ADVANCED VISION TECHNOLOGY (A.V.T.) LTD. Hod Hasharon, Israel

Die Aktionäre werden zur

außerordentlichen Hauptversammlung

der Advanced Vision Technology (A.V.T.) Ltd. am Dienstag, den 18. April 2017, um 14:30 Uhr in den Geschäftsräumen der Gesellschaft, 6 Hanagar St., Hod Hasharon, Israel, eingeladen.

Die Tagesordnung dieser außerordentlichen Hauptversammlung umfasst folgende Anträge:

1. Beschlussfassung über die Fusionsvereinbarung vom 6. März 2017 („Merger Agreement“) zwischen der Gesellschaft („A.V.T.“), Pelican Merger Holdings Israel Ltd. („Parent“) und der Pelican Merger Sub Ltd. („Merger Sub“), die Folgendes umfasst:

(i) Die Pelican Merger Sub Ltd., wird mit der A.V.T. gemäß den Bedingungen des Israelischen Companies Law 5759-1999 verschmolzen („Merger“). Als deren Folge wird die Pelican Merger Sub Ltd. nicht mehr als eigenständige Gesellschaft bestehen bleiben und A.V.T eine 100%ige Tochtergesellschaft der Pelican Merger Holdings Israel Ltd. wird, die indirekt eine 100%ige Tochtergesellschaft der Danaher Corporation („Danaher“) ist. Jede Stammaktie der A.V.T. mit einem Nennwert von NIS 2,00 („Ordinary Shares“) wird in einen Barabfindungsanspruch in Höhe von EUR 14,50 je Stammaktie („Merger Consideration“) umgewandelt;

(ii) Beschlussfassung über die entsprechenden Vereinbarungen und Auflagen der Fusionsvereinbarung hinsichtlich der Versicherungen, Ausnahmen und Haftungen, inkl. der Ermächtigung zum Abschluss einer Versicherung („tail insurance“) für derzeitige und frühere Directors und leitende Angestellte; und

(iii) Beschlussfassung über die Behandlung der aktienbasierten Mitarbeiterbeteiligungen inkl. (soweit anwendbar) der beschleunigten Handhabung der noch nicht ausgeübten Optionen (unvested options) und nicht ausgeübten (unvested) restricted share units („RSUs“) gehalten von den Directors, den leitenden Angestellten sowie den Mitarbeitern der Gesellschaft, die Behandlung der nicht ausgeübten Optionen und nicht ausgeübten RSUs (unvested options and unvested RSUs) gehalten von den leitenden Angestellten und Mitarbeitern der Gesellschaft, die nicht beschleunigt werden (not be accelerated) sowie die Substitution solcher aktienbasierten Mitarbeiterbeteiligungen durch Barzahlungen, wie im Fusionsvertrag geregelt.

2. Beschlussfassung über eine außerordentliche und einmalige Gewährung einer Mitarbeiterbeteiligung von 20.000 Fully vested restriced share units für Herrn Jaron Lotan, dem Präsidenten und CEO der Gesellschaft, unmittelbar vor und unter der Voraussetzung der Durchführung des Verschmelzungsabschlusses.

3. Behandlung aller sonstigen dieser, einer verschobenen oder vertagten Hauptversammlung ordnungsgemäß unterbreiteten Angelegenheiten.

Der Board of Directors empfiehlt, dass die Aktionäre für die vorgeschlagenen Beschlussfassungen stimmen.

Nach der Satzung der Gesellschaft bilden zwei oder mehr Aktionäre am Stichtag (soweit kein Zahlungsverzug bezüglich eines in Art. 34 (c) der Satzung der Gesellschaft erfassten Tatbestände besteht), gleich ob persönlich anwesend oder durch bevollmächtigten Vertreter vertreten, ein Quorum. Auf der Hauptversammlung (auch im Falle ihrer Vertagung) werden keine Angelegenheiten behandelt, bis das erforderliche Quorum festgestellt wird. Wird innerhalb einer Stunde nach der für die Hauptversammlung festgesetzten Zeit kein Quorum festgestellt, so wird die Hauptversammlung auf den gleichen Tag der folgenden Woche zur gleichen Stunde und am gleichen Ort vertagt. Über eine solche vertagte Hauptversammlung wird es keine weitere Ankündigung geben.

Die Abstimmung zu dem oben genannten Punkt 1) erfordert eine Mehrheit von mindestens 75% der auf der Hauptversammlung anwesenden (persönlich oder vertreten durch Bevollmächtigte) Stimmrechte der Gesellschaft mit der Maßgabe, dass

(i) entweder eine solche Mehrheit mindestens die Mehrheit der Stimmen der Aktionäre, welche weder Großaktionär sind noch ein persönliches Interesse an der Beschlussfassung haben, umfasst oder

(ii) die Gesamtzahl der Gegenstimmen, abgegeben durch Aktionäre, welche weder Großaktionär sind noch ein persönliches Interesse an der Beschlussfassung haben, 2% der ausstehenden Stimmrechte der Gesellschaft nicht übersteigt (“Special Majority”).

Die Abstimmung zu dem oben genannten Punkt 2) erfordert eine einfache Mehrheit der auf der Hauptversammlung anwesenden (persönlich oder vertreten durch Bevollmächtigte) Stimmrechte der Gesellschaft mit der Maßgabe,

(i) diese entweder eine einfache Mehrheit der abgegebenen Stimmen der Aktionäre, welche kein persönliches Interesse an der Beschlussfassung haben und nicht dem Großaktionär zuzurechnen sind, umfasst oder

(ii) die Gesamtzahl der Gegenstimmen, abgegeben durch Aktionäre, welche kein persönliches Interesse an der Beschlussfassung haben und nicht dem Großaktionär zuzurechnen sind, 2% der ausstehenden Stimmrechte der Gesellschaft nicht übersteigt (“Compensation Majority”).

Um das Stimmrecht ordnungsgemäß auszuüben erfordert das geltende israelische Recht von jedem Aktionär in der Vollmacht oder durch Information an die Gesellschaft bei der Hauptversammlung und vor der Abgabe der Stimme, offenzulegen,

(i) ob er ein Großaktionär der Gesellschaft ist und

(ii) ob ein persönliches Interesse an der Beschlussfassung eines der auf der Tagesordnung befindlichen Anträge besteht (im Folgenden auch als „Interessierte Person“ bezeichnet).

Die Definition des „Großaktionärs“ umfasst nach Israelischem Recht eine gesetzliche Vermutung, dass bei jeder „Interessierten Person“ (wie nach Israelischem Recht definiert) in dem Unternehmen des Großaktionärs vermutet wird, dass diese Interessierte Person gemeinsam mit dem Großaktionär Aktionär der Gesellschaft ist. Da Herr Yeoshua Agassi ein Director der Gesellschaft ist und zugleich auch eine Interessierte Person (Director) in dem Großaktionär der Gesellschaft, verlangt die Gesellschaft vorsichtshalber, dass alle nachfolgenden Tagesordnungspunkte mit einer Special Majority (zusätzlich zu der 75% Mehrheit) beschlossen werden. Dies gilt, ungeachtet der Tatsache, dass die zuvor dargestellte gesetzliche Vermutung widerlegt werden könnte, für die Zustimmung zum Fusionsvertrag, der Fusion als solchen sowie allen hierfür vorgesehen Transaktionen, einschließlich der beschleunigten Handhabung der aktienbasierten Mitarbeiterbeteiligungen gehalten von Directors, die Regelungen bezüglich der Entschädigung, der Exkulpation und der Versicherung, einschließlich des Abschlusses der („tail insurance“) Versicherung zu Gunsten der gegenwärtigen und früheren Directors und Officers der Gesellschaft, von welcher Herr Agassi profitieren wird.

Der Begriff „persönliches Interesse“ umfasst nach Israelischem Recht das persönliche Interesse des Aktionärs in einer Handlung oder Transaktion der Gesellschaft (i) einschließlich des persönlichen Interesses der Ehegatten, Geschwister, Eltern, Großeltern, Nachkommen, Nachkommen der Ehegatten, Geschwister oder Eltern der Eheleute der jeweiligen Aktionäre sowie das persönliche Interesse einer dritten Gesellschaft in der der jeweilige Aktionär oder einer der zuvor erwähnten nahestehenden Personen des jeweiligen Aktionärs als Organe (director or chief executive officer) tätig sind, 50% oder mehr der ausstehenden Anteile oder Stimmrechte an einer solchen dritten Gesellschaft halten oder das Recht haben einen oder mehrere Organe (director or chief executive officer) einer solchen dritten Gesellschaft zu bestimmen und (ii) ausschließlich des persönlichen Interesses, welches lediglich durch die Stellung als Aktieninhaber der Stammaktien der Gesellschaft entsteht. Nach dem Israelischen Recht, umfasst „persönliches Interesse“ im Falle einer Person, die auf der Basis einer Vollmacht eine Stimme abgibt, auch das persönliche Interesse sowohl des Vollmachtinhabers als auch des vollmachtgebenden Aktionärs, unabhängig davon, ob dem Bevollmächtigten bei der Ausübung des Stimmrechts ein Ermessen zusteht oder nicht.

In der Vollmacht werden Sie gebeten anzugeben, ob Sie eine der oben beschriebenen Personen, eine Interessierte Person bezüglich Tagesordnungspunkte sind, die eine Special Majority oder eine Compensation Majority erfordern.

Damit eine ordnungsgemäße Zählung der Stimmrechte gewährleistet werden kann, wird folgendermaßen verfahren: sollten Sie auf der Vollmacht (oder in Ihrer elektronischen Einreichung) kein „Nein“ angekreuzt haben und damit nur konkludent, aber nicht ausdrücklich, bestätigt haben, dass Sie keine Interessierte Partei bezüglich solcher Tagesordnungspunkte sind, die eine Special Majority oder eine Compensation Majority erfordern, wird Ihre Stimmabgabe dennoch nicht für die Zwecke der Special Majority bzw. der Compensation Majority mitgezählt, und Ihre Unterschrift auf der Vollmacht (oder der elektronischen Stimmeinreichung) wird als eine Bestätigung angesehen, dass Sie eine solche Interessierte Person in Bezug auf die entsprechenden Tagesordnungspunkte sind.

Die Form der Vollmacht enthält zudem eine Bestätigung, dass Sie kein Aktionär gemäß § 320 (c) des Israelischen Companies Law 5759-1999 sind (d.h., dass Sie weder Parent noch Merger Sub sind, noch dass Sie direkt oder indirekt 25% oder mehr der Stammaktien oder anderer Kontrollrechte an dem Parent halten oder, durch den Parent, 25% oder mehr der Stammaktien oder anderer Kontrollrechte an dem Merger Sub halten). Sollten Sie der Ansicht sein, dass diese Aussage falsch ist, kontaktieren Sie bitte die Gesellschaft unter +972-9-7614480.

Zum Datum der erstmaligen Veröffentlichung dieser Bekanntmachung, sind die Großaktionäre der Gesellschaft, wie nach Israelischem Recht definiert, die Union Investment and Development Ltd., eine Israelische Gesellschaft sowie Herr Yeoshua Agassi, ein Director der Gesellschaft und der Union Investment and Development Ltd., sodass die Gesellschaft annimmt, dass die überwiegende Mehrheit der Aktionäre der Gesellschaft kein persönliches Interesse in der Beschlussfassung der Tagesordnungspunkte der gegenwärtigen Hauptversammlung haben sollten. Solche anderen Aktionäre sollten daher „Nein“ an den betreffenden Stellen in der Vollmacht (oder ihrer elektronischen Einreichung) ankreuzen.

Stimmrechte von Stammaktien, die durch ausgeübte und nicht widerrufene Vollmachten vertreten werden, werden entsprechend den Weisungen des vollmachtgebenden Aktionärs ausgeübt bzw. falls keine bestimmten Weisungen erteilt wurden, werden die entsprechenden Stimmrechte „für“ die oben dargelegten Tagesordnungspunkte abgegeben. Die Gesellschaft hat derzeit keine Kenntnis über etwaige andere Angelegenheiten, die in der Hauptversammlung behandelt werden müssen. Falls solche anderen Angelegenheiten im Vorfeld der Hauptversammlung der Gesellschaft ordentlich zur Kenntnis gebracht werden, beabsichtigen die Bevollmächtigten ihre Stimmen bezüglich solcher Angelegenheiten nach bestem Wissen und Gewissen abzugeben.

Zur Teilnahme an der Hauptversammlung und zur Ausübung des Stimmrechts sind diejenigen Aktionäre berechtigt, welche am 20. März 2017 („Stichtag“) im Aktionärsregister der Gesellschaft eingetragen sind.

Per 10. März 2017 sind 6.134.357 Aktien der Gesellschaft ausstehend und stimmberechtigt. Diese Zahl enthält zum Zeitpunkt der erstmaligen Veröffentlichung dieser Ankündigung nicht: (i) Stammaktien, die Teil eines outstanding equity award sind, welches aufgrund eines Mitarbeiterbeteiligungsplans (equity remuneration plan) ausgegeben wurden; und (ii) insgesamt 819.122 Stammaktien, die als eigene Aktien der Gesellschaft (treasury shares) gehalten werden.

Die rechtsverbindliche Englische Fassung der vollständigen Tagesordnung und dieser Einladung, einschließlich der Explanatory Notes ist am Sitz der Gesellschaft sowie bei der Deutsche Bank AG, GSS/Issuer Services, Post IPO Services, 60262 Frankfurt am Main, E-Mail [email protected], kostenlos erhältlich.

Aktionäre, die nicht an der (ggf. vertagten) Hauptversammlung persönlich teilnehmen können, werden gebeten die Vollmacht auszufüllen, zu datieren und zu unterzeichnen, welche, um wirksam zu sein, der Deutschen Bank AG spätestens am 13. April 2017 um 14:30 Uhr zentraleuropäischer Zeit zugehen muss. Der Zugang muss durch den jeweiligen Aktionär der Stammaktien zum Stichtag durch das Settlement System der Clearstream Banking AG („CBF“), Frankfurt am Main, über die jeweilige Depotbank erfolgen. Alternativ kann die Vollmacht auch dem Vorsitzenden der Hauptversammlung in der Hauptversammlung vorgelegt werden. Stammaktien, die durch nach diesen Zeitpunkten zugegangenen Vollmachten repräsentiert werden, werden als in der Hauptversammlung nicht anwesend behandelt und dementsprechend nicht bei der Stimmabgabe berücksichtigt.

Da alle Stammaktien der Advanced Vision Technology (A.V.T.) Ltd. auf den Namen der CBF, eingetragen und in Form einer Globalurkunde bei der CBF hinterlegt sind, sollten alle Aktionäre Folgendes beachten:

Das ihr aufgrund ihrer Eintragung als Aktionärin im Aktionärsregister zustehende Teilnahme- und Stimmrecht aus den Stammaktien wird die CBF grundsätzlich nicht ausüben. Auf Verlangen wird CBF, die Teilnahme an der Hauptversammlung und/oder die Ausübung des Stimmrechts im Namen der CBF für diejenige Person in deren Namen die Stammaktien bei der CBF verbucht sind, ermöglichen.

Die berechtigte Person, in deren Namen die Stammaktien bei der CBF verbucht sind, wird gebeten, bis spätestens 13. April 2017 über seine Depotbank bei der Deutsche Bank AG, Frankfurt am Main, als Bevollmächtigte der CBF eine Vollmacht (oder eine andere gültige Bestätigung) bis zur Höhe seines am Stichtag verbuchten Sammeldepotguthabens zu beantragen. Anträge und Weisungen, die nach diesem Datum eingegangen sind, werden nach bestmöglichen Bemühen bearbeitet.

Hod Hasharon, im März 2017 Der Board of Directors Explanatory Notes

ITEM 1

APPROVAL OF THE MERGER AGREEMENT, THE MERGER AND THE OTHER TRANSACTIONS CONTEMPLATED THEREBY

General

On March 6, 2017, the Company entered into the Merger Agreement with Parent, an indirect wholly- owned subsidiary of Danaher, and Merger Sub, a wholly-owned subsidiary of Parent, pursuant to which, among other things, Merger Sub will merge with and into the Company (with the Company being the surviving entity, the “Surviving Company”), on the terms and subject to the conditions set forth in the Merger Agreement and in accordance with the provisions of Sections 314-327 of the Companies Law, following which Merger Sub will cease to exist, and the Company will become a wholly owned subsidiary of Parent, on the terms and subject to the conditions set forth in the Merger Agreement. As a result of the Merger, each Ordinary Share will be converted into the right to receive the Merger Consideration.

Danaher, a Delaware corporation whose share are traded on the New York Stock Exchange, designs, manufactures and markets professional, medical, industrial and commercial products and services, which are typically characterized by strong brand names, innovative technology and major market positions. Danaher’s research and development, manufacturing, sales, distribution, service and administrative facilities are located in more than 50 countries.

Board Recommendation

The Board of Directors, by an unanimous vote, has determined that the Merger Agreement, the Merger and the other transactions contemplated thereby, are advisable, fair to and in the best interests of the Company and its shareholders, and that, considering the financial position of the merging companies, and assuming, among other things, the accuracy of the representations and warranties of Parent and Merger Sub in the Merger Agreement, no reasonable concern exists that the Surviving Company, as a result of the Merger, will be unable to fulfill the obligations of the Company to its creditors. Furthermore, the Board of Directors unanimously recommends that the Company’s shareholders vote in favor of the adoption and approval of the Merger Agreement, the Merger and the other transactions contemplated thereby.

Considerations in Approving the Merger

The Board of Directors, following the approval of the Audit Committee of the Board and the Compensation Committee of the Board, considered a number of factors in making its determination that the Merger Agreement, the Merger and the other transactions contemplated thereby, are advisable, fair to and in the best interests of, the Company and its shareholders. These factors include the following:

1. Prospects of Company

1.1. In considering the Merger Agreement and the advisability of the Merger and the other transactions, the Board considered the Company’s financial condition, results of operations, competitive position, strategic opportunities and business and earnings prospects, including their impact on the trading prices of the Ordinary Shares, in light of various factors, including the risks and uncertainties with respect to the following, and after considering these factors concluded that there were significant risks in meeting the Company’s business objectives as a stand-alone company:

• The competition the Company faces from its competitors and potential competitors, some of whom are much larger than the Company, and from some of its large customers’ internal research and development plans;

• The importance of scale in a competitive market environment and the associated challenges to growth as a smaller stand-alone public company;

• The Company’s dependency on the strength of the worldwide printing industry; and

• The “Risk Factors” as set forth in the Company’s management’s report for the first half of 2016.

1.2. The Board further considered the Company’s strategic objectives, which include expanding its customer base, expanding and enhancing its product offerings, expanding its global distribution and support capabilities and extending its technological leadership, and concluded that these would be furthered by the proposed Merger and, as a result, the Company would be better positioned to reach these objectives than it would as a stand- alone company.

2. Merger Consideration

2.1. The Board concluded that the Merger Consideration of €14.50 per share represents an attractive valuation for the Company;

2.2. The price per share represents a premium of approximately 31% over the volume-weighted average share price of the Company’s shares on the Frankfurt Stock Exchange during the three-month period prior to approval by the Board of the Merger Agreement and is higher than the price at which the Company’s shares have traded at any time since 2008;

2.3. 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; and

2.4. In the opinion of the Company’s financial advisors, Prometheus Financial Advisory Ltd. (“Prometheus”), the Merger Consideration is fair to the Company’s shareholders from a financial point of view.

3. Likelihood of Consummation

3.1. The Board considered the relatively limited nature of the closing conditions included in the Merger Agreement, including the absence of any financing condition or related contingencies with respect to the Merger Consideration and the lack of the need to receive significant regulatory approvals; and

3.2. The Board considered the identity of the ultimate parent company, Danaher, which is a reputable strategic buyer experienced in transactions of this type, who has also guaranteed the performance of the obligations of Parent and Merger Sub to be performed at or prior to the closing of the Merger, including payment of the Merger Consideration.

4. Terms of the Merger Agreement

The Board considered the terms of the Merger Agreement, including the parties’ respective representations, warranties and covenants, the conditions to their respective obligations to complete the Merger and the ability of the respective parties to terminate the Merger Agreement. The Board noted that the termination or “breakup” fee provisions of the Merger Agreement could have the effect of discouraging competing proposals for a business combination between the Company and a third party, but that such provisions are customary for transactions of this size and type. The Board considered that the €3,370,000 amount of the termination fee, which amount is equal to approximately 3.5% of the transaction value, was within a reasonable range. The Board also noted that the Merger Agreement permits the Company and the Board to respond to a competing proposal that the Board determines is a superior proposal, subject to certain restrictions imposed by the Merger Agreement and the requirement that the Company pay the termination fee in the event that the Company terminates the Merger Agreement to accept a superior proposal.

5. No participation in future growth

The Board considered the fact that, because the Company’s shareholders will be receiving a fixed amount of cash for their shares, they will not participate in any increase in value of the Company or the ultimate parent company, whether during the limited pre-closing period or following the closing.

6. Other considerations

The Board also identified and considered a number of other matters, including some of which are countervailing factors and risks to the Company and its shareholders, relating to the Merger and the Merger Agreement, including the following:

6.1. The possibility that the Merger may not be completed and the potential adverse consequences to the Company if the Merger is not completed, including the potential (a) loss of customers, suppliers and employees, (b) reduction in the perceived value of the Company and (c) erosion of customer and employee confidence in the Company;

6.2. The limitations imposed in the Merger Agreement on the conduct of the Company’s business during the pre-closing period, its ability to solicit and respond to competing proposals and the ability of the Board to change or withdraw its recommendation of the Merger;

6.3. The possibilities that certain provisions of the Merger Agreement, including the non- solicitation and other protective provisions such as the €3,370,000 termination fee payable if the Merger Agreement is terminated under certain circumstances, might have the effect of deterring other potential acquirers from making competing proposals that could be more advantageous to the Company’s shareholders;

6.4. The potential conflicts of interest of the Company’s directors and executive officers, including with respect to the indemnification, exculpation and insurance provisions, treatment, including acceleration, of equity awards, change of control benefits and transaction bonuses; and

6.5. The fact that the controlling shareholder of the Company, who holds approximately 51% of the voting power in the Company, signed a voting undertaking with Parent and Merger Sub, which is terminable in certain circumstances as set forth therein, pursuant to which such shareholder undertook to vote in favor of the Merger and the approval and adoption of the Merger Agreement, as set forth in the voting undertaking and the fact that one of the Company’s directors signed a participation undertaking with Parent and Merger Sub pursuant to which such director undertook to be present, or to cause all his shares of the Company to be counted as present, at the Meeting.

Opinion of Financial Advisor

Prometheus has delivered to the Board of Directors its written opinion, dated March 6, 2017, to the effect that, as of that date and based upon and subject to the matters and assumptions stated in that opinion, the Merger Consideration (of €14.50 in cash per outstanding Ordinary Share) was fair from a financial point of view to the Company’s shareholders. A copy of such opinion is available for review upon request and coordination during regular business hours at the Company’s offices at 6 Hanagar Street, Hod Hasharon, Israel, attention: Mr. Dudi Berger; telephone: +972-9-7614554; e- mail: [email protected], or at the offices of Deutsche Bank AG, Global Securities Services, Issuer Services, Post IPO Services, 60262 Frankfurt am Main, e-mail: [email protected].

Prometheus’s opinion is directed to the Board of Directors and relates only to the fairness of the Merger Consideration from a financial point of view as of March 6, 2017. The opinion does not address any other aspect of the proposed transaction and is not a recommendation as to how any of the Company’s shareholders should vote with respect to the Merger Agreement or the Merger.

Summary Highlights of the Merger Agreement

The description below is a brief summary of some of the material terms of the Merger Agreement and is subject to, and is qualified in its entirety by reference to, the full text of the Merger Agreement, which is the legal document governing the Merger and which will prevail in the event of any inconsistency with the description below. A copy of the Merger Agreement is available for review upon request and coordination during regular business hours at the Company’s offices at 6 Hanagar Street, Hod Hasharon, Israel, attention: Mr. Dudi Berger; telephone: +972-9-7614554; e-mail: [email protected], or at the offices of Deutsche Bank AG, Global Securities Services, Issuer Services, Post IPO Services, 60262 Frankfurt am Main, e-mail: [email protected].

Main terms

(a) Subject to the satisfaction of the terms and conditions set forth in the Merger Agreement, at the effective time of the Merger, Merger Sub will merge with and into the Company in accordance with the provisions of the Companies Law.

(b) As a result of the Merger, the separate corporate existence of Merger Sub shall cease and the Company shall continue as the Surviving Company and shall: (a) become a wholly owned direct subsidiary of Parent; (b) continue to be governed by the laws of the State of Israel; (c) maintain a registered office in the State of Israel; and (d) succeed to and assume all of the rights, properties and obligations of Merger Sub and the Company in accordance with the Companies Law.

(c) As soon as practicable after the determination of the date on which the closing is to take place, each of the Company and Merger Sub shall, in coordination with each other, deliver to the Registrar of Companies of the State of Israel (the “Companies Registrar”) a notice of the contemplated Merger and the proposed date of the closing on which the Companies Registrar is requested to issue a certificate evidencing the Merger in accordance with Section 323(5) of the Companies Law, and the Merger shall become effective upon the issuance by the Companies Registrar of such certificate of merger.

(d) The Memorandum and the Articles of Association of the Company, as in effect immediately prior to the effective time of the Merger, shall continue to be the Memorandum and the Articles of Association of the Surviving Company, until thereafter duly amended as provided therein and in accordance with the Companies Law.

(e) The current directors of the Company will resign from office as of the effective time of the Merger and the directors of Merger Sub will become the directors of the Surviving Company.

(f) As of the effective time of the Merger, each issued and outstanding Ordinary Share, except as otherwise set forth in the Merger Agreement, shall be converted automatically into and shall thereafter represent only the right to receive the Merger Consideration (€14.50 in cash), without interest, less applicable taxes required to be withheld, upon the terms and subject to the conditions of the Merger Agreement.

(g) At the effective time of the Merger, each outstanding unexercised option or unsettled RSU issued as equity-based awards by the Company, which are vested in accordance with their terms or after giving effect to acceleration thereof as described in Section (h) below, shall be canceled in exchange for the right to receive a lump sum cash payment (without interest) equal to the product of: (x) in case of options, the excess, if any, of the Merger Consideration over the exercise price per Ordinary Share for such option, and in case of RSUs, the Merger Consideration; and (y) the total number of Ordinary Shares underlying such equity-based award (the “Equity-based Awards Consideration”), less applicable taxes required to be withheld with respect to such payment.

Payment of the Equity-based Awards Consideration shall be made in accordance with, and subject to defined payment procedures and shall be further subject to all applicable deductions and withholdings required by law in respect of such payment.

(h) The Board has adopted resolutions to accelerate the vesting of all outstanding unvested equity-based awards (x) granted to non-employee directors (subject to shareholder approval of the Merger Agreement, the Merger and the other transactions contemplated thereby at this Meeting), or (y) which constitute part of a grant in which less than 1,000 Ordinary Shares underlying the relevant outstanding equity-based award would vest in accordance with their terms after the effective time of the Merger, so as to vest at the effective time of the Merger, other than performance based awards which shall continue to vest or expire prior to the effective time of the Merger pursuant to their original terms, based on the performance of the Company through 2016.

(i) The Merger Agreement contains customary representations and warranties made by Parent and the Company to each other. The representations and warranties are subject in some cases to specified exceptions and qualifications. The Company’s representations and warranties relate to, among other things, capital structure and subsidiaries, the absence of any material adverse effect or certain other changes or events, compliance with applicable legal requirements, intellectual property, material contracts and other matters.

Interim period

(j) During the period commencing with the execution and delivery of the Merger Agreement and until closing, the Company shall carry on its business in the usual and ordinary course of business consistent with past practice in substantially the same manner as heretofore conducted, subject to certain matters which will require the approval of Parent. Among the matters that require approval of Parent during this interim period is a distribution of dividends by the Company. The Company does not expect to distribute any dividends to its shareholders prior to the effective time of the Merger.

Closing conditions and required approvals

(k) The closing of the Merger and the other transactions contemplated by the Merger Agreement shall be subject to the satisfaction of, among other things:

(i) Shareholder approval at this Meeting by the Special Majority;

(ii) The Company shall have provided notice of the Merger to the Israel Innovation Authority (previously, the Office of the Chief Scientist of the Israeli Ministry of Economy) (the “OCS”) and the OCS shall have issued an acknowledgment of receipt of said notice without any objections or conditions relating to the Merger Agreement, the Merger or the other transactions contemplated thereunder;

(iii) The lapse of the Israeli statutory waiting periods of at least fifty (50) days after the filing of the merger proposal with the Companies Registrar and at least thirty (30) days after the approval of the Merger by the shareholders at this Meeting and by the shareholder of Merger Sub;

(iv) The absence of any injunctions or legal prohibitions preventing the consummation of the Merger;

(v) The accuracy of the representations and warranties of the Company as of the date of the Merger Agreement and as of the effective time of the Merger, subject, in certain instances, to certain qualifications;

(vi) The Company having performed its obligations under the Merger Agreement in all material respects;

(vii) The delivery to Parent of a Company’s officers’ certificate confirming that certain conditions to the closing have been satisfied; and

(viii) The absence of a material adverse effect with respect to the Company.

Termination of the Merger Agreement

(l) Generally, the Merger Agreement may be terminated and the Merger may be abandoned at any time prior to its completion as follows:

(i) By mutual written agreement of Parent and the Company.

(ii) By either Parent or the Company, if a competent court or other governmental authority issues a final and non-appealable order, or takes any other action, having the effect of permanently restraining, enjoining or otherwise prohibiting the Merger; provided, however, that the party seeking to terminate the Merger Agreement as aforesaid must have complied in all material respects with certain obligations under the Merger Agreement and, provided further, that the right to terminate the Merger Agreement as aforesaid shall not be available to any party whose breach of any provision of the Merger Agreement results in the issuance of such order or the taking of such other action;

(iii) By either the Company or Parent, in the event the Merger is not consummated on or before July 31, 2017 (the “Outside Date”); provided, however, that the right to terminate the Merger Agreement as aforesaid shall not be available to any party whose actions or omissions have been a principal cause of, or primarily resulted in, the failure of the Merger to occur on or before the Outside Date, and such actions or omissions constitute a breach of the Merger Agreement;

(iv) By either Parent or the Company if the Merger is not approved at the Meeting;

(v) By the Company, prior to the Meeting, if the Board of Directors of the Company has authorized the Company to enter into an “Alternative Acquisition Agreement” with respect to a “Superior Proposal” (as such terms are defined in the Merger Agreement) and immediately after the termination of the Merger Agreement, the Company enters into an Alternative Acquisition Agreement with respect to the Superior Proposal; provided, however, that the right of the Company to terminate the Merger Agreement as aforesaid shall be subject to certain terms and conditions set forth in Merger Agreement;

(vi) By Parent, in the event that the Company shall have breached any of its representations, warranties, covenants or agreements under the Merger Agreement such that certain conditions to the closing of the Merger Agreement would not be satisfied, provided however, that the right of Parent to terminate the Merger Agreement as aforesaid shall not be available to Parent if Parent or Merger Sub has breached any of its respective representations, warranties or covenants under the Merger Agreement in any material respect;

(vii) By Parent, prior to the Meeting, if prior to the Meeting the Board shall have changed its recommendation to the shareholders with respect to the approval of the Merger (a “Board Recommendation Change”) or the Company shall have breached its obligations under the Merger Agreement with respect to non-solicitation of alternative acquisition proposals and the Board recommendation to approve the Merger;

(viii) By Parent, by no later than the Outside Date, if following the Meeting, the Company Board shall have effected a Board Recommendation Change or the Company shall have breached any of its obligations under the Merger Agreement with respect to non- solicitation of alternative acquisition proposals and the Board recommendation to approve the Merger;

(ix) By the Company, in the event that Parent or Merger Sub shall have breached any of their representations, warranties or covenants under the Merger Agreement such that certain conditions to the closing of the Merger Agreement would not be satisfied, provided however, that the right to terminate the Merger Agreement as aforesaid shall not be available to the Company if it has breached any of its representations, warranties or covenants under the Merger Agreement in any material respect; or

(x) By Parent, by no later than the Outside Date, if there shall have occurred a Company material adverse effect following March 6, 2017.

Termination Fees; Expenses

(m) The Company is required to pay Parent a €3,370,000 termination fee (the “Termination Fee”) if the Merger Agreement is terminated in the following events:

(i) The Merger Agreement is terminated by the Company pursuant to Section (l)(v) above;

(ii) The Merger Agreement is terminated by Parent pursuant to Section (l)(iv) above, provided however, that at or prior to the Meeting either:

• the Board shall have effected a Board Recommendation Change; or

• the Company shall have breached any of its obligations with respect to non- solicitation of alternative acquisition proposals and the Board recommendation to approve the Merger;

(iii) The Merger Agreement is terminated by Parent pursuant to Sections (l)(vii) or (l)(viii) above;

(iv) The Merger Agreement is terminated by either Parent or the Company pursuant to Section (l)(iii) above or by Parent pursuant to Section (l)(iv) or by Parent pursuant to Section (l)(vi), provided however, that both of the following conditions are met:

• at or prior to the time of such termination, an acquisition proposal shall have been made, and such proposal shall not have been withdrawn prior to the termination of the Merger Agreement; and

• the Company consummates an acquisition transaction or enters into any acquisition agreement with respect to the purchase of 50% or more of the share capital or assets of the Company before the end of the 12-month period following the termination of the Merger Agreement.

In the event of termination as aforesaid, the Company shall pay the Termination Fee less any amount previously paid to Parent as reimbursable expenses (as described in Section (n) below).

(n) The Company has also agreed to reimburse up to $1,500,000 of Parent’s reasonable out-of- pocket expenses, if:

(i) the Merger Agreement is terminated by either Parent or the Company pursuant to Section (l)(iv) above; or

(ii) an acquisition proposal shall have been made and shall not have been withdrawn, and thereafter, the Merger Agreement is terminated

• by either the Company or Parent, pursuant to Section (l)(iii); or

• by Parent, pursuant to Section (l)(vi).

Guaranty

(o) Danaher has executed an irrevocable and unconditional guaranty for the due and punctual performance of the obligations of Parent and Merger Sub under the Merger Agreement that are required to be performed at or prior to closing, including the payment of the Merger Consideration.

Amendment

(p) The Merger Agreement may be amended by the parties in writing at any time prior to the effective time of the Merger, whether before or after shareholder approval. However, after approval by the Company’s shareholders of the Merger Agreement, the Merger and the other transactions contemplated thereby, the Merger Agreement may not be amended in a manner that by applicable law would require further approval by the Company’s shareholders, without such approval.

Governing Law; Jurisdiction

(q) The Merger Agreement is governed by and will be construed and enforced in accordance with the laws of the State of Israel, and any dispute arising under or in relation to the Merger Agreement shall be resolved in, and the sole and exclusive jurisdiction shall be with, the competent court located in Tel Aviv-Jaffa, Israel.

Payment Procedures; Letter of Transmittal

(r) Parent will appoint a bank in Germany accustomed to act as a paying agent, to act as the paying agent for the Merger and may also appoint an Israeli agent to assist in obtaining any requisite information for Israeli tax withholding purposes and otherwise in connection with tax rulings that may be obtained from the Israeli Tax Authority.

Shareholders will be requested to sign a letter of transmittal and to submit a declaration and information for purposes of Israeli tax withholding and are expected to receive instructions for use in effecting the surrender of the their shares in exchange for the Merger Consideration, which will be made available to them through the paying agent following the effective time of the Merger. The paying agents, the Company, the Surviving Company, Parent and Merger Sub are entitled to deduct and withhold from any payment made pursuant to the Merger Agreement, including the Merger Consideration, any amounts required to be deducted or withheld under applicable law.

The above summary terms of the Merger Agreement and the discussion of the Merger are general summaries only and are qualified in their entirety by reference to the full text of the Merger Agreement, which is available for review upon request and coordination during regular business hours at the Company’s offices at 6 Hanagar Street, Hod Hasharon, Israel, attention: Mr. Dudi Berger; telephone: +972-9-7614554; e-mail: [email protected], or at the offices of Deutsche Bank AG, Global Securities Services, Issuer Services, Post IPO Services, 60262 Frankfurt am Main, e- mail: [email protected].

Other Details Relating to the Merger

Capital Gains and Income Taxes Applicable to Non-Israeli Shareholders

The following is a summary discussion of the material Israeli capital gains and income tax considerations applicable to non-Israeli shareholders 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.

As a consequence of the Merger, holders of Ordinary Shares will be treated as having sold their Ordinary Shares in the Merger. Because of the Company’s residence in Israel, the Israeli Tax Authority will view the Merger Consideration received by holders of Ordinary Shares as subject to Israeli taxation.

Israeli law generally imposes a capital gains tax on the sale of securities of an Israeli company traded on the Tel Aviv Stock Exchange, on an authorized stock exchange outside Israel or on a regulated market (which includes a system through which securities are traded pursuant to rules prescribed by the competent authority in the relevant jurisdiction) in or outside Israel (a “Recognized Exchange”). The Frankfurt Stock Exchange, on which the Company’s Ordinary Shares are listed, qualifies as a Recognized Exchange. The Israeli capital gains tax rate applicable to individuals upon the sale of such securities is such individual’s marginal tax rate but not more than 25%. However, a tax rate of up to 30% will apply to an individual who meets the definition of a ‘Substantial Shareholder’ on the date of the sale of the securities or at any time during the 12 months preceding such date. A ‘Substantial Shareholder’ is defined as a person who, either alone or together with any other person, holds, directly or indirectly, at least 10% of any of the means of control of a company (including, among other things, the right to receive profits of the company, voting rights, the right to receive the company’s liquidation proceeds and the right to appoint a director). An additional tax at a rate of 3% on the capital gain may be imposed upon individual shareholders whose annual income from all sources that is taxable in Israel exceeds a certain amount.

With respect to corporate investors, capital gains tax equal to the corporate tax rate (for 2017 - 24%) will generally be imposed on the sale of traded shares.

If the Ordinary Shares are traded on a Recognized Exchange, gains on the sale of Ordinary Shares held by non-Israeli tax resident investors will generally be exempt from Israeli capital gains tax so long as the capital gain is not made through a permanent establishment that the non-Israeli tax resident investor maintains in Israel. Notwithstanding the foregoing, dealers in securities in Israel are taxed at regular tax rates applicable to business income.

Persons paying consideration for shares, including purchasers of shares, Israeli securities dealers effecting a transaction, or a financial institution through which securities being sold are held, are required, subject to any applicable exemptions and the demonstration by the selling shareholder of its non-Israeli residency, to withhold tax upon the sale of publicly traded securities at a rate of 25% for individuals and at the corporate tax rate for corporations (currently 24%).

The Company intends to apply to the Israel Tax Authority for tax rulings with respect to the application of Israeli tax withholding to payment of the Merger Consideration to its shareholders and with respect to the application of Israeli tax withholding and other Israeli tax treatment applicable to the treatment of equity-based awards pursuant to the Merger Agreement. There can be no assurance that such rulings will be obtained before the closing of the Merger or at all, and the closing of the Merger is not conditioned upon such rulings being obtained. The Company expects that further administrative and procedural information, including with respect to declarations that may be required from shareholders with respect to their residency for tax purposes will be provided to shareholders separately in connection with the consummation of the Merger, subject to obtaining shareholder approval at this Meeting.

THE ABOVE DISCUSSION IS FOR GENERAL INFORMATION ONLY. SHAREHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE APPLICATION OF ISRAELI INCOME TAX LAWS TO THEIR PARTICULAR SITUATION AS WELL AS WITH RESPECT TO ANY TAX CONSEQUENCES ARISING UNDER GERMAN OR ANY OTHER NON-ISRAELI TAX LAWS OR UNDER ANY APPLICABLE TAX TREATY.

Insurance, Exemption and Indemnification

Under the Companies Law, procurement of insurance coverage for an Office Holder of a company, the indemnification of an Office Holder and the exemption of an Office Holder from liability for breach of his or her duty of care to a company form part of the terms of office and employment of an Office Holder and require the approval of the Compensation Committee and the Board, and, if the Office Holder is a director or chief executive officer, the approval of the Company’s shareholders.

At the 2016 annual general meeting, the shareholders approved the procurement of liability insurance coverage in the amount of $25 million and the Company is in the process of increasing this insurance coverage to $25 million, The Company’s directors and executive officers (including a former director and the Chief Executive Officer), were issued with Letters of Indemnification and Release, in the form approved by the Company’s shareholders at the 2016 annual general meeting, providing, among other things, for a release from liability for monetary or other damages due to a breach of their duty of care to the Company and for indemnification of up to the higher of: (i) US$5,000,000, or (ii) 25% of the Company’s shareholder equity, as of the date of the event triggering the indemnification, as set forth in the Company’s most recent audited consolidated financial statements at such time.

The Merger Agreement provides that Parent will cause the Surviving Company to honor all rights to indemnification and exculpation for acts or omissions prior to the effective time of the Merger existing in favor of the current or former directors or officers of the Company and that, prior to the effective time of the Merger, the Company may purchase a “run-off” or “tail” officers’ and directors’ liability insurance policy for a period of seven years following the effective time of the Merger on terms and conditions no less favorable than the Company’s existing directors’ and officers’ liability insurance, for an aggregate premium of 300% or less of the annual premium paid by the Company for its existing insurance. If the shareholders approve the Merger Agreement, the Merger and the other transactions contemplated thereby at the Meeting, this approval will also constitute approval of the indemnification, exculpation and insurance provisions of the Merger Agreement with respect to the Company’s current and former directors and officers, including authorization of the purchase of the “tail” insurance as described therein.

Controlling Shareholder, Voting Undertaking and Participation Undertaking

As of the date of this Notice, the Company’s controlling shareholder, as such term is defined for purposes of the Companies Law, is Union Investment and Development Ltd., an Israeli company, holding 3,111,273 Ordinary Shares, representing approximately 51% of the total voting rights in the Company and Mr. Yeoshua Agassi, who is presumed to be a holder of his Ordinary Shares together with Union Investment and Development Ltd and consequently, a controlling shareholder for purposes of approving the Merger Agreement, the Merger and the other transactions contemplated thereby, as detailed in footnote no. 1 above, who holds 45,000 Ordinary Shares, representing less than 1% of the total voting rights in the Company.

Union Investment and Development Ltd. has signed a Voting Undertaking with Parent and Merger Sub pursuant to which it has undertaken, subject to certain conditions as set forth in the Voting Undertaking, to be present, or to cause its Ordinary Shares to be represented, at the Meeting and to vote in favor of approval of the Merger Agreement, the Merger and the other transactions contemplated thereby, and Mr. Yeoshua Agassi has signed a Participation Undertaking with Parent and Merger Sub, pursuant to which he has undertaken to be present, or to cause his Ordinary Shares to be represented at, the Meeting for quorum purposes. The obligations of Union Investment and Development Ltd. under the Voting Undertaking terminate upon the earliest to occur of (a) the effective time of the Merger, (b) the termination of the Merger Agreement in accordance with its terms, (c) an amendment of the Merger Agreement that adversely changes the economic rights of the shareholders of the Company and (d) a Board recommendation change made pursuant to the applicable provisions of the Merger Agreement.

Interested Parties; Personal Interests of the Controlling Shareholders and the Directors

Following is a list of the personal interests in this transaction of which the Company is aware, of the following: the controlling shareholder, the directors 1, the Company’s President and Chief Executive Officer, the Company’s Chief Financial Officer and all other officers.

1. Interests of Union Investment and Development Ltd. and Mr. Yeoshua Agassi. The interest of the controlling shareholder, Union Investment and Development Ltd., is a result of the personal interest of Mr. Yeoshua Agassi, a director of the controlling shareholder, who is also a director and a shareholder of the Company. Pursuant to a presumption under Israeli law, Union Investment and Development Ltd. and Mr. Agassi may be deemed as joint holders of the Ordinary Shares held by them respectively 2:

1.1. Acceleration of unvested equity awards held by non-employee directors at closing as described in paragraphs (g) and (h) under “Summary Highlights of the Merger Agreement” above; and

1.2. Indemnification, exculpation and insurance provisions of the Merger Agreement, including the purchase of a ‘tail’ directors’ and officers’ insurance policy for a period of seven years following the Merger, for current and former directors. ______1 The Board of Directors currently consist of Mr. Yariv Avisar, the Chairman of the Board, Mr. Yeoshua Agassi, Mr. Ofer Ne’eman (member of the Compensation Committee), Mrs. Adina Shorr (member of the Audit Committee), Mr. Arie Weisberg (an external director, Chairman of the Compensation Committee and a member of the Audit Committee), and Ytzhak Edelman (an external director, Chairman of the Audit Committee and a member of the Compensation Committee). 2 See footnote no. 1 above.

2. Interests of all directors. Same as above;

3. Interests of all officers. Indemnification, exculpation and insurance provisions of the Merger Agreement, including the purchase of a ‘tail’ directors’ and officers’ insurance policy for a period of seven years following the Merger for current and former directors and officers; conversion of unvested and unexercised equity-based awards into the right to receive cash, subject to the provisions of the Merger Agreement; the right of acceleration of unvested RSUs of Israeli officers so that they will be deemed fully vested at the time of termination of employment, in the event of termination other than for cause, within 6 months following a change-of-control event; and the right of acceleration of option awards upon termination of employment by the Company, other than for cause, within 6 months of a change-of-control event;

In addition, the provisions of the Merger Agreement with respect to the acceleration of unvested equity-based awards as described in paragraphs (g) and (h) under “Summary Highlights of the Merger Agreement” above also apply to awards held by officers. However, as a practical matter, the Company does not expect that as of the effective time of the Merger there will be any outstanding equity-based awards held by officers which constitute part of a grant in which less than 1,000 equity-based awards would vest in accordance with their terms after the effective time of the Merger;

4. Additional interests of Mr. Jaron Lotan, President and Chief Executive Officer.

4.1. The grant of 20,000 fully vested RSUs in connection with the consummation of the Merger, as further detailed below in Item 2 of this Notice;

4.2. A change-of-control provision in Mr. Lotan’s employment agreement which provides for acceleration of option awards upon termination of employment by the Company, other than for cause, within 6 months of a change-of-control event; and

4.3. The Company’s undertaking under the Merger Agreement to provide that following the effective time of the Merger, Mr. Lotan will no longer be entitled to an annual equity award, as currently provided pursuant to his employment agreement and applicable corporate resolutions and approvals (a “negative” interest).

5. Additional interests of Mr. Udi Bar-Sela, Chief Financial Officer. An increase of his advance notice period of termination (whether voluntary or involuntary) from 3 months to 6 months, in the event of termination within one year from a change-of-control event.

All personal interests provided above have been disclosed to the Board of Directors, the Audit Committee and the Compensation Committee, at their meetings held in connection with the approval of the items on the agenda of the Meeting.

Name of contact for further information

Requests for further information should be directed in writing to Mr. Dudi (David) Berger, Finance Director, Advanced Vision Technology (A.V.T) Ltd., 6 Hanagar Street, Hod Hasharon, Israel; telephone: +972-9-7614554; e-mail: [email protected], or Deutsche Bank AG, Global Securities Services, Issuer Services, Post IPO Services, 60262 Frankfurt am Main, e-mail: [email protected].

It is proposed that the following resolution be adopted at the Meeting:

“RESOLVED, to approve the Merger Agreement, the Merger and the other transactions contemplated thereby, including, among other things, the following matters:

(a) The agreements and covenants set forth in the Merger Agreement with respect to indemnification, exculpation and insurance, including authorization of the purchase of ‘tail’ insurance, in favor of current and former directors and officers of the Company; and

(b) The treatment of the Company’s equity-based awards, including, where applicable, the acceleration of unvested options and unvested RSUs held by directors, officers and employees of the Company, the treatment of unvested options and unvested RSUs held by officers and employees of the Company that will not be accelerated and the substitution of such Company equity-based awards for cash, all as set forth in the Merger Agreement.”

The Board recommends that the shareholders vote “FOR” the proposed resolution.

ITEM 2

A ONE-TIME EQUITY-BASED AWARD TO THE PRESIDENT AND CHIEF EXECUTIVE OFFICER

Pursuant to the Companies Law, any arrangement between the Company and its chief executive officer (who is not a director) relating to his or her terms of office and employment generally must be consistent with the Company’s Directors and Officers Compensation Policy (the “Compensation Policy”) and must be approved by the Compensation Committee, the Board and the shareholders by the Compensation Majority. Under certain circumstances, to the extent the proposed compensation terms are not approved by shareholders, the Compensation Committee and the Board may subsequently override the resolution of the shareholders following a new discussion of the matter and for specified reasons.

The Compensation Committee and the Board have approved, and are recommending to the shareholders to approve to grant Mr. Jaron Lotan, the Company’s President and Chief Executive Officer, a special one-time equity-based award of 20,000 fully vested RSUs (the “One-time Grant”), immediately prior to the effective time of the Merger and subject to the Merger becoming effective. The One-time Grant will be subject to the terms, conditions and limitations set forth in the Compensation Policy with respect thereto, as well as the Company’s 2009 Israeli Incentive Plan and may be subject to the tax ruling which the Company intends to apply for with the Israeli Tax Authority with respect to the treatment of equity-based awards pursuant to the Merger Agreement.

The Compensation Committee and the Board are recommending approval of the One-time Grant in recognition of Mr. Lotan’s leadership of the Company, as well as his significant contributions to the Merger and the creation of shareholder value in connection therewith.

It is proposed that the following resolution be adopted at the Meeting:

“RESOLVED, to approve the One-time Grant to Mr. Jaron Lotan, the Company’s President and Chief Executive Officer, as set forth in the Company’s Notice for its 2017 Special General Meeting of Shareholders.”

The Board recommends that the shareholders vote “FOR” the proposed resolution.

OTHER BUSINESS

Other than as set forth above, management knows of no other business to be transacted at the Meeting; but, if any other matters are properly presented at the Meeting, Ordinary Shares represented by executed and unrevoked proxies will be voted by the persons named in the enclosed form of proxy upon such matters in accordance with their best judgment.

Frankfurt am Main, im März 2017

Im Auftrag der ADVANCED VISION TECHNOLOGY (A.V.T.) LTD.

Deutsche Bank Aktiengesellschaft