior employees who made a significant contribution to the realization of the transaction M&A (merger or acquisition - D.I.), protection against the value of their options. So in the case of Dismissal Within 12 months of the completion of the transaction, due to organizational changes and the cancellation of their positions, they will receive the full maturity of their rights to options. This is because reorganization proceedings During the first year that after the completion of a merger or acquisition transaction, are a common and structured phenomenon". The plaintiff further claimed in paragraph 10 of the statement of claim that such changes are "common and constitute part of a planned corporate move, which includes discussions and orderly decisions." The plaintiff also argued in paragraphs 3 and 11 of his summaries.
In paragraph 44 of SRS's statement of defense , it is claimed that it is "a matter of maintaining the mechanism that protected the plaintiff from the possibility of dismissal during the first year of his employment with the purchaser." Similarly, it is argued in paragraph 28 of its summaries that "the purpose of the dismissal protection mechanism is to ensure employment stability in the event of a merger or acquisition transaction... There is no basis for the plaintiff's empty claim that this is a mechanism intended to ensure "compensation for a purchase transaction".