FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

Date of Report: November 2430, 2021 Commission File No.: 000-29992

OPTIBASE LTD.

(Translation of registrant’s name into English)

8 ~~Hamanofim~~Hamenofim Street

Herzliya 4672559, Israel

+972-73-7073700

(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- ________

AtAttached ~~the~~hereto ~~Extraordinary~~and ~~General~~incorporated ~~Meeting~~by ofway ~~Shareholders~~ of ~~Optibase~~reference ~~Ltd.~~herein ~~(Nasdaq:~~is ~~OBAS)~~a ~~(the~~press ~~"Company")~~release ~~held~~issued ~~on November 24, 2021, all of the proposed resolutions presented were approved~~ by the ~~shareholders~~Registrant byand ~~the~~entitled ~~required~~“Optibase ~~majority, except that with respect to Proposal No~~Ltd.~~1, the Company's board of directors, following the recommendation of the compensation committee, approved the~~ ~~omission~~Announces ofThird ~~the~~Quarter ~~possibility to grant exemption from liability for directors and officers from the compensation policy attached hereto and incorporated by way of reference~~Results”.

For further information on the proposals, please refer to proxy statement filed by the company on Edgar and furnished to the Securities and Exchange Commission on October 19, 2021.

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.

OPTIBASE LTD.
(the “Registrant”)

By: /s/ Amir Philips
——————————————
Amir Philips
Chief Executive Officer

Date: November 2430, 2021

~~Annex~~Media AContacts:

~~COMPENSATION~~Amir ~~POLICY~~Philips, CEO, Optibase Ltd.

~~OPTIBASE LTD.~~011-972-73-7073-700

~~Compensation Policy for Executive Officers and Directors~~info@optibase-holdings.com

~~(As~~Investor ~~Adopted~~Relations ~~by the Shareholders on February 14, 2019 and as amended on February 18, 2020 and on~~ Contact:

~~December~~Marybeth 30Csaby, ~~2020)~~for Optibase

~~Table of Contents~~+1- 917-664-3055

~~Page~~Marybeth.Csaby@gmail.com

AOPTIBASE LTD. ~~Overview~~ANNOUNCES ~~and~~THIRD ~~Objectives~~QUARTER ~~A-3~~RESULTS

BHERZLIYA, Israel, November 30, 2021 – Optibase Ltd. ~~Base~~(NASDAQ: ~~Salary~~OBAS) today ~~and~~announced ~~Benefits~~financial ~~A-4~~results for the third quarter ended September 30, 2021.

CRevenues from fixed income real estate totaled $3.5 ~~Cash~~million ~~Bonuses~~for A-the quarter ended September 30, 2021 compared to revenues of $3.5 million for the third quarter of 2020.

DNet loss attributable to Optibase Ltd shareholders for the quarter ended September 30, 2021 was $86,000 or $0.02 per ~~Equity-Based~~basic ~~Compensation~~and ~~A-76~~diluted share compared to net income of $5.2 million or $1 per basic and diluted share for the third quarter of 2020.

EFor the nine months ended September 30, 2021 revenues totaled $10.4 ~~Retirement~~million ~~and~~compared ~~Termination~~to revenues of ~~Service~~$11.4 ~~Arrangements~~million for A-the nine months ended September 30, 2020. Net loss attributable to Optibase Ltd Shareholders for the period was $1.4 million or $0.28 per basic and diluted share, compared to net income of $7.1 million or $1.36 per basic and diluted share for the nine months ended September 30, 2020.

F.Weighted ~~Exemption,~~average ~~Indemnification~~shares outstanding used in the calculation for the periods were approximately 5.2 million basic and ~~Insurance~~diluted ~~A-8~~shares for each period.

GAs of September 30, 2021, we had cash and cash equivalents of $30.2 ~~Arrangements~~million, ~~upon~~and ~~Change~~shareholders' equity of ~~Control~~$83.4 million, ~~A-9~~compared with $28.8 million, and $86.7 million, respectively, as of December 31, 2020.

HAmir Philips, Chief Executive Officer of Optibase commented on the third quarter results: "This quarter our fixed income real estate rent stayed stable compared to the third quarter of 2020 and we had a net loss of $86,000 compared to net income of $5.2 ~~Board~~million for the third quarter of ~~Directors~~2020, ~~Compensation~~the ~~A-10~~decrease is mainly due to the sale of our portfolio in Germany during the second and the third quarters of 2020. For the third quarter of 2021, we generated NOI of $2.9 million compared to NOI of $3 million for the third quarter of 2020. In addition, for the third quarter of 2021, our Recurring FFO was $1.5 million compared to Recurring FFO of $1.2 million for the third quarter of 2020. Mr. Philips concluded: “We will continue to work to maintain our operating results and to increase our financial stability.”

~~I. Miscellaneous A-10~~2

AOPTIBASE - REPORTS/2

A.ACCOUNTING ~~Overview and~~AND ~~Objectives~~OTHER DISCLOSURES

1Non-GAAP Net Operating Income, or NOI, is a non-GAAP financial measure. ~~Introduction~~The most directly comparable GAAP financial measure is operating income, which, to calculate NOI, is adjusted to add back real estate depreciation, and amortization, general and administrative expenses and other operation expenses less gain on sale of operating properties. We use NOI internally as a performance measure and believe that NOI (when combined with the primary GAAP presentations) provides useful information to investors regarding our financial condition and results of operations because it reflects only those income and expense item that are incurred at the property level.

~~This~~We ~~document~~consider ~~sets~~the ~~forth~~NOI ~~the~~to be an appropriate supplemental non-GAAP measure to operating income because it assists management, and thereby ~~Compensation~~ investors, ~~Policy~~to ~~for~~understand ~~Executive~~the ~~Officers~~core property operations prior to depreciation and ~~Directors~~amortization ~~(this~~expenses ~~"Compensation~~and ~~Policy"~~general orand ~~"Policy")~~administrative costs. In addition, because prospective buyers of real estate have different overhead structures, with varying ~~Optibase~~ marginal ~~Ltd.~~impact ~~("Optibase"~~to oroverhead ~~the~~by ~~"Company")~~acquiring real estate, in ~~accordance~~we ~~with~~consider the ~~requirements~~NOI ofto ~~the~~be ~~Companies~~a ~~Law~~useful ofmeasure ~~1999~~for (determining the ~~"Companies~~value ~~Law")~~of a real estate asset or groups of assets.

~~Compensation~~The ismetric aNOI ~~key~~should ~~component~~only ofbe ~~Optibase's~~considered ~~overall~~as ~~human~~supplemental ~~capital~~to ~~strategy~~the tometric ~~attract,~~operating ~~retain,~~income ~~reward,~~as ~~and~~a measure of our performance. NOI should ~~motivate~~ not ~~highly~~be ~~skilled~~used ~~individuals~~as ~~that~~a ~~will~~measure ~~enhance~~of ~~Optibase's~~our ~~value~~liquidity, ~~and~~nor ~~otherwise~~is ~~assist~~it ~~Optibase~~indicative of funds available to ~~reach~~fund ~~its~~our ~~business~~cash ~~and~~needs, ~~financial~~including ~~long~~our ~~term~~ability ~~goals~~to pay dividends or make distributions. ~~Accordingly,~~NOI ~~the~~should ~~structure~~also ofnot ~~this~~be ~~Policy~~used ~~was~~as ~~established~~a supplement to, ~~tie~~or ~~the~~substitute ~~compensation~~for, ofcash ~~each~~flow ~~officer~~ from tooperating ~~Optibase's~~activities ~~goals~~(computed ~~and~~in ~~performance~~accordance with generally accepted accounting principles in the United States).

~~For~~Non-GAAP ~~purposes~~Funds offrom ~~this~~operation, ~~Policy~~or FFO, ~~"Executive~~is ~~Officers"~~a ~~shall~~non-GAAP ~~mean~~financial ~~"Office~~measure. ~~Holders"~~The asmost ~~such~~directly ~~term~~comparable GAAP financial measure is ~~defined~~net income, inwhich, ~~Section~~to 1calculate ofFFO, ~~the~~is ~~Companies~~adjusted ~~Law~~to add back depreciation and amortization and after adjustments for unconsolidated associates. We make certain adjustments to FFO, ~~excluding~~which it refers to as Non-GAAP recurring FFO or recurring FFO, ~~unless~~to account ~~otherwise~~for ~~expressly~~items ~~indicated~~we ~~herein~~do not believe are representative of ongoing operating results, ~~Optibase's~~including ~~directors;~~transaction costs associated with acquisitions. We use FFO internally as a performance measure and ~~"Directors"~~we ~~shall~~believe ~~mean~~FFO (when combined with the ~~Optibase's~~primary ~~directors~~GAAP presentations) is a useful, supplemental measure of our operating performance as ~~shall~~it’s bea ~~from~~recognized ~~time~~metric toused ~~time,~~extensively ~~including~~by the ~~Executive~~real ~~Chairperson~~estate industry. We also believe that Recurring FFO is a useful, ~~unless~~supplemental ~~otherwise~~measure ~~expressly~~of ~~indicated~~our ~~herein~~core operating performance. The company believes that financial analysts, investors and shareholders are better served by the presentation of operating results generated from its FFO and Recurring FFO measures.

~~This~~We ~~Compensation~~consider ~~Policy~~the ~~shall~~FFO ~~serve~~and asRecurring ~~Optibase’s~~FFO ~~Compensation~~to ~~Policy~~be ~~for~~an ~~three~~appropriate ~~(3)~~supplemental ~~years,~~non-GAAP ~~commencing~~measure asto ofoperating income because it assists ~~its~~ management, ~~adoption~~and thereby investors, in analyzing our operating performance.

The ~~Compensation~~metric’s ~~Committee~~FFO and Recurring FFO should only be considered as supplemental to the ~~Board~~metric ofnet ~~Directors~~income as a measure of ~~Optibase~~our performance. FFO (~~the~~i) ~~"Compensation~~does ~~Committee"~~not ~~and~~represent ~~"Board"~~cash ~~respectively~~flow from operations as defined by GAAP, (ii) ~~shall~~is ~~review~~not ~~and reassess~~indicative of cash available to fund all cash flow needs, including the ~~adequacy~~ability ofto ~~this~~make ~~Policy~~distributions, ~~from~~(iii) ~~time~~is not an alternative to ~~time~~cash flow as a measure of liquidity, and (iv) should not be considered as ~~required~~an byalternative ~~the~~to ~~Companies~~net ~~Law~~income (which is determined in accordance with GAAP) for purposes of evaluating our operating performance.

~~2. Objectives~~3

~~Optibase's~~OPTIBASE objectives and goals in setting this Compensation Policy are to attract, motivate and retain highly experienced personnel who will provide leadership for Optibase's success and enhance shareholder value, while supporting a performance culture that is based on merit, and rewards excellent performance in the long term, while recognizing Optibase's core values. To that end, this Policy is designed, among others:REPORTS/3

~~2.1.~~Reconciliation ~~To closely align the interests~~ of ~~the~~GAAP ~~Executive~~to ~~Officers~~Non-GAAP ~~with~~(Unaudited) ~~those~~Supplemental ofFinancial ~~Optibase's shareholders in order to enhance shareholder value;~~Data

~~2.2.~~A Toreconciliation ~~provide~~of ~~the~~operating ~~Executive~~income ~~Officers~~to ~~with~~NOI ais ~~structured compensation package, putting the emphasis on a proper balance between the fixed components, i.e., the base salaries and benefits, and on the variable compensation, such~~ as ~~bonuses and equity-based compensation in order to minimize potential conflicts between the interests of Executive Officers and those of Optibase;~~follows:

2.3. To strengthen the retention and the motivation of Executive Officers in the long term.

	Nine months ended					Three months ended
	September 30		September 30			September 30		September 30
	2021		2020			2021		2020
	$		$			$		$
	Unaudited		Unaudited			Unaudited		Unaudited

GAAP Operating income		3,438		14,056			1,160		8,558

Adjustments:
Real estate depreciation and amortization		2,962		2,718			981		959

General and administrative		2,355		1,800			772		288

Gain on sale of operating properties		-		(9,127	)		-		(6,810	)

Non-GAAP Net Operating Income NOI		8,755		9,447			2,913		2,995

3.A ~~Compensation~~reconciliation ~~structure~~of net income to FFO and ~~instruments~~Recurring FFO is as follows:

Compensation instruments under this Compensation Policy may include the following:

	Nine months ended						Three months ended
	September 30			September 30			September 30			September 30
	2021			2020			2021			2020
	$			$			$			$
	Unaudited			Unaudited			Unaudited			Unaudited

GAAP Net income (loss) attributable to Optibase LTD		(1,445	)		7,058			(86	)		5,164

Adjustments :
Real estate depreciation and amortization		2,962			2,718			981			959

Pro-rata share of real estate depreciation and amortization from unconsolidated associates		2,375			2,493			912			849

Non-controlling interests share in the above adjustments		(974	)		(912	)		(322	)		(314	)

Non-GAAP Fund From Operation (FFO)		2,918			11,357			1,485			6,658

Gain on sale of operating properties, net		-			(7,557	)		-			(5,473	)

Non-GAAP Recurring Fund From Operation (Recurring FFO)		2,918			3,800			1,485			1,185

Amounts in thousands

~~• Base salary;~~4

•OPTIBASE ~~Benefits;~~REPORTS/4

•About ~~Cash bonuses;~~Optibase

•Optibase ~~Equity~~invests ~~based~~in ~~compensation;~~the fixed-income real estate field and currently holds properties and beneficial interest in real-estate assets and projects in Switzerland, Texas, Philadelphia, PA, Miami, FL, and in Chicago, IL, USA and is currently looking for additional real estate investment opportunities. Optibase was previously engaged in the field of digital video technologies until the sale of its video solutions business to Optibase Technologies Ltd., a wholly owned subsidiary of VITEC Multimedia in July 2010. For further information, please visit www.optibase-holdings.com.

•This ~~Retirement~~press release contains forward-looking statements concerning our marketing and ~~termination~~operations plans. All statements other than statements of ~~service~~historical fact are statements that could be deemed forward-looking statements. All forward-looking statements in this press release are made based on management's current expectations which involve risks, uncertainties and other factors that could cause results to differ materially from those expressed in forward-looking statements. These statements involve a number of risks and uncertainties including, but not limited to, difficulties in finding suitable real-estate properties for investment, availability of financing for the acquisition of real-estate, difficulties in leasing of real-estate properties, insolvency of tenants, difficulties in the disposition of real-estate projects, risk relating to collaborative arrangements with our partners relating to our real-estate properties, risks relating to the full consummation of the transaction for the sale of our video solutions business, general economic conditions and other risk factors. For a more detailed discussion of these and other risks that may cause actual results to differ from the forward looking statements in this press release, please refer to Optibase's most recent annual report on Form 20-F. The Company does not undertake any obligation to update forward-looking statements made herein.

~~A - 3~~5

4.OPTIBASE ~~Overall Compensation - Ratio Between Fixed and Variable Compensation~~REPORTS/5

This Policy aims to balance the mix of "Fixed Compensation" (comprised of base salary and benefits) and "Variable Compensation" (comprised of cash bonuses and equity -based compensation) in order to, among other things, appropriately incentivize Executive Officers to meet Optibase's ~~short and long term goals while taking into consideration the Company’s need to manage a variety of business risks~~Ltd.

~~The~~Condensed ~~total~~Consolidated ~~Variable~~Statement ~~Compensation~~ of each Executive Officer (as well as the Executive Chairman of the Board ("Executive Chairman")) shall not exceed 60% of the total compensation package of such Executive Officer (and the Executive Chairman) on an annual basis. The Compensation Committee and Board believe that such range expresses the appropriate compensation mix in the event that all performance objectives are achieved and assumes that all compensation elements are granted with respect to a given year.Operations

5.For ~~Intra-Company~~the ~~Compensation~~Period ~~Ratio~~Ended September 30, 2021

In the process of drafting this Policy, Optibase’s Board and Compensation Committee have examined the ratio between employer cost, as such term is defined in the Companies Law, associated with the engagement of the Executive Officers (as well as the Executive Chairman) and the average and median employer cost associated with the engagement of the other employees of Optibase (the "Ratio"). The Compensation Committee and Board believe that the current Ratio does not adversely impact the work environment in Optibase.

	Nine months ended					Three months ended
	September 30			September 30		September 30			September 30
	2021			2020		2021			2020
	$			$		$			$
	Unaudited			Unaudited		Unaudited			Unaudited

Fixed income real estate rent		10,422			11,431		3,486			3,536
Cost and expenses:
Cost of real estate operation		1,667			1,984		573			541
Real estate depreciation and amortization		2,962			2,718		981			959
General and administrative		2,355			1,800		772			288
Total cost and expenses		6,984			6,502		2,326			1,788

Gain on sale of operating properties		-			9,127		-			6,810

Operating income		3,438			14,056		1,160			8,558

Other Income		639			301		307			153
Financial expenses, net		1,262			1,758		408			594
Income before taxes on income		2,815			12,599		1,059			8,117
Taxes on income		1,014			1,665		274			1,560
Equity share in losses of associates, net		1,132			1,569		187			627

Net income		669			9,365		598			5,930

Net income attributable to non-controlling interests		2,114			2,307		684			766
Net income (loss) attributable to Optibase LTD		(1,445	)		7,058		(86	)		5,164

Net income (loss) per share :
Basic and Diluted	$	(0.28	)	$	1.36	$	(0.02	)	$	1

Number of shares used in computing earnings losses per share
Basic		5,186			5,186		5,186			5,186
Diluted		5,186			5,186		5,186			5,186

Amounts in thousands.

~~B. Base Salary and Benefits~~6

6.OPTIBASE ~~Base Salary~~REPORTS/6

~~6.1.~~Condensed ~~The~~Consolidated ~~base~~Balance salary varies between Executive Officers (among themselves) and the Executive Chairman of the Board, and is individually determined by the Compensation Committee and the Board (unless other approvals are required under any applicable law) according to the educational background, prior vocational experience, qualifications, role, business responsibilities, past performance and previous compensation arrangements of such Executive Officer and Executive Chairman of the Board.Sheets

6.2. The maximum monthly base salary for each of the following roles shall be as follows:

	September 30, 2021		December 31, 2020
	Unaudited		Audited
Assets

Current Assets:
Cash and cash equivalents		30,198		28,820
Restricted cash		577		835
Trade receivables, net		272		216
Other accounts receivables and prepaid expenses		1,930		569
Bonds related deposits		2,257		2,564
Total current assets		35,234		33,004

Long term investments:
Long-term deposits		98		98
Right-of-use assets		167		272
Investments in companies and associates		5,925		9,269
Total long term investments		6,190		9,639

Real estate properties, net		179,957		192,054

Total assets		221,381		234,697

Liabilities and shareholders' equity

Current Liabilities:
Current maturities of long term loans and bonds		4,097		6,447
Accounts payable and accrued expenses and other		4,429		4,144
Operating lease liabilities		136		166
Liabilities attributed to discontinued operations		2,061		2,061
Total current liabilities		10,723		12,818

Long term liabilities:
Deferred tax liabilities		14,407		15,095
Land lease liability, net		6,641		7,054
Operating lease liabilities		55		146
Long term loans, net of current maturities		105,817		112,923
Total long term liabilities		126,920		135,218

Shareholders’ equity:
Shareholders’ equity of Optibase Ltd		57,860		61,464
Non-controlling interests		25,878		25,197
Total shareholders' equity		83,738		86,661

Total liabilities and shareholders’ equity		221,381		234,697

Amounts in thousands

~~(i) Chief Executive Officer ("CEO") – up to NIS 100,000 for a full time position~~7

(ii) CEO of the Company's subsidiary ("Subsidiary CEO") – up to NIS 90,000 for a full time position;

(iii) Executive Officer who is not a director, CEO or Subsidiary CEO – up to NIS 50,000 for a full time position

Such amounts may be linked to increases in the Israeli Consumer Price Index ("Israeli CPI") or to the representative rate of exchange of the US dollar, as the case may be.

6.3. The Executive Chairman may be paid management fee in amount that shall not exceed NIS 50,000 per month.

7. Benefits

7.1. In addition to the base salary, the following benefits may be granted to the Executive Officers in order, among other things, to comply with legal requirements:

• Vacation days in accordance with market practice and applicable law;

A - 4

• Sick days in accordance with market practice and applicable law;

• Convalescence pay according to applicable law;

• Monthly remuneration for a study fund, as allowed by applicable tax law and with reference to Optibase’s practice and common market practice;

• Contribution by Optibase on behalf of the Executive Officer to an insurance policy or a pension fund, as allowed by applicable tax law and with reference to Optibase’s policies and procedures and common market practice; and

• Contribution by Optibase on behalf of the Executive Officer towards work disability insurance, as allowed by applicable tax law and with reference to Optibase’s policies and procedures and common market practice.

7.2. Optibase may offer additional benefits to its Executive Officers, including but not limited to: communication, company car and travel benefits, insurances, other benefits (such as newspaper subscriptions, academic and professional studies), etc., including their gross up.

7.3. Optibase may reimburse its Executive Officers and its Executive Chairman for reasonable work-related expenses incurred as part of their activities, including without limitations, meeting participation expenses, reimbursement of business travel including a daily stipend when traveling and accommodation expenses. Optibase may provide advance payments to its Executive Officers in connection with work-related expenses.

7.4. Non-Israeli Executive Officers may receive other similar, comparable or customary benefits as applicable in the relevant jurisdiction in which they are employed.

8. Signing Bonus

At the Compensation Committee’s and Board’s discretion, Optibase may grant a newly recruited Executive Officer a signing bonus. The signing bonus shall not exceed two (2) monthly base salaries of such Executive Officer.

C. Cash Bonuses

9. Annual Bonuses

9.1. The payment of annual bonuses to the Executive Chairman and any Executive Officer for any particular fiscal year shall be subject to the fulfillment (in addition to the fulfillment of the applicable objectives set forth below as the case may be) of any one of the two following criteria: (a) that Optibase's EBITDA was at least USD $10 million (on a consolidated basis) during such fiscal year; or (b) that Optibase's net profit for such fiscal year was at least USD $500,000, net of equity gains or losses, and net of non-recurring expenses related to the purchase or disposal of real estate investments.

9.2. The Compensation Committee and Board may decide, at their sole discretion, to grant annual bonuses to the Executive Chairman and the Executive Officers, subject to the fulfillment of the pre-conditions for payment of bonuses as detailed in section 9.1 above.

9.3. The annual bonus to the Executive Chairman and the CEO will be based on measurable criteria. The measurable criteria and their relative weight shall be determined by the Compensation Committee and the Board in respect of each calendar year. These measurable criteria may include, inter alia, objectives relating to the annual income, annual profit (net profit, pre tax profit), budget, annual EBITDA, acquisition and/or disposal of assets, financing, re-financing and fundraising).

9.4. In addition, the Company may grant the CEO a bonus of up to three (3) monthly base salaries, at the sole discretion of the Compensation Committee and Board, based on the CEO's contribution to the Company.

A - 5

9.5. The Company may also grant, subject to the approval of the Compensation Committee and the Board, an annual bonus to its Executive Officers (other than the CEO) for their contribution to the Company. Such grants may be based in whole or in part on discretion, provided that they do not exceed the ceiling specified in section 9.6 below.

9.6. The annual bonus that may be paid to the Executive Officers for any fiscal year shall not exceed six (6) monthly base salaries to the CEO, and three (3) monthly base salaries to any other Executive Officer (excluding the CEO). The annual bonus that may be paid to the Executive Chairman for any fiscal year shall not exceed two (2) monthly payments of management fee.

9.7. The Board, following the recommendation of the Compensation Committee, shall be entitled to decrease the annual bonus to be paid to the Executive Chairman and/or Executive Officers based on measurable criteria (if such criteria were determined) or cancel such grant of bonuses altogether in its sole discretion, even in the event measurable criteria were determined and met.

10. Special Bonuses

In addition to the annual bonus, Optibase may grant its Executive Chairman and Executive Officers (other than the CEO) a special bonus as an award for special achievements (such as in connection with mergers and acquisitions, offerings, achieving target budget or business plan under exceptional circumstances or, regarding the Executive Officers, special recognition in case of retirement) at the discretion of the Compensation Committee and Board which shall not exceed three (3) monthly base salaries for any Executive Officer (other than the CEO) and two (2) monthly payments of management fee for the Executive Chairman.

11. Pro Rata Payment

Should the employment or service of the Executive Chairman or any Executive Officer terminate prior to the end of a fiscal year, Optibase may pay the Executive Chairman or the Executive Officer his or her pro rata share of that fiscal year’s bonus, based on the period the Executive Chairman or such Executive Officer was employed by the Company or has served in the Company.

12. Compensation Recovery ("Clawback")

12.1. In the event of an accounting restatement, Optibase shall be entitled to recover from its Executive Chairman or Executive Officers the bonus compensation in the amount in which such bonus exceeded what would have been paid under the financial statements, as restated, provided that a claim is made by Optibase prior to the third anniversary of fiscal year end of the restated financial statements.

12.2. Notwithstanding the aforesaid, the compensation recovery will not be triggered in the following events:

• The financial restatement is required due to changes in the applicable financial reporting standards; or

• The Compensation Committee has determined that clawback proceedings in the specific case would be impossible, impractical or not commercially or legally efficient; or

• The amount to be paid under the clawback proceedings is less than 10% of the relevant bonus received by the Executive Chairman or Executive Officer.

12.3. Nothing in this Section 12 derogates from any other "clawback" or similar provisions regarding disgorging of profits imposed on the Executive Chairman and Executive Officers by virtue of applicable securities laws.

A - 6

D. Equity-Based Compensation

13. General and Objectives

13.1. The Compensation Committee and Board may grant from time to time equity-based compensation which will be individually determined and awarded according to the performance, educational background, prior business experience, qualifications, role and the personal responsibilities of the Executive Officer. Equity-based compensation may also be awarded to the Directors, subject to the provisions of the Companies Law and the regulations thereunder and the receipt of all additional approvals that may be required under the Companies Law.

13.2. The main objectives of the equity-based compensation is to enhance the alignment between the Executive Officers' and Directors' interests with the long term interests of Optibase and its shareholders, and to strengthen the retention and the motivation of Executive Officers in the long term. In addition, since equity-based awards are structured to vest over several years, their incentive value to recipients is aligned with longer-term strategic plans.

13.3. The equity -based compensation offered by Optibase is intended to be in a form of share options, restricted shares and/or other equity -based awards, such as RSUs, in accordance with the Company's incentive plan in place as may be updated from time to time.

14. Fair Market Value

The fair market value of the equity-based compensation for each Executive Officer and each Director shall not exceed USD $200,000, as shall be determined according to acceptable valuation practices at the time of grant.

15. Additional Terms

15.1. Subject to any applicable law, Optibase may determine, at the Compensation Committee and the Board’s discretion, the tax regime under which equity-based compensation may be granted, including a tax regime which will maximize the benefit to the Executive Officers and Directors.

15.2. All equity-based incentives granted to Executive Officers and Directors shall be subject to vesting periods in order to promote long-term retention of such recipients. Unless otherwise determined in a specific award agreement approved by the Compensation Committee and the Board, grants to Executive Officers shall vest gradually over a period of at least two years.

15.3. All other terms of the equity awards shall be in accordance with Optibase's incentive plans and other related practices and policies. Accordingly, the Board may, following approval by the Compensation Committee, extend the period of time for which an award is to remain exercisable and make provisions with respect to the acceleration of the vesting period of any Executive Officer's or Director's awards, including, without limitation, in connection with a corporate transaction involving a change of control, subject to any additional approval as may be required by the Companies Law.

E. Retirement and Termination of Service Arrangements

16. Advanced Notice Period

16.1. Optibase may provide each Executive Officer, according to his or her seniority in the Company, his or her contribution to the Company’s goals and achievements and the circumstances of retirement, a prior notice of termination of up to three (3) months, except for the CEO whose prior notice may be of up to six (6) months. During such advance notice period, the Executive Officer may be entitled to all of the compensation elements, and to the continuation of vesting of his or her options, restricted shares or RSUs.

16.2. Optibase may waive the Executive Officer’s services to the Company during the advance notice period and pay the amount payable in lieu of notice, plus the value of benefits.

A - 7

17. Adjustment Period/Retirement Bonus

In addition to the advance notice period, the Compensation Committee and Board may provide an additional adjustment period/retirement bonus that will be determined, among other things, taking into consideration the Executive Officer's seniority in the Company, performance during employment, contribution to Optibase achieving its goals and the circumstances of retirement or termination. The maximum adjustment period/retirement bonus that may be paid to each Executive Officer is as follows:

17.1. CEO – for seniority of up to 5 years – the CEO will not be entitled to any Adjustment Period; seniority between 5 to 10 years – up to 4 monthly base salaries; and seniority of 10 years or more – up to 8 monthly base salaries.

17.2. Executive Officer (except the CEO) – for seniority of up to 5 years – such Executive Officer will not be entitled to any Adjustment Period; seniority between 5 to 10 years – up to 2 monthly base salary; and seniority of 10 years or more – up to 4 monthly base salaries.

The amounts for the adjustment period and the retirement bonus to be granted to an Executive Officer shall be calculated on the Executive Officer’s gross base salary without benefits, bonuses or grants which were granted to him or her during the Executive Officer's employment.

18. Additional Retirement and Termination Benefits

Optibase may provide additional retirement and terminations benefits and payments as may be required by applicable law (e.g., mandatory severance pay under Israeli labor laws), or which will be comparable to customary market practices.

19. Non-Compete Grant

Upon termination of employment and subject to applicable law, Optibase may grant to its Executive Officers a non-compete grant as an incentive to refrain from competing with Optibase for a defined period of time. The terms and conditions of the Non-Compete grant shall be decided by the Board and shall not exceed such Executive Officer's monthly base salary multiplied by six (6).

F. Exemption, Indemnification and Insurance

20. Exemption

Optibase may exempt in advance and retroactively its directors and Executive Officers, from any liability to the Company, in whole or in part, for damages in consequence of his or her duty of care vis-a-vis the Company, to the fullest extent permitted by law and subject to the provisions of the Company’s articles.

21.20. Indemnification

Optibase may indemnify its directors and Executive Officers to the fullest extent permitted by applicable law, for any liability and expense that may be imposed on the director or the Executive Officer, as provided in the Indemnity Agreement between such individuals and Optibase, all subject to applicable law and the Company’s articles of association.

A - 8

22.21. Insurance

22.1.21.1. Optibase will provide "Directors’ and Officers’ Liability Insurance" (the "Insurance Policy") for its directors and Executive Officers as follows:

• The limit of liability of the insurer shall not exceed the greater of $25 million or 25% of the Company’s shareholders equity (based on the most recent financial statements of the Company at the time of approval by the Compensation Committee) per incident and insurance period (for a one-year period) in addition to reasonable litigation expenses;

• The purchase of each Insurance Policy shall be approved by the Compensation Committee (and, if required by law, by the Board) which shall determine that the Insurance Policy reflects the current market conditions, and it shall not materially affect the Company's profitability, assets or liabilities.

22.2.21.2. Upon circumstances to be approved by the Compensation Committee (and, if required by law, by the Board), Optibase shall be entitled to enter into a "run off" Insurance Policy of up to seven (7) years, with the same insurer or any other insurer, as follows:

• The purchase of such Insurance Policy shall be approved by the Compensation Committee (and, if required by law, by the Board) which shall determine that the Insurance Policy reflects the current market conditions, and that it shall not materially affect the Company's profitability, assets or liabilities.

22.3.21.3. Optibase may extend the Insurance Policy in place to include cover for liability pursuant to a future public offering of securities as follows:

• The purchase of such Insurance Policy shall be approved by the Compensation Committee (and if required by law, by the Board) which shall determine that the Insurance Policy reflects the current market conditions, and it does not materially affect the Company's profitability, assets or liabilities.

G. Arrangements upon Change of Control

23.22. The following benefits may be granted to the Directors and/or Executive Officers in addition to the benefits applicable in the case of any retirement or termination of service upon a "Change of Control" following of which the employment of the Executive Officer is terminated or adversely adjusted in a material way:

23.1.22.1. Vesting acceleration of outstanding options or restricted shares.

23.2.22.2. Extension of the exercising period of options or restricted shares for Optibase’s Executive Officers for a period of up to one (1) year and two (2) years, respectively, following the date of termination of employment.

23.3.22.3. For Executive Officers only - up to an additional six (6) months of continued base salary and benefits following the date of employment termination (the "Additional Adjustment Period"). For avoidance of doubt, such additional Adjustment Period shall be in addition to the advance notice and adjustment periods pursuant to Sections 14 and 15 of this Compensation Policy.

23.4.22.4. For Executive Officers only - a cash bonus not to exceed together with the annual cash bonus, up to eighteen (18) monthly base salaries, in the case of the CEO, and nine (9) monthly base salaries, in the case of other Executive Officers (excluding the CEO).

A - 9

H. Board of Directors Compensation

24.23. All the Directors, excluding the Executive Chairman, shall be entitled to an equal annual and per-meeting compensation.

25.24. The compensation of the Directors (including external directors and independent directors, but excluding the Executive Chairman) shall not exceed the maximum amounts provided in the Companies Regulations (Rules Regarding the Compensation and Expenses of an External Director) of 2000, as amended by the Companies Regulations (Relief for Public Companies Traded in Stock Exchange Outside of Israel) of 2000, as such regulations may be amended from time to time ("Compensation of Directors Regulations").

26.25. Directors may be granted equity-based compensation in accordance with the principles detailed in this Policy, and subject to the provisions of the Companies Law and the regulations thereunder.

26. Optibase's external and independent Directors may be entitled to reimbursement of expenses in accordance with the Compensation of Directors Regulations. Optibase’s Directors, excluding external and independent Directors, may be entitled to reimbursement of work-related expenses, including meeting participation expenses, reimbursement of business travel including a daily stipend when traveling and accommodation expenses. Optibase may provide advance payments to its Directors in connection with work-related expenses.

27. Directors may provide Optibase with additional services, not relating to their service as directors, at a total consideration which shall not exceed Euro 50,000 per annum.

I. Miscellaneous

28. This Policy is designed solely for the benefit of Optibase. Nothing in this Compensation Policy shall be deemed to grant any of Optibase’s Executive Officers, Directors or employees or any third party any right or privilege in connection with their employment by the Company. Such rights and privileges shall be governed by the respective personal employment agreements.

29. This Policy is subject to applicable law and is not intended, and should not be interpreted as limiting or derogating from, provisions of applicable law to the extent not permitted, nor should it be interpreted as limiting or derogating from the Company’s articles of association.

30. This Policy is not intended to affect current agreements nor affect obligating customs (if applicable) between the Company and its Executive Officers or Directors as such may exist prior to the approval of this Compensation Policy.

31. In the event of amendments made to the Companies Law or any regulations promulgated thereunder providing relief in connection with Optibase’s compensation to its Executive Officers and Directors, Optibase may elect to act pursuant to such relief without regard to any contradiction with this Policy.

32. The Compensation Committee and Board may determine that none or only part of the payments, benefits and perquisites shall be granted, and is authorized to cancel or suspend a compensation package or part of it.

*********************

A - 10

Filing Compare · OPTIBASE LTD