Investor Relations

Syneron Medical Ltd (ELOS) IR Room

SECURITIES AND EXCHANGE COMMISSION


 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 6-K
 
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
 
May 1, 2017
 
Commission File Number: 001-34559
 
Syneron Medical Ltd.
(Translation of registrant’s name into English)
 
Industrial Zone, Yokneam Illit 20692, P.O.B. 550, Israel
(Address of principal executive offices)
 
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
 
Form 20-F ☒          Form 40-F ☐
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____
 
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant  to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
 
Yes ☐          No ☒
 
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- ________
 
Attached hereto as Exhibit 99.1 and incorporated herein by reference is a preliminary proxy statement and related appendices in connection with the Registrant's Special General Meeting of Shareholders to be held on June 15, 2017.
 
Also attached as Exhibit 99.2 is an updated proxy card in connection the Registrant's Special General Meeting of Shareholders to be held on June 15, 2017.  The proxy card is an update to the proxy card that was previously submitted by the Company on Form 6-K on April 10, 2017.  The proxy card is attached hereto for informational purposes only, and the Company will not accept executed proxy cards until after May 8, 2017, the record date of the Special General Meeting of Shareholders, and after the Company submits on Form 6-K a final proxy statement related to the Special General Meeting of Shareholders.
 

 
Signatures
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
SYNERON MEDICAL LTD.
 
       
 
By:
/s/ Hugo Goldman
 
   
Name: Hugo Goldman
 
   
Title: Chief Financial Officer
 
 
Date: May 1, 2017
 
2


Exhibit 99.1
 
SYNERON MEDICAL LTD.
 
                , 2017
 
To the Shareholders of Syneron Medical Ltd.:
 
You are cordially invited to attend the Special General Meeting of Shareholders (which we refer to as the Meeting) of Syneron Medical Ltd. (which we refer to as Syneron or the Company) to be held at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel on Thursday, June 15, 2017, at 3:00 p.m. (Israel time).
 
At the Meeting, you will be asked to consider and vote on the adoption and approval, pursuant to Section 320 of the Companies Law, 5759-1999 of the State of Israel (which, together with the regulations promulgated thereunder, we refer to as the Companies Law), of the merger of Syneron with Rendel Amare Ltd. (which we refer to as Merger Sub), a company formed under the laws of the State of Israel and a wholly-owned subsidiary of Lupert Ltd. (which we refer to as Parent), a company formed under the laws of the State of Israel, including the adoption and approval of: (i) the merger transaction pursuant to Sections 314 through 327 of the Companies Law, whereby Merger Sub will merge with and into Syneron, with Syneron surviving (which we refer to as the Surviving Company) and becoming a wholly-owned subsidiary of Parent (which we refer to as the Merger); (ii) the Agreement and Plan of Merger, dated as of April 2, 2017 (which we refer to as the Merger Agreement), by and among Parent, Merger Sub and Syneron; (iii) the consideration to be received by Syneron’s shareholders in the Merger, consisting of US $11.00 in cash (which we refer to as the Merger Consideration), without interest and subject to withholding taxes, for each ordinary share, nominal value NIS 0.01 per share, of Syneron (which we refer to as an Ordinary Share) held as of immediately prior to the effective time of the Merger; (iv) the conversion of each outstanding option that is unexercised immediately prior to the effective time of the Merger, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest and subject to any withholding obligations (which we refer to as the Option Consideration); (v) the conversion of each outstanding restricted share unit (which we refer to as a RSU) that is unsettled immediately prior to the effective time of the Merger, whether vested or unvested, representing the right to receive one Ordinary Share, including RSU’s held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without interest and subject to any withholding obligations (which we refer to as the RSU Consideration and, together with the Option Consideration, the Award Consideration); and (vi) all other transactions and arrangements, including directors’ and officers’ liability insurance, contemplated by the Merger Agreement, a copy of which is attached as Appendix A to the accompanying Proxy Statement (we refer to the above collectively as the Merger Proposal). At the Meeting, you will also be asked to vote on any other business that properly comes before the Meeting or any adjournment or postponement of the Meeting, including voting on the adjournment or postponement of such meetings.
 
Our Board of Directors has unanimously: (i) determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to and in the best interests of the Company and its shareholders and that, considering the financial positions of the Company and Merger Sub, no reasonable concern exists that the Surviving Company will be unable to fulfill the obligations of the Company to its creditors; (ii) approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement; and (iii) resolved to recommend that the shareholders of the Company adopt and approve the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement.
 
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ADOPTION AND APPROVAL OF THE MERGER PROPOSAL.
 

The Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the Merger Proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding, directly or indirectly, at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates. Record holders of our outstanding Ordinary Shares as of the close of business on May 8, 2017, the record date for the Meeting, are entitled to vote at the Meeting, and any adjournment or postponement thereof, and are entitled to one vote at the Meeting per Ordinary Share held. Our outstanding Ordinary Shares constitute the only outstanding class of our share capital.
 
Concurrently with the execution of the Merger Agreement, I, solely in my capacity as a shareholder, entered into a voting agreement (which we refer to as the Voting Agreement) with Parent, a copy of which is attached as Appendix B to the accompanying Proxy Statement. Pursuant to the Voting Agreement, I have agreed, subject to the terms and conditions of the Voting Agreement, to vote all of my Ordinary Shares in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting (and any adjournment or postponement thereof), representing an aggregate 2,689,911 outstanding Ordinary Shares and 281,250 Ordinary Shares issuable upon exercise of outstanding options (all shares covered by the Voting Agreement are referred to as the Eckhouse Shares), or approximately      % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting.
 
Enclosed with this letter you will find a Notice of the Meeting and the related Proxy Statement and proxy card. The accompanying Proxy Statement, including any document incorporated therein by reference, and the attachments thereto contain important information regarding the Merger Proposal and specific information regarding the Meeting and you are urged to read them carefully and in their entirety. You may obtain additional information about the Company from documents the Company has filed with the U.S. Securities and Exchange Commission.
 
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF ORDINARY SHARES THAT YOU OWN. ACCORDINGLY, IF YOU ARE A SHAREHOLDER OF RECORD, YOU ARE REQUESTED TO PROMPTLY MARK, SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE ENVELOPE PROVIDED OR VOTE ON THE INTERNET AT WWW.VOTEPROXY.COM OR BY TELEPHONE BY DIALING TOLL-FREE 1-800-PROXIES (1-800-776-9437) IN THE UNITED STATES OR 1-718-921-8500 FROM COUNTRIES OUTSIDE THE UNITED STATES, WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.  IF YOU RECEIVE MORE THAN ONE PROXY CARD BECAUSE YOU OWN ORDINARY SHARES REGISTERED IN DIFFERENT NAMES OR ADDRESSES, EACH PROXY CARD SHOULD BE SUBMITTED.  IN THE ALTERNATIVE, IF YOU HOLD YOUR ORDINARY SHARES IN “STREET NAME,” YOU MAY EITHER (1) INSTRUCT YOUR BANK, BROKER OR OTHER NOMINEE WHO HOLDS YOUR ORDINARY SHARES ON HOW TO VOTE BY EITHER MAILING YOUR PROPERLY COMPLETED VOTING INSTRUCTION CARD PROVIDED TO YOU BY YOUR BANK, BROKER OR OTHER NOMINEE WHO HOLDS YOUR ORDINARY SHARES OR BY TELEPHONE BY CALLING THE NUMBER ON YOUR VOTING INSTRUCTION CARD OR (2) VOTE IN PERSON AT THE MEETING, SO LONG AS YOU OBTAIN A SIGNED, LEGAL PROXY FROM YOUR BANK, BROKER OR OTHER NOMINEE WHO HOLDS YOUR ORDINARY SHARES, GIVING YOU THE RIGHT TO VOTE THOSE ORDINARY SHARES IN PERSON.  IN ANY SUCH CASE, SUBMITTING YOUR VOTE IN ADVANCE WILL NOT PREVENT YOU FROM VOTING YOUR ORDINARY SHARES IN PERSON IF YOU SUBSEQUENTLY CHOOSE TO ATTEND THE MEETING.
 
If you have any questions or need assistance voting your Ordinary Shares, or if you need to obtain copies of the accompanying Proxy Statement, proxy card or other documents incorporated by reference in the Proxy Statement, please contact The Proxy Advisory Group, LLC, our proxy solicitor, by calling toll-free 1-888-55-PROXY (1-888-557-7699) in the United States or 1-212-616-2180 from countries outside the United States.
 
Thank you for your cooperation.
 

 
 
Very truly yours,
 
Dr. Shimon Eckhouse
Active Chairman of the Board of Directors
 
Neither the U.S. Securities and Exchange Commission nor any state securities regulatory agency has approved or disapproved of the Merger, passed upon the merits of the Merger Agreement or the Merger or determined if the accompanying Proxy Statement is accurate or complete. Any representation to the contrary is a criminal offense. Further, as a foreign private issuer, the Company is exempt from the rules under the Securities Exchange Act of 1934, as amended, related to the furnishing of proxy statements. The circulation of this notice and Proxy Statement should not be taken as an admission that the Company is subject to such rules.
 
The accompanying Proxy Statement is dated                 , 2017 and is first being mailed to holders of Ordinary Shares of the Company on or about May    , 2017.
 

 
SYNERON MEDICAL LTD.
 
 
NOTICE OF SPECIAL GENERAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 15, 2017
 
Industrial Zone, Tavor Building, P.O.B 550, Yokneam Illit 20692, Israel
 
                 , 2017
 
To the Shareholders of Syneron Medical Ltd.:
 
NOTICE IS HEREBY GIVEN that a special general meeting (which we refer to as the Meeting) of shareholders of Syneron Medical Ltd. (which we refer to as Syneron or the Company) will be held at our executive offices located at Industrial Zone, Tavor Building, P.O.B 550, Yokneam Illit 20692, Israel, on June 15, 2017, at 3:00 p.m. (Israel time).
 
At the Meeting, shareholders will be asked to consider and vote on the following:
 
1.          The adoption and approval, pursuant to Section 320 of the Companies Law, 5759-1999 of the State of Israel (which, together with the regulations promulgated thereunder, we refer to as the Companies Law), of the merger of Syneron with Rendel Amare Ltd. (which we refer to as Merger Sub), a company formed under the laws of the State of Israel and a wholly-owned subsidiary of Lupert Ltd. (which we refer to as Parent), a company formed under the laws of the State of Israel, including the adoption and approval of: (i) the merger transaction pursuant to Sections 314 through 327 of the Companies Law, whereby Merger Sub will merge with and into Syneron, with Syneron surviving and becoming a wholly-owned subsidiary of Parent (which we refer to as the Merger); (ii) the Agreement and Plan of Merger, dated as of April 2, 2017 (which we refer to as the Merger Agreement), by and among Parent, Merger Sub and Syneron; (iii) the consideration to be received by Syneron’s shareholders in the Merger, consisting of US $11.00 in cash (which we refer to as the Merger Consideration), without interest and subject to withholding taxes, for each ordinary share, nominal value NIS 0.01 per share, of Syneron (which we refer to as an Ordinary Share) held as of immediately prior to the effective time of the Merger; (iv) the conversion of each outstanding option that is unexercised immediately prior to the effective time of the Merger, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest and subject to any withholding obligations (which we refer to as the Option Consideration); (v) the conversion of each outstanding restricted share unit (which we refer to as a RSU) that is unsettled immediately prior to the effective time of the Merger, whether vested or unvested, representing the right to receive one Ordinary Share, including RSU’s held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without interest and subject to any withholding obligations (which we refer to as the RSU Consideration and, together with the Option Consideration, the Award Consideration); and (vi) all other transactions and arrangements, including directors’ and officers’ liability insurance, contemplated by the Merger Agreement, a copy of which is attached as Appendix A to the accompanying Proxy Statement (we refer to the above collectively as the Merger Proposal).
 
2.          Any other business that properly comes before the Meeting or any adjournment or postponement of the Meeting, including voting on the adjournment or postponement of such meetings.
 
We currently know of no other business to be transacted at the Meeting, other than as set forth above, as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matter is properly presented at the Meeting, the persons named in the enclosed proxy card will vote upon such matters in accordance with their best judgment.
 
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ADOPTION AND APPROVAL OF THE MERGER PROPOSAL.
 

Two or more shareholders, present in person or by proxy, and holding Ordinary Shares in the aggregate representing at least 40% of Syneron’s voting power, will constitute a quorum at the Meeting. If a quorum is not present within thirty minutes of the scheduled time for the Meeting, the Meeting will be adjourned for a week and will be held on Thursday, June 22, 2017 at the same time and place as the originally scheduled Meeting. At such adjourned meeting, the presence of at least one shareholder in person or by proxy (regardless of the voting power possessed by their Ordinary Shares) will constitute a quorum.
 
The Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the Merger Proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding, directly or indirectly, at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
Holders of record of the Company’s Ordinary Shares as of the close of business on May 8, 2017, the record date for the Meeting, are entitled to vote at the Meeting and any adjournment or postponement of the Meeting. This notice and the accompanying Proxy Statement, letter to shareholders and proxy card are first being mailed to our shareholders on or about May    , 2017.
 
IT IS IMPORTANT THAT YOUR ORDINARY SHARES BE REPRESENTED AT THE MEETING. WHETHER OR NOT YOU PLAN TO ATTEND IN PERSON, PLEASE VOTE YOUR ORDINARY SHARES OVER THE INTERNET OR BY TELEPHONE PURSUANT TO THE INSTRUCTIONS CONTAINED IN THESE MATERIALS NOT LATER THAN 11:59 P.M. ISRAEL TIME ON JUNE 14, 2017 OR MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE IN A TIMELY MANNER IN ORDER THAT IT IS RECEIVED BY US NOT LATER THAN FORTY-EIGHT (48) HOURS BEFORE THE MEETING. If you receive more than one proxy card because you own Ordinary Shares registered in different names or addresses, each proxy card should be submitted. No postage is required if mailed in the United States. You may revoke your proxy as described in the accompanying Proxy Statement at any time before your proxy has been voted at the Meeting. Your proxy, if properly executed, will be voted in the manner directed by you. If no direction is made with respect to the proposal for the Meeting, your proxy will be voted “FOR” that proposal and, if applicable, in such manner as the holder of the proxy determines with respect to any other business that may properly come before the Meeting or all and any adjournments or postponements thereof (including voting on the adjournment or postponement of such meetings). If you fail to attend the Meeting in person or fail to submit your proxy, your Ordinary Shares will not be counted for purposes of determining whether a quorum is present at the Meeting and will not be counted as present at the Meeting for purposes of counting the vote.
 
If your Ordinary Shares are held in “street name” through your bank, broker or other nominee, you may either (1) instruct your bank, broker or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card or (2) vote in person at the Meeting, so long as you obtain a signed, legal proxy from your bank, broker or other nominee who holds your Ordinary Shares, giving you the right to vote those Ordinary Shares in person. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
Further information regarding the Merger Proposal and the Meeting is included in the accompanying Proxy Statement, which will be mailed to the Company’s shareholders in advance of the Meeting. The Proxy Statement will be furnished to the U.S. Securities and Exchange Commission (which we refer to as the SEC) on Form 6-K and will be available to the public on the SEC’s website at www.sec.gov, at the Company’s website at www.syneron-candela.com and on the website noted on your proxy card. We urge you to read the accompanying Proxy Statement, including any document incorporated therein by reference, and the attachments carefully and in their entirety.
 

If you have any questions or need assistance voting your Ordinary Shares, or if you need to obtain copies of the accompanying Proxy Statement, proxy card or other documents incorporated by reference in the Proxy Statement, please contact The Proxy Advisory Group, LLC, our proxy solicitor, by calling toll-free 1-888-55-PROXY (1-888-557-7699) in the United States or 1-212-616-2180 from countries outside the United States.
 
Please do not send your certificates representing Ordinary Shares at this time. If the Merger Proposal is adopted and approved and the Merger is subsequently completed, instructions for surrendering your certificates in exchange for the Merger Consideration will be sent to you.
 
 
By order of the Board of Directors,
 
DR. SHIMON ECKHOUSE
Active Chairman of the Board of Directors
 

 
IT IS IMPORTANT THAT YOU EITHER VOTE OVER THE INTERNET, BY TELEPHONE OR BY
MARKING, SIGNING, DATING AND RETURNING THE ENCLOSED PROXY CARD PROMPTLY
 
PROXY STATEMENT
 
SPECIAL GENERAL MEETING OF SHAREHOLDERS TO BE HELD ON
JUNE 15, 2017
 
INTRODUCTION
 
We are furnishing this proxy statement (which we refer to as the Proxy Statement) to our shareholders in connection with the solicitation by our Board of Directors of proxies to be used at a special general meeting of shareholders, as it may be adjourned or postponed from time to time (which we refer to as the Meeting) to be held at our executive offices located at Industrial Zone, Tavor Building, P.O.B 550, Yokneam Illit 20692, Israel on June 15, 2017, at 3:00 p.m. (Israel time). We are first mailing this Proxy Statement, the accompanying notice, letter to shareholders and proxy card on or about May    , 2017 to the holders of our Ordinary Shares (as defined below) entitled to notice of, and to vote at, the Meeting. All references to “Syneron,” “the Company,” “we,” “us,” “our” and “our Company,” or words of like import, are references to Syneron Medical Ltd. and its subsidiaries, references to “you” and “your” refer to our shareholders, all references to “$” or to “US $” are to United States dollars and all references to “NIS” are to New Israeli Shekels.
 
At the Meeting, shareholders will be asked to consider and vote on the following:
 
1.          The adoption and approval, pursuant to Section 320 of the Companies Law, 5759-1999 of the State of Israel (which, together with the regulations promulgated thereunder, we refer to as the Companies Law), of the merger of Syneron with Render Amare Ltd. (which we refer to as Merger Sub), a company formed under the laws of the State of Israel and a wholly-owned subsidiary of Lupert Ltd. (which we refer to as Parent), a company formed under the laws of the State of Israel, including the adoption and  approval of (we refer to this proposal collectively, including all aspects described below, as the Merger Proposal):
 
  ·
the merger transaction pursuant to Sections 314 through 327 of the Companies Law, whereby Merger Sub will merge with and into Syneron, with Syneron surviving (which we refer to as the Surviving Company) and becoming a wholly-owned subsidiary of Parent (which we refer to as the Merger) at the effective time of the Merger (which we refer to as the Effective Time);
 
  ·
the Agreement and Plan of Merger, dated as of April 2, 2017, by and among Parent, Merger Sub and Syneron (which we refer to as the Merger Agreement);
 
  ·
the consideration to be received by Syneron’s shareholders in the Merger, consisting of US $11.00 in cash (which we refer to as the Merger Consideration), without interest and subject to withholding taxes, for each ordinary share, nominal value NIS 0.01 per share, of Syneron (which we refer to as Ordinary Shares) held as of immediately prior to the Effective Time;
 
  ·
the conversion of each outstanding option that is unexercised immediately prior to the Effective Time, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest and subject to any withholding obligations (which we refer to as the Option Consideration);
 
  ·
the conversion of each outstanding restricted share unit (which we refer to as a RSU) that is unsettled immediately prior to the Effective Time, whether vested or unvested, representing the right to receive one Ordinary Share, including RSU’s held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without any interest and subject to any withholding obligations (which we refer to as the RSU Consideration and, together with the Option Consideration, the Award Consideration); and
 

  ·
all other transactions and arrangements, including directors’ and officers’ liability insurance, contemplated by the Merger Agreement, a copy of which is attached as Appendix A to this Proxy Statement.
 
2.          Any other business that properly comes before the Meeting or any adjournment or postponement of the Meeting, including voting on the adjournment or postponement of such meetings.
 
We currently know of no other business to be transacted at the Meeting, other than as set forth above, as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matter is properly presented at the Meeting, the persons named in the enclosed proxy card will vote upon such matters in accordance with their best judgment.
 
OUR BOARD OF DIRECTORS RECOMMENDS UNANIMOUSLY THAT YOU VOTE “FOR” THE ADOPTION AND APPROVAL OF THE MERGER PROPOSAL.
 
Voting
 
Only holders of record of Ordinary Shares at the close of business on May 8, 2017, the record date for the Meeting, are entitled to vote at the Meeting, and any adjournment or postponement thereof.  As of May 8, 2017, there were               Ordinary Shares outstanding and entitled to vote. Each Ordinary Share outstanding on the record date will entitle its holder to one vote upon each of the matters to be presented at the Meeting, and any adjournment or postponement thereof.
 
Two or more shareholders, present in person or by proxy and holding or representing Ordinary Shares conferring in the aggregate at least 40% of Syneron’s voting power, will constitute a quorum at the Meeting. If a quorum is not present within thirty minutes of the scheduled time for the Meeting, the Meeting will be adjourned for a week and will be held on Thursday, June 22, 2017 at the same time and place as the original Meeting. At such adjourned meeting, the presence of at least one shareholder in person or by proxy (regardless of the voting power possessed by their shares) will constitute a quorum.
 
Provided that a quorum is present, the adoption and approval of the Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
Concurrently with the execution of the Merger Agreement, Dr. Shimon Eckhouse, Active Chairman of the Board of Directors of Syneron, solely in his capacity as a shareholder, entered into a voting agreement (which we refer to as the Voting Agreement) with Parent, a copy of which is attached as Appendix B to this Proxy Statement. Pursuant to the Voting Agreement, Dr. Eckhouse has agreed, subject to the terms and conditions of the Voting Agreement, to vote all of his Ordinary Shares in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting (and any adjournment or postponement thereof), representing an aggregate 2,689,911 outstanding Ordinary Shares and 281,250 Ordinary Shares issuable upon exercise of outstanding options (all shares covered by the Voting Agreement are referred to as the Eckhouse Shares), or approximately      % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting.
 
ii

Proxies
 
For shareholders of record, such shareholders may elect to vote their Ordinary Shares, either by (1) attending the Meeting in person, (2) voting over the Internet at www.voteproxy.com, (3) by telephone by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States, or (4) by executing and delivering to Syneron a proxy as detailed below. Alternatively, if your Ordinary Shares are held in “street name” through your bank, broker or other nominee, you may either (1) instruct your bank, broker or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card or (2) vote in person at the Meeting, so long as you obtain a signed, legal proxy from your bank, broker or other nominee who holds your Ordinary Shares, giving you the right to vote those Ordinary Shares in person. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
Proxies are being solicited by our Board of Directors and are being mailed together with this Proxy Statement. Certain of our officers, directors, employees and agents may solicit proxies by telephone, facsimile, electronic mail or other personal contact. However, such parties will not receive additional compensation therefor. We will bear the cost of the solicitation of proxies, including the cost of preparing, assembling and mailing the proxy materials, and will reimburse the reasonable expenses of brokerage firms and others for forwarding such proxy materials to the beneficial owners of our Ordinary Shares. We have retained The Proxy Advisory Group, LLC as our proxy solicitor. We have agreed to pay a minimum base proxy solicitation fee of $10,000 plus up to $1,500 for disbursements, to The Proxy Advisory Group, LLC, which fee may increase if special added-value services are required.
 
All Ordinary Shares represented by properly executed proxies, submitted over the Internet, by telephone or by mail, will, unless such proxies have been previously revoked or superseded, be voted at the Meeting in accordance with the directions on the proxies. If no direction is made with respect to the proposal for the Meeting, your proxy will be voted “FOR” that proposal and, if applicable, in such manner as the holder of the proxy determines with respect to any other business that may properly come before the Meeting or all and any adjournments or postponements thereof (including voting on the adjournment or postponement of such meetings).
 
Internet and telephone services for the submission of a proxy to vote Ordinary Shares will be available 24 hours a day and will close at 11:59 p.m. Israel time on June 14, 2017. Proxy cards mailed with respect to Ordinary Shares must be received no later than forty-eight (48) hours prior to the Meeting in order to be counted for the purposes of establishing a quorum and the vote.
 
We know of no other matters to be submitted at the Meeting other than as specified herein as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matter is properly presented at the Meeting, the persons named in the enclosed proxy card will vote upon such matters in accordance with their best judgment.
 
In regards to shareholders of record, a shareholder returning a proxy may revoke it at any time prior to commencement of the Meeting by communicating such revocation in writing to us or by executing and delivering a later-dated proxy, over the Internet at www.voteproxy.com or by telephone by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States. Any written notice revoking a proxy should be sent to us at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel, Attention: Hugo Goldman, Chief Financial Officer. Alternatively, if your Ordinary Shares are held in “street name,” you must contact your bank, broker or other nominee who holds your Ordinary Shares to change or revoke your voting instructions. In addition, any person who has executed a proxy and is present at the Meeting may vote in person instead of by proxy, thereby canceling any proxy previously given, whether or not written revocation of such proxy has been given.
 
Required Vote
 
The Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
iii

It is proposed that the following resolution be adopted and approved at the Meeting:
 
RESOLVED, to adopt and approve, pursuant to Section 320 of the Companies Law, of the merger of the Company with Merger Sub, a company formed under the laws of the State of Israel and a wholly-owned subsidiary of Parent, including the adoption and approval of: (i) the Merger; (ii) the Merger Agreement; (iii) the Merger Consideration, without interest and subject to applicable withholding taxes, for each Ordinary Share held as of immediately prior to the Effective Time; (iv) the conversion of each outstanding option that is unexercised immediately prior to the Effective Time, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest and subject to any withholding obligations; (v) the conversion of each outstanding restricted share unit that is unsettled immediately prior to the Effective Time, whether vested or unvested, representing the right to receive one Ordinary Share, including RSUs held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such, without interest and subject to any withholding obligations; and (vi) all other transactions and arrangements contemplated by the Merger Agreement, including directors’ and officers’ liability insurance.”
 
OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ADOPTION AND APPROVAL OF THE PROPOSED RESOLUTION.
 
Meeting Agenda
 
In accordance with the Companies Law, any shareholder of the Company holding at least one percent of the outstanding voting rights of the Company was permitted to submit to the Company a proposed additional agenda item for the Meeting no later than Monday, April 17, 2017. To the extent that there were any additional agenda items that the Board determined to add as a result of any such submission, the Company was required to publish an updated agenda and proxy card with respect to the Meeting, no later than Monday, April 24, 2017, which would have been furnished to the U.S. Securities and Exchange Commission (which we refer to as the SEC) on Form 6-K, and would have been made available to the public on the SEC’s website at www.sec.gov. As the Company did not receive any proposed additional agenda items and shareholders are no longer permitted to submit additional agenda items, we do not expect any additional agenda items for the Meeting.
 
iv

 
TABLE OF CONTENTS
 
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v

Appendix A
Agreement and Plan of Merger, dated as of April 2, 2017, by and among Lupert Ltd., Rendel Amare Ltd. and Syneron Medical Ltd.
   
Appendix B
Voting Agreement, dated as of April 2, 2017, by and between Lupert Ltd. and Shimon Eckhouse
   
Appendix C
Opinion of Barclays Capital Inc.
 
vi

QUESTIONS AND ANSWERS ABOUT THE TRANSACTION
 
The following questions and answers are intended to briefly address certain commonly asked questions regarding the Merger, the Merger Agreement and the Meeting. These questions and answers may not address all of the questions that may be important to you as a shareholder of Syneron. Please refer to the more detailed information contained elsewhere in this Proxy Statement, the appendices attached to this Proxy Statement and the documents referred to or incorporated by reference in this Proxy Statement, which you are urged to read carefully and in their entirety. See the section of this Proxy Statement entitled “Where You Can Find More Information” beginning on page 74.
 
Q:
Why am I receiving this Proxy Statement?
 
A:
On April 2, 2017, Syneron entered into the Merger Agreement providing for the merger of Merger Sub with and into the Company, with the Company surviving the merger as a wholly owned subsidiary of Parent.  In order to complete the Merger, Syneron shareholders must vote to adopt and approve the Merger Agreement, the Merger and the transactions contemplated by the Merger Agreement. We are sending you this Proxy Statement and the accompanying materials in connection with the solicitation of proxies by our Board of Directors to vote on the Merger Proposal at the Meeting. You are receiving this Proxy Statement because you owned Ordinary Shares on May 8, 2017, the record date, and that entitles you to vote at the Meeting. By use of a proxy, submitted over the Internet, by telephone or by mail, you can vote whether or not you attend the Meeting. This Proxy Statement describes the matters on which we would like you to vote and provides information on those matters so that you can make an informed decision.
 
Q:
What am I being asked to vote on?
 
A:
You are being asked to vote on the adoption and approval, pursuant to Section 320 of the Companies Law, of the merger of Syneron with Merger Sub, a wholly-owned subsidiary of Parent, including the adoption and approval of: (i) the Merger; (ii) the Merger Agreement; (iii) the Merger Consideration to be received by Syneron’s shareholders pursuant to the Merger, without interest and subject to withholding taxes, for each Ordinary Share held as of immediately prior to the Effective Time of the Merger; (iv) the conversion of each outstanding option that is unexercised immediately prior to the Effective Time of the Merger, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the Option Consideration; (v) the conversion of each outstanding RSU that is unsettled immediately prior to the Effective Time of the Merger, whether vested or unvested, representing the right to receive one Ordinary Share, including RSU’s held by Company directors, into the right to receive an amount of cash equal to the RSU Consideration; and (vi) all other transactions and arrangements, including directors’ and officers’ liability insurance, contemplated by the Merger Agreement, a copy of which is attached as Appendix A to this Proxy Statement.
 
We do not currently expect there to be any other matters on the agenda at the Meeting as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matter is properly presented at the Meeting, the persons named in the enclosed proxy card will vote upon such matters in accordance with their best judgment.
 
Q:
What will I receive in the Merger?
 
A:
Upon completion of the Merger, holders of Ordinary Shares held as of immediately prior to the effective time of the Merger will only have the right to receive US$11.00 in cash per Ordinary Share without interest and subject to withholding taxes, if any.
 
You will not receive any shares in the Surviving Company in connection with the Merger nor will you have any ownership interest in the Surviving Company following the completion of the Merger.
 
1

Q:
When will the Merger be completed?
 
A:
We are working to complete the Merger as soon as practicable and expect to complete the Merger in the third quarter of 2017, but because the Merger is subject to governmental and regulatory notification filings and certain other conditions, some of which are beyond our and Parent’s control, the exact timing cannot be predicted nor can it be guaranteed that the Merger will ever be completed. Under Israeli law, at least 50 days must elapse after the filing of the Merger Proposal with the Israeli Registrar of Companies (which was filed on April 19, 2017) and at least 30 days must elapse from the date of the adoption and approval of the Merger by the shareholders of each of our Company and Merger Sub before the Merger can become effective. The Merger Agreement may be terminated if the Merger is not completed by August 30, 2017 (unless such date has been extended as a result of a postponement or adjournment of the Meeting) or at such later date agreed upon in writing by all parties to the Merger Agreement, so long as the terminating party’s breach of the Merger Agreement was not the principal cause of, or primarily resulted in, the failure to close the Merger. See the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Conditions to the Merger” beginning on page 67 for a summary description of these conditions.
 
Q:
Are there risks I should consider in deciding how to vote on the Merger?
 
A:
Yes. You should carefully read this Proxy Statement in its entirety, including the factors discussed in the section of this Proxy Statement entitled “Risk Factors” beginning on page 11.
 
Q:
When and where is the Meeting?
 
A:
The Meeting will be held on June 15, 2017, at 3:00 p.m. (Israel time) at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel. In lieu of your attending the Meeting in person, your Ordinary Shares can be represented and voted at the Meeting via proxy or you may vote your Ordinary Shares over the Internet or by telephone, as described below under the question “How do I vote?”
 
Q:
What vote is required for Syneron shareholders to adopt and approve the Merger Proposal?
 
A:
The adoption and approval of the Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the Merger Proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
Q:
How many Ordinary Shares must be present to constitute a quorum for the Meeting? What if there is no quorum?
 
A:
A quorum must be present in order for the Meeting to be held. Two or more shareholders present in person or by proxy, and holding or representing Ordinary Shares conferring in the aggregate at least 40% of the total voting power of our Company, will constitute a quorum at the Meeting. If a quorum is not present within thirty minutes of the scheduled time for the Meeting, the Meeting will be adjourned for a week and will be held on Thursday, June 22, 2017 at the same time and place. At the adjourned meeting, the presence of at least one shareholder in person or by proxy (regardless of the voting power possessed by their Ordinary Shares) will constitute a quorum for the business for which the original Meeting was called.
 
Q:
What if I abstain from voting on the Merger Proposal?
 
A:
Proxies submitted with instructions to abstain from voting and broker non-votes will not be considered to be votes “FOR” or “AGAINST” the Merger Proposal or any other proposal and will have no effect on the result of the vote, other than for establishing a quorum.
 
2

Q:
Are there any voting agreements with existing shareholders of the Company?
 
A:
Yes. Concurrently with the execution of the Merger Agreement, Dr. Shimon Eckhouse, Active Chairman of the Board of Directors of Syneron, solely in his capacity as a shareholder, entered into the Voting Agreement with Parent, a copy of which is attached as Appendix B to this Proxy Statement. Pursuant to the Voting Agreement, Dr. Eckhouse has agreed, subject to the terms and conditions of the Voting Agreement, to vote in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting (and any adjournment or postponement thereof) the Eckhouse Shares, representing approximately        % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting.
 
Q:
How does Syneron’s Board of Directors recommend that I vote?
 
A:
Our Board of Directors has adopted and approved the Merger Agreement and adopted and approved the Merger and the other transactions contemplated by the Merger Agreement. Our Board of Directors unanimously recommends that you vote “FOR” the adoption and approval of the Merger Proposal.
 
Q:
Why is Syneron’s Board of Directors recommending that I vote “FOR” the adoption and approval of the Merger Proposal?
 
A:
Our Board of Directors has unanimously determined that the terms and provisions of the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to and in the best interests of our Company and our shareholders. For additional information, see the sections of this Proxy Statement entitled “The Merger—Background of the Merger” beginning on page 21, “The Merger—Reasons for Approving the Merger” beginning on page 30 and “The Merger—Recommendation and Determination of Our Board of Directors” beginning on page 35.
 
Q:
Has Syneron’s Board of Directors sought any opinion to determine the fairness of the Merger Consideration to Syneron’s shareholders?
 
A:
We retained Barclays Capital Inc. (which we refer to as Barclays) to act as our financial advisor with respect to pursuing strategic alternatives for the Company, including a possible sale of the Company.  On April 1, 2017, Barclays rendered its oral opinion (subsequently confirmed by delivery of a written opinion dated April 2, 2017) to the Board of Directors of the Company to the effect that, as of such date and based upon and subject to the qualifications, limitations and assumptions stated in its opinion, from a financial point of view, the Merger Consideration to be offered to the holders of Ordinary Shares (other than any Ordinary Shares held by the Company, Parent, Merger Sub or any entity of which Merger Sub is a direct or indirect wholly owned subsidiary (we refer to such shares as the Cancelled Shares)) in the Merger is fair to such holders.
 
Barclays’ opinion sets forth, among other things, the assumptions made, procedures followed, matters considered and limitations upon the review undertaken by Barclays in rendering its opinion. Barclays’ opinion was directed to our Board of Directors and addresses only the fairness, from a financial point of view, of the Merger Consideration to be offered to the holders of Ordinary Shares (other than the Cancelled Shares) in the Merger as of the date of the opinion. It does not address any other aspects of the Merger and does not constitute a recommendation as to how any holder of Ordinary Shares should vote on the Merger or any matter related thereto.
 
The full text of Barclays’ written opinion, dated April 2, 2017, is attached hereto as Appendix C. We encourage you to read the opinion carefully and in its entirety. A summary of Barclays’ opinion and the methodology used to render its opinion is set forth in the section of this Proxy Statement entitled “The Merger—Opinion of Financial Advisor” beginning on page 36. The summary of Barclays’ opinion in this proxy statement is qualified in its entirety by reference to the opinion.
 
3

Q:
Is the Merger conditioned on the receipt of debt financing?
 
A:
No. Under the Merger Agreement, consummation of the Merger is not conditioned on Parent’s receipt of debt financing for the Merger Consideration and Award Consideration that it will pay to our shareholders.
 
Apax IX USD L.P., Apax IX EUR L.P., Apax IX EUR Co-Investment L.P. and Apax IX USD Co-Investment L.P. (which we refer to, collectively, as the Investors) have provided an equity commitment letter with respect to the full amount of the Merger Consideration and Award Consideration, subject to the terms and conditions set forth therein.
 
Q:
Will the Company solicit or consider alternative proposals or offers to the Merger?
 
A:
Yes. The Merger Agreement contains a “go shop” provision where we have the right to initiate, solicit and encourage any inquiry or the making of any alternative proposal or offer to acquire Syneron, and participate in discussions and negotiations with third parties with respect to any alternative proposal or offer (each of which we refer to as a Company Acquisition Proposal) through May 9, 2017. After May 9, 2017 and until shareholder approval of the Merger Proposal, we may continue discussions only with a party that has submitted a Company Acquisition Proposal that our Board of Directors determines in good faith (after consultation with our outside legal and financial advisor) that such Company Acquisition Proposal constitutes a more favorable proposal from a financial point of view than the Merger (which we refer to as a Superior Proposal) or is reasonably expected to lead to a Superior Proposal (we refer to such parties as Excluded Parties); otherwise, we will cease such activities and be subject to customary “no-shop” restrictions on our ability to solicit third party proposals related to a Company Acquisition Proposal or to provide information to and engage in discussions with a third party in relation to a Company Acquisition Proposal, subject to certain customary exceptions to permit our Board of Directors to comply with its fiduciary duties. The Merger Agreement provides Parent with customary match rights, up to three occasions, with respect to any Superior Proposal. If our Board of Directors authorizes us to enter into a definitive agreement with an Excluded Party to effect a transaction constituting a Superior Proposal and we enter into such definitive agreement with an Excluded Party, we may terminate the Merger Agreement and, under certain circumstances, be required to pay to Parent a termination fee of $5,960,000.
 
Our Board of Directors, with the assistance of its independent advisors, will actively solicit alternative proposals and offers to acquire Syneron during the “go shop” period. There can be no assurances that this process will result in a Superior Proposal. We do not intend to disclose any developments regarding this process unless and until our Board of Directors makes an affirmative decision to proceed with a Superior Proposal.
 
Q:
Should I send my share certificates now? What is the process for payment of the Merger Consideration?
 
A:
No. Once all conditions to closing of the Merger are satisfied, including, but not limited to, receipt of all governmental and regulatory approvals, we will be able to effect the closing of the Merger. In the event that all closing conditions are fulfilled, the closing of the Merger will occur and payment will be made to the paying agent appointed by Parent prior to the Effective Time and reasonably acceptable to the Company (which we refer to as the Paying Agent).
 
4

If you are a holder of record as of the Effective Time, promptly after the Merger is completed, the Paying Agent will send you a letter of transmittal with detailed instructions regarding the surrender of your certificates representing Ordinary Shares or the transfer of your Ordinary Shares held in book entry form, as applicable, and any other required documentation, including a United States Internal Revenue Service (which we refer to as the IRS) Form W-9 or appropriate Form W-8 (as applicable), a tax declaration form and a representation as to whether or not you are an Israeli resident (which we refer to as the Tax Declaration Form) to facilitate payment in exchange for the Merger Consideration for each Ordinary Share that you hold. You should not send your certificates representing Ordinary Shares to us or anyone else until you receive such instructions. The Paying Agent will send the Merger Consideration, without any interest thereon, subject to the withholding of any applicable taxes, to you as promptly as practicable following its receipt of your share certificates (unless your Ordinary Shares are held in book entry form), or, if applicable, affidavit claiming such Certificate to be lost, stolen or destroyed and, if required by Parent or the Paying Agent, the posting of a bond in such amount as Parent or the Paying Agent may determine is reasonably necessary as indemnity against any claim that may be made against it with respect to such Certificate, and other required documents, including the Tax Declaration Form. If your Ordinary Shares are held in “street name” by your bank, broker or other nominee, you will receive instructions from your bank, broker or other nominee as to how to effect the surrender or transfer of your “street name” Ordinary Shares in exchange for the Merger Consideration. You will be required to deliver an IRS Form W-9 or appropriate Form W-8 (as applicable) and a Tax Declaration Form prior to receiving the Merger Consideration. For information regarding the tax consequences of the Merger to the shareholders, see the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger” beginning on page 43.
 
If you do not deliver a valid IRS Form W-9 or Form W-8 (as applicable) demonstrating exemption for United States backup withholding, you may be subject to United States backup withholding as described in the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger—Certain United States Federal Income Tax Consequences” beginning on page 43. If you do not deliver a properly completed Tax Declaration Form or you indicate you are a resident of Israel on the Tax Declaration Form or you do not deliver a valid certificate granting a specific exemption from Israeli withholding tax, Israeli withholding tax will be withheld from the Merger Consideration paid to you as described in the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger—Israeli Income Tax Consequences” beginning on page 46. Please also see the question below “Will taxes be withheld from the Merger Consideration that is paid to me in the Merger?”
 
You are encouraged to consult your own tax advisors as to the consequences of the Merger.
 
Q:
Will taxes be withheld from the Merger Consideration that is paid to me in the Merger?
 
A:
It depends on your tax status and the documents that you submit to the Paying Agent when you receive a letter of transmittal upon the consummation of the Merger. With respect to withholding of U.S. taxes, if you are a United States Holder (as defined under the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger— Certain United States Federal Income Tax Consequences” beginning on page 43), proceeds from the exchange of Ordinary Shares pursuant to the Merger generally will be subject to backup withholding at the applicable rate (currently 28%) unless you provide a valid taxpayer identification number and comply with certain certification procedures (generally by providing a properly completed IRS Form W-9) or otherwise establish an exemption from backup withholding. If you are a non-United States Holder (as defined under the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger—Certain United States Federal Income Tax Consequences” beginning on page 43), you must complete an appropriate IRS Form W-8 that certifies that you are not a United States person, or you must otherwise establish an exemption from backup withholding in order to avoid the withholding of U.S. taxes on the payment of the Merger Consideration.
 
As to the withholding of Israeli taxes, pursuant to an Israeli tax ruling that we expect to receive prior to the Effective Time, the following rules will apply:
 
  1)
payments to be made to eligible Israeli brokers or Israeli financial institutions will not be subject to Israeli withholding tax, and the relevant Israeli broker or Israeli financial institution will withhold Israeli tax, if any, as required by Israeli law;
 
  2)
payments to be made to eligible foreign brokers or foreign financial institutions on behalf of eligible Israeli brokers or Israeli financial institutions will not be subject to Israeli withholding tax, and the relevant Israeli broker or Israeli financial institution will withhold Israeli tax, if any, as required by Israeli law;
 
  3)
payments to be made to shareholders who certify that they (i) acquired their Ordinary Shares on or after Syneron’s initial public offering on NASDAQ on August 6, 2004, (ii) are non-Israeli residents for purposes of the Israeli Income Tax Ordinance (New Version), 1961, and (iii) hold less than 5% of the Ordinary Shares, will not be subject to Israeli withholding tax; and
 
5

  4)
payments to be made to shareholders who are not described in clauses (1), (2) and (3) above will be subject to Israeli withholding tax at a rate of up to 25% of the gross proceeds payable to them.
 
Notwithstanding the foregoing, should any shareholder present the Paying Agent with a valid certificate from the Israeli Tax Authority applying withholding tax at a lesser rate than that described above or otherwise granting a specific exemption from Israeli withholding tax, the Paying Agent will act in accordance with such valid certificate.
 
Q:
What will happen to Syneron options and restricted share units (RSUs)?
 
A:
At the Effective Time, each outstanding option to purchase one Ordinary Share, whether vested or unvested, will be canceled and converted into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without any interest thereon and subject to any withholding obligations. If the exercise price per Ordinary Share for any option is equal to or greater than the Merger Consideration, such option will be canceled without payment of any consideration.
 
At the Effective Time, each outstanding RSU that is unsettled immediately prior to the Effective Time, whether vested or unvested, representing the right to receive one Ordinary Share will be canceled and converted into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without any interest thereon and subject to any withholding obligations.
 
Q:
What effects will the proposed Merger have on our Company?
 
A:
As a result of the proposed Merger, we will cease to be a publicly traded company and will become a private, wholly-owned direct subsidiary of Parent. Following the completion of the proposed Merger, the registration of the Ordinary Shares and our reporting obligations under the U.S. Securities Exchange Act of 1934, as amended (which we refer to as the Exchange Act) will be terminated upon notification to the SEC. In addition, upon completion of the proposed Merger, the Ordinary Shares will no longer be listed on any stock exchange, including the NASDAQ Global Select Market.
 
Q:
What happens if the Merger is not completed?
 
A:
If the Merger is not completed for any reason, our shareholders will not receive any Merger Consideration for their Ordinary Shares. Instead, we will remain a public company and the Ordinary Shares will continue to be listed on the NASDAQ Global Select Market. Under certain circumstances related to a termination, as specified in the Merger Agreement, we may be required to pay Parent a termination fee as described in the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Termination Provisions—Termination Fees” beginning on page 69.
 
Q:
What interests do the directors and executive officers of our Company have in the Merger?
 
A:
In considering the recommendation of our Board of Directors with respect to the Merger Agreement and the Merger, you should be aware that certain of our officers and directors have agreements or arrangements that provide them interests in the Merger that may be different from, or in addition to, the interests of other Syneron shareholders, including:
 
  ·
Certain indemnification and insurance provisions in favor of our directors and officers as set forth in the Merger Agreement, including Parent’s agreement that the Surviving Company will maintain, for seven years after the Effective Time, a director’s and officer’s liability insurance policy covering all individuals covered under Syneron’s current such policy in respect of acts or omissions occurring prior to the Effective Time, with coverage terms and for amounts no less favorable than those under Syneron’s current policy.
 
6

  ·
Each outstanding option to purchase one Ordinary Share held by our executive officers and directors (similarly to options held by employees or other persons generally), whether vested or unvested, will be canceled and converted into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without any interest thereon and subject to any withholding obligations.
 
  ·
Each outstanding RSU representing the right to receive one Ordinary Share held by our executive officers and directors (similarly to RSUs held by employees or other persons generally), whether vested or unvested, will be canceled and converted into the right to receive an amount of cash equal to the excess over the purchase price per Ordinary Share for such RSU (if any), if any, of the Merger Consideration, without any interest thereon and subject to any withholding obligations and subject to any withholding obligations.
 
  ·
Pursuant to, and contingent upon, the Merger, Mr. Hugo Goldman, our Chief Financial Officer, will be entitled to a cash award of $150,000, Ms. Sarit Soccary, our Vice President Strategy and Business Development, will be entitled to a cash award of $150,000, and Mr. Philippe Schaison, the CEO of Syneron Candela North America and Global Executive Vice President Strategy and Business Development, will be entitled to a cash award of $5.0 million, in each case paid at the closing of the Merger.
 
  ·
Our executive officers will be entitled to six months prior notice for any termination or effective termination of their employment during the one-year period following the closing of the Merger, except for (i) the notice period for Mr. Amit Meridor, our Chief Executive Officer, whose notice period is nine months under our existing arrangement with him, (ii) the notice period for Avi Huppert, our Vice President of Research and Development and Chief Operating Officer, whose notice period is 12 months and (iii) Mr. Schaison, who, in lieu of such notice period, under a Change of Control (as defined in Mr. Schaison’s employment agreement), will receive the following benefit, subject to Mr. Schaison’s execution of a general release of claims against the Company:
 
  o
In the event Mr. Schaison’s employment is terminated within one year of closing of the Merger without cause or for Good Reason (as defined below), then Mr. Schaison will be entitled to (i) his monthly base salary for a period of 36 months plus three times his annual target bonus and (ii) if Mr. Schaison chooses to elect health and dental insurance coverage in accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985 (which we refer to as COBRA), the Company will pay the entire premium payments for his health and dental insurance coverage under COBRA for a period of 36 months (in certain cases, the Company will instead pay Mr. Schaison an amount, as a taxable payment in a lump sum, subject to required withholding, equal to the value of such COBRA coverage, as determined in the Company’s sole and absolute discretion).  These benefits are subject to Mr. Schaison’s execution of a general release of claims against the Company.
 
  ·
During the notice period, the applicable executive officer (excluding Mr. Schaison) would receive his then monthly salary and would not be required to work.
 
  ·
If any executive officer’s employment is terminated or constructively terminated within one year of the closing of the Merger (or such later period at the discretion of Parent), each such executive officer will be entitled to receive a pro rata portion of such executive officer’s annual bonus for the year of termination or constructive termination based on such executive officer’s key performance indicator achievement at the time of termination or constructive termination.
 
For additional details, see the section of this Proxy Statement entitled “The Merger—Interests of our Executive Officers and Directors in the Merger” beginning on page 51.
 
7

 
Our Board of Directors was aware of these different or additional interests in determining to adopt and approve the Merger Agreement and the Merger, and to recommend to Syneron’s shareholders that they vote in favor of the Merger Proposal.
 
Q:
What do I need to do now?
 
A:
This Proxy Statement, including any document incorporated herein by reference, and the attachments hereto contain important information regarding the Merger Proposal, Merger Agreement, Merger and transactions contemplated by the Merger Agreement, as well as information about us. It also contains important information regarding the factors considered by our Board of Directors in evaluating the Merger. You are urged to read this Proxy Statement, including any document incorporated herein by reference, and the attachments hereto, carefully and in its entirety.
 
If you are a shareholder of record, and if you choose not to vote at the Meeting, you should (1) vote over the Internet at www.voteproxy.com, (2) vote by telephone by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States, or (3) vote by marking, signing and dating the enclosed proxy card and returning it in the enclosed envelope as soon as possible.
 
Alternatively, if your Ordinary Shares are held in “street name” through your bank, broker or other nominee, and if you choose not to vote at the Meeting, you should instruct your bank, broker, or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker, or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card. If you are not going to vote in person at the Meeting, you must provide your bank, broker or other nominee who holds your Ordinary Shares with instructions on how to vote your Ordinary Shares. Your bank, broker or other nominee who holds your Ordinary Shares cannot vote or make any election with respect to your Ordinary Shares without receiving instructions from you. Please check your voting instruction card used by your bank, broker or other nominee who holds your Ordinary Shares on how to instruct your bank, broker or other nominee who holds your Ordinary Shares by telephone on how to vote your Ordinary Shares.
 
Q:
How do I vote?
 
A:
If your Ordinary Shares are registered directly in your name with us and our transfer date as of the record date, May 8, 2017, you are considered a “shareholder of record” and you can vote your Ordinary Shares in the following four ways:
 
  ·
By Internet: You may submit your proxy by going to www.voteproxy.com and by following the instructions on how to complete an electronic proxy card. Please have your proxy card available when you access the web page.
 
  ·
By Telephone: You may submit your proxy by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States and by following the recorded instructions. Please have your proxy card available when you call.
 
  ·
By Mail: You may vote by mail by indicating your vote by marking, signing and dating the proxy card and returning in the envelope provided as soon as possible.  You should sign your name exactly as it appears on the proxy card. If you are signing in a representative capacity (for example, as guardian, executor, trustee, custodian, attorney or officer of a corporation), indicate your name and title or capacity.
 
  ·
At the Meeting: If you are a shareholder of record and prefer to vote your Ordinary Shares at the Meeting, you must bring proof of identification along with your proxy card or proof of ownership.
 
Even if you plan to attend the Meeting in person, we encourage you to submit a proxy in advance by Internet, telephone or mail so that your Ordinary Shares will be voted if you later decide not to attend the Meeting. Telephone and Internet facilities for the submission of a proxy to vote Ordinary Shares will be available 24 hours a day and will close at 11:59 p.m. Israel time on June 14, 2017.  Proxy cards mailed with respect to Ordinary Shares must be received no later forty-eight (48) hours prior to the Meeting (i.e. at 3:00 pm Israel time on June 13, 2017) in order to be counted in the vote.
 
8

Alternatively, if your Ordinary Shares are held in “street name” through your bank, broker or other nominee, you may either (1) instruct your bank, broker or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card or (2) vote in person at the Meeting, so long as you obtain a signed, legal proxy from your bank, broker or other nominee who holds your Ordinary Shares, giving you the right to vote those Ordinary Shares in person.  If you are not going to vote in person at the Meeting, you must provide your bank, broker or other nominee who holds your Ordinary Shares with instructions on how to vote your Ordinary Shares. Your bank, broker or other nominee who holds your Ordinary Shares cannot vote or make any election with respect to your Ordinary Shares without receiving instructions from you. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
Q:
What do I do if I want to change my vote?
 
A:
If you are a shareholder of record, you may send a written notice of revocation to us at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel, Attention: Hugo Goldman, Chief Financial Officer, so it is received prior to the Meeting, you may send a later-dated, marked and signed proxy card, submit a new proxy on the Internet at www.voteproxy.com or by telephone by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States relating to the same Ordinary Shares. Ordinary Shares represented by properly executed proxies received by us not later than 11:59 Israel time on June 14, 2017 for votes submitted over the Internet or by telephone or not later than forty-eight (48) hours prior to the Meeting for proxies submitted by mail will be voted at the Meeting in accordance with the directions on the proxies, unless such proxies have been previously revoked or superseded. Alternatively, you may attend the Meeting and vote in person. A shareholder who holds the Company’s Ordinary Shares under his, her or its name, and who attends the Meeting in person, shall be identified by a copy of an identity card, passport or a certificate of incorporation. Attendance without voting at the Meeting will not, in and of itself, revoke a prior proxy card that you have submitted.
 
Alternatively, if your Ordinary Shares are held in “street name,” you must contact your bank, broker or other nominee to change or revoke your voting instructions.
 
Q:
If my Ordinary Shares are held in “street name” by my bank, broker or other nominee, will my bank, broker or other nominee vote my Ordinary Shares for me?
 
A:
If you are not going to vote in person at the Meeting, you must provide your bank, broker or other nominee who holds your Ordinary Shares with instructions on how to vote your Ordinary Shares.  Your bank, broker or other nominee who holds your Ordinary Shares will vote your Ordinary Shares only if you provide instructions to your bank, broker or other nominee who holds your Ordinary Shares on how to vote. Your bank, broker or other nominee who holds your Ordinary Shares cannot vote or make an election with respect to your Ordinary Shares without receiving instructions from you. Please check your voting instruction card used by your bank, broker or other nominee who holds your Ordinary Shares on how to instruct your bank, broker or other nominee who holds your Ordinary Shares by telephone by calling the number on your voting instruction card how to vote your Ordinary Shares. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
If your Ordinary Shares are held in “street name,” you must contact your bank, broker or other nominee to change or revoke your voting instructions.
 
9

Q:
Who can vote at the Meeting? How many votes do I have?
 
A:
Only those holders of record of outstanding Ordinary Shares at the close of business on May 8, 2017, the record date for the Meeting, are entitled to vote at the Meeting. As of May 8, 2017, there were              Ordinary Shares outstanding and entitled to vote. You are entitled to one vote for each Ordinary Share that you owned as of the close of business on the record date.
 
Q:
What happens if I sell my Ordinary Shares before the Meeting?
 
A:
The record date for the Meeting (May 8, 2017) is earlier than the Meeting (June 15, 2017). If you transfer your Ordinary Shares after the record date but before the Meeting, you will retain your right to vote at the Meeting, but will have transferred the right to receive the Merger Consideration with respect to such Ordinary Shares. In order to receive the Merger Consideration, you must hold your Ordinary Shares through the completion of the Merger.
 
Q:
Am I entitled to appraisal rights in connection with the Merger?
 
A:
No. Under Israeli law, holders of Ordinary Shares are not entitled to appraisal rights in connection with the Merger. However, under the Companies Law, objections to the Merger may be filed by our creditors with the Israeli district court. See the section of this Proxy Statement entitled “The Merger—No Appraisal Rights; Objections by Creditors” on page 35.
 
Q:
Who will pay the costs of soliciting votes for the Meeting?
 
A:
We are making this solicitation and will pay the entire cost of preparing, printing, mailing and distributing the proxy materials and soliciting votes with respect to the Meeting. In addition to the mailing of proxy materials, the solicitation of proxies may be made in person, by telephone or by electronic communication by certain of our directors, officers and other employees, who will not receive any additional compensation for such activities. We have retained The Proxy Advisory Group, LLC as our proxy solicitor. We have agreed to pay a minimum base proxy solicitation fee of $10,000 plus up to $1,500 for disbursements, to The Proxy Advisory Group, LLC, which fee may increase if special added-value services are required.
 
Q:
Who can help answer my questions?
 
A:
If you have additional questions about the Merger Agreement, the Merger, how to vote, or would like additional copies of this Proxy Statement or the enclosed proxy card, you should contact:
 
Syneron Medical Ltd.
Attention: Hugo Goldman, Chief Financial Officer
Industrial Zone, Tavor Building
P.O.B. 550, Yokneam Illit 20692, Israel
972-732-442200
hugo.goldman@syneron-candela.com
 
The Proxy Advisory Group, LLC
Attention: William M. Poudrier
18 East 41st Street, 20th Floor
 
New York, NY 10017
toll-free 1-888-55-PROXY (1-888-557-7699) in the United States
or 1-212-616-2180 from countries outside the United States
 
10

 
RISK FACTORS
 
In addition to the other information included in this Proxy Statement, including the matters addressed under the section of this Proxy Statement entitled “Cautionary Statement Concerning Forward-Looking Statements” on page 14; you should carefully consider the following risk factors in determining how to vote at the Meeting. The following is not intended to be an exhaustive list of the risks related to the Merger and you should read and consider the risk factors described under Part 1, Item 3.D, “Key Information—Risk Factors” of the Company’s Annual Report on Form 20-F for the year ended December 31, 2016, which is on file with the SEC, and is incorporated by reference into this Proxy Statement.
 
Failure to complete the Merger could negatively impact our stock price, business, financial condition, results of operations or prospects.
 
The Merger is subject to the satisfaction or waiver of certain closing conditions described in the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Conditions to the Merger” beginning on page 67, including that:
 
  ·
no Material Adverse Effect (as defined below) shall have occurred since entry into the Merger Agreement;
 
  ·
 
the applicable approvals and clearances have been obtained and waiting periods (and any extension thereof) applicable to the consummation of the merger under applicable foreign antitrust laws have expired or terminated;
 
  ·
we shall have obtained shareholder approval of the Merger pursuant to the Companies Law; and
 
  ·
there shall not be pending or threatened any legal or regulatory action or proceeding seeking to restrain or prohibit the consummation of the Merger or any of the transactions contemplated by the Merger Agreement.
 
No assurance can be given that each of the conditions will be satisfied. In addition, the Merger Agreement may be terminated under the circumstances described in the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Termination Provisions” beginning on page 68. If the conditions are not satisfied or waived in a timely manner and the Merger is delayed, payment of the Merger Consideration will also be delayed. If the Merger is not completed (including in the case the Merger Agreement is terminated), our ongoing business may be adversely affected and, without realizing any of the benefits of having completed the Merger, we will be subject to a number of risks, including the following:
 
  ·
we may be required to pay Parent a termination fee if the Merger is terminated under various circumstances described in the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Termination Provisions—Termination Fees” beginning on page 69;
 
  ·
we will be required to pay certain costs relating to the Merger, including substantial financial advisor, legal and accounting fees, even though the Merger will have not been completed;
 
  ·
the price of the Ordinary Shares may decline to the extent that the current market price reflects a market assumption that the Merger will be completed;
 
  ·
under the Merger Agreement, we are subject to certain restrictions on the conduct of our business prior to completing the Merger that may affect our ability to execute certain of our business strategies as an independent company; and
 
  ·
during the period before completion of the Merger, our management’s attention will be diverted from the day-to-day business of the Company, which could otherwise have been devoted to other opportunities that may have been beneficial to us as an independent company, and there may be unavoidable disruptions to our employees and our relationships with customers and suppliers.
 
11

We also could be subject to litigation related to any failure to complete the Merger or related to any enforcement proceeding commenced against us to perform our obligations under the Merger Agreement. If the Merger is not completed, these risks may materialize and may adversely affect the price of Ordinary Shares, business, financial condition, results of operations or prospects.
 
Some of our directors and officers have interests that may differ from the interests of our shareholders, and these persons may have conflicts of interest in recommending to our shareholders to approve the Merger Proposal.
 
Some of the members of management and our Board of Directors may have interests that differ from, or are in addition to, their interests as shareholders, which are described in the section of this Proxy Statement entitled “The Merger—Interests of our Executive Officers and Directors in the Merger” on page 51. These interests could cause members of management or members of our Board of Directors to have a conflict of interest in recommending approval of the Merger Proposal.
 
The fact that there is a Merger pending could harm our business, revenue and results of operations.
 
While the Merger is pending, it creates uncertainty about our future. As a result of this uncertainty, customers may decide to delay, defer or cancel purchases of our products pending completion of the Merger or termination of the Merger Agreement. If these decisions represent a significant portion of our anticipated revenue, our results of operations and quarterly revenues could be substantially below the expectations of investors. If as a result there is a Material Adverse Effect, Parent may have a right to terminate the Merger Agreement without paying any termination fee.
 
In addition, while the Merger is pending, we are subject to a number of risks that may harm our business, revenue and results of operations, including:
 
  ·
the diversion of management and employee attention and the unavoidable disruption to our relationships with customers and suppliers may detract from our ability to grow revenues and minimize costs;
 
  ·
we have and will continue to incur significant expenses related to the Merger prior to its closing;
 
  ·
we may be unable to respond effectively to competitive pressures, industry developments and future opportunities; and
 
  ·
certain of our current and prospective employees may be uncertain about their future roles and relationships with the Company following completion of the Merger, which may adversely affect our ability to attract and retain key personnel.
 
12

 
The restriction on soliciting competing offers (other than during the “go shop” period and with “Excluded Parties” after termination of the “go shop” period) and certain other provisions might have the effect of discouraging other persons potentially interested in acquiring the Company from pursuing an acquisition of the Company.
 
Beginning at the end of the “go shop” period on May 9, 2017, until the Merger is completed or the Merger Agreement is terminated, with limited exceptions, the Merger Agreement prohibits us from entering into, soliciting or engaging in negotiations with respect to acquisition proposals or other business combinations. If our Board of Directors authorizes the Company to enter into a definitive agreement to effect a transaction constituting a Superior Proposal with a specified party that results from the “go shop” process and the Company enters into such definitive agreement, the Company may terminate the Merger Agreement and, under such circumstances, be required to pay Parent a termination fee of $5,960,000. Under certain other circumstances, including if our shareholders do not approve the Merger Proposal or if Parent terminates the agreement due to a breach by the Company, we will be obligated to pay Parent a termination fee of $13,910,000.
 
If the Merger is not consummated by August 30, 2017 or at such later date agreed upon in writing by all parties to the Merger Agreement (with certain automatic extensions to be made if the Meeting is postponed, adjourned or delayed for any reason), either we or Parent may choose not to proceed with the Merger.
 
 
The Merger is subject to the satisfaction or waiver of certain closing conditions described in the section of this Proxy Statement entitled “The Merger Agreement; Other Agreements—The Merger Agreement—Conditions to the Merger” beginning on page 67 and set forth in the Merger Agreement, a copy of which is attached to this Proxy Statement as Appendix A. The fulfillment of certain of these conditions is beyond our control, such as the receipt of our shareholders’ approval of the Merger. If the Merger has not been completed by August 30, 2017 or at such later date agreed upon in writing by all parties to the Merger Agreement, either the Company or Parent may freely terminate the Merger Agreement, so long as the terminating party’s breach of the Merger Agreement was not the principal cause of, or primarily resulted in, the failure to close the Merger.

 
13

 
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
 
Information provided in this Proxy Statement may include statements relating to current expectations, estimates, forecasts and projections about future events that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include, but are not limited to, statements contained in the sections of this Proxy Statement entitled “Questions and Answers about the Transaction,” “The Merger” and “The Merger—Regulatory Matters”, statements about the expected completion of the proposed transaction with Parent and the timing thereof, the satisfaction or waiver of any conditions to the proposed transaction, anticipated benefits, and growth opportunities and other events relating to the proposed transaction. Forward-looking statements are often characterized by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “estimate,” “continue,” “believe,” “should,” “intend,” “plan,” “project” or other similar words, but are not the only way these statements are identified. Factors that could cause actual events, results, performance, circumstances or achievements to differ from such forward-looking statements include, but are not limited to, the following: (1) conditions to the closing of the transaction may not be satisfied and required regulatory approvals may not be obtained; (2) the proposed transaction may involve unexpected costs, liabilities or delays; (3) the Company’s business may suffer as a result of uncertainty surrounding the proposed transaction and diversion of management attention on transaction-related matters; (4) risks related to the financial analyses used by the Company to consider the transaction, including that (a) numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of the Company or any of other parties to the Merger, may turn out not to be correct, (b) future results may materially differ from those discussed in such analysis, and (b) estimates contained in these analyses may not be indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth in such analyses; (5) the outcome of any legal proceedings related to the proposed transaction; (6) the Company may be adversely affected by other economic, business, and/or competitive factors; (7) the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement; (8) difficulties in recognizing benefits of the proposed transaction; (9) the proposed transaction may disrupt current plans and operations and raise difficulties for employee retention; (10) impact of the transaction on relationships with customers, distributors and suppliers; (11) other risks to consummation of the transaction, including the risk that the transaction will not be consummated within the expected time period or at all; and (12) the potential requirement for the Company to pay a termination fee in connection with its failure to consummate the Merger.  This list is intended to identify only certain of the principal factors that could cause actual results to differ. Additional risks related to the proposed Merger may also cause actual results to differ from expected results. Readers are referred to the reports and documents filed by the Company with the SEC, including the Company’s Annual Report on Form 20-F for the year ended December 31, 2016, for a discussion of these and other important risk factors.
 
In light of the significant uncertainties inherent in the forward-looking statements contained herein, readers should not place undue reliance on forward-looking statements. We cannot guarantee any future results, including with respect to the Merger. The statements made in this Proxy Statement represent our views as of the date of this Proxy Statement, and it should not be assumed that the statements made herein remain accurate as of any future date. Except as required by law, the Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements, that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.
 
14

 
THE PARTIES TO THE MERGER
 
Our Company
 
Syneron Medical Ltd. was incorporated under the laws of the State of Israel in 2000. We design, develop and market innovative aesthetic medical products based on our various technologies, including our proprietary Electro-Optical Synergy, or ELOS, technology, which uses the synergy between electrical energy, including radiofrequency, or RF energy, and optical energy to provide effective, safe and affordable aesthetic medical treatments. Our products, which we sell primarily to physicians and other qualified practitioners, target a wide array of non-invasive aesthetic medical procedures, including hair removal, wrinkle reduction, rejuvenation of the skin’s appearance through the treatment of superficial benign vascular and pigmented lesions, acne treatment, treatment of leg veins, treatment for the temporary reduction in the appearance of cellulite and thigh circumference, ablation and resurfacing of the skin, and laser-assisted lipolysis. We believe ELOS provides performance advantages over other technologies that rely solely on optical energy. We believe using optical energy alone limits the safety and efficacy of many aesthetic medical procedures due to limited skin penetration and unwanted epidermal absorption. Our proprietary ELOS technology, which combines optical and electrical energy, enhances the user’s ability to accurately target the tissue to be treated and enables real-time measurement of skin temperature, resulting in increased patient safety and comfort and improved treatment results. On January 5, 2010, we acquired Candela Corporation (which we refer to as Candela), which became our indirect wholly-owned subsidiary. Candela’s current product line offers comprehensive and technologically sophisticated cosmetic and aesthetic lasers and light-based systems used by physicians and personal care practitioners to treat a wide variety of cosmetic and medical conditions.
 
This Proxy Statement incorporates important business and financial information about Syneron from other documents that are not included in or delivered with this Proxy Statement. For a list of the documents incorporated by reference in this Proxy Statement, see “Where You Can Find More Information” on page 74.
 
Our headquarters are located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit, 20692, Israel and our phone number is +972 (73) 24-42200.  Our stock trades on the NASDAQ Global Select Market under the symbol ELOS. As of December 31, 2016, we had total assets of $277.2 million, total liabilities of $69.8 million and total shareholders’ equity of $207.4 million, and for the year ended December 31, 2016, we had total revenues of $298.1 million.
 
Parent
 
Lupert Ltd. (which we refer to as Parent) is a company incorporated under the laws of the State of Israel and a newly formed company organized by affiliates of Apax Partners LLP, a private equity advisory firm (which we refer to as Apax), solely for the purpose of entering into the Merger Agreement and effecting the Merger and the other transactions contemplated by the Merger Agreement. Prior to its entry into the Merger Agreement, Parent had not engaged in any business other than in connection with the transactions contemplated by the Merger Agreement. Following the consummation of the Merger, Syneron will be a wholly owned subsidiary of Parent.
 
The principal executive offices of Parent are located at c/o Apax Partners Israel Ltd., 4 Berkowitz Street, Tel Aviv 6423803 Israel, and its telephone number is +44-20-7872-6300.
 
Merger Sub
 
Rendel Amare Ltd. (which we refer to as Merger Sub) is a company incorporated under the laws of the State of Israel and a wholly-owned subsidiary of Parent. Merger Sub is a newly formed company solely for the purpose of entering into the Merger Agreement and effecting the Merger and the other transactions contemplated by the Merger Agreement.  Prior to its entry into the Merger Agreement, Merger Sub has not engaged in any business other than in connection with the transactions contemplated by the Merger Agreement. Following the consummation of the Merger, Merger Sub will cease to exist.
 
The principal executive offices of Merger Sub are located at c/o Apax Partners Israel Ltd., 4 Berkowitz Street, Tel Aviv 6423803 Israel, and its telephone number is +44-20-7872-6300.
 
15

 
THE SPECIAL GENERAL MEETING
 
Time and Place of the Meeting
 
This Proxy Statement is being furnished to holders of Ordinary Shares in connection with the solicitation of proxies by and on behalf of our Board of Directors for use at the Meeting to be held on June 15, 2017, at 3:00 p.m. (Israel time), at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit, 20692, Israel, and at any adjournment or postponement thereof. We are first mailing this Proxy Statement, the accompanying notice, letter to shareholders and the enclosed proxy card on or about May     , 2017 to all holders of Ordinary Shares entitled to notice of, and to vote at, the Meeting.
 
Purposes of the Meeting; Proposed Resolutions
 
Merger Proposal. At the Meeting, our shareholders will consider and vote on the Merger Proposal, which is a proposal to adopt and approve the Merger, the Merger Agreement, and the other transactions contemplated by the Merger Agreement. To adopt and approve the Merger Proposal, it is proposed that at the Meeting, the following resolution be adopted and approved:
 
RESOLVED, to adopt and approve, pursuant to Section 320 of the Companies Law, the merger of the Company with Merger Sub, a company formed under the laws of the State of Israel and a wholly-owned subsidiary of Parent, including the adoption and approval of: (i) the Merger; (ii) the Merger Agreement; (iii) the Merger Consideration, without interest and subject to applicable withholding taxes, for each Ordinary Share held as of immediately prior to the Effective Time; (iv) the conversion of each outstanding option that is unexercised immediately prior to the Effective Time, whether vested or unvested, to purchase one Ordinary Share, including options held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest and subject to any withholding obligations; (v) the conversion of each outstanding restricted share unit that is unsettled immediately prior to the Effective Time, whether vested or unvested, representing the right to receive one Ordinary Share, including RSUs held by Company directors, into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such, without interest and subject to any withholding obligations; and (vi) all other transactions and arrangements contemplated by the Merger Agreement, including directors’ and officers’ liability insurance.”
 
Our shareholders must adopt and approve the Merger Proposal in order for the Merger to occur. If the shareholders fail to adopt and approve the Merger Proposal, the Merger will not occur. For more information about the Merger and the Merger Agreement, see the sections of this Proxy Statement entitled “The Merger” and “The Merger Agreement; Other Agreements” beginning on pages 21 and 54, respectively.
 
Other Matters. We currently know of no other business to be transacted at the Meeting, other than as set forth above, as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matter is properly presented at the Meeting, the persons named in the enclosed proxy card will vote upon such matters in accordance with their best judgment.
 
Recommendation of the Board of Directors of Syneron
 
Our Board of Directors has unanimously: (i) determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to and in the best interests of the Company and its shareholders and that, considering the financial positions of the Company and Merger Sub, no reasonable concern exists that the Surviving Company will be unable to fulfill the obligations of the Company to its creditors; (ii) approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement; and (iii) resolved to recommend that the shareholders of the Company adopt and approve the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement.
 
OUR BOARD OF DIRECTORS BELIEVES THAT THE MERGER PROPOSAL IS FAIR TO AND IN THE BEST INTERESTS OF SYNERON AND ITS SHAREHOLDERS AND UNANIMOUSLY RECOMMENDS THAT YOU AND THE OTHER SYNERON SHAREHOLDERS VOTE “FOR” THE MERGER PROPOSAL. See “The Merger—Reasons for Approving the Merger” beginning on page 30 and “The Merger—Recommendation and Determination of Our Board of Directors” beginning on page 35.
 
16

 
Record Date, Method of Voting and Quorum Requirements
 
In accordance with the Companies Law and our Articles of Association, our Board of Directors has fixed May 8, 2017 as the record date for determining the shareholders entitled to notice of, and to vote at, the Meeting. Accordingly, you are entitled to notice of, and to vote at, the Meeting only if you were a record holder of Ordinary Shares at the close of business on that date, irrespective of the amount of Ordinary Shares in your possession on such date. As of May 8, 2017, there were                    Ordinary Shares outstanding and entitled to vote. Your Ordinary Shares may be voted at the Meeting only if you are present at the Meeting personally or if your Ordinary Shares are represented by a valid proxy.
 
You are being asked to vote the Ordinary Shares held directly in your name as a shareholder of record and any Ordinary Shares you hold in “street name” as beneficial owner. Ordinary Shares held in “street name” are Ordinary Shares held on your behalf by a bank, a broker in a stock brokerage account or a nominee.
 
The method of voting differs for Ordinary Shares held as a record holder and Ordinary Shares held in “street name.” Shareholders of record will receive proxy cards, which they should mark, sign, date and return in the envelope provided as soon as possible. Shareholders of record can also vote over the Internet at www.voteproxy.com, by telephone by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States or by voting in person at the Meeting. Alternatively, if your Ordinary Shares are held in “street name” through your bank, broker or other nominee, you may either (1) instruct your bank, broker or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card or (2) vote in person at the Meeting, so long as you obtain a signed, legal proxy from the bank, broker or other nominee who holds your Ordinary Shares, giving you the right to vote those Ordinary Shares in person. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
Proxies are being solicited on behalf of our Board of Directors from our shareholders in favor of the Merger Proposal as described in this Proxy Statement.
 
You may receive more than one set of voting materials, including multiple copies of this document and multiple proxy cards or voting instruction card. For example, shareholders who hold Ordinary Shares in more than one brokerage account will receive a separate voting instruction card for each brokerage account in which Ordinary Shares are held.
 
Shareholders of record whose Ordinary Shares are registered in more than one name will receive more than one proxy card. You should mark, sign, date and return each proxy card or voting instruction card you receive.
 
A quorum must be present in order for the Meeting to be held. Two or more shareholders present in person or by proxy, and holding or representing Ordinary Shares conferring in the aggregate at least 40% of the total voting power of our Company, will constitute a quorum at the Meeting. Ordinary Shares that are voted in person or by proxy “FOR” or “AGAINST” are treated as being present at the Meeting for purposes of establishing a quorum and are also treated as voted at the Meeting with respect to such matters. Abstentions and broker non-votes will be counted for purposes of determining the presence or absence of a quorum for the transaction of business, but such abstentions and broker non-votes will not be counted for purposes of determining the number of votes cast with respect to the particular proposal. If a quorum is not present within thirty minutes of the scheduled time for the Meeting, the Meeting will be adjourned for a week and will be held on Thursday, June 22, 2017 at the same time and place. At the adjourned meeting, the presence of at least one shareholder in person or by proxy (regardless of the voting power possessed by their Ordinary Shares) will constitute a quorum for the business for which the original Meeting was called.
 
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Voting Rights and Vote Required
 
Each Ordinary Share outstanding on the record date will entitle its holder to one vote upon each of the matters to be presented at the Meeting, and any adjournment or postponement thereof.
 
Provided that a quorum is present, the adoption and approval of the Merger Proposal requires the affirmative vote of the holders of a majority of our Ordinary Shares present, in person or by proxy, at the Meeting (or any adjournment or postponement thereof) where a quorum is present and voting on the proposal, excluding abstentions and broker non-votes and excluding any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
A proxy card of a record shareholder that is signed and returned that does not indicate a vote “FOR” or “AGAINST” a proposal will be voted in accordance with the recommendation of our Board of Directors with respect to such proposal, including “FOR” the Merger Proposal.
 
A bank, broker or other nominee who holds Ordinary Shares for customers who are the beneficial owners of those Ordinary Shares has the authority to vote on “routine” proposals when it has not received instructions from the beneficial owners. However, such bank, broker or other nominee who holds Ordinary Shares for customers is prohibited from giving a proxy to vote those customers’ Ordinary Shares with respect to approving non-routine matters, such as the Merger Proposal to be voted on at the Meeting, without instructions from the customer. Ordinary Shares held for customers by a bank, broker or other nominee that are not voted at the Meeting because the customer has not provided instructions to the bank, broker or other nominee are referred to as “broker non-votes” and will not be considered to be votes “FOR” or “AGAINST” the Merger Proposal or any other proposal and will have no effect on the result of the vote, other than for establishing a quorum.
 
Concurrently with the execution of the Merger Agreement, Dr. Shimon Eckhouse, Active Chairman of the Board of Directors of Syneron, solely in his capacity as a shareholder, entered into the Voting Agreement, a copy of which is attached as Appendix B to this Proxy Statement. Pursuant to the Voting Agreement, Dr. Eckhouse has agreed, subject to the terms and conditions of the Voting Agreement, to vote all of the Eckhouse Shares, representing approximately       % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting, in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting (and any adjournment or postponement thereof).
 
Adjournment and Postponement
 
If a quorum is not present within thirty minutes of the scheduled time for the Meeting, the Meeting will be adjourned for a week and will be held on Thursday, June 22, 2017 at the same time and place as the original Meeting. At the adjourned meeting, the presence of at least one shareholder in person or by proxy (regardless of the voting power possessed by their Ordinary Shares) will constitute a quorum for the business for which the original Meeting was called.
 
Voting Procedures and Voting Instructions
 
Shareholders of Record
 
If you are a shareholder of record, meaning that your Ordinary Shares and your Ordinary Shares certificate(s) or electronic evidence of ownership were registered in your name with us and our transfer agent as of the record date, May 8, 2017, you may vote in the following four ways:
 
  ·
By Internet: You may submit your proxy by going to www.voteproxy.com and by following the instructions on how to complete an electronic proxy card.  Please have your proxy card available when you access the web page.
 
  ·
By Telephone: You may submit your proxy by calling toll-free 1-800-PROXIES (1-800-776-9437) in the United States or 1-718-921-8500 from countries outside the United States and by following the recorded instructions. Please have your proxy card available when you call.
 
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  ·
By Mail: You may vote by mail by indicating your vote by marking, signing and dating the proxy card and returning in the envelope provided as soon as possible.  You should sign your name exactly as it appears on the proxy card. If you are signing in a representative capacity (for example, as guardian, executor, trustee, custodian, attorney or officer of a corporation), indicate your name and title or capacity.
 
  ·
At the Meeting: If you are a shareholder of record and prefer to vote your Ordinary Shares at the Meeting, you must bring proof of identification along with your proxy card or proof of ownership.
 
Even if you plan to attend the Meeting in person, we encourage you to submit a proxy in advance by Internet, telephone or mail so that your Ordinary Shares will be voted if you later decide not to attend the Meeting. Telephone and Internet facilities for the submission of a proxy to vote Ordinary Shares will be available 24 hours a day and will close at 11:59 p.m. Israel time on June 14, 2017.  Proxy cards mailed with respect to Ordinary Shares must be received no later forty-eight (48) hours prior to the Meeting (i.e. at 3:00 pm Israel time on June 13, 2017) in order to be counted in the vote.
 
You may revoke your proxy at any time before the vote is taken at the Meeting by (a) delivering to us at our executive offices located at Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel, Attention: Hugo Goldman, Chief Financial Officer, a written notice of revocation, bearing a later date than the proxy, stating that the proxy is revoked, (b) properly submitting a later-dated proxy relating to the same Ordinary Shares over the Internet, by telephone or by mail or (c) attending the Meeting and voting in person (although attendance at the Meeting will not, by itself, revoke a proxy). Ordinary Shares represented by properly executed proxies received by us no later than 11:59 p.m. Israel time on June 14, 2017 if voting over the Internet or by telephone or no later than forty-eight (48) hours prior to the Meeting for proxies voted by mail will, unless such proxies have been previously revoked or superseded, be voted at the Meeting in accordance with the directions on the proxies.
 
You may also be represented by another person present at the Meeting by executing a proxy designating that person to act on your behalf.
 
If you vote over the Internet, by telephone or sign, date and return your proxy card without indicating how you want to vote, your Ordinary Shares will be voted “FOR” all of the proposals on the agenda of the Meeting and, if applicable, at the discretion of the proxy holder, on any other business that may properly come before the Meeting or any adjournments or postponements thereof.
 
Shares Held in “Street Name”
 
If you hold your Ordinary Shares in “street name” through a bank, broker or other nominee you may either (1) instruct your bank, broker or other nominee who holds your Ordinary Shares on how to vote by either mailing your properly completed voting instruction card provided to you by your bank, broker or other nominee who holds your Ordinary Shares or by telephone by calling the number on your voting instruction card or (2) vote in person at the Meeting, so long as you obtain a signed, legal proxy from the bank, broker or other nominee who holds your Ordinary Shares, giving you the right to vote those Ordinary Shares in person. Please reach out to your bank, broker or other nominee who holds your Ordinary Shares and ask them to send you the voting instruction card.
 
If you are not going to vote in person at the Meeting, you must provide your bank, broker or other nominee with instructions on how to vote your Ordinary Shares. Your bank, broker or other nominee who holds your Ordinary Shares cannot vote or make any election with respect to your Ordinary Shares without receiving instructions from you. Please check your voting instruction card used by your bank, broker or other nominee who holds your Ordinary Shares on how to instruct your bank, broker or other nominee by telephone on how to vote your Ordinary Shares.
 
If you are going to vote in person at the Meeting, you will need to obtain a signed, legal proxy from your bank, broker or other nominee who holds your Ordinary Shares.
 
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You must also contact your bank, broker or other nominee who holds your Ordinary Shares to change or revoke your voting instructions.
 
Voting of Proxies
 
All Ordinary Shares represented at the Meeting by valid proxies that we receive no later than 11:59 p.m. Israel time on June 14, 2017 if voting over the Internet or by telephone or no later than forty-eight (48) hours prior to the Meeting for proxies voted by mail as a result of this solicitation (other than proxies that are revoked or superseded before they are voted) will be voted in the manner specified on such proxy. If you submit an executed proxy but do not specify how to vote your proxy, your Ordinary Shares will be voted “FOR” the proposals on the agenda of the Meeting and, if applicable, at the discretion of the proxy holder, on any other business that may properly come before the Meeting or any adjournment or postponement thereof.
 
Proxies submitted with instructions to abstain from voting and broker non-votes will not be considered to be votes “FOR” or “AGAINST” the Merger Proposal or any other proposal and will have no effect on the result of the vote, other than for establishing a quorum.
 
Solicitation of Proxies
 
This proxy solicitation is being made and paid for by us on behalf of our Board of Directors. In addition to solicitation by mail, our directors, officers and employees of our Company may solicit proxies for the Meeting from our shareholders personally or by telephone, facsimile and other electronic means without compensation other than reimbursement for their actual expenses. We have retained The Proxy Advisory Group, LLC as our proxy solicitor. We have agreed to pay a minimum base proxy solicitation fee of $10,000 plus up to $1,500 for disbursements, to The Proxy Advisory Group, LLC, which fee may increase if special added-value services are required.
 
Arrangements will be made with brokerage firms and other custodians, nominees and fiduciaries for the forwarding of solicitation materials to the beneficial owners of Ordinary Shares held of record by those persons, and we will, if requested, reimburse the record holders for their reasonable out-of-pocket expenses in so doing.
 
SHAREHOLDERS SHOULD NOT SEND ANY CERTIFICATES REPRESENTING ORDINARY SHARES WITH THEIR PROXY CARDS. IF THE MERGER PROPOSAL IS ADOPTED AND APPROVED AND THE MERGER IS SUBSEQUENTLY COMPLETED, YOU WILL RECEIVE INSTRUCTIONS FOR SURRENDERING YOUR CERTIFICATES OR ELECTRONIC EVIDENCE OF OWNERSHIP IN EXCHANGE FOR THE MERGER CONSIDERATION.
 
SHAREHOLDERS ARE URGED TO MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE PROVIDED. IN ORDER TO AVOID UNNECESSARY EXPENSE, WE ASK YOUR COOPERATION IN VOTING OVER THE INTERNET OR BY TELEPHONE OR RETURNING YOUR PROXY CARD PROMPTLY, NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE. ALTERNATIVELY, YOU MAY VOTE YOUR ORDINARY SHARES OVER THE INTERNET OR BY TELEPHONE PURSUANT TO THE INSTRUCTIONS CONTAINED IN THESE MATERIALS.
 
Questions and Additional Information
 
If you have questions about the Merger or how to submit your proxy, or if you need any additional copies of this Proxy Statement or the enclosed proxy card or voting instructions, please contact:
 
Syneron Medical Ltd.
Attention: Hugo Goldman, Chief Financial Officer
Industrial Zone, Tavor Building
P.O.B. 550, Yokneam Illit 20692, Israel
972-732-442200
hugo.goldman@syneron-candela.com
 
The Proxy Advisory Group, LLC
Attention: William M. Poudrier
18 East 41st Street, 20th Floor
 
New York, NY 10017
toll-free 1-888-55-PROXY (1-888-557-7699) in the United States
or 1-212-616-2180 from countries outside the United States
 
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THE MERGER
 
The discussion in this Proxy Statement of the Merger is subject to, and is qualified in its entirety by reference to, the Merger Agreement, which is the legal document governing the Merger. We have attached a copy of the Merger Agreement to this Proxy Statement as Appendix A and it is hereby incorporated by reference into this Proxy Statement, and we urge that you read it carefully and in its entirety.
 
Background of the Merger
 
The Company's Board of Directors regularly reviews the Company’s performance, risks, opportunities and strategy, Additionally, as part of its ongoing oversight of the Company’s business, from time to time, the Company’s Board of Directors and the senior management of the Company, together with the Company’s legal and financial advisors, review and evaluate strategic opportunities and alternatives available to the Company with a view toward maximizing shareholder value. Such opportunities and alternatives include, among other things, remaining as an independent public company and pursuing business combinations and similar transactions.
 
As part of this ongoing review and evaluation, the Board of Directors and the senior management of the Company have noted the challenges of maximizing shareholder value as an independent public company operating in both a highly competitive and consolidating industry, the lack of liquidity in the Company’s Ordinary Shares, a limited institutional and equity research following, a material historical trading discount relative to peers and the challenges of increasing sales and profitability in North America.
 
As part of this ongoing review and evaluation, representatives of Barclays have regularly provided input to the Company and its Board of Directors regarding industry trends, valuations and various potential strategic opportunities. Dr. Eckhouse, certain members of the Company’s senior management and the Board of Directors have had a longstanding relationship with Barclays and retained Barclays to act as the Company’s financial advisor with respect to pursuing strategic alternatives for the Company, including a possible sale of the Company, based on, among other factors, its familiarity with the Company and because of Barclays’ qualifications, reputation and experience in the valuation of businesses and securities in connection with mergers and acquisitions generally, as well as substantial experience in transactions comparable to the Merger.
 
During recent years, as part of regular conversations between certain members of the senior management of the Company and global companies in the same or adjacent industries, as well as private equity firms that invest in the medical technology sector, informal discussions regarding possible strategic transactions involving the Company had occurred with a number of potentially interested parties. The Board of Directors was periodically informed of the status of such discussions.
 
 
On November 8, 2015, Dr. Shimon Eckhouse, the Company’s Co-Founder and Chairman of the Board of Directors, met with certain members of the senior management of Party A, a strategic party, regarding the possible acquisition of the Company by Party A (or by its controlling shareholder, a private equity firm). On November 22, 2015, Party A signed a non-disclosure agreement with the Company.  At a working session on November 24, 2015 with certain members of the senior management of the Company, Party A and Party A’s controlling shareholder, the Company presented certain non-public financial information and other strategic information and reviewed the existing products and infrastructure of the Company. Certain members of the senior management of the Company and Party A held an additional meeting focused on potential synergies that could result from a combination transaction on December 27, 2015. From late November 2015 until the end of January 2016, the Company had several telephone conversations with Party A regarding Party A’s internal process for considering a strategic transaction, after which Party A indicated that it was not interested in pursuing such a transaction with the Company. Party A did not give any indication of price and the Company received no formal offer from Party A or its controlling shareholder.  The standstill provision in the non-disclosure agreement between the Company and Party A ceased to be effective.
 
In December 2015, the Company was introduced to Party B, a private equity firm, by a mutual business partner, after which Party B signed a non-disclosure agreement with the Company on January 11, 2016. At a meeting between certain members of the senior management of the Company and Party B on January 12, 2016 and on a follow-up telephone conference call between such parties on January 24, 2016, the Company provided non-public information to Party B regarding the Company's business.
 
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On February 18, 2016, at the request of the Board of Directors, Barclays provided the Board of Directors with an overview of the Company’s potential strategic alternatives moving forward to maximize shareholder value. As part of its presentation, Barclays reviewed (i) the current global macro-economic environment, trends in the medical technology industry in the global M&A market and valuation considerations, and (ii) potential strategic and financial buyers for the Company.
 
On April 11, 2016, certain members of the senior management of the Company and representatives of Party B held an additional meeting.  The parties signed an additional, more comprehensive, non-disclosure agreement on April 25, 2016, after which, through June 2016, the Company provided Party B with certain detailed, non-public financial and business information regarding the Company. Certain members of the senior management of the Company held additional meetings with Party B on May 9, 2016 and June 1, 2016, at which the parties discussed the potential acquisition of the Company by Party B, as well as additional ways that the parties could collaborate. Party B did not provide any non-binding indications of price and in early July 2016, Party B indicated that it would not make an offer to acquire the Company. Instead, on July 10, 2016, Party B provided the Company with a proposal regarding a joint venture in China. Such proposal was revised on August 16, 2016 and again on August 30, 2016, in each case as a result of discussions between the Company and Party B.  The Company informed Party B on October 18, 2016 that the proposed joint venture structure and offer were not in line with its business interests.
 
At the direction of certain members of the senior management of the Company, Barclays contacted Party C, a private equity firm, and certain members of the senior management of the Company met with Party C on July 19, 2016 regarding a potential transaction with the Company through either a third-party partially funded acquisition of Ordinary Shares or a going-private transaction.  Following Party C’s execution of a non-disclosure agreement with the Company on August 11, 2016, the Company provided Party C with certain non-public financial and business information.  Certain members of the senior management of the Company held another meeting with Party C on August 31, 2016, at which the Company provided further non-public information about its business, financials and other financial information.
 
At the direction of certain members of the senior management of the Company, representatives of Barclays also contacted Party D, a private equity firm, and certain members of the senior management of the Company met with representatives of Party D on July 20, 2016 regarding a potential transaction with the Company through either a third-party partially funded acquisition of Ordinary Shares or going-private transaction.  Following Party D’s execution of a non-disclosure agreement with the Company on July 24, 2016, the Company provided Party D with certain non-public information regarding the Company’s business.  Certain members of the senior management of the Company held another meeting with Party D on August 30, 2016, at which the Company addressed questions raised by Party D and provided further details on its business and financial information and a potential integration by Party D.  During the following weeks, Party D conducted additional due diligence on the Company.
 
Beginning in August 2016, certain members of management of the Company updated the Board of Directors from time to time regarding its interactions with the various parties described herein.
 
During August 2016, Party E, a strategic party, approached the Company, and the parties held a meeting on August 26, 2016, at which Party E expressed an interest in exploring strategic opportunities with the Company, including a possible acquisition of the Company.  Party E signed a non-disclosure agreement with the Company on September 1, 2016.  On September 19, 2016, the Company met again with Party E and further discussed a possible acquisition of the Company by Party E.  During September and October 2016, the Company provided confidential financial and business information to Party E. The parties continued discussions regarding a potential transaction until January 2, 2017, when the Company terminated discussions with Party E without receiving a formal offer.
 
On September 8, 2016, certain members of the senior management of the Company met again with representatives of Party D and, later in the same month, had an additional telephone call with representatives of Party D and provided further information and addressed questions raised by representatives of Party D. On October 10, 2016, Party D informed the Company that it would not move forward on a transaction with the Company at that time.
 
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For a number of years, the Company had been in contact with Party F, a private equity firm, in connection with a possible investment by Party F in the Company to finance potential acquisitions by the Company.  In June 2016, Party F contacted Dr. Eckhouse and expressed its interest in a potential investment in or acquisition of the Company and, on June 17, 2016, the parties entered into a non-disclosure agreement.
 
Dr. Eckhouse, together with Dominick Arena, a Company director, and Gene Kleinhendler from Gross, Kleinhendler, Hodak, Halevy, Greenberg & Co., the Company’s outside legal counsel (which we refer to as GKH), met with Party F at GKH’s offices in Tel Aviv on September 6, 2016. At the meeting, Dr. Eckhouse provided an oral overview on the Company and its prospects, including certain non-public information.  The parties also discussed a possible acquisition of the Company by Party F.  On September 7, 2016, Dr. Eckhouse and certain members of the senior management of the Company held a meeting at the Company’s offices with Party F.  Certain members of the senior management of the Company made a presentation about the Company and a potential acquisition and integration implications, and the parties discussed the structure of such potential transaction. In addition, Party F suggested a price in the range of $9.75 to $10.25 per Ordinary Share and described the process by which Party F had formulated such offer and the discussions it had with its investment committee. Dr. Eckhouse asked Party F to go back to its investment committee to increase the suggested price.
 
On September 14, 2016, Party C informed the Company that it was not interested in continuing discussions with the Company regarding a potential transaction.
 
During September and October 2016, the Company had several telephone calls with Party F to further discuss a potential transaction and provided Party F with additional non-public financial and business information regarding the Company. Dr. Eckhouse, after conferring with counsel, resolved to end the discussions with Party F when it became known to the Company that it would be difficult for Party F to offer more than $9.75 to $10.25 per Ordinary Share.
 
Following the termination of discussions with Party F, Mr. Arena suggested to Dr. Eckhouse that Mr. Arena contact Apax, another private equity fund, to gauge its interest in a possible transaction.  Mr. Arena had previously worked with Apax and knew Steven Dyson, a partner and co-head of healthcare at Apax.
 
On November 4, 2016, Mr. Arena contacted Mr. Dyson to discuss the possibility of Apax acquiring the Company, and they agreed to arrange a meeting for the parties to discuss a possible transaction.
 
On November 6, 2016, the Company was approached by Party G and Party H, both private equity firms that were considering a joint acquisition of the Company.  On November 11, 2016, certain members of senior management of the Company met with Party G and Party H to better understand the nature of their interest and to provide them with an introduction to the Company. On November 14, 2016, Parties G and H each signed non-disclosure agreements with the Company. Over the next few weeks, the Company provided Parties G and H with certain non-public information related to the Company’s business and financials. On December 26, 2016, certain members of the senior management of the Company met with Party H to further discuss the information that had been provided to them.
 
On December 11, 2016, the Company met in Israel with Party I, a strategic party and business partner of the Company, regarding a potential acquisition by Party I of the Company.  At the meeting, the parties discussed the companies’ existing commercial relationship and the opportunity for Party I to acquire and integrate the Company.  On December 28, 2016, the Company received an informal indication of interest from Party I regarding an acquisition of the Company without specifying price.  Party I indicated that it would need certain non-public information regarding the Company in order to express a view on price.
 
Over the course of 2016, the Company met with four additional potential strategic and financial investors that signed non-disclosure agreements, and the Company provided them with certain non-public information regarding the Company.  None of these parties showed substantial interest in a transaction with the Company or provided a formal offer to the Company.
 
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On December 8, 2016, Dr. Eckhouse, Mr. Arena and Mr. Kleinhendler met with Mr. Dyson and Zehavit Cohen, a partner of Apax Partners Israel Ltd. (an affiliate of Apax), at the offices of GKH. At the meeting, Dr. Eckhouse gave an overview of the Company and its prospects. Mr. Dyson provided the Company with a description of Apax, its general history and track record and its healthcare experience, including recent transactions. At the meeting, the parties discussed solely public information.  Based on its preliminary due diligence on publicly available information, Apax presented an indicative offer to acquire all of the Ordinary Shares of the Company for $10.25 to $10.75 per Ordinary Share in cash.  Dr. Eckhouse expressed the Company’s desire that Apax increase its price.
 
On December 20, 2016, based on publicly available information, Apax delivered a non-binding written proposal to Dr. Eckhouse outlining the preliminary terms and conditions of a transaction, which provided, among other things, for:
 
  ·
the acquisition of all of the Company’s Ordinary Shares (on a fully diluted basis) for a price of $10.75 to $11.00 per Ordinary Share in cash, representing a 27% to 30% premium to the Company’s closing price on December 16, 2016 and a 40% to 43% premium to the Company’s 90-day volume-weighted average closing price; and
 
  ·
a proposed exclusivity period following receipt of the proposal, during which Apax would be permitted to conduct and complete due diligence within four to six weeks of being given full access to the management of the Company and Company data and with a merger agreement to be negotiated and signed in parallel.
 
During the following days, Dr. Eckhouse updated the Board of Directors on the offer received from Apax.
 
On December 21, 2016, Dr. Eckhouse contacted Barclays to discuss the initial Apax proposal.
 
On December 26, 2016, Dr. Eckhouse spoke with Mr. Dyson regarding the valuation approach underlying the non-binding proposal from Apax and requested certain clarifications as to the valuation approach.
 
On December 27, 2016, Apax sent the Company a supplemental letter further outlining the basis of its proposal, stating, among other things, that its proposal was predominantly based on its assessment of the future performance of the Company’s business under presumed Apax ownership.  Apax stated that it considered the trading and transaction comparables, the Company’s historical trading prices and the premium implied by its proposal.  In addition, Apax stated that it (i) conducted both primary and secondary market research, (ii) interviewed industry experts, key opinion leaders and typical customers, and (iii) reviewed publicly available information on the Company and its competitors to build its assumptions regarding the future financial performance of the Company.
 
On December 28, 2016, the Board of Directors held a telephonic meeting to discuss the Apax proposal, which GKH attended. GKH reviewed with the Board of Directors its fiduciary duties under Israeli law in connection with a potential sale of the Company and related Israeli law matters. At the meeting, Dr. Eckhouse provided background regarding the potential transaction with Apax and provided information regarding Barclays as the Company’s potential financial advisor in connection with a potential sale of the Company. At the meeting, Dr. Eckhouse stated his view that, based on his discussions with Mr. Dyson and Apax’s reputation and history as a credible acquirer of global healthcare businesses, the Apax proposal was a serious offer that could potentially maximize value for shareholders. Dr. Eckhouse informed the Board of Directors that, in parallel with discussions with Apax, the Company also was conducting ongoing discussions with additional potential investors and acquirers, including with some of the parties previously described herein, regarding a potential acquisition of the Company. The Board of Directors discussed the Apax proposal and the challenges facing the Company in the market, including its relative industry valuation. The Board of Directors resolved in the meeting that Dr. Eckhouse would schedule another call with Barclays to review the Apax proposal and consider any other strategic alternatives available to the Company.
 
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On January 4, 2017, the Board of Directors met at the offices of the Company with Barclays participating telephonically.  Dr. Eckhouse provided additional information with respect to Apax and an update on the potential transaction, including Apax’s requested due diligence timing and exclusivity period, as well as the potential for a “go shop” period that would enable the Company to more broadly market itself for sale after execution of a definitive agreement with Apax. The Board of Directors discussed issues relating to the valuation of the Company, comparable public company valuations and valuations in precedent transactions in the industry.  The Board of Directors and Barclays also discussed other alternatives available to the Company, including an analysis of other potential acquirers of the Company. This was followed by a discussion of tactical options available to the Company and what a bidding process could entail.  The Board of Directors also received an update on the status of relevant Company contacts in 2016 and 2017 with private equity firms and strategic parties regarding potential transactions, including with the parties described herein and with other parties who had discussions with the Company but did not materialize into meaningful relationships.  The Board of Directors discussed whether to grant Apax exclusivity or run an auction process and concluded that based on (i) the distraction to management of the Company and diversion of resources from operating the Company that a lengthy broad sales process (which may not be ultimately successful) may cause, (ii) concerns that Apax may withdraw its offer if the Company were to run an auction process, and (iii) its belief that, based on prior discussions with other multiple parties, the valuation proposed by Apax was attractive.  After further consideration, the Board of Directors determined that if they could successfully negotiate a transaction at or above the upper end of Apax’s value range and there was a subsequent “go shop” period, the Board of Directors would consider pursuing the transaction with Apax and agree to an exclusivity period.
 
In addition, the Board of Directors resolved to prepare a virtual data room containing due diligence materials regarding the Company (which we refer to as the VDR), and requested that Barclays contact Apax to discuss the terms of an exclusivity period and emphasize the importance of a “go shop” process. Barclays subsequently contacted Apax to discuss the foregoing on January 16, 2017.
 
Also on January 4, 2017, at the request of the Board of Directors, Barclays provided disclosure to the Company indicating certain of its investment banking relationships with the Company and Apax. The Board of Directors discussed such disclosure and relationships and concluded that there were no material conflicts that should prevent Barclays from continuing to advise the Company.
 
On January 12, 2017 and January 19, 2017, the Company met with Party I to discuss a potential acquisition of the Company by Party I.  On January 26, 2017, Party I sent a formal information request to the Company.
 
On January 13, 2017, the Company and Apax entered into a non-disclosure agreement.
 
Following meetings between the Company and Party D in early January 2017, Barclays, at the direction of certain members of senior management of the Company, provided a non-public financial information of the Company to Party D on January 15, 2017.  Certain members of senior management of the Company participated in general discussions regarding a potential transaction with Party D but did not receive any indication of price or a formal offer from Party D.
 
On January 17, 2017, certain members of senior management of the Company met with Party H to discuss a potential transaction.
 
On January 24, 2017 and January 25, 2017, Party H met with certain members of senior management of the Company in Israel to receive a full overview of the Company’s business, management and financials.  At the meeting, Party H discussed a potential acquisition of the Company.
 
On January 24, 2017, the Company formally engaged Barclays as its financial advisor with respect to pursuing strategic alternatives for the Company.
 
On January 29, 2017, the Company and Apax entered into an exclusivity agreement (which we refer to as the Exclusivity Agreement) for a 30-day period, with the term to run from February 6, 2017 to March 8, 2017.  The Exclusivity Agreement contained a provision that enabled the Company to continue to engage in any existing activities, discussions or negotiations with any party that had commenced prior to the date of the Exclusivity Agreement with respect to any offer or proposal to acquire the Company.  The Exclusivity Agreement also enabled the Company to consider any other proposal to acquire the Company made during the exclusivity period if the Board of Directors determined that consideration of such proposal was required in order for the Board of Directors, based on the advice of outside counsel, to satisfy its fiduciary obligations under Israeli law.
 
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On February 6, 2017 and February 7, 2017, meetings were held in Israel with certain members of management of the Company, Barclays, Apax, GKH and other Apax advisors.  Certain members of management of the Company made presentations regarding the Company, and Apax and its counsel, which was only present at the February 6, 2017 meeting, had the opportunity to ask questions.  The parties also discussed a detailed 30-day due diligence plan, including site visits by Apax to Company facilities.
 
On February 7, 2017, Apax and its advisors were granted access to the VDR.
 
From February 8, 2017 through April 2, 2017, the Company, with the assistance of Barclays and GKH, collected and responded to Apax and its advisors’ due diligence requests, and posted Company documentation in the VDR or shared Company documentation with Apax and its advisors via email.  During this time period, representatives of Apax and its advisors conducted extensive financial, commercial, clinical and legal due diligence on the Company. The due diligence review included teleconferences between Apax’s advisors and certain members of management of the Company and its advisors. In addition, the Company and its advisors provided written responses to diligence inquiries from Apax and its advisors.
 
On February 9, 2017, the Company and Party I entered into a non-disclosure agreement as permitted under the Exclusivity Agreement with Apax.  On February 13, 2017, Party I was provided with answers to previously submitted questions regarding the business of the Company, as well as a non-public financial information for the Company.
 
On February 13, 2017, various media reported that Apax and the Company were in negotiations regarding a potential acquisition of the Company by Apax. The Company’s stock increased as much as 6.5% from the closing price on February 10, 2017 (the previous trading day) during intra-day trading on February 13, 2017 after the news, and closed at $9.65, up 3.8% from the closing price on February 10, 2017 on significantly elevated trading volume.  The Company determined, based on (i) the limited amount of due diligence completed by Apax and its advisors as of such date, (ii) the uncertainty associated with such proposal and (iii) a general policy not to comment on rumors about the Company, not to make a public announcement regarding the media reports. Apax also did not make a public announcement regarding the media reports.
 
From February 16, 2017 to February 17, 2017, certain members of management of the Company and representatives of Barclays, Apax, and Apax’s advisors participated in additional diligence meetings in New York as well as a site visit to Candela Corporation’s Wayland, Massachusetts facility. From February 20, 2017 to February 21, 2017, the certain members of management of the Company met with representatives of Apax at the Company’s headquarters in Israel to conduct further diligence meetings.
 
On February 21, 2017, the Board of Directors had a conference call with GKH and Barclays. Barclays updated the Board of Directors regarding Apax’s proposal in light of the then-recent announcement on February 13, 2017 by Allergan plc of its all-cash acquisition of ZELTIQ Aesthetics, Inc., a competitor of the Company, and the then-recent announcement on February 14, 2017 by Hologic, Inc. of its all-cash acquisition of Cynosure, Inc., another competitor of the Company, and presented a valuation analysis of the Company. The Board of Directors discussed the similarities and differences between those transactions and the proposed transaction with Apax. In addition, Barclays informed the Board of Directors regarding the timing of receipt of draft transaction documentation. The Board of Directors discussed the steps to be taken as part of a “go shop” process and agreed, in consultation with Barclays, Morrison & Foerster LLP, U.S. legal counsel for the Company (which we refer to as M&F) and GKH, to entertain any other offers the Company may receive in light of recent market transactions. The Board of Directors further discussed the price per Ordinary Share that it would require in order to agree to a transaction and the potential steps for improving Apax’s proposal.
 
On February 22, 2017, the Company provided answers to additional due diligence questions from Party I, after which Party I ceased communicating with the Company. Party I did not provide any indication of price to the Company and never submitted a formal offer.
 
On March 2, 2017, Apax sent an updated non-binding letter to the Company, which included a price of $10.75 per Ordinary Share in cash and listed certain open due diligence matters. In addition, Apax sent the Company a first draft of the Merger Agreement, which did not provide for a “go shop” period.
 
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On March 2, 2017, the senior management of the Company met with representatives of Party H.  At the meeting, the senior management of the Company provided further non-public information to members of Party H’s investment committee.  Soon thereafter, Party H informed the Company that it would not pursue an opportunity to acquire the Company.
 
On March 6, 2017, the Board of Directors held a teleconference meeting with representatives of Barclays and discussed the latest price of $10.75 per Ordinary Share offered by Apax.  The Board of Directors determined to seek a higher price from Apax.  Following discussion by the Board of Directors regarding issues raised in the draft Merger Agreement, the Board of Directors requested that Barclays relay to Apax the Board of Directors’ feedback on a number of issues in the draft Merger Agreement, including that the proposed breakup fee of 4.25% of the total equity value of the transaction was too high and that the Merger Agreement would need to include a customary “go shop” period.
 
On March 7, 2017, representatives of Barclays relayed to representatives of Apax the Board of Directors’ position on the various issues in the draft Merger Agreement and that the Board of Directors would seek a value in excess of $10.75 per Ordinary Share (the upper end of the range Apax had provided in its initial proposal).
 
On March 8, 2017, Apax provided the Company with a “best and final” non-binding proposal to acquire the Company for $11.00 per Ordinary Share in cash, along with a draft equity commitment letter and draft Voting Agreement. The revised proposal also included a 30-day “go shop” period, which was not included in earlier versions of its proposals, and a reduced termination fee of 3.5% of the total equity value of the transaction. Apax also requested a seven-day extension of the exclusivity period.
 
On March 10, 2017, the Board of Directors held a teleconference meeting, with representatives of Barclays and GKH present.  Representatives of Barclays informed the Board of Directors regarding the updated proposal received from Apax and described its key terms. Barclays reviewed the “go shop” process and a list of potential buyers that could be contacted as part of such a process. The Board of Directors agreed, to the extent required, to extend the non-solicitation period to March 16, 2017, requested that any “go shop” period be extended to take into account holidays in Israel and also requested that the reverse termination fee (equal to 4.25% of the total equity value of the transaction) construct be removed and that certain revisions be made to bifurcate the termination fee proposed in the draft Merger Agreement.  Specifically, the Board of Directors noted that the termination fee should be bifurcated such that the termination fee would be 1.5% of the total equity value of the transaction during the “go shop” period and 3.5% thereafter.
 
At the meeting on March 10, 2017, the Board of Directors also discussed the price per Ordinary Share considering the “undisturbed” price analysis prior to reported speculation on the transaction, Apax’s potential willingness to agree to a price greater than $11.00 per Ordinary Share, the challenges of increasing sales in North America, the current market price of the Company’s Ordinary Shares and the importance of a “go shop” process.  Representatives of GKH also presented legal considerations for the Board of Directors, including business judgment and fiduciary duty issues.  The Board of Directors requested more time to consider the terms of Apax’s updated proposal.
 
Also on March 10, 2017 after discussions with, and at the direction of, the Board of Directors, representatives of Barclays had a teleconference with representatives of Apax during which they relayed to representatives of Apax that the Board of Directors would need additional time to evaluate Apax’s proposed purchase price and the Board of Director’s position on the reverse termination fee, termination fee and “go shop” period.
 
On March 12, 2017, the Board of Directors held a telephonic meeting during which the Board of Directors decided to continue negotiations with Apax based on the $11.00 per Ordinary Share offer. The Board of Directors reviewed the business potential of the Company, the various inquiries the Company received in the past from potential acquirers, the lack of inquiries after the acquisition of two of the Company’s competitors, public speculation of a transaction involving the Company and the market price. In addition, the Board of Directors considered the financial analysis presented by representatives of Barclays and the agreement by Dr. Eckhouse to sign a voting agreement to vote in favor of the transaction.  Following its discussion, the Board of Directors resolved to advise senior management of the Company to continue negotiating with Apax based on the $11.00 per Ordinary Share price.  Dr. Eckhouse raised the need for the Compensation Committee to consider deal-related compensation for the management of the Company and other employees. On March 13, 2017, certain members of senior management of the Company indicated to Apax an agreement on Apax’s proposed purchase price of $11.00 per Ordinary Share.
 
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From March 8, 2017 through April 2, 2017, the parties exchanged drafts of the Merger Agreement, Voting Agreement, equity commitment letter and related documents and the Company continued to respond to due diligence requests from Apax and its advisors.
 
On March 15, 2017, the Compensation Committee met to consider the recommendation of senior management of the Company for deal-related compensation to members of senior management of the Company and other employees. After discussion, the Compensation Committee reduced the scope of the proposed cash compensation to those members of senior management of the Company and employees involved in the due diligence and negotiation process with the buyers and resolved to focus the deal related compensation for members of senior management of the Company and employees generally through full acceleration of options. From March 15, 2017 until March 17, 2017, the Board of Directors discussed such deal-related compensation.
 
On March 21, 2017, GKH, M&F, and Simpson Thacher & Bartlett LLP (which we refer to as STB) and Meitar Liquornik Geva Leshem Tal (which we refer to as Meitar), legal counsel to Apax, had a teleconference call to discuss open issues on the drafts of the Merger Agreement, Voting Agreement and equity commitment letter.  The discussions regarding the Merger Agreement included: (i) the timing for filing the Proxy Statement with the SEC and convening of the Meeting, both in relation to the timing of the “ go shop” process; (ii) the number of matching rights afforded to Parent with respect to a Superior Proposals; (iii) the terms and conditions of terminating the Merger Agreement, including the triggers for termination and fiduciary outs for the Board of Directors, and (iv) the amounts of terminations fees to be paid to Parent under certain circumstances. During these negotiations, the Board of Directors and certain members of senior management of the Company were regularly updated and consulted on the remaining issues.
 
On March 22, 2017, the Board of Directors convened at the request of a director to allow the Board of Directors to consider the then-recent increase in the Company’s Ordinary Share price, which had increased from a closing price per share of $10.05 on March 10, 2017 to $10.70 on March 22, 2017.  The Board of Directors discussed whether, in light of such increase in the Company’s Ordinary Share price, the Company should seek a higher price per Ordinary Share from Apax. The Board of Directors resolved to continue negotiations based on the $11.00 price per Ordinary Share.  At this meeting, the Board of Directors approved deal-related compensation for the members of senior management of the Company and other employees.
 
From March 22, 2017 through April 2, 2017, Apax finalized its due diligence of the Company, and the Company answered additional questions from Apax and its advisors.  Until the execution of the Merger Agreement, GKH, M&F, STB and Meitar continued negotiating the Merger Agreement and the Company’s disclosure schedule to the Merger Agreement. The discussions regarding the Merger Agreement and Company’s disclosure schedule to the Merger Agreement included a teleconference on March 28, 2017 between GKH, M&F, STB and Meitar. As part of the negotiations regarding the Merger Agreement, Parent agreed to (i) set the number of opportunities afforded to Parent to provide matching offers as a result of receiving a Superior Proposal from an unlimited number to three, (ii) not require the Company to publicly recommend against an acquisition proposal by a third party or publicly reaffirm the Merger during the “go shop” period, and (iii) set the “End Date” from eight months to 150 days after execution of the Merger Agreement (subject to extensions as agreed to among the parties or due to an adjournment or postponement of the Meeting).
 
On March 23, 2017, the Company and Apax amended their non-disclosure agreement to permit Apax to share confidential information with potential debt financing sources.
 
On March 23, 2017, the Company filed its annual report for the fiscal year 2016 on Form 20-F with the SEC, which included the financial statements for fiscal year 2016.
 
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From March 28, 2017 to March 31, 2017, GKH, M&F, STB and Meitar, Apax and the Company had several teleconference calls to discuss open issues on the drafts of the Merger Agreement, equity commitment letter and disclosure schedules to discuss issues that remained outstanding, which included, among others, (i) the timing for filing the Proxy Statement with the SEC and convening of the Meeting, both in relation to the timing of the “go shop” process; (ii) the terms and conditions of the “go shop” process, such as the number of matching rights afforded to Parent with respect to a Superior Proposals; (iii) deal certainty, including closing conditions for the Merger and the definition of “Material Adverse Effect”; (iv) the interim operating covenants of the Company; (v) the terms and conditions of terminating the Merger Agreement, such as the triggers for termination, including fiduciary outs for the Board of Directors, and (vi) the amounts of terminations fees to be paid to Parent under certain circumstances. On March 31, 2017, the parties’ lawyers exchanged revised drafts of the Merger Agreement resolving the issues discussed over the previous few days.
 
On April 1, 2017, the Board of Directors met telephonically with representatives of Barclays, M&F and GKH, as well as certain members of senior management of the Company to consider the final terms of the proposed Merger with Parent and Merger Sub and to approve the Merger Agreement.  
 
Representatives of Barclays reviewed with the Board of Directors the financial analyses of the $11.00 per Ordinary Share merger consideration that they had performed in connection with the preparation of its fairness opinion.  In addition, representatives of Barclays discussed with the Board of Directors the possibility that another party would be interested in a transaction at this time at a value in excess of the proposed price offered by Apax, as well as the “go shop” period under the Merger Agreement, pursuant to certain terms, would enable the Company to approach additional parties for a period of 37 days following execution of the Merger Agreement.
 
Representatives of GKH and M&F discussed the key terms of the draft Merger Agreement, including closing conditions, termination and termination fee provisions, and noted the fact that pursuant to certain terms, the Merger Agreement allows the Board of Directors to change its recommendation if an unsolicited Superior Proposal emerges after the execution of the Merger Agreement (subject to certain match rights of Apax) and that the Company would be able to conduct a “go shop” process under the Merger Agreement.  Representatives of GKH further reviewed with the Board of Directors its fiduciary duties under Israeli law in connection with a potential sale of the Company and related Israeli law matters.
 
Following additional updates by the Company’s advisors on the terms of the Merger Agreement and related matters, Barclays rendered to the Board of Directors an oral opinion (subsequently confirmed by delivery of a written opinion dated April 2, 2017) to the effect that, as of the date of such opinion and based upon and subject to the qualifications, limitations and assumptions stated in its opinion, from a financial point of view, the Merger Consideration to be offered to the holders of Ordinary Shares (other than the Cancelled Shares) in the Merger is fair to such holders.
 
Following an extensive and thorough discussion of the factors relevant to the transaction during the course of the Board of Directors meeting on April 1, 2017, the Board of Directors unanimously (i) determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to, and in the best interests of, the Company and its shareholders and that, considering the financial position of the Company and Merger Sub, no reasonable concern exists that the Surviving Company will be unable to fulfill the obligations of the Company to its creditors existing as of immediately prior to the effective time of the Merger, (ii) approved the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, (iii) directed that the matter be submitted to a vote at a special general meeting of the Company’s shareholders and (iv) resolved to recommend to the Company’s shareholders that they adopt and approve the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, and all related matters to be brought before the shareholders at such special general meeting.
 
From April 1, 2017 to April 2, 2017, the Company, M&F, GKH, STB, Meitar and Apax continued to work on and finalize the Merger Agreement, Voting Agreement, equity commitment letter and other related documentation.
 
On April 2, 2017, the Company, Parent and Merger Sub executed the definitive Merger Agreement, a copy of which is attached as Appendix A to this Proxy Statement.
 
On April 3, 2017, prior to the commencement of the trading of the Company’s Ordinary Shares on the NASDAQ Global Select Market, the Company and Apax issued a joint press release announcing the proposed transaction.
 
29

Reasons for Approving the Merger
 
In evaluating the Merger Agreement and the Merger, the Board of Directors, from time to time, consulted with members of management of the Company and the Company’s legal and financial professional advisors and considered various information and factors in connection with the Merger, including those material factors described below.  Among the information and material factors considered by the Board of Directors were the following (which are not listed in any relative order of importance):
 
Financial Condition; Prospects of the Company
 
  ·
The Company’s current and historical financial condition, results of operations, business strategy and competitive position, as well as the Company’s future prospects and objectives as a stand-alone public company and the risks involved in achieving those prospects and objectives under current industry, regulatory and market conditions, and the potential impact of those factors on the trading price of the Ordinary Shares (which is not feasible to quantify numerically).
 
  ·
The prospective risks to the Company as a stand-alone public company, including the risks and uncertainties with respect to (i) achieving its growth in light of the current and foreseeable market conditions, including the risks and uncertainties in the U.S. and global economy generally and the medical device and energy-based medical industries specifically, (ii) the current and prospective competitive climate in both the medical device and energy-based medical industries, which the Company expects to increase in the future, (iii) the likelihood of consolidation in such industries (as evidenced by the recent consolidation among the Company’s competitors in the aesthetic market, such as Cynosure Inc.’s acquisitions of Palomar Medical Technologies, Inc. in June 2013 and Ellman International in September 2014, Valeant Pharmaceuticals International, Inc.’s acquisition of Solta Medical, Inc. in January 2014, Merz Pharma Group’s acquisition of Ulthera, Inc. in July 2014, Boston Scientific’s acquisition of the urology portfolio of American Medical Systems in August 2015, XIO Group’s acquisition of Lumenis Ltd. in October 2015, Hologic, Inc.’s acquisition of Cynosure, Inc. in March 2017 and Allergan plc’s acquisition of ZELTIQ Aesthetics, Inc. in April 2017), which may require the Company to compete against larger competitors with substantially greater resources than the Company’s, (iv) the potential of new market entrants that may attempt to acquire laser or other energy-based medical technology, and the likelihood that the Company will compete with additional, new companies in the future, and (v) other “Risk Factors” as set forth in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2016.
 
  ·
The inherent uncertainty of achieving the Company management’s projections, and that as a result, the Company’s actual financial results in future periods could differ materially from the Company management’s forecasted results. In reaching this view, the Board of Directors took into account the risks and operational challenges associated with the continued execution of the Company’s strategic plan in North America.
 
  ·
The current state of the economy and uncertainty surrounding forecasted economic conditions both in the near term and the long term, generally, and within our industry in particular, which could reduce net revenue generated by our clients.
 
  ·
The costs to the Company of operating as a stand-alone public company, including the costs and efforts associated with public reporting and other compliance obligations, national exchange regulations and fees, insurance, and regulatory matters, and the limitations on the Company’s ability to pursue its strategic plan and take necessary competitive actions while remaining a public company.
 
Strategic Alternatives
 
  ·
The trends and competitive developments in the industries in which the Company operates and the range of strategic alternatives available to the Company.  These strategic alternatives include either remaining as a stand-alone public company or, based on prior periodic discussions with other potential strategic and financial parties, being acquired by or pursuing a business combination with such parties.
 
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  ·
Based on the results of such discussions with other potential strategic and financial parties prior to executing the Merger Agreement, the Board of Directors believed it was well-informed about the opportunities for acquisition and business combination transactions and how potential acquirers and strategic partners would likely value the Company’s business in the context of an acquisition or business combination.  The Board of Directors took this knowledge and experience into account in considering strategic alternatives available to the Company and in negotiating the “go shop” period in the Merger Agreement.
 
  ·
The Board of Directors, with assistance of the Company management and financial and legal advisors, determined that the Merger was more favorable to its shareholders than other potential strategic or other alternatives reasonably available to the Company at that time, taking into account the risks and uncertainties associated with those alternatives and the Company’s ability to actively solicit alternative acquisition proposals during the “go shop” period, which is intended to help ensure that the Company’s shareholders receive the highest price per share reasonably available. See “—‘Go Shop’ Period and Fiduciary Out” below.
 
Financial Terms; Fairness Opinion; Certainty of Value
 
  ·
Historical market prices, volatility and trading information with respect to Ordinary Shares, including that the Merger Consideration of $11.00 per share in cash:
 
  o
Was represented as Apax’s “best and final offer” and was the result of extensive negotiations with Apax, including an increase from the $10.75 price per share previously offered by Apax;
 
  o
Represented a premium of 15% over the volume-weighted average closing price of Ordinary Shares on the NASDAQ Global Select Market during the 90 days ended March 31, 2017 (the last trading day before the adoption and approval of the Merger Agreement by the Board of Directors); and
 
  o
Represented a premium of 33% over the volume-weighted average closing price of Ordinary Shares on the NASDAQ Global Select Market during the 90 days ended February 10, 2017 (the last trading day prior to media speculation of a transaction with Apax).
 
  ·
Notwithstanding numerous discussions with other potential strategic and financial parties prior to executing the Merger Agreement, no third party made a formal offer for the Company.
 
  ·
The oral opinion of Barclays rendered on April 1, 2017 (subsequently confirmed by delivery of a written opinion dated April 2, 2017) to the Board of Directors to the effect that, as of the date of such opinion and based upon and subject to the qualifications, limitations and assumptions stated in its opinion, from a financial point of view, the Merger Consideration to be offered to the holders of Ordinary Shares (other than the Cancelled Shares) in the Merger is fair to such holders, as more fully described in the section of this Proxy Statement entitled “The Merger—Opinion of Financial Advisor” beginning on page 36.
 
  ·
The form of consideration to be paid in the transaction is cash, which provides certainty of value and immediate liquidity to the Company’s shareholders, especially when viewed against the risks and uncertainties inherent in the Company’s business, as described above.
 
  ·
The Board of Directors’ belief that the present Merger Consideration together with the “go shop” process described below under “—‘Go Shop’ Period and Fiduciary Out” would likely result in a sale of the Company at the highest per share value reasonably obtainable for the Company’s shareholders.
 
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“Go Shop” Period and Fiduciary Out
 
  ·
Subject to compliance with the Merger Agreement, the Board of Directors is permitted until May 9, 2017, to actively initiate and solicit acquisition proposals and to participate in discussions or negotiations with, or pursuant to an acceptable confidentiality agreement, provide non-public information to, any person, which process is intended to enable the Company to continue to evaluate potential alternatives to the proposed acquisition by Apax, in order to obtain maximum shareholder value.
 
  ·
The fact that Parent only has the right on three occasions to negotiate with the Company to match the terms of any Superior Proposal (as defined in the section of this Proxy Statement entitled “The Merger Agreement—No Solicitation” beginning on page 61) or any subsequent modifications to such proposal, and the Board of Directors’ belief that the limitation of such matching right removes a potential deterrent to a third party’s willingness to make a Company Acquisition Proposal.
 
  ·
The Company’s right, until its shareholders’ adoption and approval of the Merger Agreement, to continue discussions, subject to certain conditions, after May 9, 2017, only with a party who had made a bona fide Company Acquisition Proposal during the “go shop” period and if the Board of Directors has determined in good faith (after consultation with the Company’s outside legal and financial advisors) that such proposal constitutes or is reasonably expected to lead to a Superior Proposal;
 
  ·
If the Board of Directors determines in good faith, after consultation with the Company’s outside legal counsel and  financial advisor, that a Company Acquisition Proposal constitutes a Superior Proposal, and assuming it has not violated any provisions of the Merger Agreement related to solicitation of the Company Acquisition Proposal (and after giving Parent three matching rights to revise the terms of the Merger Agreement in response to the Company Acquisition Proposal so that accepting it would not be inconsistent with the directors’ fiduciary duties), the Board of Directors may change its current recommendation in favor of the Merger Proposal, terminate the Merger Agreement and pay Parent a termination fee of either $5.96 million or $13.91 million under certain circumstances as provided in the Merger Agreement.
 
  ·
The Board of Directors, based in part on advice from its financial and legal advisors, believes that the termination fee payable under certain circumstances as provided in the Merger Agreement is reasonable, customary and would not deter any interested third party from making, or inhibit the Board of Directors from approving, a Company Acquisition Proposal that would constitute a Superior Proposal if such proposal were available and made in accordance with the terms and conditions of the Merger Agreement.
 
  ·
The Company’s right, until its shareholders’ adoption and approval of the Merger Proposal and the adoption of the Merger Agreement, to make a change by the Board of Directors in its recommendation in favor of the Merger Proposal if there is an event, development or change in circumstances that is material to the Company and its subsidiaries, taken as a whole, that does not relate to any Company Acquisition Proposal and was not known or reasonably foreseeable as of the date of the Merger Agreement, and the Board of Directors determines in good faith (after consultation with the Company’s outside legal and financial advisors) that failure to make such a recommendation change as a result of such event, development or change in circumstances would be inconsistent with the directors’ fiduciary duties under applicable law.
 
Likelihood of Consummation
 
  ·
The Merger Agreement has terms that were the product of extensive arm’s-length negotiations and such terms are, in the Board of Directors’ view, advisable and the transactions contemplated thereby fair to the Company and its holders of Ordinary Shares.
 
32

  ·
The structure of the transaction as a statutory merger under the Companies Law, which enables the Company’s shareholders to receive the Merger Consideration in a relatively short time frame (and reduces the pendency and hence the uncertainty of the transaction).
 
  ·
The timing of the Merger and the Board of Directors’ consideration that Apax communicated that it had provided its “best and final offer.”
 
  ·
There are no third party consents that are conditions to the transaction.
 
  ·
There are no debt financing conditions, and the equity commitment letter received from the Investors in connection with the Merger reduces the possibility that Apax will be unable to pay the Merger Consideration.
 
  ·
The Company’s ability, under certain circumstances, to seek specific performance of Apax’s obligation to cause the Investors to fund the full amount of the Merger Consideration and Award Consideration pursuant to the terms of the equity commitment letter.
 
  ·
Dr. Eckhouse, solely in his capacity as a shareholder, has entered into a voting agreement with Parent, a copy of which is attached as Appendix B to this Proxy Statement, pursuant to which he has agreed to vote his 2,689,911 outstanding Ordinary Shares and 281,250 Ordinary Shares issuable upon exercise of outstanding options, or approximately      % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting, in favor of the adoption and approval of the Merger Agreement solely in his capacity as a shareholder, and the adoption and approval of the Merger and the other transactions contemplated by the Merger Agreement.
 
  ·
The identity of Apax, which is a reputable financial buyer, and the Board of Directors’ assessment that Apax would have adequate capital resources to pay the Merger Consideration and complete the Merger.
 
Other Terms
 
  ·
The structure of the transaction as a statutory merger under the Companies Law which allows for an informed vote by the shareholders on the merits of the Merger Proposal.
 
  ·
Under the terms of the Merger Agreement, the Company has sufficient operating flexibility to conduct its business in the ordinary course between the execution of the Merger Agreement and consummation of the Merger.
 
  ·
The fact that the adoption and approval of the Merger Proposal will require the affirmative vote of holders of at least a majority of Ordinary Shares present and voting, in person or by proxy, at the Meeting on the Merger Proposal.
 
  ·
The definition of “Material Adverse Effect” has a number of exceptions and “Material Adverse Effect” is generally a very high standard as applied by courts.
 
  ·
The Board of Directors’ engagement of financial and legal advisors with significant experience in public company transactions to advise it in connection with the Merger, and that those financial and legal advisors were involved throughout the negotiations with Apax and updated the Board of Directors directly and regularly, which provided the Board of Directors with additional perspectives on the negotiations in addition to those of the Company management.
 
  ·
The fact that the members of the Board of Directors were unanimous in their determination to approve the Merger Agreement and the Merger.
 
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 Risks and Uncertainties
 
The Board of Directors also considered a number of uncertainties and risks in its deliberations concerning the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement, including the risks described under the section of this Proxy Statement entitled “Risk Factors,” as well as the following (which are not listed in any relative order of importance):
 
  ·
The Company’s current shareholders would not have the opportunity to participate in any possible growth and profits of the Company following the completion of the Merger.
 
  ·
The closing conditions for the Merger, and the fact that if the closing conditions are not satisfied or waived in a timely manner and the Merger is delayed, payment of the Merger Consideration would also be delayed. Further, if the Merger is not completed (including in the case the Merger Agreement is terminated), the Company’s ongoing business may be adversely affected and it would be required to pay certain costs relating to the Merger, including substantial financial advisor, legal and accounting fees, even though the Merger will have not been completed.
 
  ·
The regulatory notifications and filings required for completion of the Merger and the risk that the applicable governmental authorities may challenge or decide not to approve the Merger. The Board of Directors also considered the potential length of the regulatory approval process. See the section of this Proxy Statement entitled “The Merger—Regulatory Matters” beginning on page 48.
 
  ·
The risk that the proposed transaction might not be completed, even if approved by the Company’s shareholders, and the effect of the resulting public announcement of termination of the Merger Agreement on:
 
  o
The market price of Ordinary Shares, which could be affected by many factors, including (i) the reason for the termination of the Merger Agreement and whether such termination results from factors adversely affecting the Company, (ii) the possibility that the marketplace would consider the Company to be an unattractive acquisition candidate and (iii) the possible sale of Ordinary Shares by short-term investors following the announcement of termination of the Merger Agreement.
 
  o
The Company’s operating results, particularly in light of the expenses incurred in connection with the transaction, including the potential requirement to pay a termination fee.
 
  o
The ability to attract and retain key personnel.
 
  o
Relationships with customers, suppliers and others that do business with the Company.
 
  ·
The possible disruption to the Company’s business that may result from the announcement of the transaction, the resulting distraction of the Company management and employees which may hinder their ability to respond effectively to competitive pressures, industry developments and future opportunities, as well as the impact of the transaction on the Company’s customers, suppliers and others that do business with the Company.  In addition, during the pendency of the transaction, the Company would continue to incur significant expenses related to the Merger.
 
  ·
The possible litigation from stockholder suits in connection with the Merger could distract the senior management of the Company and the Board of Directors from operating and overseeing the Company.
 
  ·
The terms of the Merger Agreement, including (i) the operational restrictions imposed on the Company between signing and closing (which may delay or prevent the Company from undertaking business opportunities that may arise pending the completion of the transaction), and (ii) the payment of a termination fee to Parent under certain circumstances.
 
34

  ·
The restriction on soliciting competing offers (other than during the “go shop” period and with “Excluded Parties” after termination of the “go shop” period) and the risk that some provisions of the Merger Agreement and related documents might have the effect of discouraging other persons potentially interested in acquiring the Company from pursuing an acquisition of the Company.
 
  ·
The fact that the Merger Consideration would be taxable to the Company’s shareholders. See the section of this Proxy Statement entitled “The Merger—Material Tax Consequences of the Merger” beginning on page 43.
 
The Board of Directors also considered that certain of the Company’s directors and officers may have interests in connection with the Merger that may be different from the interests of the Company’s shareholders in general.  See the section of this Proxy Statement entitled “The Merger—Interests of Our Directors and Executive Officers in the Merger” beginning on page 51.
 
After taking into account all of the factors set forth above, as well as others, the Board of Directors unanimously agreed that, overall, the potential benefits of the Merger to the Company and its shareholders far outweighed the risks and uncertainties. Accordingly, the Board of Directors unanimously determined that the Merger, the Merger Agreement and the other transactions contemplated by the Merger Agreement are advisable and in the best interests of the Company’s shareholders.
 
The preceding discussion of the information and factors considered by the Board of Directors is not intended to be exhaustive but includes the material factors considered by the Board of Directors.  In view of the wide variety of factors considered by the Board of Directors in connection with its evaluation of the Merger and the complexity of these matters, the Board of Directors did not consider it practical to, nor did it attempt to, quantify, rank or otherwise assign relative weights to the different factors that it considered in reaching its decision.  In addition, in considering the factors described above, individual members of the Board of Directors may have given different weight to different factors.  The Board of Directors considered this information as a whole and overall considered the information and factors to be favorable to, and in support of, its determinations and recommendation.
 
The Board of Directors realized that there can be no assurance about future results, including results considered or expected as described in the factors listed above.  This explanation of the Board of Directors’ reasoning and all other information presented in this section are forward-looking in nature and, therefore, should be read in light of the factors discussed under the section of this Proxy Statement entitled “Cautionary Statement Concerning Forward-Looking Statements” beginning on page 14.
 
The Board of Directors recommends that you vote “FOR” the Merger Proposal.
 
Recommendation and Determination of Our Board of Directors
 
Our Board of Directors has unanimously: (i) determined that the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement are fair to and in the best interests of the Company and its shareholders and that, considering the financial positions of the Company and Merger Sub, no reasonable concern exists that the Surviving Company will be unable to fulfill the obligations of the Company to its creditors; (ii) approved and declared advisable the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement; and (iii) resolved to recommend that the shareholders of the Company adopt and approve the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement.
 
OUR BOARD OF DIRECTORS BELIEVES THAT THE MERGER PROPOSAL IS FAIR TO AND IN THE BEST INTERESTS OF SYNERON AND ITS SHAREHOLDERS AND UNANIMOUSLY RECOMMENDS THAT YOU AND THE OTHER SYNERON SHAREHOLDERS VOTE “FOR” THE MERGER PROPOSAL.
 
No Appraisal Rights; Objections by Creditors
 
Under Israeli law, holders of Ordinary Shares are not entitled to appraisal rights in connection with the Merger. Under the Companies Law, objections to the Merger may be filed by our creditors with the Israeli district court. The court, in its discretion, may provide a remedy to any creditor who so objects if there is a reasonable concern that, as a result of the Merger, the Surviving Company will not be able to satisfy its obligations to our and Merger Sub’s creditors following completion of the Merger.
 
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Opinion of Financial Advisor
 
The Company engaged Barclays to act as its financial advisor with respect to pursuing strategic alternatives for the Company, including a possible sale of the Company, pursuant to an engagement letter dated January 24, 2017.  On April 1, 2017, Barclays rendered its oral opinion (subsequently confirmed by delivery of a written opinion dated April 2, 2017) to the Board of Directors of the Company to the effect that, as of such date and based upon and subject to the qualifications, limitations and assumptions stated in its opinion, from a financial point of view, the Merger Consideration to be offered to the holders of Ordinary Shares (other than the Cancelled Shares) in the Merger is fair to such holders.
 
A copy of Barclays’ written opinion, dated as of April 2, 2017, is attached as Appendix C to this Proxy Statement.  Barclays’ written opinion sets forth, among other things, the assumptions made, procedures followed, factors considered and limitations upon the review undertaken by Barclays in rendering its opinion.  You are encouraged to read the opinion carefully in its entirety.  The following is a summary of Barclays’ opinion and the methodology that Barclays used to render its opinion.  This summary is qualified in its entirety by reference to the full text of the opinion.
 
Barclays’ opinion, the issuance of which was approved by Barclays’ Valuation and Fairness Opinion Committee, is addressed to the Board of Directors of the Company, addresses only the fairness, from a financial point of view, of the Merger Consideration to be offered to the holders of the Company’s Ordinary Shares (other than the Cancelled Shares) in the Merger and does not constitute a recommendation to any holder of the Company’s Ordinary Shares as to how such holder should vote with respect to the Merger or any other matter.  The terms of the Merger were determined through arm’s-length negotiations between the Company and Parent and were unanimously approved by the Board of Directors of the Company.  Barclays did not recommend any specific form of consideration to the Company or that any specific form of consideration constituted the only appropriate consideration for the Merger.  Barclays was not requested to address, and its opinion does not in any manner address, the Company’s underlying business decision to proceed with or effect the Merger, the likelihood of the consummation of the Merger, or the relative merits of the Merger as compared to any other transaction in which the Company may engage.  In addition, Barclays expressed no opinion on, and its opinion does not in any manner address, the fairness of the amount or the nature of any compensation to any officers, directors or employees of any parties to the Merger, or any class of such persons, relative to the consideration to be offered to the stockholders of the Company in the Merger.  No limitations were imposed by the Board of Directors of the Company upon Barclays with respect to the investigations made or procedures followed by it in rendering its opinion.
 
In arriving at its opinion, Barclays, among other things:
 
  ·
reviewed and analyzed a draft of the Merger Agreement, dated as of April 2, 2017, and the specific terms of the Merger;
 
  ·
reviewed and analyzed publicly available information concerning the Company that Barclays believed to be relevant to its analysis, including its Annual Report on Form 20-F for the fiscal year ended December 31, 2016 and its Reports of Foreign Issuer on Form 6-K announcing the Company’s financial results for the fiscal quarters ended December 31, 2016 and September 30, 2016;
 
  ·
reviewed and analyzed financial and operating information with respect to the business, operations and prospects of the Company furnished to Barclays by the Company, including financial projections of the Company prepared and approved for Barclays’ use by management of the Company (which we refer to as the Company Financial Projections);
 
  ·
reviewed and analyzed a trading history of the Company’s common stock from March 29, 2012 to March 29, 2017 and a comparison of that trading history with those of other companies that Barclays deemed relevant;
 
36

  ·
reviewed and analyzed a comparison of the historical financial results and present financial condition of the Company with those of other companies that Barclays deemed relevant;
 
  ·
reviewed and analyzed a comparison of the financial terms of the Merger with the financial terms of certain other transactions that Barclays deemed relevant;
 
  ·
reviewed and analyzed published estimates of independent research analysts with respect to the future financial performance and price targets for the Company;
 
  ·
had discussions with the management of the Company concerning its business, operations, assets, liabilities, financial condition and prospects; and
 
  ·
undertook such other studies, analyses and investigations as Barclays deemed appropriate.
 
In arriving at its opinion, Barclays assumed and relied upon the accuracy and completeness of the financial and other information used by Barclays without any independent verification of such information (and did not assume responsibility or liability for any independent verification of such information) and further relied upon the assurances of management of the Company that they were not aware of any facts or circumstances that would make such information inaccurate or misleading.  With respect to the Company Financial Projections, upon the advice and at the instruction of the Company, Barclays assumed that the Company Financial Projections were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of the Company as to the future financial performance of the Company and that the Company would perform substantially in accordance with the Company Financial Projections.  Barclays assumed no responsibility for and expressed no view as to any such projections or estimates or the assumptions on which they were based.  In arriving at its opinion, Barclays conducted only a limited physical inspection of the properties and facilities of the Company and did not make or obtain any evaluations or appraisals of the assets or liabilities of the Company.  In addition, Barclays was not requested to solicit third party indications of interest in the possible acquisition of all or a part of the Company’s business except, from and after the date of the Merger Agreement, for the specified period set forth in, and to the limited extent permitted by, the Merger Agreement.  Barclays’ opinion was necessarily based upon market, economic and other conditions as they existed on, and could be evaluated as of, April 2, 2017.  Barclays expressed no opinion as to the prices at which the Company’s Ordinary Shares would trade following the announcement of the Merger.  Barclays assumed no responsibility for updating or revising its opinion based on events or circumstances that may have occurred after April 2, 2017.
 
Barclays assumed that the executed Merger Agreement would conform in all material respects to the last draft reviewed by Barclays. In addition, Barclays assumed the accuracy of the representations and warranties contained in the Merger Agreement and all the agreements related thereto. Barclays also assumed, upon the advice of the Company, that all material governmental, regulatory and third party approvals, consents and releases for the Merger would be obtained within the constraints contemplated by the Merger Agreement and that the Merger will be consummated in accordance with the terms of the Merger Agreement without waiver, modification or amendment of any material term, condition or agreement thereof. Barclays did not express any opinion as to any tax or other consequences that might result from the Merger, nor did Barclays’ opinion address any legal, tax, regulatory or accounting matters (whether arising under Israeli law or otherwise), as to which Barclays understands that the Company has obtained such advice as it deemed necessary from qualified professionals.
 
In connection with rendering its opinion, Barclays performed certain financial, comparative and other analyses as summarized below.  In arriving at its opinion, Barclays did not ascribe a specific range of values to the Company’s Ordinary Shares but rather made its determination as to fairness, from a financial point of view, to the holders of the Company’s Ordinary Shares (other than the Cancelled Shares) of the Merger Consideration to be offered to such holders in the Merger on the basis of various financial and comparative analyses.  The preparation of a fairness opinion is a complex process and involves various determinations as to the most appropriate and relevant methods of financial and comparative analyses and the application of those methods to the particular circumstances.  Therefore, a fairness opinion is not readily susceptible to summary description.
 
In arriving at its opinion, Barclays did not attribute any particular weight to any single analysis or factor considered by it but rather made qualitative judgments as to the significance and relevance of each analysis and factor relative to all other analyses and factors performed and considered by it and in the context of the circumstances of the particular transaction.  Accordingly, Barclays believes that its analyses must be considered as a whole, as considering any portion of such analyses and factors, without considering all analyses and factors as a whole, could create a misleading or incomplete view of the process underlying its opinion.
 
37

The following is a summary of the material financial analyses used by Barclays in preparing its opinion to the Board of Directors of the Company.  Certain financial analyses summarized below include information presented in tabular format.  In order to fully understand the financial analyses used by Barclays, the tables must be read together with the text of each summary, as the tables alone do not constitute a complete description of the financial analyses.  In performing its analyses, Barclays made numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of the Company or any other parties to the Merger.  None of the Company, Parent, Merger Sub, Barclays or any other person assumes responsibility if future results are materially different from those discussed.  Any estimates contained in these analyses are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth below.  In addition, analyses relating to the value of the businesses do not purport to be appraisals or reflect the prices at which the businesses may actually be sold.
 
Discounted Cash Flow Analysis
 
In order to estimate the present value of the Company’s Ordinary Shares, Barclays performed a discounted cash flow analysis of the Company.  A discounted cash flow analysis is a traditional valuation methodology used to derive a valuation of an asset by calculating the “present value” of estimated future cash flows of the asset.  “Present value” refers to the current value of future cash flows or amounts and is obtained by discounting those future cash flows or amounts by a discount rate that takes into account macroeconomic assumptions and estimates of risk, the opportunity cost of capital, expected returns and other appropriate factors.
 
To calculate the estimated enterprise value (which we refer to as EV) of the Company using the discounted cash flow method, Barclays added (i) the Company’s projected after-tax unlevered free cash flows for fiscal years 2017 through 2020 based on the Company Financial Projections to (ii) the “terminal value” of the Company as of the end of fiscal year 2020, and discounted such amount to its present value (as of December 31, 2016) using a range of selected discount rates as described below.  Barclays used the mid-year convention in its discounted cash flow analysis because it more accurately reflects the present value of future cash flows because cash flows are actually earned throughout the year rather than at the end of the year.  For purposes of this analysis, Barclays included stock based compensation as a cash expense.  The after-tax unlevered free cash flows were calculated by taking the tax-affected earnings before interest and tax expense, adding depreciation and appreciation, subtracting capital expenditures and adjusting for changes in working capital.  The residual value of the Company at the end of the forecast period, or “terminal value,” was estimated by selecting a range of perpetuity growth rates of 3.0% to 4.0%, which range was derived by Barclays by utilizing its professional judgment and experience, taking into account the financial forecasts and market expectations regarding the medical aesthetic devices industry, and applying such range to the Company Financial Projections.  Barclays then calculated the net present value of the after tax unlevered free cash flows using the range of discount rates of 15.5% to 17.5%, which was selected by Barclays based on an analysis of the weighted average cost of capital of the Company and the selected comparable companies used in the “Selected Comparable Company Analysis” summarized below.  Barclays then calculated a range of implied value per Ordinary Share of the Company by subtracting estimated net debt as of December 31, 2016 from the estimated EV using the discounted cash flow method and dividing such amount by the fully diluted number of Ordinary Shares of the Company as provided by Company management.  This analysis implied a range of value per Ordinary Share of $8.80 to $10.39.  Barclays noted that on the basis of the foregoing discounted cash flow analysis, the Merger Consideration of $11.00 per Ordinary Share was above the range of implied values per Ordinary Share calculated on a standalone basis.
 
Selected Precedent Transaction Analysis
 
Barclays reviewed and compared the purchase prices and financial multiples paid in selected other transactions that Barclays, based on its experience with merger and acquisition transactions, deemed relevant.  Barclays chose such transactions based on, among other things, the similarity of the applicable target companies in the transactions to the Company with respect to the size, mix, margins and other characteristics of their businesses.
 
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The following table sets forth the transactions analyzed based on such characteristics:
 
Announcement Date
Acquiror
Target
February 14, 2017
Hologic, Inc.
Cynosure, Inc.
February 13, 2017
Allergan plc
ZELTIQ Aesthetics, Inc.
January 4, 2016
Almirall, S.A.
ThermiGen LLC
June 18, 2015
XIO Group
Lumenis Ltd.
June 26, 2014
Merz Pharma Group
Ulthera, Inc.
February 13, 2014
PhotoMedex, Inc.
LCA-Vision, Inc.
December 16, 2013
Valeant Pharmaceuticals International, Inc.
Solta Medical, Inc.
April 26, 2013
Shanghai Fosun Pharmaceutical (Group) Co., Ltd
Alma Lasers Ltd.
March 20, 2013
Valeant Pharmaceuticals International, Inc.
Obagi Medical Products, Inc.
March 18, 2013
Cynosure, Inc.
Palomar Medical Technologies, Inc.
January 29, 2013
Solta Medical, Inc.
Sound Surgical Technologies LLC
November 8, 2012
Sun Pharmaceuticals Industries Limited
DUSA Pharmaceuticals, Inc.
June 28, 2011
Cynosure, Inc.
HOYA ConBio
January 4, 2010
Merz Pharma Group
BioForm Medical, Inc.
September 9, 2009
Syneron Medical Ltd.
Candela Corporation
July 7, 2008
Thermage, Inc.
Reliant Technologies Inc.
February 26, 2001
ESC Medical Systems Ltd.
Coherent Medical Group
November 10, 1997
ESC Medical Systems Ltd.
Laser Industries Ltd.
February 19, 1997
ESC Medical Systems Ltd.
Luxar Corporation
 
For each of the selected transactions, based on information Barclays obtained from publicly available information, Barclays analyzed the ratio of the target company’s EV to its next 12-months (which we refer to as NTM) revenue, the ratio of the target company’s EV to its last 12-months (which we refer to as LTM) revenue and the ratio of the target company’s EV to its LTM adjusted earnings before interest, taxes, depreciation and amortization (excluding stock based compensation) (which we refer to as Adjusted EBITDA), in each case, as of the announcement date of the applicable transaction.  The EV of each target company for each of the selected transactions was obtained by adding its short and long-term debt as reported by the target company in its public filings prior to the announcement of the applicable selected transaction to the sum of the equity purchase price in the selected transaction, the value of any preferred stock (at liquidation value) and the book value of any minority interest, and subtracting its cash, cash equivalents and liquid investments, in each case, as reported by the target company in its public filings prior to the announcement of the applicable selected transaction.  The results of this precedent transaction analysis are summarized below:
 
 
EV/NTM Revenue
 
EV/LTM Revenue
 
EV/LTM Adjusted EBITDA
High
6.00x
 
6.81x
 
24.5x
Mean
2.73x
 
2.60x
 
16.7x
Mean(1)
2.41x
 
2.32x
 
16.4x
Low
0.81x
 
0.32x
 
7.6x
 
(1) Excluding transactions involving Cynosure, Inc. and ZELTIQ Aesthetics, Inc.
 
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The reasons for and the circumstances surrounding each of the selected precedent transactions analyzed were diverse and there are inherent differences in the business, operations, financial conditions and prospects of the Company and the companies included in the selected precedent transaction analysis.  Accordingly, Barclays believed that a purely quantitative selected precedent transaction analysis would not be particularly meaningful in the context of considering the Merger.  Barclays therefore made qualitative judgments concerning differences between the characteristics of the selected precedent transactions and the Merger which would affect the acquisition values of the selected target companies and the Company.  Based upon these judgments, Barclays selected ranges of multiples for the Company and applied such ranges to the Company’s actual revenue for calendar year 2016 and the Company’s actual Adjusted EBITDA for calendar year 2016 on a standalone basis to calculate ranges of implied value per Ordinary Share.  The following table sets forth the results of such analysis:
 
   
Selected Multiple Range
 
Implied Value per Ordinary Share
EV/LTM Revenue
 
0.87x – 2.60x
 
$9.51 – $22.10
EV/LTM Adjusted EBITDA
 
11.0x – 16.7x
 
$9.07 – $12.22
 
Barclays noted that on the basis of the foregoing selected precedent transaction analysis, the Merger Consideration of $11.00 per Ordinary Share was within the range of implied values per Ordinary Share calculated on a standalone basis.
 
Selected Comparable Company Analysis
 
In order to assess how the public market values shares of similar publicly traded companies and to provide a range of implied equity values per Ordinary Share of the Company, Barclays reviewed and compared specific financial and operating data relating to the Company with that of selected companies that Barclays, based on its experience in the medical devices industry, deemed comparable to the Company.  The companies that Barclays selected as comparable to the Company were:
 
  ·
ZELTIQ Aesthetics, Inc.;
 
  ·
Cynosure, Inc.; and
 
  ·
Cutera, Inc.
 
Barclays calculated and compared various financial multiples and ratios of the Company and those of the selected comparable companies.  As part of its selected comparable company analysis, Barclays calculated and analyzed each selected comparable company’s EV as a multiple of its calendar year 2017 estimated revenue and of its calendar year 2017 estimated Adjusted EBITDA.  The EV of each company was obtained by adding its short and long-term debt to the sum of the market value of its common equity, calculated as fully diluted equity value (with respect to the Company, as provided by Company management), based on closing stock prices as of the last trading day prior to public reports regarding a potential transaction in the case of ZELTIQ Aesthetics, Inc. and Cynosure, Inc. and as of March 29, 2017 in the case of Cutera, Inc., the value of any preferred stock (at liquidation value) and the book value of any minority interest, and subtracting its cash, cash equivalents and liquid investments.  These calculations for each of the selected comparable companies were performed, and based on publicly available financial data (including FactSet, a subscription-based data source containing historical and estimated financial data) and closing prices, as of the last trading day prior to public reports regarding a potential transaction in the case of ZELTIQ Aesthetics, Inc. and Cynosure, Inc. and as of March 29, 2017 in the case of Cutera, Inc.  The results of this selected comparable company analysis are summarized below:
 
 
EV/CY2017E Revenue
 
EV/CY2017E Adjusted EBITDA
ZELTIQ Aesthetics, Inc.
5.01x
 
42.1x
Cynosure, Inc.
1.83x
 
9.6x
Cutera, Inc.
1.81x
 
19.9x
       
High
5.01x
 
42.1x
Median
1.83x
 
19.9x
Low
1.81x
 
9.6x
       
Company Financial Projections(1)
0.74x
 
7.7x
Wall Street(1)
0.79x
 
8.0x
 
(1) Based on the 2017 calendar year and calculated using financial data as of February 10, 2017, the last trading day prior to public reports regarding a potential transaction involving the Company (which we refer to as the Undisturbed Date).
 
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Barclays selected the comparable companies listed above because of similarities in one or more business or operating characteristics with the Company.  However, because of the inherent differences between the business, operations and prospects of the Company and those of the selected comparable companies, including the historical trading discounts of the Company as compared to the selected comparable companies, Barclays believed that it was inappropriate to, and therefore did not, rely solely on the quantitative results of the selected comparable company analysis.  Accordingly, Barclays also made qualitative judgments concerning differences between the business, financial and operating characteristics and prospects of the Company and the selected comparable companies that could affect the public trading values of each in order to provide a context in which to consider the results of the quantitative analysis.  These qualitative judgments related primarily to the differing sizes, growth prospects, geographic revenue mix, profitability levels and degree of operational risk between the Company and the companies included in the selected company analysis.  Based upon these judgments, including the historical trading discounts of the Company to the selected comparable companies, Barclays selected a range of multiples of EV to calendar year 2017 estimated revenue of 0.68x to 1.19x.  Barclays applied this range to the calendar year 2017 estimated revenue from the Company Financial Projections on a standalone basis to calculate a range of implied value per Ordinary Share.  The results of these calculations are summarized as follows:
 
 
Selected Multiple Range
 
Implied Value per Ordinary Share
EV/CY2017E Revenue
0.68x – 1.19x
 
$8.79 – $13.17
 
Barclays noted that on the basis of the foregoing selected comparable company analysis, the Merger Consideration of $11.00 per Ordinary Share was within the range of implied values per Ordinary Share calculated on a standalone basis.
 
Other Factors
 
Barclays also noted certain additional factors that were not considered part of Barclays’ financial analysis with respect to its fairness determination but were referenced for informational purposes, including, among other things, the following:
 
  ·
Trading Comparables – Discounted Analysis.  Barclays calculated the approximate discount of the Company’s two-year average trading history to the two-year average trading history of each of the selected comparable companies as one component of the qualitative judgments Barclays made in the selected comparable company analysis described above.  Barclays then applied these discounts to the EV to calendar year estimated revenue multiples of the selected comparable companies.  This calculation generated an implied range of EV to calendar year 2017 estimated revenue of 0.68x to 1.19x, which was consistent with the range of implied multiples derived by Barclays in the selected comparable company analysis.  Barclays applied this range to the calendar year 2017 estimated revenue from the Company Financial Projections on a standalone basis to calculate a range of implied value per Ordinary Share of $8.79 to $13.17.
 
  ·
Present Value of Illustrative Future Stock Price.  Barclays performed an illustrative analysis of the implied present value of the future value per Ordinary Share of the Company.  Using the Company Financial Projections, Barclays derived a range of theoretical per share future values for the Ordinary Shares of the Company as of December 31 for each of 2017 through 2019, based on current, low, average and high two-year EV to NTM revenue multiples ranging from 0.48x to 1.28x.  Using an illustrative discount rate of 16.5%, reflecting Barclays’ estimate of the Company’s cost of equity, Barclays discounted to present value as of December 31, 2016, the range of theoretical future values per Ordinary Share it derived as of December 31 for each of 2017 through 2019 to yield illustrative present values per Ordinary Share of the Company ranging from $6.71 to $13.46.
 
  ·
Historical Share Price Analysis.  To illustrate the trend in the historical trading prices of the Company’s Ordinary Shares, Barclays considered historical data with regard to the trading prices of the Company’s Ordinary Shares for the five-year period from March 29, 2012 to March 29, 2017.  Barclays noted that during such five-year period, the closing price of the Company’s Ordinary Shares ranged from $6.11 to $13.11.  Barclays also considered historical data with regard to the trading prices of the Company’s Ordinary Shares for the 52-week period prior to March 29, 2017 and for the 52-week period prior to the Undisturbed Date.  The high and low closing prices for the Company’s Ordinary Shares provided an illustrative range per Ordinary Share of the Company of $6.18 to $11.25 for the 52-week period prior to March 29, 2017 and of $6.18 to $9.80 for the 52-week period prior to the Undisturbed Date.
 
41

  ·
Research Analysts Price Targets Analysis.  Barclays considered publicly available research analysts’ per share price targets for the Company’s Ordinary Shares.  The research analysts’ one year per share price targets for the Company’s Ordinary Shares ranged from $11.00 to $14.00.  Barclays also calculated the implied present value of the low and high one year per share price targets using a discount rate of 16.5%, which yielded a range of implied prices per Ordinary Share of $9.44 to $12.02.  The publicly available per share price targets published by securities research analysts do not necessarily reflect the current market trading prices for the Company’s Ordinary Shares and these estimates are subject to uncertainties, including future financial performance of the Company and future market conditions.
 
General
 
Barclays is an internationally recognized investment banking firm and, as part of its investment banking activities, is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, investments for passive and control purposes, negotiated underwritings, competitive bids, secondary distributions of listed and unlisted securities, private placements and valuations for estate, corporate and other purposes.  The Company’s Board of Directors selected Barclays because of its familiarity with the Company and its qualifications, reputation and experience in the valuation of businesses and securities in connection with mergers and acquisitions generally, as well as substantial experience in transactions comparable to the Merger.
 
Barclays is acting as financial advisor to the Company in connection with the Merger.  As compensation for its services in connection with the Merger, the Company paid Barclays a fee of $1,000,000 in connection with the rendering of Barclays’ opinion, which is referred to as the Opinion Fee.  The Opinion Fee was not contingent upon the conclusion of Barclays’ opinion or the consummation of the proposed transaction.  Additional compensation of approximately $5,600,000 will be payable upon consummation of the Merger against which the amounts paid for the opinion will be credited.   In addition, the Company has agreed to reimburse a portion of Barclays’ expenses incurred in connection with its engagement and to indemnify Barclays for certain liabilities that may arise out of or otherwise relating to its engagement or the Merger.  Barclays has performed various investment banking services for the Company in the past, and expects to perform such services in the future, and has received, and expects to receive, customary fees for such services. For the period from April 2, 2015 through April 2, 2017, Barclays has not earned investment banking fees from the Company except in connection with the Merger.  In addition, Barclays and its affiliates in the past have provided, currently are providing, or in the future may provide, investment banking services to Apax, an affiliate of Parent and Merger Sub, and certain of its affiliates and portfolio companies and have received or in the future may receive customary fees for rendering such services, including (i) having acted or acting as financial advisor to Apax and certain of its portfolio companies and affiliates in connection with certain mergers and acquisition transactions; (ii) having acted or acting as arranger, bookrunnner and/or lender for Apax and certain of its portfolio companies and affiliates in connection with the financing for various acquisition transactions; and (iii) having acted or acting as underwriter, initial purchaser and placement agent for various equity and debt offerings undertaking by Apax and certain of its portfolio companies and affiliates.
 
Barclays and its affiliates engage in a wide range of businesses from investment and commercial banking, lending, asset management and other financial and non-financial services.  In the ordinary course of its business, Barclays and its affiliates may actively trade and effect transactions in the equity, debt and/or other securities (and any derivatives thereof) and financial instruments (including loans and other obligations) of the Company, Apax and certain of Apax’s portfolio companies and affiliates for its own account and for the accounts of its customers and, accordingly, may at any time hold long or short positions and investments in such securities and financial instruments.
 
Financing of the Merger
 
Under the Merger Agreement, the consummation of the Merger is not conditioned on Parent’s receipt of debt financing for the Merger Consideration and Award Consideration that it will pay to our shareholders.
 
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The Investors have provided an equity commitment letter with respect to the full amount of the Merger Consideration and Award Consideration, to which we are an express third party beneficiary of Parent’s right to cause the funding of the closing commitment, and have the right to specifically enforce the Investors’ obligations under the letter agreement and to cause the Investors to fund the closing commitment to Parent, in each case, subject to the terms and conditions set forth therein.
 
Material Tax Consequences of the Merger
 
Certain United States Federal Income Tax Consequences
 
The following is a summary of certain United States federal income tax consequences of the Merger to United States Holders and non-United States Holders (each as defined below). This summary is general in nature and does not discuss all aspects of United States federal income taxation that may be relevant to a United States Holder or non-United States Holder in light of its particular circumstances. In addition, this summary does not describe the effect of the Medicare tax on net investment income or any tax consequences arising under the laws of any local, state or foreign jurisdiction and does not consider any aspects of United States federal tax law other than income taxation. This summary deals only with Ordinary Shares held as capital assets within the meaning of Section 1221 of the United States Internal Revenue Code of 1986, as amended (which we refer to as the Code) (generally, property held for investment) and does not address tax considerations applicable to any holder of Ordinary Shares that may be subject to special treatment under the United States federal income tax laws, including:
 
  ·
a bank or other financial institution;
 
  ·
a tax-exempt organization;
 
  ·
a retirement plan or other tax-deferred account;
 
  ·
a partnership (including any entity or arrangement treated as a partnership for United States federal income tax purposes), an S corporation or other pass-through entity (or an investor in any of the foregoing);
 
  ·
an insurance company;
 
  ·
a mutual fund;
 
  ·
a real estate investment trust or regulated investment company;
 
  ·
a dealer or broker in stocks and securities, or currencies;
 
  ·
a trader in securities that elects mark-to-market treatment;
 
  ·
a holder of Ordinary Shares subject to the alternative minimum tax provisions of the Code;
 
  ·
a holder of Ordinary Shares that received the Ordinary Shares through the exercise of an employee stock option, through a tax qualified retirement plan or otherwise as compensation;
 
  ·
a person that has a functional currency other than the United States dollar;
 
  ·
a person that holds the Ordinary Shares as part of a hedge, straddle, constructive sale, conversion or other integrated transaction;
 
  ·
a United States expatriate;
 
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a person that entered into a voting agreement as part of the transactions described in this Proxy Statement; or
 
  ·
a person actually or constructively holding 10% or more of our voting stock.
 
If a partnership (including any entity or arrangement treated as a partnership for United States federal income tax purposes) holds Ordinary Shares, the tax treatment of a holder that is a partner in the partnership generally will depend upon the status of the partner and the activities of the partner and the partnership. Such holders should consult their tax advisors regarding the tax consequences to them of the Merger.
 
This summary is based on the Code, the Treasury regulations promulgated under the Code, and rulings and judicial decisions, all as in effect as of the date of this Proxy Statement, and all of which are subject to change or differing interpretations at any time, with possible retroactive effect. We have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and no assurance can be given that the IRS will agree with the views expressed herein, or that a court will not sustain any challenge by the IRS in the event of litigation.
 
The discussion set out herein is intended only as a summary of certain United States federal income tax consequences relevant to a United States Holder or non-United States Holder (each as defined below). We urge each holder to consult its tax advisor with respect to the specific tax consequences of the Merger to it in light of its own particular circumstances, including federal estate, gift and other non-income tax consequences, and tax consequences under state, local or foreign tax laws.
 
United States Holders
 
For purposes of this discussion, the term “United States Holder” means a beneficial owner of Ordinary Shares that is, for United States federal income tax purposes:
 
  ·
a citizen or resident of the United States;
 
  ·
a corporation (or any other entity or arrangement treated as a corporation for United States federal income tax purposes) organized in or under the laws of the United States or any state thereof or the District of Columbia;
 
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an estate, the income of which is subject to United States federal income taxation regardless of its source; or
 
  ·
a trust if (i) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust or (ii) the trust has validly elected to be treated as a “United States person” under applicable Treasury regulations.
 
Payments with Respect to Ordinary Shares
 
The exchange of Ordinary Shares for cash pursuant to the Merger will be a taxable transaction for United States federal income tax purposes and a United States Holder who receives cash for Ordinary Shares pursuant to the Merger will generally, subject to the discussion below regarding our possible status as a passive foreign investment company (which we refer to as a PFIC) (see “—Passive Foreign Investment Company” below), recognize gain or loss, if any, equal to the difference between the amount of cash received and the holder’s adjusted tax basis in the Ordinary Shares exchanged therefor. A United States Holder’s adjusted tax basis generally will equal the price the United States Holder paid for such shares. Gain or loss will be determined separately for each block of Ordinary Shares (i.e., Ordinary Shares acquired at the same cost in a single transaction). Such gain or loss will be capital gain or loss, and generally will be long-term capital gain or loss if such United States Holder’s holding period for the Ordinary Shares is more than one year at the time of the exchange. Long-term capital gain recognized by an individual holder generally is subject to tax at a lower rate than short-term capital gain or ordinary income. There are limitations on the deductibility of capital losses. The gain or loss generally will be gain or loss from sources within the United States for United States foreign tax credit limitation purposes.
 
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To the extent a United States Holder is subject to Israeli income tax on the disposition of Ordinary Shares, as discussed under “Israeli Income Tax Consequences,” such United States Holder may be eligible to claim a credit for such taxes against the United States federal income tax imposed on the disposition, subject to limitations.
 
Passive Foreign Investment Company
 
The foregoing summary assumes that we are not and have never been a PFIC for United States federal income tax purposes. A non-United States corporation is classified as a “passive foreign investment company” for United States federal income tax purposes in any taxable year in which, after applying certain look through rules, either (i) at least 75% of its gross income is “passive income” or (ii) at least 50% of the average value of its gross assets is attributable to assets that produce “passive income” or are held for the production of “passive income.” Passive income for this purpose generally includes dividends, interest, royalties, rents and gains from commodities and securities transactions.
 
 
We believe that we were not a PFIC for any taxable year prior to 2017, and we do not expect to be a PFIC in 2017. See our Annual Reports on Form 20-F for additional information on our PFIC status in prior years. However, because the determination of PFIC status is a factual determination that must be made annually at the close of each taxable year, we cannot provide assurance that we will not be a PFIC in 2017. In general, if we were characterized as a PFIC for any taxable year in which a United States Holder held our Ordinary Shares and such United States Holder did not make a “mark to market” or “qualified electing fund” election, any gain recognized by the United States Holder in connection with the Merger with respect to such Ordinary Shares would be treated as ordinary income, which would be taxed as if such gain had been realized ratably over the holding period of the Ordinary Shares. The amount allocated to the current taxable year and any year prior to the first year of the United States Holder’s holding period in which we were a PFIC would be taxed as ordinary income (rather than capital gain) earned in the current taxable year. The amount allocated to other taxable years would be taxed at the highest marginal rates applicable to ordinary income for the applicable taxable year, and the United States Holder also would be liable for an additional tax equal to interest on the tax liability for such years.
UNITED STATES HOLDERS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE POTENTIAL APPLICATION OF THE PFIC RULES TO THE RECEIPT OF CASH PURSUANT TO THE MERGER.
 
Information Reporting and Backup Withholding
 
Generally, information reporting requirements will apply to proceeds on the disposition of Ordinary Shares paid within the United States (and, in certain cases, outside the United States) to United States Holders other than certain exempt recipients, such as corporations. Furthermore, proceeds from the exchange of Ordinary Shares pursuant to the Merger generally will be subject to backup withholding at the applicable rate (currently 28%) unless the applicable United States Holder or other payee provides a valid taxpayer identification number and complies with certain certification procedures (generally by providing a properly completed IRS Form W-9) or otherwise establishes an exemption from backup withholding. Any amounts withheld under the backup withholding rules from a payment to a United States Holder will be allowed as a credit against the United States Holder’s United States federal income tax liability and may entitle the holder to a refund, provided that the required information is timely furnished to the IRS.
 
Non-United States Holders
 
For purposes of this discussion, the term “non-United States Holder” means a beneficial owner of Ordinary Shares that is neither a United States Holder nor an entity classified as a partnership for United States federal income tax purposes.
 
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The following discussion applies only to non-United States Holders and assumes that no item of income, gain, deduction or loss derived by the non-United States Holder in respect of Ordinary Shares at any time is effectively connected with the conduct of a United States trade or business. Special rules, not discussed herein, may apply to certain non-United States Holders, such as:
 
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certain former citizens or residents of the United States;
 
  ·
controlled foreign corporations;
 
  ·
passive foreign investment companies;
 
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corporations that accumulate earnings to avoid United States federal income tax;
 
  ·
investors in pass-through entities that are subject to special treatment under the Code; and
 
  ·
non-United States Holders that are engaged in the conduct of a United States trade or business.
 
Payments with Respect to Ordinary Shares
 
Payments made to a non-United States Holder with respect to Ordinary Shares exchanged for cash pursuant to the Merger generally will be exempt from United States federal income tax. However, if the non-United States Holder is an individual who was present in the United States for 183 days or more in the taxable year of the exchange and certain other conditions are met, such holder will be subject to tax at a flat rate of 30% (or such lower rate as may be specified under an applicable income tax treaty) on any gain from the exchange of the Ordinary Shares, net of applicable United States-source losses from sales or exchanges of other capital assets recognized by the holder during the year.
 
Backup Withholding
 
A non-United States Holder may be subject to backup withholding with respect to the proceeds from the disposition of Ordinary Shares pursuant to the Merger, unless the non-United States Holder or other payee certifies under penalties of perjury on an appropriate IRS Form W-8 that such non-United States Holder or other payee is not a United States person or otherwise establishes an exemption from backup withholding.
 
Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against the non-United States Holder’s United States federal income tax liability, if any, provided that certain required information is timely furnished to the IRS.
 
The foregoing summary does not discuss all aspects of United States federal income taxation that may be relevant to particular holders of Ordinary Shares. Each holder of Ordinary Shares should consult its own tax advisor as to the particular tax consequences to it of exchanging its Ordinary Shares for cash in the Merger under any federal, state, foreign, local or other tax laws.
 
Israeli Income Tax Consequences
 
The following is a summary discussion of certain Israeli income tax considerations in connection with the Merger. The following summary is included for general information purposes only, is based upon current Israeli tax law and should not be conceived as tax advice to any particular holder of Ordinary Shares. No assurance can be given that the analysis made and the views contained in this summary as well as the classification of the transaction for Israeli tax purposes as set forth below will be upheld by the tax authorities, nor that new or future legislation, regulations or interpretations will not significantly change the tax considerations described below, and any such change may apply retroactively. This summary does not discuss all material aspects of Israeli tax consequences that may apply to particular holders of Ordinary Shares in light of their particular circumstances, such as investors subject to special tax rules or other investors referred to below.
 
HOLDERS OF ORDINARY SHARES SHOULD CONSULT THEIR TAX ADVISORS AS TO THE PARTICULAR ISRAELI TAX CONSEQUENCES OF THE MERGER APPLICABLE TO THEM.
 
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Sale of Ordinary Shares
 
In general, under the Israeli Income Tax Ordinance (New Version), 5721-1961 and the rules and regulations promulgated thereunder, which we also refer to as the Tax Ordinance, the disposition of shares of an Israeli resident company is deemed to be a sale of capital assets, unless such shares are held for the purpose of trading. The Tax Ordinance generally imposes a capital gains tax on the sale of capital assets located in Israel, including shares in an Israeli resident company, by both residents and non-residents of Israel, unless a specific exemption is available under Israeli law or unless a double taxation prevention treaty between Israel and the seller’s country of residence provides otherwise.
 
Under the Tax Ordinance, the tax rate applicable to capital gains derived from the disposition of Ordinary Shares in the Merger is generally up to 25% for Israeli individuals, unless such an individual shareholder claims a deduction for financing expenses in connection with such Ordinary Shares, in which case the gain will generally be taxed at a rate of up to 30%. Additionally, if such shareholder is considered a “Significant Shareholder” at any time during the 12-month period preceding such disposition, i.e., such shareholder holds directly or indirectly, including with others, at least 10% of any means of control in our Company, the tax rate will be 30%. However, the foregoing tax rates will not apply to: (a) dealers in securities; or (b) shareholders who acquired their Ordinary Shares prior to the Company’s initial public offering. Companies are subject to the corporate tax rate (24% for the 2017 tax year) on capital gains derived from the disposition of Ordinary Shares. Individuals who are subject to tax in Israel are also subject to an additional tax at a rate of 3% on annual income (including, but not limited to, capital gains) exceeding a certain threshold (NIS 640,000 for the year 2017, which amount is linked to the annual change in the Israeli Consumer Price Index). A reduced rate of, or an exemption from, Israeli withholding tax is available to shareholders that provide a valid withholding certificate issued by the Israeli Tax Authority evidencing such reduced withholding rate or withholding exemption.
 
Notwithstanding the foregoing, according to the Tax Ordinance and the regulations promulgated thereunder, non-Israeli residents are generally exempt from Israeli capital gains tax on any gains derived from the disposition of shares of an Israeli resident company whose shares are publicly traded on a stock exchange, provided that such gains are not derived from a permanent establishment of such shareholders in Israel, that such shareholders did not acquire their Ordinary Shares prior to the Company’s initial public offering, that such capital gains are not subject to Section 101 of the Tax Ordinance, the Israeli Income Tax Law (Inflationary Adjustments), 5745-1985 or the rules promulgated under Section 130A of the Tax Ordinance. However, a non-Israeli corporate shareholder will not be entitled to such exemption if Israeli residents (a) have, directly or indirectly, a controlling interest of more than 25% in such non-Israeli corporation or (b) are the beneficiaries of or are entitled to 25% or more of the revenues or profits of such non-Israeli corporation, whether directly or indirectly.
 
In addition, under the Convention Between the Government of the United States of America and the Government of the State of Israel with Respect to Taxes on Income, or the U.S.-Israel Tax Treaty, Israeli capital gains tax generally will not apply to the disposition of Ordinary Shares by a U.S. resident to which the U.S.-Israel Tax Treaty applies, or a U.S. Treaty Resident, who holds the Ordinary Shares as capital assets. However, such exemption will not apply if (a) the U.S. Treaty Resident holds, directly or indirectly, Ordinary Shares representing 10% or more of our voting power during any part of the 12-month period preceding the disposition, subject to specified conditions; (b) the capital gains from such disposition can be allocated to a permanent establishment of such U.S. Treaty Resident in Israel; or (c) the U.S. Treaty Resident, being an individual, was present in Israel for a period or periods of 183 days or more in the aggregate during the applicable taxable year. In each case, the disposition of such Ordinary Shares could be subject to Israeli tax, to the extent applicable; however, under the U.S.-Israel Tax Treaty, such U.S. Treaty Resident would be permitted to claim a credit for Israeli income tax against the U.S. federal income tax imposed on the disposition, subject to the limitations in U.S. tax laws applicable to foreign tax credits.
 
In addition, we have filed with the Israeli Tax Authority an application for a ruling that provides that no Israeli withholding tax is applicable to a shareholder who provides the required information set forth in the ruling, certifies that it is a non-Israeli resident and has no connection to Israel as set forth in the ruling, certifies that it holds less than 5% of the Ordinary Shares and that it purchased its Ordinary Shares after the initial public offering on August 6, 2004. Parent may hold payments to shareholders in escrow pending the receipt of a final ruling from the Israeli Income Tax Authority and the receipt of the required documentation as set forth in the ruling from a shareholder. Any payment to a shareholder that fails to provide the required documentation as set forth in the ruling, or does not present a valid withholding certificate providing for a reduced withholding rate or an exemption from withholding, will be subject to the Israeli applicable withholding rate.
 
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Our shareholders who acquired their Ordinary Shares prior to our initial public offering on August 6, 2004 and who do not qualify for an exemption from Israeli capital gains tax under the Tax Ordinance or an applicable tax treaty to which the State of Israel is a party, including the U.S.-Israel Tax Treaty described above, may be subject to Israeli capital gains tax on the disposition of their Ordinary Shares in the Merger. SUCH SHAREHOLDERS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE TAX CONSEQUENCES OF THE MERGER TO THEM.
 
Shares Issued as Compensation for Employment or Service
 
Shareholders who received or acquired their Ordinary Shares under one or more of our incentive plans, or otherwise as compensation for employment or services provided to our Company or any of its affiliates, may be subject to different tax rates. BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, ANY SUCH HOLDERS OF ORDINARY SHARES SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE ISRAELI TAX CONSEQUENCES APPLICABLE TO THEM.
 
Company Options Tax Ruling
 
We have agreed, as soon as practicable after the execution of the Merger Agreement, and no later than five (5) business days thereafter, to prepare and file with the Israeli Tax Authority an application for a ruling providing, among other things, that: (i) the cancellation and exchange of the Company’s options and RSUs and the conversion of the Ordinary Shares will not be regarded as a violation of the minimum trust period required by Section 102 of the Tax Ordinance so long as the respective Award Consideration and Merger Consideration is deposited with Tamir Fishman Trusts 2004 Ltd., in its capacity as trustee (which we refer to as the Section 102 Trustee) until the end of the minimum trust period required by Section 102 of the Tax Ordinance and (ii) the deposit of the respective Award Consideration and Merger Consideration with the Paying Agent and the Section 102 Trustee will not be subject to any withholding obligation in respect of Israeli withholding tax. We refer to this ruling that we will be seeking as the Options Tax Ruling.
 
Regulatory Matters
 
Antitrust Filings
 
 
Under the Hart-Scott-Rodino Act (which we refer to as the HSR Act) and the rules and regulations promulgated thereunder, certain transactions, including the Merger, may not be consummated unless certain waiting period requirements have expired or been terminated. Pursuant to the requirements of the HSR Act, the required Notification and Report Forms with respect to the Merger have been filed with the United States Department of Justice, Antitrust Division (which we refer to as the Antitrust Division) and the Federal Trade Commission (which we refer to as the FTC). Pursuant to the requirements of the HSR Act, the Merger may be closed following the expiration of a 30-calendar day waiting period (if the thirtieth day falls on a weekend or holiday, the waiting period will expire on the next business day) following such filings with the Antitrust Division and the FTC, unless the United States federal government terminates the waiting period early or issues a request for additional information and documentary material. The 30-calendar day waiting period commenced on April 19, 2017.
 
 
On May 1, 2017, the FTC notified the Company that early termination of the waiting period under the HSR Act was granted, effective immediately.
 
At any time before or after the Merger is completed, any of the Department of Justice, the FTC or private parties (including individual states) may bring legal actions under the antitrust laws. Syneron and Parent do not believe that the closing of the Merger will result in a violation of any applicable antitrust laws. However, there can be no assurance that a challenge to the Merger on antitrust grounds will not be made, or if such a challenge is made, what the result will be. See “The Merger Agreement; Other Agreements—The Merger Agreement—Conditions to the Merger” on page 67.
 
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Israel
 
The Merger is subject to notification under the Restrictive Trade Practices Law, 5748-1988 (which we refer to as the Israeli Antitrust Law). On April 9, 2017, the parties filed pre-merger notifications with the Israeli Antitrust Authority (which we refer to as the IAA). Under the Israeli Antitrust Law, the Antitrust Commissioner has to advise on its ruling within 30 days of the receipt of the notifications (subject to requests for additional information). Such term may be extended with the parties’ consent or by the Israeli Antitrust Tribunal. Consummating the transaction prior to receiving the approval of the Antitrust Commissioner is prohibited under the Israeli Antitrust law. The Merger received clearance from the IAA on April 19, 2017.
 
Spain
 
The Merger may be subject to notification under the Spanish Competition Act, 15/2007 (which we refer to as the Spanish Antitrust Law) on the basis of the Company’s market share in some market segments in Spain. Given this, on April 13, 2017, the parties filed a precautionary premerger-notification before the Spanish Competition Authority (which we refer to as the SCA). Should the SCA decide that the Merger is notifiable under the Spanish Antitrust Law, it has to advise on its ruling within one month of the receipt of the formal notification (subject to requests for additional information).
 
Austria
 
The Merger is subject to notification under the Austrian Cartel Act. On April 13, 2017, the parties filed the merger notification with the Federal Competition Authority. Under the Austrian Cartel Act, the Austrian Agencies (Federal Competition Authority and Federal Competition Attorney) would have to launch an in-depth investigation (phase 2) of the transaction within four weeks of the receipt of the notification if they are concerned that it will lead to the creation or strengthening of a dominant position. This four-week period ends at midnight on May 11, 2017. The clearance certificate will be issued on the next working day. The waiting period may be extended only with the parties’ consent by two weeks.
 
Serbia
 
The Merger is subject to notification under the Competition Law (Official Gazette of the Republic of Serbia, No. 51/2009 and 95/2013) (which we refer to as the Serbian Competition Law). On April 12, 2017, Parent filed the merger notification with the Serbian Competition Commission. Under the Serbian Competition Law, the Serbian Competition Commission has to decide within one month of the receipt of the notification (subject to subsequent requests for additional information which may extend review).
 
Israeli Registrar of Companies
 
Under the Companies Law, we and Merger Sub may not complete the Merger without first making the following filings and notifications to the Israeli Registrar of Companies:
 
  ·
Merger Proposal. We and Merger Sub are required to jointly file with the Israeli Registrar of Companies a “merger proposal” setting forth specified details with respect to the Merger, within three (3) days of calling the Meeting. Both we and Merger Sub filed the required merger proposal with the Israeli Registrar of Companies on April 19, 2017. Under the Companies Law, at least 50 days must pass from the date of the filing of the merger proposal by both merging companies with the Israeli Registrar of Companies before the Merger can become effective.
 
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  ·
Notice to Creditors. In addition, each of us and Merger Sub is required to notify its creditors of the proposed Merger. Pursuant to the Companies Law, a copy of the merger proposal must be sent to the secured creditors of each company within three (3) days after the merger proposal is filed with the Israeli Registrar of Companies, and, within four (4) business days of such filing, known significant creditors must be informed individually by registered mail of such filing and where the merger proposal can be reviewed. Non-secured creditors must be informed of the merger proposal by publication in two daily Hebrew newspapers circulated in Israel on the day that the merger proposal is filed with the Israeli Registrar of Companies and, where necessary, elsewhere, and by making the merger proposal available for review. Each of us and Merger Sub has notified our respective creditors of the Merger in accordance with these requirements, to the extent applicable and, because our Ordinary Shares are traded on the NASDAQ Global Select Market, we have also published an announcement of the Merger in Yedioth Ahronoth (distributed in the State of New York) within three (3) business days following the day on which the merger proposal was submitted to the Israeli Registrar of Companies.  Each of us and Merger Sub has notified the Israeli Registrar of Companies of the notices to our respective creditors and compliance with the publication requirements. In addition, pursuant to the Companies Law, because we employ more than 50 employees, we must provide to the workers’ union a copy of the publication placed in the newspapers or post a copy of the publication placed in the newspapers in a prominent location in the workplace within three (3) business days after the merger proposal was filed with the Israeli Registrar of Companies. We have satisfied such requirement by posting a copy of the publication in a prominent location in our office in Yokneam Illit, Israel.
 
  ·
Shareholder Approval Notice. After the Meeting, and assuming the adoption and approval of the Merger by the shareholders of each of the merging companies, each of the merging companies must file a notice with the Israeli Registrar of Companies regarding the vote of the shareholders, within three (3) days of the adoption and approval of the shareholder resolution. At least 30 days must pass from the date of the Meeting before the Merger can become effective.
 
No later than the closing date of the Merger (assuming that the shareholders of each of the merging companies adopted and approved the Merger Agreement and the Merger, and that all of the other conditions set forth in the Merger Agreement have been satisfied or waived (if permissible under applicable law)), each of us and Merger Sub will notify the Israeli Registrar of Companies that all of the conditions to the closing have been met and request that the Israeli Registrar of Companies issue a certificate evidencing the completion of the Merger in accordance with Section 323(5) of the Companies Law. Assuming all statutory procedures and requirements have been complied with, the Merger will then become effective and the Israeli Registrar of Companies will be required to register the Merger in the Surviving Company’s register and to issue the Surviving Company a certificate regarding the Merger.
 
National Authority for Technological Innovation, or the Israeli Innovation Authority (formerly known as the Israeli Office of the Chief Scientist, or OCS)
 
According to the Israeli Encouragement of Research, Development and Technological Innovation in the Industry Law, 5744-1984, as amended from time to time (which we refer to as the Innovation Law) and the regulations promulgated thereunder, a change in the “Control” of an entity which receives grants from the OCS (as such term is defined in the Israeli Securities Law, 5728-1968) requires the submission of a notice to the OCS. As such, Company shall be required to submit such notice in connection with the Merger. Under the Innovation Law, research and development programs approved by the OCS are eligible to receive grants if they meet specified criteria in exchange for the payment of royalties from the sale of the products developed in the course of research and development programs funded by the OCS. We have satisfied such requirement by submitting a notice to the OCS on April 19, 2017.
 
Israeli Tax Authority
 
Besides the Options Tax Ruling that we will seek from the Israeli Tax Authority, as described above, we have agreed to apply, in coordination with Parent, for a ruling concerning the Israeli withholding tax treatment of the Merger (which we refer to as the Withholding Ruling). The Merger Agreement provides that we shall cause our Israeli counsel, advisors and/or accountants to prepare and file with the Israeli Tax Authority an application for the Withholding Ruling. The Withholding Ruling that will be sought will address (i) exempting Parent, Merger Sub, the Surviving Company from the Merger and the Paying Agent from any obligation to withhold Israeli tax at source from any consideration payable or otherwise deliverable pursuant to the Merger Agreement, or clarifying that no such obligation exists, or (ii) clearly instructing Parent, Merger Sub, the Surviving Company and the Paying Agent how such withholding at source is to be executed, and in particular, with respect to the classes or categories of holders or former holders of Ordinary Shares from which tax is to be withheld (if any), the rate or rates of withholding to be applied and how to identify each holder. To the extent that prior to the closing of the Merger an interim Withholding Ruling is obtained, then all parties will act in accordance with that interim ruling, until such time that a final definitive Withholding Ruling is obtained. In the event that a Withholding Ruling (whether final or interim) is not obtained, Parent, Merger Sub, the Surviving Company and the Paying Agent may make such payments and withhold any applicable Israeli taxes in accordance with applicable law. We made the initial filing relating to the Withholding Ruling on April 27, 2017.
 
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Other Approvals
 
Other than the filings described above, neither Parent nor the Company is aware of any material regulatory filings or approvals issued by the United States government, the State of Israel, or any foreign, state or local government, required to be obtained, or waiting periods required to expire, to complete the Merger. If Parent and the Company discover that other such material approvals or waiting periods are necessary, Parent and the Company will seek to obtain or comply with them in accordance with the Merger Agreement.
 
Interests of our Executive Officers and Directors in the Merger
 
In considering the recommendation of our Board of Directors with respect to the Merger Agreement and the Merger, you should be aware that certain of our officers and directors have agreements or arrangements that provide them interests in the Merger that may be different from, or in addition to, the interests of other Syneron shareholders. Our Board of Directors was aware of these different or additional interests in determining to adopt and approve the Merger Agreement, the Merger and any other transactions contemplated by the Merger Agreement, and to recommend to Syneron shareholders that they vote in favor of the Merger Proposal.
 
Ordinary Shares
 
As of April 2, 2017 (the date of the Merger Agreement), the executive officers and directors of Syneron (comprising 16 persons) held an aggregate of 2,656,778 Ordinary Shares, or 7.58% of the outstanding Ordinary Shares. Outstanding Ordinary Shares held by executive officers and directors of Syneron will be treated in the Merger in the same manner as Ordinary Shares held by all other shareholders of Syneron (i.e., they will be cancelled and entitle the holders thereof to receive the Merger Consideration).
 
Syneron Options and Restricted Share Units
 
Pursuant to the Merger Agreement, at the Effective Time, each outstanding option, whether vested or unvested, to purchase one Ordinary Share will be canceled and converted into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without any interest thereon and subject to any withholding obligations.  If the exercise price per Ordinary Share for any option is equal to or greater than the Merger Consideration, such option will be canceled without payment of any consideration.  In addition, at the Effective Time, each outstanding RSU, whether vested or unvested, representing the right to receive one Ordinary Share will be canceled and converted into the right to receive an amount of cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without any interest thereon and subject to any withholding obligations.
 
As of April 2, 2017, the total number of Ordinary Shares issuable upon the exercise of options and the vesting of RSUs held by the executive officers and directors of Syneron as a group (comprising 16 persons) was 1,428,543 and 48,503, respectively. The options have exercise prices ranging from $6.82 to $12.30 per Ordinary Share and a weighted average exercise price of $9.62. Options and RSUs held by our executive officers and directors will be treated in the Merger in the same manner as all other options and RSUs.
 
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Indemnification and Insurance
 
Pursuant to the Merger Agreement, Parent has agreed to cause the Surviving Company in the Merger to indemnify and hold harmless, to the fullest extent provided in the Company’s existing articles of association and permitted by applicable law, all past and present directors and officers of the Company or its subsidiaries against all losses arising out of acts or omissions occurring at or prior to the Effective Time in connection with such indemnified party serving as a director or officer of the Company or any subsidiary.
 
In addition, Parent has agreed to maintain or cause the Surviving Company to maintain, for seven years after the Effective Time, a directors’ and officers’ liability insurance policy  covering those persons who, as of immediately prior to the Effective Time, are covered by the Company’s current directors’ and officers’ liability insurance policy on terms and conditions which are, in the aggregate, no less advantageous to the insured parties than those of the Company’s present directors’ and officers’ liability insurance policy. In the alternative, Parent may cause the Surviving Company to purchase a “run off” policy providing for such coverage, provided that Parent will not be required to expend for the “run off” insurance in excess of 300% of the annual premiums currently paid by the Company for its officers’ and directors’ liability insurance.
 
For more details on the indemnification and insurance arrangements for our directors and officers, see “The Merger Agreement; Other Agreements—The Merger Agreement—Indemnification and Insurance” beginning on page 65.
 
Change of Control Payments
 
Our Compensation Committee and the Board of Directors have approved arrangements with certain of our executive officers providing for cash awards upon the closing of the Merger as follows: (i) Mr. Hugo Goldman, our Chief Financial Officer - $150,000 and (ii) Ms. Sarit Soccary, our Vice President Strategy and Business Development - $150,000.
 
In addition, pursuant to our existing employment agreement, dated October 8, 2016, with Philippe Schaison, the CEO of Syneron Candela North America and Global Executive Vice President Strategy and Business Development, upon the closing of the Merger, Mr. Schaison will be entitled to a one-time payment of $5.0 million paid at the closing of the Merger.
 
Executive Arrangements after the Merger
 
Our Compensation Committee and the Board of Directors have extended to six months the notice period required prior to termination or effective termination of the employment of any executive officer during the one-year period following the closing of the Merger, except for (i) the notice period for Mr. Amit Meridor, our Chief Executive Officer, whose notice period is nine months under our existing arrangement with him, (ii) the notice period for Avi Huppert, our Vice President of R&D and Chief Operating Officer, whose notice period is 12 months and (iii) Mr. Schaison, who, in lieu of such notice period, under a Change of Control (as defined in Mr. Shaison’s employment agreement), will receive the following benefit, subject to Mr. Schaison’s execution of a general release of claims against the Company:
 
  ·
In the event Mr. Schaison’s employment is terminated within one year of closing of the Merger without cause or for Good Reason (as defined below), then Mr. Schaison will be entitled to (i) his monthly base salary for a period of 36 months plus three times his annual target bonus and (ii) if Mr. Schaison chooses to elect health and dental insurance coverage in accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985 (which we refer to as COBRA), the Company will pay the entire premium payments for his health and dental insurance coverage under COBRA for a period of 36 months (in certain cases, the Company will instead pay Mr. Schaison an amount, as a taxable payment in a lump sum, subject to required withholding, equal to the value of such COBRA coverage, as determined in the Company’s sole and absolute discretion).  These benefits are subject to Mr. Schaison’s execution of a general release of claims against the Company.
 
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During the notice period, the applicable executive officer would receive his then monthly salary and would not be required to work, although it is expected that such executive officer would be available to answer any questions.  Effective termination means the occurrence of one of the following with respect to the position of the relevant executive officer:
 
  ·
material change in job scope;
 
  ·
adverse change in remuneration (if applicable country labor laws consider this to be termination of employment); or
 
  ·
requirement to relocate beyond the country border or beyond a 100 kilometer (60 mile) distance.
 
There is no obligation to pay if the executive officer resigns or is terminated for cause.
 
In addition, if such executive officer’s employment is terminated or constructively terminated within one year of the closing of the Merger (or such later period at the discretion of Parent), each executive officer will be entitled to receive a pro rata portion of such executive officer’s annual bonus for the year of termination or constructive termination based on such executive officer’s key performance indicator achievement at the time of termination or constructive termination.  The payment date of such bonus will be the date of termination or constructive termination of the executive officer.  Constructive termination means the occurrence of one of the following with respect to the position of the relevant executive officer:
 
  ·
material change in job scope; or
 
  ·
requirement to relocate beyond the country border or beyond a 100 kilometer (60 mile) distance.
 
There is no obligation to pay if the executive officer resigns or is terminated for cause.
 
In addition, pursuant to our existing employment agreement with Mr. Schaison, in the event Mr. Schaison’s employment is terminated within one year of closing of the Merger without cause or for Good Reason (which is defined below), subject to Mr. Schaison’s execution of a general release of claims against the Company, then Mr. Schaison will be entitled to receive the following:
 
  ·
monthly base salary for a period of 36 months plus three times his annual target bonus, with the first payment made on 60th day following the date of termination of employment and remaining payments payable in regularly bi-monthly installments for the remainder of 36-month period; and
 
  ·
if Mr. Schaison chooses to elect health and dental insurance coverage in accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985 (which we refer to as COBRA), the Company will pay the entire premium payments for his health and dental insurance coverage under COBRA for a period of 36 months beginning immediately after the date of termination of employment; notwithstanding the foregoing, in the event the Company determines that the provision of COBRA coverage on the terms set forth above constitutes a violation of the Affordable Care Act, or creates a discriminatory self-insured group health plan to which Section 105(h) of the Code applies, then the provisions of COBRA on those terms and conditions will cease to apply (or not apply) and the Company will pay Mr. Schaison an amount, as a taxable payment in a lump sum, subject to the required withholding of income and wage taxes, equal to the value of such COBRA coverage, as determined in the Company’s sole and absolute discretion.
 
Mr. Schaison’s employment agreement defines “Good Reason” to mean any of the following: (i) any material diminution in Mr. Schaison’s authority, duties or responsibilities; provided that a change in job description will not be deemed a “material diminution” unless his new authority, duties or responsibilities are substantially reduced from the prior authority, duties or responsibilities; (ii) Mr. Schaison’s salary is reduced by more than 10% below his salary in effect at any time during the preceding 12 months, other than an across-the-board reduction in the base compensation of the officers and senior management employees of the Company, its subsidiaries and affiliated entities necessitated by the business or financial condition of the Company, its subsidiaries and affiliated entities, and that does not adversely affect Mr. Schaison to a greater extent than other such persons; (iii) a material change in the geographic location in which he must perform his duties which is more than 80 miles from the current location, without his prior written consent; or (iv) a material breach by the Company of the terms of Mr. Schaison’s employment agreement; provided that Mr. Schaison’s resignation will not be deemed termination for Good Reason unless (i) he gives notice to the Company within 30 days of the initial existence of such condition, (ii) the Company fails to cure the condition within 30 days of receipt of notice from Mr. Schaison; and (iii) Mr. Schaison thereafter separates from service with the Company not later than 90 days following initial existence of the condition claimed to constitute Good Reason.
 
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THE MERGER AGREEMENT; OTHER AGREEMENTS
 
This section of the Proxy Statement describes the material provisions of the Merger Agreement and the Voting Agreement, but does not purport to describe all of the terms of those agreements and may not contain all of the information that is important to you. The following summary is qualified in its entirety by reference to the complete text of the Merger Agreement and the Voting Agreement, which are attached as Appendix A and Appendix B, respectively, to this Proxy Statement and are incorporated by reference into this Proxy Statement. You are urged to read the Merger Agreement carefully and in its entirety because it is the legal document that governs the Merger. The Merger Agreement is not intended to provide you with any other factual information about us. Such information can be found elsewhere in this Proxy Statement and in the public filings we make with the SEC, as described in the section entitled “Where You Can Find More Information” beginning on page 74.
 
The Merger Agreement
 
Structure of the Merger
 
Subject to the terms and conditions of the Merger Agreement and in accordance with Israeli law, Merger Sub, a wholly-owned indirect subsidiary of Parent, will be merged with and into the Company, following which Merger Sub will cease to exist and the Company shall continue as the Surviving Company in the Merger and shall become a wholly-owned subsidiary of Parent. The Merger will be effected by way of a statutory merger pursuant to Sections 314-327 of the Companies Law, which require, among other things, the adoption and approval of a simple majority of the voting power present, in person or by proxy, and voting at a meeting of the Company’s shareholders (not including abstentions and broker non-votes), excluding the voting power of any Ordinary Shares that are held by Merger Sub, Parent or by any person or entity holding, directly or indirectly, at least 25% of the means of control of either Merger Sub or Parent, or any person or entity acting on behalf of either Merger Sub or Parent or any person or entity described in the previous clause, including any of their affiliates.
 
Merger Consideration
 
As a result of the Merger, each Ordinary Share issued and outstanding immediately prior to the Effective Time (other than the Cancelled Shares) will be canceled and converted into the right to receive US $11.00 in cash, without interest and subject to the withholding of any applicable taxes.
 
At the Effective Time, the portion of each outstanding option to purchase one Ordinary Share that is unexercised immediately prior to the Effective Time, whether vested or unvested, will be canceled and converted into the right to receive an amount in cash equal to the excess, if any, of the Merger Consideration over the applicable exercise price of such option, without interest.
 
At the Effective Time, the portion of each outstanding RSU, representing the right to receive one Ordinary Share of the Company, that is unsettled immediately prior to the Effective Time, whether vested or unvested, will be canceled and converted into the right to receive an amount in cash equal to the excess, if any, of the Merger Consideration over the applicable purchase price per Ordinary Share of such RSU, without interest.
 
The proceeds payable to the holders of such options or RSUs (or Ordinary Shares that were issued upon the exercise of such options or RSUs) will be subject to any withholdings required by applicable law and if such options or RSUs were intended to be granted pursuant to Section 102(b) of the Tax Ordinance and is held by the Section 102 Trustee, the proceeds will be held by the Section 102 Trustee until such proceeds become distributable in accordance with that provision, the Options Tax Ruling (if obtained) and applicable law.
 
Representations and Warranties
 
The Merger Agreement contains a number of representations and warranties made by the Company on the one hand, and by Parent and Merger Sub, on the other hand. The representations and warranties in the Merger Agreement were made solely for the benefit of the parties to the Merger Agreement. The assertions embodied in those representations and warranties were made for purposes of specific provisions of the Merger Agreement and are subject to the qualifications and limitations referenced therein, some of which are contained in confidential disclosure schedules. In addition, certain representations and warranties were made as of a specified date or may be subject to a contractual standard of materiality different from what might be viewed as material to shareholders. For the foregoing reasons, you should not rely on the representations and warranties as statements of factual information.
 
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Representations made by the Company to Parent and Merger Sub in the Merger Agreement relate to, among other things:
 
  ·
our and our subsidiaries’ due organization, valid existence, good standing, corporate power and qualification;
 
  ·
our and our subsidiaries’ articles of association, certificate of incorporation, bylaws or similar governing documents;
 
  ·
ownership of our subsidiaries;
 
  ·
our capitalization, capital structure and equity securities;
 
  ·
our corporate power and authority to enter into the Merger Agreement and consummate the transactions contemplated thereby and the enforceability of the Merger Agreement against the Company;
 
  ·
required consents, authorizations, permits or approvals of and filings with governmental entities;
 
  ·
absence of any conflict with our or our subsidiaries’ charter documents, laws, agreements and instruments;
 
  ·
the revenues of the Company and our Israeli subsidiaries for the fiscal year ending December 31, 2016;
 
  ·
accuracy of documents filed with the SEC and compliance with SEC regulations, the status of the Company as a “foreign private issuer”, internal controls over financial reporting;
 
  ·
conformity of the Company’s financial statements with applicable accounting requirements and that the financial statements fairly present, in all material respects, the consolidated financial position of the Company;
 
  ·
absence of undisclosed liabilities;
 
  ·
the absence of certain changes or events since December 31, 2016;
 
  ·
absence of material pending or threatened legal proceedings or claims and the absence of such since January 1, 2014 against us and our subsidiaries;
 
  ·
our and our subsidiaries’ compliance with applicable law, including with respect to Foreign Corrupt Practices Act and Office of Foreign Asset Control matters, and laws relating to encryption and other restricted technology and export laws;
 
  ·
our and our subsidiaries’ material contracts;
 
  ·
certain tax matters related to us or our subsidiaries;
 
  ·
employees, employee benefits plans and other agreements, plans and policies with or concerning our and our subsidiaries’ employees;
 
  ·
labor and employment matters affecting us or our subsidiaries;
 
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  ·
intellectual property matters related to us or our subsidiaries ;
 
  ·
compliance with data privacy requirements;
 
  ·
environmental matters related to us or our subsidiaries ;
 
  ·
matters related to real property of us or our subsidiaries;
 
  ·
personal property and good title to assets and leaseholds of us and our subsidiaries;
 
  ·
healthcare regulatory compliance and availability of and compliance with permits to conduct the business by us and our subsidiaries;
 
  ·
product warranties and recalls;
 
  ·
our and our subsidiaries material suppliers;
 
  ·
our and our subsidiaries product liability;
 
  ·
grants, incentives and subsidies received from governmental entities;
 
  ·
insurance policies and related matters;
 
  ·
the inapplicability of anti-takeover laws;
 
  ·
the affirmative vote of the holders (either in person or by proxy) of a majority of the outstanding Ordinary Shares that are present at the Meeting to adopt and approve the Merger Agreement at the Meeting has been obtained (which we refer to as the Company Shareholder Approval);
 
  ·
accuracy of statements in this Proxy Statement;
 
  ·
receipt of opinion of financial advisor;
 
  ·
absence of any obligation to pay brokers’ or other similar fees; and
 
  ·
related party transactions.
 
Representations made by Parent and Merger Sub to the Company in the Merger Agreement relate to, among other things:
 
  ·
Parent’s and Merger Sub’s due organization, valid existence, good standing, corporate power and qualification;
 
  ·
the business and purpose of Parent and Merger Sub;
 
  ·
Parent’s and Merger Sub’s corporate power and authority to enter into the Merger Agreement and consummate the transactions contemplated thereby and the enforceability of the Merger Agreement against Parent and Merger Sub;
 
  ·
required consents, approvals and filings with governmental entities;
 
  ·
absence of any conflict with Parent’s or Merger Sub’s organizational documents, laws and agreements;
 
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  ·
delivery of a true, complete and correct copy of the equity commitment letter;
 
  ·
absence of any obligation to pay brokers’ or other similar fees;
 
  ·
accuracy of statements in this Proxy Statement;
 
  ·
no ownership of Ordinary Shares in the Company; and
 
  ·
absence of claims pending or to the knowledge of Parent, threatened against Parent or Merger Sub that would constitute a Parent Material Adverse Effect.
 
Significant portions of the representations and warranties of the Company are qualified as to “materiality” or “Material Adverse Effect.”  “Material Adverse Effect” means any fact, circumstance, event, change, effect or occurrence that, individually or in the aggregate with all other facts, circumstances, events, changes, effects, or occurrences, (A) has or would be reasonably expected to have a material adverse effect on the business, results of operations or financial condition of the Company and its subsidiaries taken as a whole or (B) that prevents or materially delays or materially impairs, or that would reasonably be expected to prevent, materially delay or materially impair, the Company’s ability to perform its obligations under the Merger Agreement or consummate the transactions contemplated thereby on a timely basis; provided, however, that in determining whether a Material Adverse Effect has occurred pursuant to clause (A) above, there shall be excluded any fact, circumstance, event, change, effect or occurrence on the Company and its subsidiaries to the extent caused by, resulting from or relating to, in each case, in Israel, the United States, Europe, Asia or any specific country or region in the world where the Company or any of its subsidiaries has operations: (i) any change in laws of general applicability or published interpretations thereof by courts or governmental entities or in U.S. GAAP after the date of the Merger Agreement, (ii) the announcement or pendency of the Merger Agreement or the transactions contemplated thereby, including to the extent arising out of or resulting therefrom, the impact on the relationships, contractual or otherwise, with officers, employees, customers, suppliers, distributors, resellers, licensors or other business partners as well as the identity of Parent and any announced plans or intentions of Parent with respect to the Company or the business of the Company and its subsidiaries following the closing of the Merger; (iii) the taking of any action required by the Merger Agreement, or the failure to take any action to which Parent has approved or required by the Merger Agreement; (iv) any changes in general economic conditions or in prevailing interest rates, currency exchange rates or the financial or capital markets (including changes in securities trading prices and volumes) generally affecting the industries and geographies in which the Company and its subsidiaries operate; (v) the failure by the Company and its subsidiaries to meet internal or published projections or forecasts or published revenue or earnings predictions (but not the underlying causes thereof); (vi) hurricanes, earthquakes, floods or other natural disasters; (vii) the commencement of a war, armed hostilities or acts of sabotage or terrorism (including any escalation or general worsening of any such acts of war, armed hostilities, sabotage or terrorism); (viii) any changes in political conditions, (ix) any legal proceedings brought or threatened by any of the current or former shareholders of the Company (on their own behalf or on behalf of the Company) relating to the Merger Agreement or any of the transactions contemplated thereby; or (x) any of the items specified in confidential disclosures provided to Parent by the Company to the extent (1) arising after the date of the Merger Agreement and (2) the Company did not have knowledge prior to the date of the Merger Agreement that such fact, circumstance, event, change, effect or occurrence would arise (provided that the qualifications in clauses (1) and (2) of this clause (x) shall not apply to certain items described in such confidential disclosure schedules); provided, that the effect of such changes described in clauses (i), (iv), (vi), (vii) or (viii) shall not be excluded to the extent of the disproportionate impact, if any, they have on the Company and its subsidiaries relative to other companies of comparable size in the industries in which the Company and its subsidiaries operate.
 
Some of the representations and warranties of Parent and Merger Sub are qualified as to “materiality” or “Parent Material Adverse Effect”.  A Parent Material Adverse Effect means any fact, circumstance, event, change, effect or occurrence that, individually or in the aggregate with all other facts, circumstances, events, changes, effects, or occurrences prevents or materially delays or materially impairs, or that would reasonably be expected to prevent, materially delay or materially impair, Parent’s ability to perform its obligations under the Merger Agreement or consummate the transactions contemplated thereby.
 
The representations and warranties in the Merger Agreement do not survive or continue in force or effect following the consummation of the Merger.
 
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Conduct of Business by the Company
 
Except as otherwise expressly contemplated or permitted by the Merger Agreement, as required by applicable law, or as included in the exceptions in the confidential disclosures provided by the Company to Parent or with the prior written consent of Parent, during the period from the signing of the Merger Agreement to the Effective Time (or valid termination of the Merger Agreement), the Company and its subsidiaries will (i) conduct its business in the ordinary course consistent with past practice and (ii) use reasonable best efforts to maintain and preserve intact its business organization, and its rights, authorizations, franchises and other authorizations issued by governmental entities, preserve its business relationships with customers, vendors, distributors and others doing business with it and retain the services of its officers and key employees.
 
Except as otherwise expressly contemplated or permitted by the Merger Agreement, as required by applicable law, or as included in the exceptions in the confidential disclosures provided by the Company to Parent, during the period from the signing of the Merger Agreement to the Effective Time (or valid termination of the Merger Agreement), the Company has further agreed to not take (nor permit its subsidiaries to take) any of the following actions without the prior written consent of Parent:
 
  ·
amend its certificate of incorporation or bylaws or other applicable organizational documents, adjust, split, combine or reclassify any equity interest or enter into a plan of consolidation, merger, share exchange, share acquisition, reorganization or complete or partial liquidation with any person;
 
  ·
issue, grant, sell, dispose of, redeem or repurchase any equity securities or equity-based award in the Company or any of its subsidiaries, or securities convertible into, or exchangeable or exercisable for, any such equity securities or awards, or any rights of any kind to acquire any such equity securities or such convertible or exchangeable securities (subject to certain exceptions);
 
  ·
declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of the Ordinary Shares or other shares of capital stock or equity interests of the Company or its subsidiaries (except for any dividend or distribution by a wholly-owned subsidiary of the Company to the Company or another wholly-owned subsidiary of the Company);
 
  ·
sell, license, transfer, mortgage, encumber or otherwise dispose of, abandon or fail to maintain any assets, rights or businesses of the Company or its subsidiaries, in each case other than dispositions not exceeding $1,000,000 in the aggregate;
 
  ·
acquire any business organization or division thereof or any assets, in each case other than purchases of equipment and other assets in the ordinary course of business or acquisitions not exceeding $1,000,000 in the aggregate;
 
  ·
incur, assume, refinance or guarantee any indebtedness for borrowed money (other than indebtedness among the Company and/or wholly-owned subsidiaries) or issue any debt securities, or assume or guarantee any indebtedness for borrowed money of any person, except for borrowings in the ordinary course of business in an amount not to exceed $2,500,000 in the aggregate outstanding at one time;
 
  ·
enter into any swap or hedging transaction or other derivative agreement;
 
  ·
make any loans, advances or capital contributions to, or investments in, any other person (other than to any wholly-owned subsidiary of the Company) in excess of $1,000,000 in the aggregate;
 
  ·
enter into any contract involving or providing for the settlement (or proposed settlement) of, or other arrangements with respect to, any claims or threatened claim  with a governmental entity, that involves payments after the date of the Merger Agreement, in the aggregate, in excess of $500,000 or that materially restricts or imposes material obligations on the Company and its subsidiaries (with the exception of settlements regarding shareholder litigation related to the Merger Agreement);
 
58

  ·
commence any claim, except with respect to claims involving amounts less than $500,000 individually or $1,000,000 in the aggregate, or in connection with a breach of the Merger Agreement or any other agreements contemplated by the Merger Agreement;
 
  ·
enter into, amend in any material respect, waive compliance with any material rights with respect to, or cancel or terminate any material contract or contract which if entered into prior to the date of the Merger Agreement would be a material contract, in each case other than renewals of material contracts in the ordinary course of business with terms and conditions of the renewed material contract substantially similar to the existing material contract being so replaced;
 
  ·
except for the expenditures contemplated by and consistent with the capital expenditure budget set forth in the confidential disclosures provided by the Company to Parent, make, or commit to make, or otherwise authorize any capital expenditures in excess of an amount equal to, in the aggregate, 20% of the Company’s total capital expenditure budget for the relevant period;
 
  ·
except as required by law or the terms of any employee benefit plan in effect as of the Merger Agreement or as disclosed in the confidential disclosures provided by the Company to Parent: (i) increase the compensation or benefits of any of the Company’s  employees other than increases made in the ordinary course of business, consistent with past practice for employees with total annual cash compensation of less than $150,000; (ii) grant or pay any performance bonus, change-in-control, retention bonus, severance or termination pay to any of the Company’s  employees; (iii) establish, adopt, enter into, amend, terminate or grant any waiver or consent under any employee benefit plan; (iv) grant any equity or equity-based awards; (v) hire, or terminate the employment of, any of the Company’s  employees, other than for cause, except for individuals who have a total annual cash compensation target (including (x) base salary or wages and (y) bonus and commissions) of less than $100,000 in the ordinary course of business consistent with past practice; (vi) except with respect to options and RSUs, take any action to accelerate the vesting or time of payment of any compensation or benefit under or waive any performance conditions with respect to any employee benefit plan or awards made thereunder; (vii) loan or advance any money or other property to any present or former director, officer or employee of the Company or its subsidiaries; (viii) increase or accelerate the funding obligation or contribution rate of any employee benefit plan; (ix) approve, enter into, adopt or establish any obligation to gross-up, indemnify or otherwise reimburse any of the Company’s  employees for any tax incurred by such employee, including under Section 409A or 4999 of the Code; or (x) grant any of the Company’s  employees the right to receive an additional payment (including any tax gross up or other payment (including any tax gross up or other payment) as a result of the imposition of any taxes;
 
  ·
announce, implement or effect any reduction in force, layoff or other program resulting in the termination of employees, in each case, that would trigger the Worker Adjustment and Retraining Notification Act or similar law;
 
  ·
make any changes in its methods, practices or policies of financial accounting, except as may be required under law, rule, regulation or U.S. GAAP, in each case as approved in writing by the Company’s independent public accountants;
 
  ·
make or change any tax election, file any amended tax returns, settle or compromise any material tax liability of the Company or any of its subsidiaries, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of taxes of the Company or any of its subsidiaries, enter into any closing agreement with respect to any tax or surrender any right to claim a tax refund, incur any material liability for taxes outside the ordinary course of business or make any material changes in its methods, practices or policies of tax accounting;
 
  ·
fail to use its reasonable best efforts to maintain in full force and effect the existing insurance policies of the Company and its subsidiaries or to replace such insurance policies with comparable insurance policies covering the Company, its subsidiaries and their respective properties, assets and businesses;
 
59

  ·
apply for or accept any funding from any governmental entity, which is extended to support the Company’s research and development operations, or any material funding from any other governmental entity;
 
  ·
enter into, engage in or amend any transaction or contract with any affiliate, officer, director, manager, employee, shareholder, equityholder, member or manager of the Company;
 
  ·
terminate or materially default under any lease;
 
  ·
transfer, convey or assign any intellectual property that is material to the conduct of the business of the Company and its subsidiaries, taken as a whole;
 
  ·
make any material changes to any material internal and posted policies and terms of use relating to data, privacy, personal data and IT assets security or make any material changes in the operation or protection of any material IT assets; or
 
  ·
agree to, or make any commitment to, take any of the actions prohibited by any of the above.
 
Prior to closing, the Company will, and will cause each of its subsidiaries to, use their commercially reasonable efforts to cause the cash of the Company and its subsidiaries to be available for use by or distribution to Parent promptly following the closing. However, nothing in this requirement requires the Company or any of its subsidiaries to take any action prior to the Effective Time if the Company determines in good faith that such action could reasonably be expected to (i) result in tax obligations or other costs or expense to the Company or any of its subsidiaries, (ii) adversely affect the Company’s or any of its subsidiaries’ tax or financial reporting positions, (iii) adversely affect the ability of the Company and its subsidiaries to operate their respective businesses in the ordinary course, consistent with past practice, or (iv) be prohibited by law.
 
Nothing contained in in the Merger Agreement is intended to give Parent, directly or indirectly, the right to control or direct the Company’s or its subsidiaries’ operations prior to the Effective Time.
 
Company Shareholders Meeting, Proxy Statement and Board Recommendation
 
The Company has agreed, no later than the fifth business day following the execution of the Merger Agreement, to duly call, give notice of and convene (in accordance with applicable law) the Meeting for the purpose of obtaining the Company Shareholder Approval. The Company has agreed to furnish this Proxy Statement to the SEC on Form 6-K as soon as reasonably practicable following the date of the Merger Agreement, but in no event later than the fifteenth business day after the date thereof, and to use its reasonable best efforts to cause this Proxy Statement to be mailed to its shareholders as promptly as practicable. Unless the Merger Agreement is terminated pursuant to the termination provisions of the Merger Agreement or as Parent and the Company may otherwise agree, the Meeting shall be held no later than 70 days after the publication of the notice regarding the Meeting.
 
In addition, except to the extent there has been a Company Board Recommendation Change (as described below) the Company has agreed use its reasonable best efforts to solicit from its shareholders “FOR” votes in favor of the adoption and approval of the Merger. The Company has also agreed to include in this Proxy Statement the written opinion of Barclays and the Company’s Board of Directors recommendation of the Merger, unless the Company’s Board of Directors has made a Company Board Recommendation Change.
 
Merger Proposal
 
The Company and Merger Sub have agreed that they will, as promptly as reasonably practicable after the execution of the Merger Agreement, cause a merger proposal (in the Hebrew language) to be executed in accordance with Section 316 of the Companies Law and within three (3) days from the calling of the Meeting, delivered to the Israeli Registrar of Companies. The Company and Merger Sub have further agreed to within three (3) days after the date the merger proposal is delivered to the Israeli Registrar of Companies, provide a copy of the merger proposal to their secured creditors, if any.
 
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In addition, each of the Company and, if applicable, Merger Sub, agreed to (i) on the day the merger proposal is submitted to the Israeli Registrar of Companies, publish a notice to its creditors in two (2) daily Hebrew newspapers, (ii) within three (3) business days after submitting the merger proposal to the Israeli Registrar of Companies, publish a notice to its foreign, substantial creditors in a popular newspaper circulated in New York as may be required by applicable law, (iii) within four (4) business days after submitting the merger proposal to the Israeli Registrar of Companies, send a notice by registered mail to all of the “Substantial Creditors” (as such term is defined in the relevant regulations promulgated under the Companies Law (which we refer to as the Merger Regulations)), if any, of which the Company or Merger Sub, as applicable, is aware, and (iii) within three (3) business days after submitting the merger proposal to the Israeli Registrar of Companies, send to the Company’s “employees committee” or display in a prominent place at the Company’s premises, a copy of the notice published in the daily Hebrew newspaper.
 
Furthermore, the Company and Merger Sub have agreed that within three (3) days following the completion of all abovementioned actions, in accordance with Section 5 of the Merger Regulations, to inform the Israeli Registrar of Companies that a notice was given to their respective creditors under Section 318(a) of the Companies Law and under Section 3 of the Merger Regulations, in the form required by the Merger Regulations.
 
Not later than three (3) days after the Company Shareholder Approval is received, the Company will inform the Israeli Registrar of Companies of such adoption and approval, and the Company and Merger Sub will request that the Israeli Registrar of Companies declare the Merger effective and issue the certificate of merger.  It is the intention of the parties that the Merger shall be declared effective and the certificate of merger shall be issued on the closing date of the Merger, as a condition to the closing taking place.
 
The sole shareholder of Merger Sub will approve the Merger on the date that the Company Shareholder Approval is obtained, subject to the satisfaction or waiver of other conditions to closing.  No later than three (3) days after the date of such approval, Merger Sub will inform the Israeli Registrar of Companies of such approval.
 
No Solicitation
 
Until May 10, 2017 (which we refer to as the No-Shop Period Start Date), the Company has the right to (i) initiate, solicit and encourage any inquiry or the making of any proposal or offer that could constitute a Company Acquisition Proposal (as defined below), and (ii) cooperate or participate in any discussions or negotiations with any persons or group of persons with respect to any proposal or offer that could lead to a Company Acquisition Proposal.  Without in any way limiting the exercise by the Company’s Board of Directors of its fiduciary duties, prior to the No-Shop Period Start Date, the Company will not publicly comment on any Company Acquisition Proposal.
 
The term “Company Acquisition Proposal” means any proposal or offer from any person (other than Parent or any of its subsidiaries) relating to any (i) direct or indirect acquisition, purchase or sale of assets that constitute 20% or more of the consolidated revenues, net income or consolidated assets of the Company and its subsidiaries, (ii) liquidation, dissolution or similar transaction involving the Company or any of its subsidiaries, (iii) merger, reorganization, recapitalization, share exchange, consolidation, business combination or similar transaction involving the Company or any of its subsidiaries or (iv) direct or indirect purchase or sale of, or tender or exchange offer for, securities of the Company or any of its subsidiaries that, if consummated, would result in any person or “group” (as defined in the Exchange Act) of persons beneficially owning securities representing 20% or more of the equity or total voting power of the Company, any of its subsidiaries or the surviving parent entity in such transaction.
 
The term “Excluded Party” means any person or group of persons from whom the Company has received, prior to the No-Shop Period Start Date, a bona fide written Company Acquisition Proposal that (x) the Company’s Board of Directors has concluded in good faith (after consultation with the Company’s outside legal and financial advisor), prior to the No-Shop Period Start Date, constitutes a Superior Proposal (as defined below) or is reasonably expected to lead to a Superior Proposal, (y) remains pending as of the No-Shop Period Start Date and (z) as of any date following the No-Shop Period Start Date, has not been withdrawn or otherwise abandoned.
 
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Except as may relate to any Excluded Party (but only for so long as such person or group is an Excluded Party) or as expressly permitted by the “No Solicitation” provisions in the Merger Agreement, from the No-Shop Period Start Date continuing until the Effective Time or, if earlier, the date on which the Merger Agreement is terminated in accordance with the termination provisions of the Merger Agreement, the Company will not, directly or indirectly:
 
  ·
initiate, solicit, knowingly encourage or knowingly facilitate the submission of any proposals, offers or inquiries that constitute or could reasonably be expected to lead to any Company Acquisition Proposal;
 
  ·
have any discussions or negotiations with or provide any confidential information or data to any person relating to a Company Acquisition Proposal;
 
  ·
withdraw, change, amend, modify or qualify, or otherwise publicly propose to withdraw, change, amend, modify or qualify, in a manner adverse to Parent, the recommendation by the Company’s Board of Directors that the Company’s shareholders adopt and approve the Merger or approve or recommend, or propose publicly to approve or recommend, any Company Acquisition Proposal (which we refer to as a Company Board Recommendation Change); or
 
  ·
approve or recommend, or execute or enter into, any contract related to any Company Acquisition Proposal.
 
In addition, except as may relate to any Excluded Party (but only for as long as such person or group is an Excluded Party) or as expressly permitted by the “No Solicitation” provisions of the Merger Agreement, from and after the No-Shop Period Start Date, the Company will immediately cease any activities, discussions or negotiations with any persons, other than Parent and its affiliates, with respect to any Company Acquisition Proposal, including immediately revoking or withdrawing access of such person, other than Parent or any Excluded Party (but only for as long as such person or group is an Excluded Party), to any data room containing any non-public information previously furnished.
 
Promptly after the No-Shop Period Start Date, the Company shall also request that each person (other than Parent or any Excluded Party) that has executed a confidentiality agreement that is then still in effect to promptly return or destroy all non-public information furnished to such person on behalf of the Company prior to the No-Shop Period Start Date.  Promptly following the date that a person no longer constitutes an Excluded Party, the Company shall also request that such person promptly return or destroy all non-public information furnished to such person on behalf of the Company.
 
Notwithstanding the foregoing provisions, prior to the time the Company Shareholder Approval is obtained, in the event that the Company receives after the date of the Merger Agreement an unsolicited (except as before the No-Shop Period Start Date) bona fide written Company Acquisition Proposal that did not result from a material breach of the “No Solicitation” provisions of the Merger Agreement and the Company’s Board of Directors (x) concludes in good faith (after consultation with the Company’s outside legal and financial advisor) that such Company Acquisition Proposal constitutes a Superior Proposal or is reasonably expected to lead to a Superior Proposal and (y) concludes in good faith after consultation with the Company’s outside legal advisor that the failure to take the following actions would be inconsistent with its fiduciary duties under applicable law, the Company may have discussions or negotiations with and provide confidential information or data to the person making such Company Acquisition Proposal and/or afford to such person access to the business or other non-public information or to any personnel of the Company. 
 
However, (i) prior to providing any confidential information or access to, or having discussions or negotiations with, any person making such Company Acquisition Proposal, the Company must have entered into an confidentiality agreement with such person that contains terms that are no less favorable to the Company than those contained in the confidentiality agreement with Parent, (ii) the Company will provide to Parent any information that was not previously provided or made available to Parent prior to (or contemporaneously with) providing any such information to such person making such Company Acquisition Proposal, and (iii) information shared with such person making such Company Acquisition Proposal will be subject to customary “clean room” procedures.
 
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The term “Superior Proposal” means a bona fide written Company Acquisition Proposal (with all references in the definition of Company Acquisition Proposal to “twenty percent (20%)” changed to “fifty percent (50%)” for purposes of this definition) made by any person on terms that the Company’s Board of Directors determines in good faith, after consultation with the Company’s outside financial and legal advisors, is reasonably likely to be consummated in accordance with its terms on a timely basis and would result in a transaction that is more favorable to the Company’s shareholders from a financial point of view than the Merger, after taking into account (i) the legal and financial aspects of the offer or proposal, (ii) the likelihood and timing of consummation and (iii) any changes to the terms of the Merger Agreement proposed by Parent and any other information provided by Parent.
 
From and after the No-Shop Period Start Date, the Company shall notify Parent promptly (but in any event no longer than forty-eight hours): (i) after receipt of any Company Acquisition Proposal or an inquiry that could reasonably be expected to lead to a Company Acquisition Proposal, which notice shall include the identity of the person making such proposal or inquiry and copies of all proposals and drafts of proposed agreements related thereto (including financing commitments) or a written summary of the material terms of such proposal or inquiry if not made in writing and (ii) of any change to the material terms of any Company Acquisition Proposal or inquiry that could reasonably be expected to lead to a Company Acquisition Proposal.  From and after the No-Shop Period Start Date, the Company shall keep Parent reasonably informed of the status of any Company Acquisition Proposal.
 
Prior to the time the Company Shareholder Approval is obtained, the Company’s Board of Directors may (A) make a Company Board Recommendation Change or (B) terminate the Merger Agreement in accordance with the termination provisions of the Merger Agreement in order to enter into a definitive agreement to effect a transaction constituting a Superior Proposal, if:
 
  ·
the Company receives a bona fide Company Acquisition Proposal that did not result from a material breach of the “No Solicitation” provisions of the Merger Agreement and the Company’s Board of Directors determines in good faith (after consultation with the Company’s outside legal and financial advisors) that such Company Acquisition Proposal constitutes a Superior Proposal;
 
  ·
the Company provides Parent prior written notice of its intention to take such action;
 
  ·
for at least four (4) business days after Parent’s receipt of such notice, the Company has negotiated with Parent in good faith (to the extent Parent desires to negotiate) to make such adjustments in the terms and conditions of the Merger Agreement so that such Company Acquisition Proposal ceases to constitute a Superior Proposal (it being understood and agreed that any revision to the material terms of such Superior Proposal shall require a new notice by the Company to Parent on only two occasions following delivery of the original notice by the Company to Parent and not with respect to any subsequent revisions to the material terms of such Superior Proposal after such two occasions, and the Company will, on such two occasions, comply again with the provisions herein with respect to such new notice; provided that references to the four (4) business day period shall be deemed to be references to a two (2) business day period with respect to such two occasions); and
 
  ·
at the end of the period (or periods) referred to in the bullet point above, if Parent and Merger Sub shall have delivered (prior to or at the end of such period or periods) to the Company a written bona fide offer to alter the terms or conditions of the Merger Agreement, the Company’s Board of Directors has concluded in good faith (after consultation with the Company’s outside legal and financial advisors) that such Company Acquisition Proposal still constitutes a Superior Proposal after giving effect to all of the adjustments which may be offered by Parent and that a failure to make a Company Board Recommendation Change or to terminate the Merger Agreement in order to enter into a definitive agreement with respect to such Superior Proposal would result in a violation of its fiduciary duties under applicable law.
 
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Prior to the time the Company Shareholder Approval is obtained, the Company’s Board of Directors may also make a Company Board Recommendation Change if:
 
  ·
there is an event, development or change in circumstances that is material to the Company that does not relate to any Company Acquisition Proposal and was not known or reasonably foreseeable as of the date of the Merger Agreement (any such event, development or change in circumstances, we refer to as an Intervening Event);
 
  ·
the Company’s Board of Directors determines in good faith (after consultation with outside legal and financial advisors) that, as a result of such Intervening Event, failure to make a Company Board Recommendation Change would be inconsistent with its fiduciary duties under applicable law;
 
  ·
the Company provides Parent prior written notice of the Company’s intention to make a Company Board Recommendation Change;
 
  ·
for at least four (4) business days after Parent’s receipt of such notice, the Company has negotiated Parent in good faith to make such adjustments in the terms and conditions of the Merger Agreement in order to obviate the need to make such Company Board Recommendation Change; and
 
  ·
at the end of the period referred to the bullet point above, if Parent shall have delivered to the Company a written bona fide offer to alter the terms or conditions of the Merger Agreement, the Company’s Board of Directors has concluded in good faith (after consultation with outside legal and financial advisors) that, as a result of such Intervening Event, failure to make a Company Board Recommendation Change would still be inconsistent with its fiduciary duties under applicable law after giving effect to all of the adjustments which may be offered by Parent.
 
Nothing contained in the Merger Agreement will prevent the Company or Company’s Board of Directors from taking and disclosing to the Company’s shareholders a position contemplated by Rule 14e-2(a) under the Exchange Act (or any similar communication under Israeli law) or a position contemplated by Section 329 of the Israel Companies Law or complying with Rule 14d-9 under the Exchange Act with respect to a Company Acquisition Proposal. However, such rules will in no way eliminate or modify the effect that any action pursuant to such rules would otherwise have under the Merger Agreement. In addition, any such disclosure (other than a “stop, look and listen” or similar communication of the type contemplated by Rule 14d-9(f) under the Exchange Act) will be deemed to be a Company Board Recommendation Change unless the Company’s Board of Directors expressly and concurrently reaffirms its recommendation of the Merger in such disclosure or similar communication.
 
Efforts to Consummate the Merger
 
Each of Parent, Merger Sub and the Company has agreed to use their reasonable best efforts to (i) consummate the transactions contemplated by the Merger Agreement, (ii) comply promptly with all laws which may be imposed on such party with respect to the transactions contemplated by the Merger Agreement; (iii) defend all lawsuits or other proceedings challenging or affecting the Merger Agreement or the consummation of the transactions contemplated by the Merger Agreement until the issuance of a final, non-appealable order with respect to each such lawsuit or other proceeding, (iv) seek to have lifted or rescinded any injunction or restraining order which may adversely affect the ability of the parties to consummate the transactions contemplated by the Merger Agreement, in each case until the issuance of a final, non-appealable order with respect thereto and (v) seek to resolve any objection or assertion by any governmental entity challenging the Merger Agreement or the transactions contemplated by the Merger Agreement.
 
In addition, each of Parent, Merger Sub and the Company has agreed to use their reasonable best efforts to prepare all necessary documents in order to obtain (and to cooperate with the other party to obtain) any approval from any governmental entity which is required to be obtained by Parent, Merger Sub, the Company or its subsidiaries in connection with the transactions contemplated by the Merger Agreement. As promptly as practicable after the date of the Merger Agreement, the Company and Parent agree to make an appropriate filing of a Notification and Report Form pursuant to the HSR Act and other filings contemplated by applicable foreign competition laws.
 
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Notwithstanding anything to the contrary in the Merger Agreement, nothing in the Merger Agreement will require Parent to take any action with respect to any of its affiliates (other than the Company and its subsidiaries) or any “portfolio company” of any investment fund affiliated with Parent.
 
Each party has also agreed to use their respective reasonable best efforts to obtain any consents or approvals from any third parties (other than governmental entities) that are necessary or advisable in connection with the transactions contemplated by the Merger Agreement. In the event that the parties shall fail to obtain any such third party consents, the Company will use its reasonable best efforts (and will take such actions as are reasonably requested by Parent) to minimize any adverse effect resulting or which would reasonably be expected to result after the Effective Time from the failure to obtain such third party consent.  None of the Company, its subsidiaries, Parent, Merger Sub or any of their affiliates will be required to, or, without the prior written consent of the other party, will pay or commit to pay to such third party whose approval or consent is being solicited, any cash or other consideration, make any commitment or incur any liability or other obligation due to such person.
 
Each party will cooperate with the other and use reasonable best efforts to (i) keep the other party informed in all material respects and on a reasonably timely basis of any material communication received by such party from, or given by such party to, any governmental entity and of any material communication received or given in connection with any proceeding by a private party, in each case regarding the Merger, (ii) consult with the other party to the extent reasonably practicable, and (iii) comply with the terms and conditions of all such approvals of all such third parties and governmental entities.
 
Employee Benefits
 
Until the first anniversary of the Effective Time, each employee of the Company or its subsidiaries who remains employed following the Merger, who we refer to as a continuing employee, will be provided compensation and benefits that are substantially comparable to those provided immediately prior to the date of the Merger Agreement.
 
For each employee welfare and retirement benefit plan sponsored by Parent or the Surviving Company, for purposes of determining eligibility to participate, vesting, entitlement to benefits and vacation entitlement (but not for accrual of benefits under any defined benefit pension plan, post-retirement welfare benefit plan or “core contributions” under a U.S. tax qualified defined contribution plan), service with the Company or any of its subsidiaries shall be treated as service with Parent. However such service shall not be recognized to the extent that such recognition would result in a duplication of benefits. Such service also shall apply for purposes of satisfying any waiting periods, evidence of insurability requirements, or the application of any pre-existing condition limitations with respect to any plan sponsored by Parent or the Surviving Company.  Parent shall use commercially reasonable efforts to cause to be waived pre-existing condition limitations to the same extent waived under the applicable plan of the Company.  Parent shall use commercially reasonable efforts to cause continuing employees to be given credit for amounts paid under a corresponding plan of the Company or its subsidiaries during the same period for purposes of applying deductibles, co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of the plan sponsored by Parent or the Surviving Company during the applicable plan year.
 
Indemnification and Insurance
 
The Merger Agreement provides that the rights to indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time now existing in favor of the current or former directors or officers of the Company will be assumed by the Surviving Company in the Merger and will survive the Merger and continue in full force and effect. However, such obligations will be subject to any limitation imposed from time to time under applicable law.
 
The Merger Agreement also provides that prior to the Effective Time, the Company will purchase a directors’ and officers’ liability insurance policy covering those persons who, as of immediately prior to the Effective Time, are covered by the Company’s current directors’ and officers’ liability insurance policy, on terms no less favorable to the insured parties than those of the Company’s present directors’ and officers’ liability insurance policy, for a period of seven years after the Effective Time. In the alternative, Parent may cause the Surviving Company to purchase a “tail” policy providing for such coverage, so long as the aggregate premium of such policy will not exceed 300% of the annual premium currently paid by the Company for its officers’ and directors’ liability insurance.
 
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Financing and Financing Assistance
 
Parent has represented to the Company in the Merger Agreement that Parent shall have at the Effective Time available funds necessary to consummate the Merger and to pay the Merger Consideration, the Award Consideration and all other payments due by Parent under the Merger Agreement, as evidenced by the equity commitment letter provided to the Company by and between Parent and the Investors. There is no financing contingency (a/k/a “financing out”) in the Merger Agreement. The Company agreed to use reasonable best efforts to cooperate with Parent as reasonably requested by Parent to the extent Parent seeks to arrange any debt financing.
 
Tax Rulings
 
The Company agreed to cause its Israeli counsel, advisors and/or accountants, with approval by Parent prior to its submission, to prepare and file with the Israeli Tax Authority an application for a Withholding Ruling within five (5) business days after the date of the Merger Agreement. The application for the Withholding Ruling will, with respect to holders of Ordinary Shares, seek to (i) exempt Parent, the Paying Agent, the Surviving Company and their respective agents from any obligation to withhold taxes levied, assessed, charged or imposed by any governmental entity in Israel from any consideration payable or otherwise deliverable to such holders pursuant to Merger Agreement, including the Merger Consideration, or clarifies that no such obligation exists, or (ii) clearly instruct Parent, the Paying Agent, the Surviving Company and their respective agents on how such withholding is to be executed, and in particular, with respect to the classes or categories of holders of the Ordinary Shares from which tax is to be withheld (if any), the rate or rates of withholding to be applied and in regards to non-Israeli residents, how to identify any such non−Israeli residents. To the extent that prior to the closing of the Merger an interim Withholding Ruling is obtained, then all parties will act in accordance with such interim ruling, until such time that a final definitive Withholding Ruling is obtained.
 
The Company also agreed to cause its Israeli counsel, advisors and/or accountants, with approval by Parent prior to its submission, to prepare and file with the Israeli Tax Authority an application for an Options Tax Ruling within five (5) business days after the date of the Merger Agreement.  The application for the Options Tax Ruling will seek to confirm, among other things, that: (i) the cancellation and exchange of the options, RSUs and conversion of the Ordinary Shares, in each case, intended to be granted pursuant to Section 102(b) of the Ordinance and held by the 102 Trustee, each in accordance with their respective provision in the Merger Agreement, shall not be regarded as a violation of the minimum trust period (which we refer to as the 102 Trust Period) required by Section 102 of the Ordinance according to the applicable tax route  so long as the respective Award Consideration and Merger Consideration are deposited with the 102 Trustee until the end of the respective 102 Trust Period and (ii) the deposit of the respective Award Consideration and Merger Consideration with the Paying Agent and the 102 Trustee shall not be subject to any withholding obligation in respect of Israeli withholding tax.  The Company shall include in the request for the Options Tax Ruling a request to exempt Parent, the Surviving Company, the Paying Agent, the 102 Trustee and their respective agents from any withholding obligation. To the extent that prior to the closing of the Merger an interim Options Tax Ruling is obtained, then all parties will act in accordance with such interim ruling, until such time that a final definitive Options Tax Ruling is obtained.
 
In the event that either of the Options Tax Ruling or the Withholding Ruling (whether final or interim) is not obtained by closing, Parent, Merger Sub, Company, its subsidiaries, the 102 Trustee and the Paying Agent may deduct or withhold any taxes required to be so deducted and withheld by applicable law, in accordance with the Merger Agreement.
 
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Certain Other Covenants
 
The Merger Agreement contains additional covenants, including covenants relating to access to information, transaction-related litigation, obtaining resignations of directors as of the closing, making inapplicable any antitakeover statutes, cooperation in connection with the preparation of this Proxy Statement, public announcements, notices of certain events, reasonable best efforts  in connection with the de-listing of the Ordinary Shares from NASDAQ and the deregistration of the Ordinary Shares under the Exchange Act, and the Meeting.
 
Conditions to the Merger
 
Company Conditions
 
The Company’s obligation to effect the Merger is conditioned upon the satisfaction or waiver (in writing), on or prior to the closing date, of all of the following conditions:
 
  ·
the Company Shareholder Approval has been obtained;
 
  ·
any approvals, clearances or waiting periods (and any extensions thereof) under any applicable antitrust law have been obtained, expired or been earlier terminated;
 
  ·
as required by the Companies Law, at least 50 days have elapsed after the filing of a merger proposal with the Israeli Registrar of Companies, and at least 30 days have elapsed after the Company Shareholder Approval and the approval by the sole shareholder of Merger Sub have been obtained;
 
  ·
no injunction, writ, order, award, judgment, settlement or decree issued by any governmental entity or other legal restraint preventing the consummation of the Merger or any of the other transactions contemplated by the Merger Agreement shall be in effect and no law shall have been enacted, entered, promulgated or enforced by any governmental entity which prohibits or makes illegal the consummation of the Merger;
 
  ·
(i) certain representations and warranties of Parent and Merger Sub in the Merger Agreement related to organization, good standing and qualification, and corporate power and enforceability shall be true and correct in all respects as of the date of the Merger Agreement and at and as of the closing date as if made on and as of the closing date and (ii) all other representations and warranties of Parent and Merger Sub in the Merger Agreement shall be true and correct as of the date of the Merger Agreement and at and as of the closing date as if made on and as of the closing date, except to the extent that such failure have not had, would not have or reasonably be expected to have a Parent Material Adverse Effect; and
 
  ·
Parent shall have performed in all material respects each of the obligations that are to be performed by it under the Merger Agreement at or prior to the closing date.
 
Parent and Merger Sub Conditions
 
Parent’s and Merger Sub’s obligations to effect the Merger are conditioned upon the satisfaction or waiver (in writing) at or prior to the closing date of the following conditions:
 
  ·
the Company Shareholder Approval has been obtained;
 
  ·
any approvals, clearances or waiting periods (and any extensions thereof) under any applicable antitrust law have been obtained, expired or been earlier terminated;
 
  ·
as required by the Companies Law, at least 50 days have elapsed after the filing of a merger proposal with the Israeli Registrar of Companies, and at least 30 days have elapsed after the Company Shareholder Approval and the approval by the sole shareholder of Merger Sub have been obtained;
 
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  ·
no injunction, writ, order, award, judgment, settlement or decree issued by any governmental entity or other legal restraint preventing the consummation of the Merger or any of the other transactions contemplated by the Merger Agreement shall be in effect and no law shall have been enacted, entered, promulgated or enforced by any governmental entity which prohibits or makes illegal the consummation of the Merger;
 
  ·
(i) certain representations and warranties of the Company in the Merger Agreement related to corporate organization; good standing and qualification; company charter documents; corporate power and enforceability; the absence of a Material Adverse Effect and broker’s fees shall be true and correct in all respects as of the date of the Merger Agreement and at and as of the closing date as if made on and as of the closing date; (ii) the representation and warranty of the Company in the Merger Agreement related to its capitalization (except where the failure to be so accurate would not be reasonably expected to result in additional cost, expense or liability to the Company, Parent or their affiliates that is more than $2,000,000) shall be true and correct in all respects as of the date of the Merger Agreement and at and as of the closing date as if made on and as of the closing date; and (iii) all other representations and warranties of the Company in the Merger Agreement shall be true and correct as of the date of the Merger Agreement and at and as of the closing date as if made on and as of the closing date, except to the extent that such failure have not had, would not have or reasonably be expected to have a Material Adverse Effect; and
 
  ·
the Company shall have performed in all material respects each of the obligations that are to be performed by it under the Merger Agreement at or prior to the closing date.
 
Termination Provisions
 
The Merger Agreement may be terminated at any time before the Effective Time by the mutual written consent of Parent and the Company.
 
The Merger Agreement may also be terminated prior to the Effective Time by either Parent or the Company if:
 
  ·
a governmental entity has issued a final non-appealable order enjoining or otherwise prohibiting the consummation of the transactions contemplated by the Merger Agreement (this right to terminate is not available to a party if such party did not materially comply with its obligations to use its reasonable best efforts to obtain approvals from any applicable governmental entity required by the Merger Agreement);
 
  ·
the Merger is not consummated by August 30, 2017 or at such later date agreed upon in writing by all parties (which we refer to as the End Date), with certain automatic extensions to be made to the End Date if the Meeting is postponed, adjourned or delayed for any reason (this right to terminate is not available to a party whose actions or omissions have been the primary cause of, or the primary factor that resulted in, the failure of the Merger to occur on or before such date);
 
  ·
if the other party shall have breached any of its representations, covenants or agreements in the Merger Agreement and such breach is not cured within the 30-day cure period or cannot be cured prior to closing and would entitle the non-breaching party not to consummate the transactions contemplated by the Merger Agreement by reason of a failure of a condition to closing (this right to terminate is not available to a party who is then in material breach of any of its own representations, covenants or agreements in the Merger Agreement); or
 
  ·
the Meeting has been held and the Company Shareholder Approval has not been obtained after the final adjournment of the Meeting at which a vote is taken on the Merger.
 
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The Merger Agreement may also be terminated prior to the Effective Time by Parent under any of the following circumstances:
 
  ·
if all of the closing conditions to the obligations of the Company have been satisfied or waived by the Company and the Company has failed to consummate the closing on or before the fifth business day after the later of (i) the first day that the closing conditions to the obligations of Parent have been satisfied and (ii) the date on which Parent provides notice to the Company irrevocably undertaking to close the Merger; or
 
  ·
(i) prior to obtaining the adoption and approval of the Company’s shareholders of the Merger Agreement and the transactions contemplated thereby, the Company’s Board of Directors effects a Company Board Recommendation Change or the Company fails to include the Company’s Board of Director’s recommendation of the Merger in the Proxy Statement, (ii) the Company enters into any contract relating to a Company Acquisition Proposal, (iii) the Company materially breaches the provisions relating to the shareholder adoption and approval process or the “No Solicitation” provisions, in each case, in a manner that impairs, prevents or materially delays the consummation of the Merger and such breach cannot be cured or was not cured reasonably promptly, (iv) after the “go shop” period, the Company fails to recommend against any Company Acquisition Proposal upon request of Parent or the Company’s Board of Directors fails to publicly reaffirm the Merger upon the request of Parent, or (v) the Company’s Board of Directors shall have publicly announced an intention to effect any of the foregoing prior to obtaining the Company Shareholder Approval.
 
The Merger Agreement may also be terminated prior to the Effective Time by the Company under any of the following circumstances:
 
  ·
if all of the closing conditions to the obligations of Parent have been satisfied or waived by Parent and Parent has failed to consummate the closing on or before the fifth business day after the later of (i) the first day that the closing conditions to the obligations of the Company have been satisfied and (ii) the date on which the Company provides notice to Parent irrevocably undertaking to close the Merger; or
 
  ·
if (i) the Company has not breached its obligations under the “No Solicitation” provisions in the Merger Agreement, (ii) the Company’s Board of Directors authorizes the Company, subject to complying with the terms of the Merger Agreement including the “No Solicitation” provisions, to enter into a definitive agreement for a Superior Proposal, (iii) the Company concurrently with such termination pays to Parent or its designee, in immediately available funds, the applicable termination fee and (iv) the Company enters into such definitive agreement substantially concurrently with such termination.
 
Effect of Termination
 
Upon termination, the Merger Agreement shall be of no further force or effect, and there shall be no liability on the part of Parent, Merger Sub, the Company, or their respective officers, directors, stockholders, shareholders, or affiliates, except that certain limited provisions relating to confidentiality, fees and expenses and other general provisions shall survive termination and provided that no party shall be relieved from liability for any willful and material breach (as defined below) of any provisions of the Merger Agreement.
 
Termination Fees
 
The Merger Agreement requires that the Company pay Parent a termination fee of $5,960,000 in the event that the Merger Agreement is terminated by the Company, either before or after the No-Shop Period Start Date, if (1) the Company has not breached its obligations under the “No Solicitation” provisions in the Merger Agreement, (2) the Company’s Board of Directors authorizes the Company, subject to complying with the terms of the Merger Agreement, including the “No Solicitation” provisions of the Merger Agreement, to enter into a definitive agreement for a Superior Proposal with an Excluded Party (as previously defined herein), (3) the Company concurrently with such termination pays to Parent or its designee, in immediately available funds, the termination fee and (4) the Company enters into such definitive agreement substantially concurrently with such termination.
 
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The Merger Agreement requires that the Company pay Parent a termination fee of $13,910,000 within two  (2) business days after termination, in the event that the Merger Agreement is terminated by Parent due to any of the following (in each case, not with an Excluded Party in the manner described in the preceding paragraph): (i) prior to obtaining the adoption and approval of the Company’s shareholders of the Merger Agreement and the transactions contemplated thereby, the Company’s Board of Directors changes its recommendation of the Merger in a manner adverse to the Merger or recommends a Company Acquisition Proposal or the Company fails to include the Company’s Board of Director’s recommendation of the Merger in the Proxy Statement, (ii) the Company enters into any contract relating to a Company Acquisition Proposal, (iii) the Company materially breaches the provisions relating to the shareholder adoption and approval process or the “No Solicitation” provisions, in each case, in a manner that impairs, prevents or materially delays the consummation of the Merger and such breach cannot be cured or was not cured reasonably promptly, (iv) after the “go shop” period, the Company’s Board of Directors fails to publicly reaffirm the Merger upon the request of Parent, or fails to publicly recommend against a Company Acquisition Proposal, or (v) the Company’s Board of Directors shall have publicly announced an intention to effect any of the foregoing prior to obtaining the Company Shareholder Approval.
 
The Merger Agreement also requires that the Company pay Parent a termination fee of $13,910,000 in the event that: (i) a Company Acquisition Proposal shall have been publicly announced prior to the termination of the Merger Agreement, (ii) the Merger Agreement is thereafter terminated either because (A) the Effective Date has not occurred prior to the End Date, (B) the Company’s shareholders fail to adopt and approve the Merger Agreement and the transactions contemplated thereby at the Meeting, (C) the Company breached its representations, warranties or covenants in the Merger Agreement, or (D) the Company failed to consummate the Merger upon satisfaction of closing conditions and written request thereof by Parent, and (iii) within nine months after such termination, the Company consummates a Company Acquisition Proposal (however, references in the definition of Company Acquisition Proposal to “20% or more” shall instead refer to “50% or more”). The termination fee shall be paid to Parent on the date of the consummation of a Company Acquisition Proposal.
 
The payment of the termination fee shall be the exclusive remedy of Parent and Merger Sub (except for specific performance, as described below), except for willful and material breach of any representation, warranty, covenant or other provision of the Merger Agreement. “Willful and material breach” means a material breach that is a consequence of an act taken by the breaching party, or the failure by the breaching party to take an act it is required to take under the Merger Agreement, with the actual knowledge that the taking of, or the failure to take, such act would, or would be reasonably expected to, cause a breach of the Merger Agreement.
 
Specific Performance
 
The parties to the Merger Agreement agreed that they will be entitled, in addition to any other remedy at law or in equity, to seek an injunction, specific performance and other equitable relief to prevent or restrain breaches, or threatened or imminent breaches, of the Merger Agreement and to enforce specifically the terms and provisions of the Merger Agreement.
 
Notwithstanding anything to the contrary in the Merger Agreement, the Company is entitled to seek specific performance of Parent’s obligations to cause the equity commitment to be funded and to consummate the Merger, solely if all of Parent’s closing conditions have been satisfied or waived by Parent and Parent fails to close by the date the closing is required to have occurred pursuant to the terms of the Merger Agreement.
 
While Parent may pursue both a grant of specific performance and the payment of the termination fee, under no circumstances is Parent permitted or entitled to receive both a grant of specific performance that results in the Effective Time occurring and the payment of the termination fee.
 
Expenses
 
All fees and expenses will be borne by the party incurring such fees or expenses, except that Parent will directly pay the filing fees required to be paid in connection with any filing made under any applicable antitrust laws in connection with the transactions contemplated by the Merger Agreement.
 
70

Amendments
 
The parties may amend the Merger Agreement at any time prior to the Effective Time, provided that, after the Company Shareholder Approval has been obtained, no amendment may be made that requires the adoption and approval of the Company’s shareholders under applicable law without obtaining the adoption and approval of such amendment by the Company’s shareholders.
 
Governing Law
 
The Merger Agreement and any dispute arising out of or relating to the Merger Agreement are governed by, and construed in accordance with, the laws of the State of Israel, without giving effect to any other choice of law or conflict of law provision or rule (whether of the State of Israel or otherwise) that would cause the application of the laws of any other jurisdiction.
 
Voting Agreement
 
Concurrently with the execution of the Merger Agreement, Dr. Shimon Eckhouse, Active Chairman of the Board of Directors of Syneron, solely in his capacity as a shareholder, entered into the Voting Agreement, a copy of which is attached as Appendix B to this Proxy Statement. Pursuant to the Voting Agreement, Dr. Eckhouse has agreed, subject to the terms and conditions of the Voting Agreement, to vote all of the Eckhouse Shares, representing approximately       % of the outstanding voting power of our Ordinary Shares entitled to vote at the Meeting, in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting (and any adjournment or postponement thereof).
 
71

 
MARKET PRICE INFORMATION
 
Our Ordinary Shares are listed for trading on the NASDAQ Global Select Market under the symbol “ELOS.” The following tables set forth the high and low market prices for our Ordinary Shares on the NASDAQ Global Select Market for the periods indicated:
 
 
 
High
   
Low
 
2017
           
First Quarter
 
$
11.25
   
$
8.25
 
Second Quarter (through May 8, 2017)
  $       $    
2016
               
First Quarter
 
$
8.47
   
$
6.11
 
Second Quarter
 
$
7.88
   
$
6.50
 
Third Quarter
 
$
7.80
   
$
6.18
 
Fourth Quarter
 
$
9.10
   
$
6.93
 
2015
               
First Quarter
 
$
12.59
   
$
8.93
 
Second Quarter
 
$
12.90
   
$
10.35
 
Third Quarter
 
$
10.86
   
$
6.91
 
Fourth Quarter
 
$
8.44
   
$
6.10
 
2014
               
First Quarter
 
$
13.32
   
$
10.86
 
Second Quarter
 
$
12.88
   
$
9.99
 
Third Quarter
 
$
11.18
   
$
9.16
 
Fourth Quarter
 
$
10.89
   
$
8.32
 
 
On March 31, 2017, the last full trading day prior to date of the public announcement that we had entered into the Merger Agreement with Parent and Merger Sub, the closing price per Ordinary Share on the NASDAQ Global Select Market was $10.55. On April 28, 2017, the most recent practicable date, the closing price per Ordinary Share on the NASDAQ Global Select Market was $10.95.
 
SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE ORDINARY SHARES.
 
72

 
BENEFICIAL OWNERSHIP OF ORDINARY SHARES BY CERTAIN BENEFICIAL OWNERS
 
Major Shareholders, Directors and Executive Officers
 
 
The following table sets forth certain information regarding the beneficial ownership of our Ordinary Shares, as of May 8, 2017 (or such other dates as indicated), by: (i) each person who we believe beneficially owns 5% or more of our outstanding Ordinary Shares, and (ii) our directors and executive officers as a group. Beneficial ownership of Ordinary Shares is determined in accordance with the rules of the SEC and generally includes any Ordinary Shares over which a person exercises sole or shared voting or investment power. The percentage ownership of each such person includes the number of Ordinary Shares underlying options that are exercisable within 60 days from the date of April 27, 2017. Ordinary Shares subject to these options are deemed to be outstanding for the purpose of computing the ownership percentage of the person holding these options, but are not deemed to be outstanding for the purpose of computing the ownership percentage of any other person. Except as otherwise set forth below, the street address of each of the beneficial owners is c/o Syneron Medical Ltd., Industrial Zone, Tavor Building, P.O.B. 550, Yokneam Illit 20692, Israel.
 
   
 
 
Number of Ordinary Shares Held
   
Percentage of Outstanding Ordinary Shares(1)
 
Charles H. Brandes / Brandes Investment Partners, L.P.(2)
   
3,660,613
     
 
%
Conan Laughlin / North Tide Capital, LLC(3)
   
3,500,000
     
 
%
Dr. Shimon Eckhouse(4)
   
2,971,161
     
 
%
Stephen DuBois / Camber Capital Management LLC(5)
   
2,347,593
     
 
%
Directors and executive officers as a group (16 persons)
           
 
%
 

*          Less than 1.0%
 
(1) The percentages shown are based on                        Ordinary Shares issued and outstanding as of May 8, 2017.
 
(2) The information contained in the table above is as of December 31, 2016 and is based solely upon Amendment No. 4 to Schedule 13G filed with the SEC on January 10, 2017 by Brandes Investment Partners, L.P. (the Investment Adviser) and the following control persons of the Investment Adviser: Brandes Investment Partners, Inc., Brandes Worldwide Holdings, L.P., and Charles H. Brandes.
 
(3) The information contained in the table above is as of December 31, 2016 and is based solely on Amendment No. 4 to Schedule 13G filed with the SEC on February 14, 2017 by North Tide Capital Master, LP (the Master Fund), North Tide Capital, LLC (North Tide), and Conan Laughlin. Shares of the Company reported for North Tide represent Ordinary Shares which are beneficially owned by the Master Fund, and Ordinary Shares which are beneficially owned by a managed account (the Account). North Tide serves as investment manager to both the Master Fund and the Account. Shares of the Company reported for Mr. Laughlin represent the above referenced Ordinary Shares beneficially owned by the Master Fund and the Account. Mr. Laughlin serves as the Manager of North Tide.
 
(4) The information contained in the table above is based upon number of outstanding Ordinary Shares listed in the Voting Agreement: 2,689,911 Ordinary Shares and 281,250 Ordinary Shares issuable upon exercise of outstanding options.
 
(5) The information contained in the table above is as of May 13, 2016 and is based solely on the Schedule 13G filed with the SEC on May 23, 2016 by Camber Capital Management LLC and Stephen Dubois.
 
73

 
WHERE YOU CAN FIND MORE INFORMATION
 
We file reports and other information with the SEC under the Exchange Act. You may read and copy this information at the SEC’s public reference room located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. For further information concerning the SEC’s public reference room, you may call the SEC at 1-800-SEC-0330. Our SEC filings are also available to the public from commercial document retrieval services and on the SEC’s website at www.sec.gov.
 
The SEC reports set forth below, as well as reports we file with or submit to the SEC after the date of this Proxy Statement, contain important information about Syneron and its financial condition, and are hereby incorporated by reference into this Proxy Statement:
 
  ·
Annual Report on Form 20-F for the fiscal year ended December 31, 2016, filed on March 23, 2017; and
 
  ·
Report of Foreign Private Issuer on Form 6-K submitted on March 8, 2017.
 
Our Annual Report on Form 20-F for the fiscal year ended December 31, 2016 contains a detailed description of our business, and certain risk factors in connection with the purchase or holding of Ordinary Shares.
 
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROXY STATEMENT, INCLUDING ANY DOCUMENTS INCORPORATED BY REFERENCE HEREIN. WE HAVE NOT AUTHORIZED ANYONE TO GIVE ANY INFORMATION DIFFERENT FROM THE INFORMATION CONTAINED IN THIS PROXY STATEMENT. THIS PROXY STATEMENT IS DATED                  , 2017. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS ACCURATE AS OF ANY LATER DATE, AND THE MAILING OF THIS PROXY STATEMENT TO SHAREHOLDERS SHALL NOT CREATE ANY IMPLICATION TO THE CONTRARY.
 
OTHER MATTERS
 
Management knows of no other business to be transacted at the Meeting as the time has passed for shareholders to submit such additional matters for the agenda, but, if any other matters are properly presented at the Meeting, the persons named in the enclosed form of proxy will vote upon such matters in accordance with their best judgment.
 
 
By order of the Board of Directors,
 
DR. SHIMON ECKHOUSE
Active Chairman of the Board of Directors
 
                 , 2017
 
74
 
 
Appendix A
 
Execution Version
 
AGREEMENT AND PLAN OF MERGER
 
BY AND AMONG
 
LUPERT LTD.,
 
RENDEL AMARE LTD.,
 
AND
 
SYNERON MEDICAL LTD.
 
DATED AS OF APRIL 2, 2017
 

 
TABLE OF CONTENTS
 
     
Page
   
2
   
 
1.1.
The Merger
2
 
1.2.
Closing of the Merger
2
 
1.3.
Effective Time
2
 
1.4.
Effects of the Merger
3
 
1.5.
Articles of Association
3
 
1.6.
Board of Directors
3
 
1.7.
Officers
3
   
3
   
 
2.1.
Effect on Ordinary Shares
3
 
2.2.
Merger Sub Capital Stock
4
 
2.3.
Treatment of Company Options and Company RSU Awards
4
 
2.4.
Paying Agent
5
 
2.5.
Withholding
8
 
2.6.
Certain Adjustments
8
 
2.7.
No Further Ownership Rights in Company Shares
8
   
9
   
 
3.1.
Corporate Organization
9
 
3.2.
Capitalization
10
 
3.3.
Authority
12
 
3.4.
Consents and Approvals
13
 
3.5.
SEC Reports; Other Reports; Internal Controls
13
 
3.6.
Financial Statements; Undisclosed Liabilities
15
 
3.7.
Absence of Certain Changes or Events
15
 
3.8.
Legal Proceedings
15
 
3.9.
Compliance with Applicable Law; FCPA; OFAC
16
 
3.10.
Material Contracts
18
 
3.11.
Taxes
20
 
3.12.
Employees; Employee Benefit Plans
22
 
3.13.
Labor Matters
25
 
3.14.
Intellectual Property
26
 
3.15.
Environmental Matters
29
 
3.16.
Property
29
 
3.17.
Healthcare Regulatory Compliance
30
 
3.18.
Products
32
 
3.19.
Suppliers
33
 
3.20.
Product Liability
33
 
3.21.
Grants, Incentives and Subsidies
33
 
- ii -

 
3.22.
Insurance
34
 
3.23.
Anti-Takeover Statutes
34
 
3.24.
Shareholder Vote Required
34
 
3.25.
Proxy Statement
34
 
3.26.
Opinion Of Financial Advisor
34
 
3.27.
Broker’s Fees
35
 
3.28.
Transactions with Affiliates
35
 
3.29.
No Other Representations or Warranties
35
   
35
   
 
4.1.
Corporate Organization
35
 
4.2.
Authority; No Violation
36
 
4.3.
Consents and Approvals
36
 
4.4.
Equity Financing
37
 
4.5.
Broker’s Fees
37
 
4.6.
Proxy Statement
37
 
4.7.
Ownership of Ordinary Shares
38
 
4.8.
Absence of Litigation
38
 
4.9.
No Other Representations or Warranties
38
   
39
   
 
5.1.
Conduct of Business Prior to the Effective Time
39
 
5.2.
Access to Information
43
 
5.3.
Proxy Statement and Company Shareholders Meeting
43
 
5.4.
No Solicitation
45
 
5.5.
Reasonable Best Efforts
50
 
5.6.
Employees; Employee Benefit Plans
51
 
5.7.
Indemnification; Directors’ and Officers’ Insurance
52
 
5.8.
Publicity
54
 
5.9.
Notice of Certain Matters
54
 
5.10.
Anti-takeover Laws
54
 
5.11.
Shareholder Litigation
55
 
5.12.
NASDAQ Delisting
55
 
5.13.
Merger Proposal
55
 
5.14.
Directors
56
 
5.15.
Financing Assistance from Company
56
 
5.16.
Tax Rulings
57
   
59
   
 
6.1.
Conditions to Each Party’s Obligation to Effect the Merger
59
 
6.2.
Conditions to Obligations of Parent
60
 
6.3.
Conditions to Obligations of the Company
60
 
- iii -

   
61
   
 
7.1.
Termination
61
 
7.2.
Effect of Termination
63
   
65
   
 
8.1.
Non-survival of Representations, Warranties and Agreements
65
 
8.2.
Amendment
65
 
8.3.
Extension; Waiver
65
 
8.4.
Expenses
65
 
8.5.
Notices
65
 
8.6.
Certain Definitions
67
 
8.7.
Interpretation
74
 
8.8.
Counterparts
74
 
8.9.
Entire Agreement; No Third Party Beneficiaries
74
 
8.10.
Governing Law
75
 
8.11.
Consent to Jurisdiction
75
 
8.12.
Specific Performance
76
 
8.13.
Severability
76
 
8.14.
Assignment
76
 
8.15.
Mutual Drafting
77
 
8.16.
Non-Recourse
77
 
- iv -

 
INDEX OF DEFINED TERMS
 
102 Amounts
2.4(e)
102 Trust Period
8.6
102 Trustee
8.6
Acceptable Confidentiality Agreement
8.6
affiliate
8.6
Agreement
Preamble
Alternative Acquisition Agreement
5.4(b)
Approval
8.6
Award Consideration
2.3(b)
Book-Entry Shares
2.4(c)
Bribery Legislation
3.9(e)
Business Day
8.6
Cancelled Shares
2.1(a)
Capital Expenditure Budget
5.1(b)(x)
Certificate of Merger
1.3
Certificates
2.4(b)
Change of Recommendation Notice
5.4(f)(iii)
Charter Documents
3.1(a)
Claims
8.6
Closing
1.2
Closing Date
1.2
Code
8.6
Collective Bargaining Agreement
3.13(a)
Companies Registrar
1.3
Company
Preamble
Company 102 Option
8.6
Company 102 RSU