Protalix BioTherapeutics, Inc.

Executive compensation consists of following elements:

Base Salary. Base salaries for our executive officers are established based on the scope of their responsibilities taking into account competitive market compensation paid by other companies for similar positions. Generally, we believe that executive base salaries should be targeted near the median of the range of salaries for executives in similar positions with similar responsibilities at comparable companies. The Compensation Committee convenes from time to time to evaluate present and future executive compensation, which evaluation generally includes an evaluation of the peer group considered in analyzing executive compensation. The Compensation Committee intends to continue reviewing and revising the peer group periodically to ensure that it continues to reflect companies similar to the Company in size and development stage. The Compensation Committee also reviews executive compensation reports and an analysis of publicly-traded biotechnology companies prepared by third party experts from a well-known consulting firm for additional data and other information regarding executive compensation for comparative purposes.

Base salaries are usually reviewed annually, and adjusted from time to time to realign salaries with market levels after taking into account individual responsibilities, performance and experience. The base salaries of each of our President and Chief Executive Officer, our Senior Vice President and Chief Financial Officer our Senior Vice President, Operations, who we refer to collectively as the “Named Executive Officers,” are discussed herein.

Annual Bonus**.** The Compensation Committee has the authority to award discretionary annual bonuses to our executive officers. Discretionary annual bonus awards are intended to compensate officers for achieving financial, clinical, regulatory and operational goals and for achieving individual annual performance objectives. For any given year, the compensation objectives vary, but relate generally to strategic factors such as developments in our clinical path, the execution of a license agreement for the commercialization of product candidates, the establishment of key strategic collaborations, the build-up of our pipeline and financial factors such as capital raising. Bonuses are awarded generally based on corporate performance, with adjustments made within a range for individual performance, at the discretion of the Compensation Committee. The Compensation Committee determines, on a discretionary basis, the size of the entire bonus pool and/or the amount of the actual award to each Named Executive Officer.

The Compensation Committee selects, in its discretion, the executive officers of the Company or our subsidiary who are eligible to receive bonuses for any given year. Any bonus granted by the Compensation Committee will generally be paid upon the achievement of a specific milestone, subject to certain terms and conditions. The Compensation Committee has not fixed a minimum or maximum award for any executive officer’s annual discretionary bonus. Each of our executive officers is eligible for a discretionary annual bonus under his or her employment agreement.

During the year ended December 31, 2024, our Board of Directors determined that the Named Executive Officers and other officers and employees of the Company were entitled to certain cash bonuses as compensation for their efforts and executions during calendar year 2023. Important milestones underlying the Company’s efforts during calendar year 2023 included the following:

●Optimizing our strategic path;

●Successful inspections of our manufacturing facilities by the Israeli Ministry of Health (GMP) and the U.S. Food and Drug Administration, or the FDA;

●Approvals of Elfabrio®by both the FDA and the European Medicines Agency;

●Completion of recruitment and dosing in our PRX-115 FIH study (PEGylated Uricase for the potential treatment of uncontrolled Gout);

●Transfer of the Elfabrio extension studies to Chiesi Farmaceutici S.p.A.;

●Expansion and retention of management;

●Securing sufficient liquidity for the then upcoming debt repayment and on-going operations; and

●Continuous uninterrupted operation despite the current geopolitical situation in Israel.

Based on the foregoing, the Board of Directors, after consultation with the Compensation Committee, resolved to grant certain cash bonuses to certain Named Executive Officers and other officers and employees of the Company including NIS 480,000, or six monthly salaries, to Mr. Rubin and NIS 350,000, or approximately 5.3 monthly salaries, to Mr. Naos. In lieu of a cash bonus, our Board of Directors granted to Mr. Bashan 263,960 restricted shares of the Company’s common stock.

Options and Share-Based Compensation. Our Amended and Restated 2006 Stock Incentive Plan, as amended (the “Plan”), authorizes us to grant options to purchase shares of common stock, restricted stock and other securities to our employees, directors and consultants. Our Compensation Committee is the administrator of the Plan. Stock option or other grants are generally made at the commencement of employment and following a significant change in job responsibilities or to meet other special retention or performance objectives. The Compensation Committee reviews and approves stock option and other awards to executive officers based upon a review of competitive compensation data, its assessment of individual performance, a review of each executive’s existing long-term incentives, and retention considerations. The exercise price of stock options granted under the Plan must be equal to at least 100% of the fair market value of our common stock on the date of grant; however, in certain circumstances, grants may be made at a lower price to Israeli grantees who are residents of the State of Israel.

During the year ended December 31, 2024, the Compensation Committee granted to Mr. Rubin 90,909 fully-vested restricted shares of the Company’s common stock and to Mr. Naos options to purchase 100,000 shares of the Company’s common stock with an exercise price equal to $1.10 per share. Mr. Naos’ options vest in 12 equal increments on a quarterly basis over a three-year period commencing upon the date of grant, subject to certain terms and conditions.

Severance and Change in Control Benefits. The Compensation Committee granted the following payments that would be payable in connection with a change of control: $1.0 million to the President and Chief Executive Officer and $400,000 to each of the other executive Vice Presidents. Such payments are subject to certain terms and conditions. In addition to the foregoing, pursuant to the employment agreements entered into with each of our executive officers, the executive officer is entitled to be insured by Protalix Ltd. under a Manager’s Policy in lieu of severance. The intention of such Manager’s Policies is to provide the Israel-based officers with severance protection of one month’s salary for each year of employment. In addition, the stock options and restricted stock granted to each of our Named Executive Officers provide that all of such instruments are subject to accelerated vesting immediately upon a change in control of the Company.

Other Compensation. Consistent with our compensation philosophy, we intend to continue to maintain our current benefits for our executive officers; however, the Compensation Committee in its discretion may revise, amend, or add to the officer’s executive benefits if it deems it advisable. As an additional benefit to all of our Israel-based Named Executive Officers and for most of our employees, we contribute to certain funds amounts equaling a total of approximately 15% of their respective gross salaries for certain pension and other savings plans for the benefit of the Named Executive Officers and other employees. In addition, in accordance with customary practice in Israel, our Israel-based executives’ agreements require us to contribute towards their vocational studies, and to provide annual recreational allowances, a company car and a company phone. We believe these benefits are currently equivalent with the median compensation levels at comparable companies.

Executive Compensation. We refer to the “Summary Compensation Table” set forth below for information regarding the compensation earned during the fiscal year ended December 31, 2024 by our Named Executive Officers.