Filed Pursuant to Rule 424(b)(3)
Registration No. 333-239804
96,736,980
Ordinary Shares represented by 3,224,566 American Depositary Shares
This prospectus relates
to the resale, by the selling shareholders identified in this prospectus, of up to an aggregate of 96,736,980 ordinary shares,
par value NIS 0.25 per share of Can-Fite Biopharma Ltd., represented by 3,224,566 American Depository Shares, or ADSs, consisting
of (1) (i) 58,536,600 ordinary shares represented by 1,951,220 ADSs issuable upon the exercise of warrants issued in a private
placement in June 2020, or the June 2020 Private Placement, and (ii) 8,780,490 ordinary shares represented by 292,683 ADSs issuable
upon the exercise of placement agent warrants issued in connection with the June 2020 Private Placement, and (2) (i) 25,582,500
ordinary shares represented by 852,750 ADSs issuable upon the exercise of warrants issued in a private placement in July 2020,
or the July 2020 Private Placement, and (ii) 3,837,390 ordinary shares represented by 127,913 ADSs issuable upon the exercise of
placement agent warrants issued in connection with the July 2020 Private Placement.
The
selling shareholders are identified in the table commencing on page 8. Each ADS represents thirty (30) ordinary shares. No
ADSs are being registered hereunder for sale by us. We will not receive any proceeds from the sale of the ADSs by the selling
shareholders. All net proceeds from the sale of the ordinary shares represented by ADSs covered by this prospectus will go to
the selling shareholders. However, we may receive the proceeds from any exercise of warrants if the holders do not exercise the
warrants on a cashless basis. See “Use of Proceeds.”
The
selling shareholders may sell all or a portion of the ordinary shares represented by ADSs from time to time in market transactions
through any market on which our ADSs are then traded, in negotiated transactions or otherwise, and at prices and on terms that
will be determined by the then prevailing market price or at negotiated prices directly or through a broker or brokers, who may
act as agent or as principal or by a combination of such methods of sale. See “Plan of Distribution”.
Our ADSs are listed on
the NYSE American under the symbol “CANF”. On July 23, 2020, the closing price of our ADSs on the NYSE American was
US$2.38 per ADS. Our ordinary shares also trade on the Tel Aviv Stock Exchange, or TASE, under the symbol “CFBI”. On
July 23, 2020, the last reported sale price of our ordinary shares on the TASE was NIS 0.28 or $0.08 per share (based on the exchange
rate reported by the Bank of Israel on the same day).
The
securities offered in this prospectus involve a high degree of risk. See “Risk Factors” beginning on page 4 of
this prospectus to read about factors you should consider before purchasing any of our securities.
Neither
the U.S. Securities and Exchange Commission, the Israel Securities Authority nor any state or other foreign securities commission
has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to
the contrary is a criminal offense.
The
date of this prospectus is July 24, 2020.
TABLE
OF CONTENTS
About
This Prospectus
This
prospectus is part of a registration statement that we filed with the SEC. As permitted by the rules and regulations of the SEC,
the registration statement filed by us includes additional information not contained in this prospectus. You may read the registration
statement and the other reports we file with the SEC at the SEC’s website or its offices described below under the heading
“Where You Can Find More Information”.
You
should rely only on the information that is contained in this prospectus or that is incorporated by reference into this prospectus.
We have not authorized anyone to provide you with information that is in addition to or different from that contained in, or incorporated
by reference into, this prospectus. If anyone provides you with different or inconsistent information, you should not rely on
it.
We
are not offering to sell or solicit any security other than the ordinary shares represented by ADSs offered by this prospectus.
In addition, we are not offering to sell or solicit any securities to or from any person in any jurisdiction where it is unlawful
to make this offer to or solicit an offer from a person in that jurisdiction. The information contained in this prospectus is
accurate as of the date on the front of this prospectus only, regardless of the time of delivery of this prospectus or of any
sale of our ordinary shares. Our business, financial condition, results of operations and prospects may have changed since that
date.
This
prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made
to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents.
Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated herein by reference
as exhibits to the registration statement, and you may obtain copies of those documents as described below under the section entitled
“Where You Can Find More Information.”
Our
financial statements are prepared and presented in accordance with United States generally accepted accounting principles, or
U.S. GAAP. Our historical results do not necessarily indicate our expected results for any future periods.
Market
data and certain industry data and forecasts used throughout this prospectus were obtained from sources we believe to be reliable,
including market research databases, publicly available information, reports of governmental agencies and industry publications
and surveys. We have relied on certain data from third-party sources, including internal surveys, industry forecasts and market
research, which we believe to be reliable based on our management’s knowledge of the industry. Forecasts are particularly
likely to be inaccurate, especially over long periods of time. In addition, we do not necessarily know what assumptions regarding
general economic growth were used in preparing the third-party forecasts we cite. Statements as to our market position are based
on the most currently available data. While we are not aware of any misstatements regarding the industry data presented in this
prospectus, our estimates involve risks and uncertainties and are subject to change based on various factors, including those
discussed under the heading “Risk Factors” in this prospectus.
Certain
figures included in this prospectus have been subject to rounding adjustments. Accordingly, figures shown as totals in certain
tables may not be an arithmetic aggregation of the figures that precede them
In
this prospectus, unless the context otherwise requires:
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references
to “ADSs” refer to American Depositary Shares representing ordinary shares;
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references
to “A3AR” refer to the A3 adenosine receptor;
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references
to the “Company,” “we,” “our” and “Can-Fite” refer to Can-Fite BioPharma Ltd.
and its consolidated subsidiaries;
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references
to the “Companies Law” or “Israeli Companies Law” are to Israel’s Companies Law, 5759-1999,
as amended;
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references
to “dollars,” “U.S. dollars,” “USD” and “$” are to United States Dollars;
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references
to “HCC” refer to hepatocellular carcinoma, also known as primary liver cancer;
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references
to “NASH” refer to non-alcoholic steatohepatitis;
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references
to “ordinary shares,” “our shares” and similar expressions refer to our Ordinary Shares, NIS 0.25
nominal (par) value per share;
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references
to “shekels” and “NIS” are to New Israeli Shekels, the Israeli currency; and
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references
to the “SEC” are to the United States Securities and Exchange Commission.
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On
May 10, 2019, we effected a change in the ratio of our ADSs to ordinary shares from one (1) ADS representing two (2) ordinary
shares to a new ratio of one (1) ADS representing thirty (30) ordinary shares. For ADS holders, the ratio change had the same
effect as a one-for-fifteen reverse ADS split. All ADS and related option and warrant information presented in this prospectus
have been retroactively adjusted to reflect the reduced number of ADSs and the increase in the ADS price which resulted from this
action. Unless otherwise indicated, in this prospectus fractional ADSs have been rounded to the nearest whole number.
We
have not taken any action to permit a public offering of the securities outside the United States or to permit the possession
or distribution of this prospectus outside the United States. Persons outside the United States who come into possession of this
prospectus must inform themselves about and observe any restrictions relating to the offering of the securities and the distribution
of this prospectus outside of the United States.
PROSPECTUS
SUMMARY
This
summary highlights selected information contained elsewhere in this prospectus that we consider important. This summary does not
contain all of the information you should consider before investing in our ADSs or ordinary shares. You should read this summary
together with the entire prospectus, including the risks related to our business, our industry, investing in our ADSs or ordinary
shares and our location in Israel, that we describe under “Risk Factors” and our consolidated financial statements
and the related notes before making an investment in our securities.
Overview
We are a clinical stage
biopharmaceutical company that develops orally bioavailable small molecule therapeutic products for the treatment of cancer, liver
and inflammatory diseases and erectile dysfunction. We also co-develop specific formulations of cannabis components for the treatment
of cancer, inflammatory, autoimmune, and metabolic diseases. Our platform technology utilizes the Gi protein associated A3AR as
a therapeutic target. A3AR is highly expressed in inflammatory and cancer cells, and not significantly expressed in normal cells,
suggesting that the receptor could be a unique target for pharmacological intervention. Our pipeline of drug candidates are synthetic,
highly specific agonists and allosteric modulators, or ligands or molecules that initiate molecular events when binding with target
proteins, targeting the A3AR.
Our product pipeline
is based on the research of Dr. Pnina Fishman, who investigated a clinical observation that tumor metastasis can be found in most
body tissues, but are rarely found in muscle tissue, which constitutes approximately 60% of human body weight. Dr. Fishman’s
research revealed that one reason that striated muscle tissue is resistant to tumor metastasis is that muscle cells release small
molecules which bind with high selectivity to the A3AR. As part of her research, Dr. Fishman also discovered that A3ARs have significant
expression in tumor and inflammatory cells, whereas normal cells have low or no expression of this receptor. The A3AR agonists
and allosteric modulators, currently our pipeline of drug candidates, bind with high selectivity and affinity to the A3ARs and
upon binding to the receptor initiate down-stream signal transduction pathways resulting in apoptosis, or programmed cell death,
of tumors and inflammatory cells and to the inhibition of inflammatory cytokines. Cytokines are proteins produced by cells that
interact with cells of the immune system in order to regulate the body’s response to disease and infection. Overproduction
or inappropriate production of certain cytokines by the body can result in disease.
Our product candidates,
CF101, CF102 and CF602, are being developed to treat autoimmune inflammatory indications, oncology and liver diseases as well as
erectile dysfunction. CF101, also known as Piclidenoson, is in an advance stage of clinical development for the treatment of autoimmune-inflammatory
diseases, including rheumatoid arthritis and psoriasis. CF102, also known as Namodenoson, is being developed for the treatment
of HCC and has orphan drug designation for the treatment of HCC in the United States and Europe. Namodenoson was granted Fast Track
designation by the FDA as a second line treatment to improve survival for patients with advanced HCC who have previously received
Nexavar (sorafenib). Namodenoson is also being developed for the treatment of NASH, following our study which revealed compelling
pre-clinical data on Namodenoson in the treatment of NASH, a disease for which no FDA approved therapies currently exist. CF602
is our second generation allosteric drug candidate for the treatment of erectile dysfunction, which has shown efficacy in the treatment
of erectile dysfunction in preclinical studies and we are investigating additional compounds, targeting A3AR, for the treatment
of erectile dysfunction. Preclinical studies revealed that our drug candidates have potential to treat additional inflammatory
diseases, such as Crohn’s disease, oncological diseases, viral diseases, such as the JC virus, and obesity.
We believe our pipeline
of drug candidates represent a significant market opportunity. For instance, according to iHealthcareAnalyst, the world rheumatoid
arthritis market size is predicted to generate revenues of $50.5 billion by 2025 and the psoriasis drug market is forecasted to
be worth $11.3 billion by 2025. According to DelveInsight, the HCC drug market in the G8 countries (U.S., Germany, France, Italy,
Spain, UK, Japan and China) is expected to reach $3.8 billion by 2027.
We have in-licensed
an allosteric modulator of the A3AR, CF602 from Leiden University. In addition, we have out-licensed the following:
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Piclidenoson for the treatment of (i) rheumatoid arthritis to Kwang Dong Pharmaceutical Co. Ltd., for South Korea, (ii) psoriasis and rheumatoid arthritis to Cipher Pharmaceuticals for Canada, (iii) rheumatoid arthritis and psoriasis to Gebro Holding for Spain, Switzerland and Austria, (iv) rheumatoid arthritis and psoriasis to CMS Medical, or CMS, for China (including Hong Kong, Macao and Taiwan), and (v) psoriasis to Kyongbo Pharm Co. Ltd. for South Korea; and
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Namodenoson for the treatment of (i) liver cancer and NASH to Chong Kun Dang Pharmaceuticals for South Korea, and (ii) advanced liver cancer and NAFLD/NASH to CMS for China (including Hong Kong, Macao and Taiwan).
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On September 10, 2019,
we entered into a collaboration agreement with Univo Pharmaceuticals, or Univo, a medical cannabis company, to identify and co-develop
specific formulations of cannabis components for the treatment of cancer, inflammatory, autoimmune, and metabolic diseases. Under
the collaboration agreement, Univo will provide us with cannabis and cannabis components, as well as full access to its laboratories
for both research and manufacturing. We agreed to pay Univo a total of $500,000 in two installments and issued to Univo 19,934,355
ordinary shares through a private placement, representing approximately 16.6% of Can-Fite’s ordinary shares outstanding after
giving effect to the issuance. In addition, in connection therewith, we issued 996,690 ordinary shares to a consultant. The companies
will initially share ownership of intellectual property developed in this collaboration. Revenues derived from the collaboration
will generally be shared between us and Univo on the basis of each party’s contribution. Golan Bitton, Univo’s CEO
was appointed to our board of directors in December 2019. On February 17, 2020, we entered into an amendment to the collaboration
agreement pursuant to which the parties expanded the collaboration to allow the testing of minute cannabidiol (CBD) concentrations/dosages
in combination with Namodenoson on liver cancer and additional oncological indications. As part of the expansion, we agreed to
fund the research and development activities for the two new indications, to be jointly performed, for an amount of $200,000 per
indication. On February 27, 2020, Golan Bitton resigned from our board of directors, effective immediately.
We are currently: (i)
conducting a Phase III trial for Piclidenoson in the treatment of rheumatoid arthritis with an interim analysis expected to be
released in the fourth quarter of 2020, (ii) conducting a Phase III trial for Piclidenoson in the treatment of psoriasis with an
interim analysis expected to be released in the fourth quarter of 2020, (iii) preparing to commence a Phase III trial for Namodenoson
in the treatment of liver cancer, (iv) determining next steps following positive top-line results in Phase II trial of Namodenoson
in the treatment of NASH, (v) investigating Piclidenoson for the treatment of coronavirus which includes a planned Phase II clinical
trial in the U.S., (vi) investigating additional compounds, targeting the A3 adenosine receptor, for the treatment of erectile
dysfunction, and (vii) co-developing with Univo formulations of cannabis components for the treatment of diseases in which there
is an overexpression of A3AR.
June
2020 Financing
On
June 12, 2020, we sold to several institutional and accredited investors an aggregate of 117,073,200 ordinary shares represented
by 3,902,440 ADSs in a registered direct offering at $2.05 per ADS, resulting in gross proceeds of approximately $8.0 million.
In addition, we issued to the investors unregistered warrants to purchase 58,536,600 ordinary shares represented by 1,951,220
ADSs in a private placement. The warrants are immediately exercisable and will expire four and one-half years from issuance at
an exercise price of $2.50 per ADS, subject to adjustment as set forth therein. The warrants may be exercised on a cashless basis
if there is no effective registration statement registering the ADSs underlying the warrants. We paid an aggregate of $600,000
in placement agent fees and expenses and issued unregistered placement agent warrants to purchase 292,683 ADS on the same terms
as the warrants.
In
connection with the June 2020 financing, the selling shareholders named in this prospectus may offer and sell up to an aggregate
of 67,317,090 Ordinary Shares represented by 2,243,903 ADSs.
July
2020 Financing
On
July 8, 2020, we sold to several institutional and accredited investors an aggregate of 51,165,000 ordinary shares represented
by 1,705,500 ADSs in a registered direct offering at $2.00 per ADS, resulting in gross proceeds of approximately $3.4 million.
In addition, we issued to the investors unregistered warrants to purchase 25,582,500 ordinary shares represented by 852,750 ADSs
in a private placement. The warrants are immediately exercisable and will expire four and one-half years from the issuance date
at an exercise price of $2.50 per ADS, subject to adjustment as set forth therein. The warrants may be exercised on a cashless
basis if there is no effective registration statement registering the ADSs underlying the warrants. We paid an aggregate of $255,825
in placement agent fees and expenses and issued unregistered placement agent warrants to purchase up to 127,913 ADS on the same
terms as the warrants.
In
connection with the July 2020 financing, the selling shareholders named in this prospectus may offer and sell up to an aggregate
of 29,419,890 Ordinary Shares represented by 980,663 ADSs.
The
Offering
ADSs
Offered
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Up
to an aggregate of 96,736,980 ordinary shares, par value NIS 0.25 per share of Can-Fite Biopharma Ltd., represented by 3,224,566
ADSs, consisting of (1) (i) 58,536,600 ordinary shares represented by 1,951,220 ADSs issuable upon the exercise of warrants
issued in the June 2020 Private Placement, and (ii) 8,780,490 ordinary shares represented by 292,683 ADSs issuable upon the
exercise of placement agent warrants issued in connection with the June 2020 Private Placement, and (2) (i) 25,582,500 ordinary
shares represented by 852,750 ADSs issuable upon the exercise of warrants issued in the July 2020 Private Placement and (ii)
3,837,390 ordinary shares represented by 127,913 ADSs issuable upon the exercise of placement agent warrants issued in connection
with the July 2020 Private Placement. The selling shareholders are identified in the table commencing on page 8. Each
ADS represents 30 ordinary shares.
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Ordinary
Shares
Outstanding
at July 9,
2020
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462,419,463
ordinary shares.
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Use
of proceeds
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We
will not receive any proceeds from the sale of the ordinary shares represented by ADSs by the selling shareholders. All net
proceeds from the sale of the ordinary shares represented by ADSs covered by this prospectus will go to the selling shareholders.
However, we may receive the proceeds from any exercise of warrants and placement agent warrants if the holders do not exercise
the warrants on a cashless basis. See the section of this prospectus titled “Use of Proceeds.”
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NYSE
American Symbol for ADSs
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CANF
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Risk
factors
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Before
investing in our securities, you should carefully read and consider the “Risk Factors” beginning on page 4
of this prospectus.
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Unless
otherwise indicated, the number of ordinary shares outstanding prior to and after this offering is based on 462,419,463 ordinary
shares outstanding as of July 9, 2020, and excludes:
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6,423,401
ordinary shares issuable upon the exercise of stock options outstanding at a weighted-average exercise price of $0.416 per
ordinary share (based on the exchange rate reported by the Bank of Israel on such date) equivalent to 214,113 ADSs at a weighted
average exercise price of $12.48 per ADS;
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131,455,306
ordinary shares represented by 4,381,844 ADSs issuable upon the exercise of outstanding warrants at a weighted-average exercise
price of $3.759 per ADS;
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58,536,600
ordinary shares represented by 1,951,220 ADSs issuable upon exercise of unregistered warrants issued to the investors in the
June 2020 Private Placement at an exercise price of $2.50 per ADS;
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8,780,490
ordinary shares represented by 292,683 ADSs issuable upon the exercise of warrants to purchase 292,683 ADSs, issued as compensation
to the placement agent in connection with the June 2020 Private Placement, at an exercise price of $2.50 per ADS;
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25,582,500
ordinary shares represented by 852,750 ADSs issuable upon exercise of unregistered warrants issued to the investors in the
July 2020 Private Placement at an exercise price of $2.50 per ADS; and
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3,837,390
ordinary shares represented by 127,913 ADSs issuable upon the exercise of warrants to purchase 127,913 ADSs to be issued as
compensation to the placement agent in connection with the July 2020 Private Placement, at an exercise price of $2.50 per
ADS
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Unless
otherwise indicated, all information in this prospectus assumes no exercise of the outstanding options or warrants described above
and gives retroactive effect to the adjustment to the ratio of ADSs to ordinary shares from one ADS representing two ordinary
shares to one ADS representing 30 ordinary shares effected on May 10, 2019.
RISK
FACTORS
An
investment in our securities involves significant risk. Before making an investment in our securities, you should carefully consider
the risk factors set forth in our most recent Annual Report on Form 20-F on file with the SEC, which is incorporated by reference
into this prospectus, as well as the following risk factors, which supplement or augment the risk factors set forth in our Annual
Report on Form 20-F. Before making an investment decision, you should carefully consider these risks as well as other information
we include or incorporate by reference in this prospectus. The risks and uncertainties not presently known to us or that we currently
deem immaterial may also materially harm our business, operating results and financial condition and could result in a complete
loss of your investment.
The
sale of a substantial amount of our ordinary shares or ADSs, including resale of the ADSs issuable upon the exercise of the warrants
held by the selling shareholders in the public market could adversely affect the prevailing market price of our common stock.
We
are registering for resale 96,736,980 ordinary shares represented by 3,224,566 ADSs issuable upon the exercise of warrants held
by the selling shareholders. Sales of substantial amounts of shares of our ordinary shares or ADSs in the public market, or the
perception that such sales might occur, could adversely affect the market price of our ordinary shares, and the market value of
our other securities. We cannot predict if and when selling shareholders may sell such shares in the public markets. Furthermore,
in the future, we may issue additional ordinary shares or ADSs or other equity or debt securities convertible into ordinary shares
or ADSs. Any such issuance could result in substantial dilution to our existing shareholders and could cause our stock price to
decline.
SPECIAL
NOTE REGARDING FORWARD LOOKING STATEMENTS
This
prospectus contains forward-looking statements, about our expectations, beliefs or intentions regarding, among other things, our
product development efforts, business, financial condition, results of operations, strategies or prospects. In addition, from
time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Forward-looking
statements can be identified by the use of forward-looking words such as “believe,” “expect,” “intend,”
“plan,” “may,” “should” or “anticipate” or their negatives or other variations
of these words or other comparable words or by the fact that these statements do not relate strictly to historical or current
matters. These forward-looking statements may be included in, but are not limited to, various filings made by us with the SEC,
press releases or oral statements made by or with the approval of one of our authorized executive officers. Forward-looking statements
relate to anticipated or expected events, activities, trends or results as of the date they are made. Because forward-looking
statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties that
could cause our actual results to differ materially from any future results expressed or implied by the forward-looking statements.
Many factors could cause our actual activities or results to differ materially from the activities and results anticipated in
forward-looking statements, including, but not limited to, the factors summarized below.
This
prospectus identifies important factors which could cause our actual results to differ materially from those indicated by the
forward-looking statements, particularly those set forth under the heading “Risk Factors.” The risk factors included
in this prospectus are not necessarily all of the important factors that could cause actual results to differ materially from
those expressed in any of our forward-looking statements. Given these uncertainties, readers are cautioned not to place undue
reliance on such forward-looking statements. Factors that could cause our actual results to differ materially from those expressed
or implied in such forward-looking statements include, but are not limited to:
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our
history of losses and needs for additional capital to fund our operations and our inability to obtain additional capital on
acceptable terms, or at all;
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uncertainties
of cash flows and inability to meet working capital needs;
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risks
related to the coronavirus outbreak;
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the
initiation, timing, progress and results of our preclinical studies, clinical trials and other product candidate development
efforts;
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our
ability to advance our product candidates into clinical trials or to successfully complete our preclinical studies or clinical
trials;
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our
receipt of regulatory approvals for our product candidates, and the timing of other regulatory filings and approvals;
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the
clinical development, commercialization and market acceptance of our product candidates;
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our
ability to establish and maintain strategic partnerships and other corporate collaborations;
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the
implementation of our business model and strategic plans for our business and product candidates;
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the
scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates
and our ability to operate our business without infringing the intellectual property rights of others;
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competitive
companies, technologies and our industry;
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risks
related to not satisfying the continued listing requirements of NYSE American.
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statements
as to the impact of the political and security situation in Israel on our business.
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All
forward-looking statements attributable to us or persons acting on our behalf speak only as of the date of this prospectus and
are expressly qualified in their entirety by the cautionary statements included in this prospectus. We undertake no obligations
to update or revise forward-looking statements to reflect events or circumstances that arise after the date made or to reflect
the occurrence of unanticipated events. In evaluating forward-looking statements, you should consider these risks and uncertainties.
USE
OF PROCEEDS
We
will not receive any proceeds from the sale of the ordinary shares represented by ADSs by the selling shareholders. All net proceeds
from the sale of the ordinary shares represented by ADSs and the warrants and placement agent warrants covered by this prospectus
will go to the selling shareholders. We expect that the selling shareholders will sell their ordinary shares represented by ADSs
as described under “Plan of Distribution.”
We
may receive proceeds from the exercise of the warrants and placement agent warrants and issuance of the warrant ADSs to the extent
that these warrants are exercised for cash. Warrants, however, are exercisable on a cashless basis under certain circumstances.
If all of the warrants mentioned above were exercised for cash in full, the proceeds would be approximately $8 million. We intend
to use the net proceeds of such warrant exercise, if any, for research and development, general and administrative expenses, and
for working capital purposes.
Pending
application of the net proceeds for the purposes as described above, we expect to invest the net proceeds in short-term, interest-bearing
securities, investment grade securities, certificates of deposit or direct or guaranteed obligations of the U.S. government.
CAPITALIZATION
The
following table sets forth our capitalization:
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on
an actual basis as of March 31, 2020; and
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on
an adjusted basis, giving effect to (i) the exercise of certain outstanding warrants in April and May 2020, resulting in net
proceeds of approximately $1,550,000, (ii) the completion of the June 2020 offering based on the issuance of an aggregate
of 117,073,200 ordinary shares represented by 3,902,440 ADSs at an offering price of $2.05 per ADS, after deducting the placement
agent fees and estimated offering expenses payable by us, resulting in net proceeds of approximately $7,050,000 and (iii)
the completion of the July 2020 offering based on the issuance of an aggregate of 51,165,000 ordinary shares represented by
1,705,500 ADSs at an offering price of $2.00 per ADS, after deducting the placement agent fees and estimated offering expenses
payable by us, resulting in net proceeds of approximately $2,957,055.
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The actual and as adjusted
amounts shown below are unaudited and represent management’s estimate. The information in this table should be read in conjunction
with and is qualified by reference to the financial statements and notes thereto and other financial information incorporated by
reference into this prospectus.
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As of March 31, 2020
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(Actual)
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(As
Adjusted)
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Long-term liabilities:
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2,306
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2,306
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Shareholders’ equity:
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Share capital
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18,560
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32,943
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Share Premium
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100,750
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97,924
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Accumulated other comprehensive loss
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1,127
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1,127
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Accumulated deficit
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(115,368
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(115,368
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Total shareholder’s equity
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|
5,069
|
|
|
|
16,626
|
|
|
|
|
|
|
|
|
|
|
Total capitalization (long-term liabilities and equity)
|
|
|
7,375
|
|
|
|
18,932
|
|
The
above table is based on 263,181,243 ordinary shares outstanding as of March 31, 2020 and excludes the following:
|
●
|
2,673,401
ordinary shares issuable upon the exercise of stock options outstanding at a weighted-average exercise price of $0.87 per
ordinary share (based on the exchange rate reported by the Bank of Israel on such date) equivalent to 83,113 ADSs at a weighted
average exercise price of $26.1 per ADS;
|
|
●
|
162,455,340
ordinary shares represented by 5,415,178 ADSs issuable upon the exercise of outstanding warrants at a weighted-average exercise
price of $3.328 per ADS;
|
|
●
|
58,536,600
ordinary shares represented by 1,951,220 ADSs issuable upon exercise of unregistered warrants issued to the investors in the
June 2020 Private Placement, at an exercise price of $2.50 per ADS;
|
|
●
|
8,780,490
ordinary shares represented by 292,683 ADSs issuable upon the exercise of warrants issued as compensation to the placement
agent in connection with the June 2020 Private Placement, at an exercise price of $2.50 per ADS;
|
|
|
|
|
●
|
25,582,500
ordinary shares represented by 852,750 ADSs issuable upon exercise of unregistered warrants to be issued to the investors
in the July 2020 Private Placement, at an exercise price of $2.50 per ADS; and
|
|
●
|
3,837,390
ordinary shares represented by 127,913 ADSs issuable upon the exercise of warrants to be issued as compensation to the placement
agent in the July 2020 Private Placement, at an exercise price of $2.50 per ADS.
|
SELLING
SHAREHOLDERS
The ordinary shares
represented by ADSs being offered by the selling shareholders are those ordinary shares represented by ADSs issuable upon exercise
of warrants previously issued in connection with our private placement that closed in June 2020 and July 2020. For additional information
regarding the issuance of those ADSs and warrants to purchase ADSs, see “Prospectus Summary – June 2020 Financing”
and “Prospectus Summary – July 2020 Financing” above. We are registering the ordinary shares represented by ADSs
in order to permit the selling shareholders to offer the ordinary shares represented by ADSs for resale from time to time. Other
than with respect to H.C. Wainwright & Co. LLC, or H.C. Wainwright, which acted as our placement agent in each of the July
2020, June 2020, February 2020, January 2020, May 2019, April 2019, January 2019, March 2018 and January 2017 financings, and has
acted as a placement agent for us in financings in September and October 2015, except for the ownership of the warrants and placement
agent warrants issued, and the ADSs issued and issuable, pursuant to prior financings, the selling shareholders have not had any
material relationship with us within the past three years.
The
table below lists the selling shareholders and other information regarding the beneficial ownership of the ordinary shares represented
by ADSs by each of the selling shareholders. The second column lists the number of ordinary shares represented by ADSs beneficially
owned by each selling stockholder, based on its ownership of ADSs and warrants or placement agent warrants to purchase ADSs, as
of July 9, 2020, assuming exercise of the warrants or placement agent warrants held by the selling shareholders on that date,
without regard to any limitations on conversions or exercises. The third column lists the maximum number of ordinary shares represented
by ADSs being offered in this prospectus by the selling shareholders. The fourth and fifth columns list the amount of ordinary
shares represented by ADSs owned after the offering, by number of ordinary shares represented by ADSs and percentage of outstanding
ordinary shares (assuming for the purpose of such percentage, 462,419,463 shares outstanding as of July 9, 2020) assuming in both
cases the sale of all of the ordinary shares represented by ADSs offered by the selling shareholders pursuant to this prospectus,
and without regard to any limitations on conversions or exercises.
Under
the terms of the warrants and placement agent warrants issued in the July 2020, June 2020, January 2020 and May 2019 financing,
as well as the applicable financings in April 2019, January 2019, March 2018, January 2017, September and October 2015, a selling
stockholder may not exercise the warrants to the extent such exercise would cause such selling stockholder, together with its
affiliates, to beneficially own a number of ordinary shares which would exceed 4.99% or 9.99% of our then outstanding ordinary
shares following such exercise, excluding for purposes of such determination ordinary shares not yet issuable upon exercise of
the warrants and placement agent warrants which have not been exercised. The number of shares does not reflect this limitation.
The selling shareholders may sell all, some or none of their ordinary shares represented by ADSs or warrants or placement agent
warrants in this offering. See “Plan of Distribution.”
Selling
Shareholder
|
|
Number
of Ordinary Shares Owned Prior to Offering
|
|
|
Maximum
Number of Ordinary Shares to be Sold Pursuant
to this Prospectus
|
|
|
Number
of
Ordinary
Shares
Owned After
the Offering
|
|
|
Percentage
of Ordinary Shares Owned After the Offering
|
|
Intracoastal
Capital, LLC (1)
|
|
|
39,549,080
|
(2)
|
|
|
23,161,650
|
(3)
|
|
|
16,387,430
|
(4)
|
|
|
3.4
|
%
|
Armistice
Capital Master Fund, Ltd. (5)
|
|
|
77,911,650
|
(6)
|
|
|
23,161,650
|
(7)
|
|
|
54,750,000
|
(8)
|
|
|
10.6
|
%
|
Hudson
Bay Master Fund Ltd. (9)
|
|
|
24,384,150
|
(10)
|
|
|
14,634,150
|
(11)
|
|
|
9,750,000
|
(12)
|
|
|
2.1
|
%
|
CVI
Investments, Inc.(13)
|
|
|
39,345,780
|
(14)
|
|
|
23,161,650
|
(15)
|
|
|
16,184,130
|
(16)
|
|
|
3.4
|
%
|
Michael
Vasinkevich (17)
|
|
|
16,405,007
|
(18)
|
|
|
8,091,210
|
(19)
|
|
|
8,313,797
|
(20)
|
|
|
1.8
|
%
|
Michael
Mirsky (17)
|
|
|
2,474,432
|
(21)
|
|
|
1,198,710
|
(22)
|
|
|
1,275,722
|
(23)
|
|
|
|
*
|
Noam
Rubinstein (17)
|
|
|
5,534,616
|
(24)
|
|
|
2,775,930
|
(25)
|
|
|
2,758,686
|
(26)
|
|
|
|
*
|
Charles
Worthman (17)
|
|
|
255,452
|
(27)
|
|
|
126,180
|
(28)
|
|
|
129,272
|
(29)
|
|
|
|
*
|
Craig
Schwabe(17)
|
|
|
731,610
|
(30)
|
|
|
425,850
|
(31)
|
|
|
305,760
|
(32)
|
|
|
|
*
|
(1)
|
Mitchell
P. Kopin, or Mr. Kopin, and Daniel B. Asher, or Mr. Asher, each of whom are managers of Intracoastal Capital, LLC, or Intracoastal,
have shared voting control and investment discretion over the securities reported herein that are held by Intracoastal. As
a result, each of Mr. Kopin and Mr. Asher may be deemed to have beneficial ownership (as determined under Section 13(d) of
Exchange Act) of the securities reported herein that are held by Intracoastal. In the aggregate, Mr. Kopin and Mr. Asher may
be deemed to have beneficial ownership (as determined under Section 13(d) of the Exchange Act)
|
|
|
(2)
|
Represents
(i) 500,000 ordinary shares represented by 16,667 ADSs issuable upon exercise of warrants issued in our January 2017 financing,
(ii) 6,000,000 ordinary shares represented by 200,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing,
(iii) 6,137,430 ordinary shares represented by 204,581 ADSs issuable upon exercise of warrants issued in our January 2020
financing, (iv) 3,750,000 ordinary shares represented by 125,000 ADSs issuable upon exercise of warrants issued in our
February 2020 financing, (v) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants
issued in our June 2020 financing and (vi) 8,527,500 ordinary shares represented by 284,250 ADSs issuable upon exercise
of warrants issued in our July 2020 financing. The exercise of the foregoing warrants is subject to a 9.99% blocker
|
(3)
|
Represents
(i) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June 2020 financing
and (ii) 8,527,500 ordinary shares represented by 284,250 ADSs issuable upon exercise of warrants issued in our July 2020
financing.
|
|
|
(4)
|
Represents
(i) 500,000 ordinary shares represented by 16,667 ADSs issuable upon exercise of warrants issued in our January 2017 financing,
(ii) 6,000,000 ordinary shares represented by 200,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing,
(iii) 6,137,430 ordinary shares represented by 204,581 ADSs issuable upon exercise of warrants issued in our January 2020 financing
and (iv) 3,750,000 ordinary shares represented by 125,000 ADSs issuable upon exercise of warrants issued in our February 2020
financing.
|
|
|
(5)
|
Armistice
Capital, LLC, the investment manager of Armistice Capital Master Fund Ltd., or Armistice, and Steven J. Boyd, the managing
member of Armistice Capital, LLC, hold shared voting and dispositive power over the ordinary shares held by Armistice. The
principal business address of Armistice is c/o Armistice Capital, LLC, 510 Madison Avenue, 7th Floor, New York, NY, 10022.
|
|
|
(6)
|
Represents
(i) 9,750,000 ordinary shares represented by 325,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing
(ii) 45,000,000 ordinary shares represented by 1,500,000 ADSs issuable upon exercise of warrants issued in our February 2020
financing, (iii) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June
2020 financing and (iv) 8,527,500 ordinary shares represented by 284,250 ADSs issuable upon exercise of warrants issued in
our July 2020 financing. The exercise of the foregoing warrants is subject to a 4.99% blocker.
|
|
|
(7)
|
Represents
(i) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June 2020 financing
and (ii) 8,527,500 ordinary shares represented by 284,250 ADSs issuable upon exercise of warrants issued in our July 2020
financing.
|
|
|
(8)
|
Represents
(i) 9,750,000 ordinary shares represented by 325,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing
(ii) 45,000,000 ordinary shares represented by 1,500,000 ADSs issuable upon exercise of warrants issued in our February 2020
financing. The exercise of the foregoing warrants is subject to a 4.99% blocker.
|
|
|
(9)
|
Hudson
Bay Capital Management LP, the investment manager of Hudson Bay Master Fund Ltd., has voting and investment power over these
securities. Sander Gerber is the managing member of Hudson Bay Capital GP LLC, which is the general partner of Hudson Bay
Capital Management LP. Each of Hudson Bay Master Fund Ltd. and Mr. Gerber disclaims beneficial ownership over these securities.
|
|
|
(10)
|
Represents
(i) 9,750,000 ordinary shares represented by 325,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing
and (ii) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June 2020
financing. The exercise of the foregoing warrants is subject to a 9.99% blocker.
|
(11)
|
Represents
14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June 2020 financing.
|
|
|
(12)
|
Represents
9,750,000 ordinary shares represented by 325,000 ADSs issuable upon exercise of warrants issued in our May 2019 financing.
|
|
|
(13)
|
Heights
Capital Management, Inc., the authorized agent of CVI Investments, Inc., or CVI, has discretionary authority to vote and dispose
of the shares held by CVI and may be deemed to be the beneficial owner of these shares. Martin Kobinger, in his
capacity as Investment Manager of Heights Capital Management, Inc., may also be deemed to have investment discretion and voting
power over the shares held by CVI. Mr. Kobinger disclaims any such beneficial ownership of the shares. CVI
Investments, Inc. is affiliated with one or more FINRA members, none of whom are currently expected to participate in the
sale pursuant to this prospectus contained in the registration statement of common shares purchased by CVI.
|
|
|
(14)
|
Represents
(i) 16,184,130 ordinary shares represented by 539,471 ADSs, (ii) 14,634,150 ordinary shares represented by 487,805 ADSs
issuable upon exercise of warrants issued in our June 2020 financing and (iii) 8,527,500 ordinary shares represented by
284,250 ADSs issuable upon exercise of warrants issued in our July 2020 financing. The exercise of the foregoing warrants is subject to a 4.99% blocker.
|
(15)
|
Represents
(i) 14,634,150 ordinary shares represented by 487,805 ADSs issuable upon exercise of warrants issued in our June 2020
financing and (ii) 8,527,500 ordinary shares represented by 284,250 ADSs issuable upon exercise of warrants issued in
our July 2020 financing.
|
(16)
|
Represents
16,184,130 ordinary shares represented by 539,471 ADSs.
|
|
|
(17)
|
Referenced
person is affiliated with H.C. Wainwright, a registered broker dealer. H.C. Wainwright is a registered broker-dealer and
acted as the placement agent in the July 2020, June 2020, February 2020, January 2020, May 2019, April 2019, January 2019
financing, March 2018, January 2017, October 2015 and September 2015 financings. The address of H.C. Wainwright & Co.,
LLC, 430 Park Avenue, New York, NY 10022.
|
|
|
(18)
|
Represents
(i) 133,448 ordinary shares represented by 4,448 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 71,544 ordinary shares represented by 2,385 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 161,250 ordinary shares represented by 5,375 ADSs
issuable upon exercise of placement agent warrants issued in our January 2017 financing, (iv) 225,000 ordinary shares
represented by 7,500 ADSs issuable upon exercise of placement agent warrants issued in our March 2018 financing, (v) 144,357
ordinary shares represented by 4,812 ADSs issuable upon exercise of placement agent warrants issued in our January 2019
financing, (vi) 317,538 ordinary shares represented by 10,585 ADSs issuable upon exercise of placement agent warrants issued
in our April 2019 financing, (vii) 1,451,250 ordinary shares represented by 48,375 ADSs issuable upon exercise of placement
agent warrants issued in our May 2019 financing, (viii) 1,000,050 ordinary shares represented by 33,335 ADSs issuable upon
exercise of placement agent warrants issued in our January 2020 financing, (ix) 4,809,360 ordinary shares represented by
160,312 ADSs issuable upon exercise of placement agent warrants issued in our February 2020 financing, (x) 5,630,490 ordinary
shares represented by 187,683 ADSs issuable upon exercise of placement agent warrants issued in our June 2020 financing and
(xi) 2,460,720 ordinary shares represented by 82,024 ADSs issuable upon exercise of placement agent warrants issued in our
July 2020 financing.
|
|
|
(19)
|
Represents
(i) 5,630,490 ordinary shares represented by 187,683 ADSs issuable upon exercise of placement agent warrants issued in our
June 2020 financing and (ii) 2,460,720 ordinary shares represented by 82,024 ADSs issuable upon exercise of placement agent
warrants issued in our July 2020 financing.
|
(20)
|
Represents
(i) 133,448 ordinary shares represented by 4,448 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 71,544 ordinary shares represented by 2,385 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 161,250 ordinary shares represented by 5,375 ADSs
issuable upon exercise of placement agent warrants issued in our January 2017 financing, (iv) 225,000 ordinary shares
represented by 7,500 ADSs issuable upon exercise of placement agent warrants issued in our March 2018 financing, (v) 144,357
ordinary shares represented by 4,812 ADSs issuable upon exercise of placement agent warrants issued in our January 2019
financing, (vi) 317,538 ordinary shares represented by 10,585 ADSs issuable upon exercise of placement agent warrants issued
in our April 2019 financing, (vii) 1,451,250 ordinary shares represented by 48,375 ADSs issuable upon exercise of placement
agent warrants issued in our May 2019 financing, (viii) 1,000,050 ordinary shares represented by 33,335 ADSs issuable upon
exercise of placement agent warrants issued in our January 2020 financing, and (ix) 4,809,360 ordinary shares represented by
160,312 ADSs issuable upon exercise of placement agent warrants issued in our February 2020 financing.
|
|
|
(21)
|
Represents
(i) 39,310 ordinary shares represented by 1,310 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 21,074 ordinary shares represented by 702 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 41,250 ordinary shares represented by 1,375 ADSs
issuable upon exercise of warrants issued in our January 2017 financing, and (iv) 31,666 ordinary shares represented by 1,056
ADSs issuable upon exercise of placement agent warrants issued in our March 2018 financing, (v) 21,262 ordinary shares represented
by 709 ADSs issuable upon exercise of placement agent warrants issued in our January 2019 financing, (vi) 46,770 ordinary
shares represented by 1,559 ADSs issuable upon exercise of placement agent warrants issued in our April 2019 financing, (vii)
213,750 ordinary shares represented by 7,125 ADSs issuable upon exercise of placement agent warrants issued in our May 2019
financing, (viii) 148,140 ordinary shares represented by 4,938 ADSs issuable upon exercise of placement agent warrants issued
in our January 2020 financing, (ix) 712,500 ordinary shares represented by 23,750 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing, (x) 834,150 ordinary shares represented by 27,805 ADSs issuable upon
exercise of placement agent warrants issued in our June 2020 financing and (xi) 364,560 ordinary shares represented by 12,152
ADSs issuable upon exercise of placement agent warrants issued in our July 2020 financing.
|
|
|
(22)
|
Represents
(i) 834,150 ordinary shares represented by 27,805 ADSs issuable upon exercise of placement agent warrants issued in our June
2020 financing and (ii) 364,560 ordinary shares represented by 12,152 ADSs issuable upon exercise of placement agent warrants
issued in our July 2020 financing.
|
|
|
(23)
|
Represents
(i) 39,310 ordinary shares represented by 1,310 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 21,074 ordinary shares represented by 702 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 41,250 ordinary shares represented by 1,375 ADSs
issuable upon exercise of warrants issued in our January 2017 financing, and (iv) 31,666 ordinary shares represented by 1,056
ADSs issuable upon exercise of placement agent warrants issued in our March 2018 financing, (v) 21,262 ordinary shares represented
by 709 ADSs issuable upon exercise of placement agent warrants issued in our January 2019 financing, (vi) 46,770 ordinary
shares represented by 1,559 ADSs issuable upon exercise of placement agent warrants issued in our April 2019 financing, (vii)
213,750 ordinary shares represented by 7,125 ADSs issuable upon exercise of placement agent warrants issued in our May 2019
financing, (viii) 148,140 ordinary shares represented by 4,938 ADSs issuable upon exercise of placement agent warrants issued
in our January 2020 financing, and (ix) 712,500 ordinary shares represented by 23,750 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing.
|
|
|
(24)
|
Represents
(i) 25,862 ordinary shares represented by 862 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 13,864 ordinary shares represented by 462 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 73,334 ordinary shares represented by 2,444 ADSs
issuable upon exercise of placement agent warrants issued in our March 2018 financing, (iv) 49,238 ordinary shares represented
by 1,641 ADSs issuable upon exercise of placement agent warrants issued in our January 2019 financing, (v) 108,308 ordinary
shares represented by 3,610 ADSs issuable upon exercise of placement agent warrants issued in our April 2019 financing, (vi)
495,000 ordinary shares represented by 16,500 ADSs issuable upon exercise of placement agent warrants issued in our May 2019
financing, (vii) 343,080 ordinary shares represented by 11,436 ADSs issuable upon exercise of placement agent warrants issued
in our January 2020 financing, (ix) 1,650,000 ordinary shares represented by 55,000 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing, (x) 1,931,700 ordinary shares represented by 64,390 ADSs issuable upon
exercise of placement agent warrants issued in our June 2020 financing and (xi) 844,230 ordinary shares represented by 28,141
ADSs issuable upon exercise of placement agent warrants issued in our July 2020 financing.
|
(25)
|
Represents
(i) 1,931,700 ordinary shares represented by 64,390 ADSs issuable upon exercise of placement agent warrants issued in our
June 2020 financing and (ii) 844,230 ordinary shares represented by 28,141 ADSs issuable upon exercise of placement agent
warrants issued in our July 2020 financing.
|
|
|
(26)
|
Represents
(i) 25,862 ordinary shares represented by 862 ADSs issuable upon exercise of placement agent warrants issued in connection
with our September 2015 financing, (ii) 13,864 ordinary shares represented by 462 ADSs issuable upon exercise of placement
agent warrants issued in connection with our October 2015 financing, (iii) 73,334 ordinary shares represented by 2,444 ADSs
issuable upon exercise of placement agent warrants issued in our March 2018 financing, (iv) 49,238 ordinary shares represented
by 1,641 ADSs issuable upon exercise of placement agent warrants issued in our January 2019 financing, (v) 108,308 ordinary
shares represented by 3,610 ADSs issuable upon exercise of placement agent warrants issued in our April 2019 financing, (vi)
495,000 ordinary shares represented by 16,500 ADSs issuable upon exercise of placement agent warrants issued in our May 2019
financing, (vii) 343,080 ordinary shares represented by 11,436 ADSs issuable upon exercise of placement agent warrants issued
in our January 2020 financing and (viii) 1,650,000 ordinary shares represented by 55,000 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing.
|
|
|
(27)
|
Represents
(i) 2,068 ordinary shares represented by 69 ADSs issuable upon exercise of placement
agent warrants issued in connection with our September 2015 financing, (ii) 1,110 ordinary
shares represented by 37 ADSs issuable upon exercise of placement agent warrants issued
in connection with our October 2015 financing, (iii) 2,500 ordinary shares represented
by 83 ADSs issuable upon exercise of placement agent warrants issued in connection with
our January 2017 financing, (iv) 3,334 ordinary shares represented by 111 ADSs issuable
upon exercise of placement agent warrants issued in our March 2018 financing, (v) 2,238
ordinary shares represented by 75 ADSs issuable upon exercise of placement agent warrants
issued in our January 2019 financing, (vi) 4,922 ordinary shares represented by 164 ADSs
issuable upon exercise of placement agent warrants issued in our April 2019 financing,
(vii) 22,500 ordinary shares represented by 750 ADSs issuable upon exercise of placement
agent warrants issued in our May 2019 financing, (viii) 15,600 ordinary shares represented
by 520 ADSs issuable upon exercise of placement agent warrants issued in our January
2020 financing, (ix) 75,000 ordinary shares represented by 2,500 ADSs issuable upon exercise
of placement agent warrants issued in our February 2020 financing, (x) 87,810 ordinary
shares represented by 2,927 ADSs issuable upon exercise of placement agent warrants issued
in our June 2020 financing and (xi) 38,370 ordinary shares represented by 1,279 ADSs
issuable upon exercise of placement agent warrants issued in our July 2020 financing.
|
|
|
(28)
|
Represents
(i) 87,810 ordinary shares represented by 2,927 ADSs issuable upon exercise of placement agent warrants issued in our June
2020 financing and (ii) 38,370 ordinary shares represented by 1,279 ADSs issuable upon exercise of placement agent warrants
issued in our July 2020 financing.
|
|
|
(29)
|
Represents
(i) 2,068 ordinary shares represented by 69 ADSs issuable upon exercise of placement agent warrants issued in connection with
our September 2015 financing, (ii) 1,110 ordinary shares represented by 37 ADSs issuable upon exercise of placement agent
warrants issued in connection with our October 2015 financing, (iii) 2,500 ordinary shares represented by 83 ADSs issuable
upon exercise of placement agent warrants issued in connection with our January 2017 financing, (iv) 3,334 ordinary shares
represented by 111 ADSs issuable upon exercise of placement agent warrants issued in our March 2018 financing, (v) 2,238 ordinary
shares represented by 75 ADSs issuable upon exercise of placement agent warrants issued in our January 2019 financing, (vi)
4,922 ordinary shares represented by 164 ADSs issuable upon exercise of placement agent warrants issued in our April 2019
financing, (vii) 22,500 ordinary shares represented by 750 ADSs issuable upon exercise of placement agent warrants issued
in our May 2019 financing, (v) 15,600 ordinary shares represented by 520 ADSs issuable upon exercise of placement agent warrants
issued in our January 2020 financing and (vi) 75,000 ordinary shares represented by 2,500 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing.
|
|
|
(30)
|
Represents
(i) 52,620 ordinary shares represented by 1,754 ADSs issuable upon exercise of placement agent warrants issued in connection
with our January 2020 financing, (ii) 253,140 ordinary shares represented by 8,438 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing, (iii) 296,340 ordinary shares represented by 9,878 ADSs issuable upon
exercise of placement agent warrants issued in our June 2020 financing and (iv) 129,510 ordinary shares represented by 4,317
ADSs issuable upon exercise of placement agent warrants issued in our July 2020 financing.
|
|
|
(31)
|
Represents
(i) 296,340 ordinary shares represented by 9,878 ADSs issuable upon exercise of placement agent warrants issued in our June
2020 financing and (ii) 129,510 ordinary shares represented by 4,317 ADSs issuable upon exercise of placement agent warrants
issued in our July 2020 financing.
|
|
|
(32)
|
Represents
(i) 52,620 ordinary shares represented by 1,754 ADSs issuable upon exercise of placement agent warrants issued in connection
with our January 2020 financing and (ii) 253,140 ordinary shares represented by 8,438 ADSs issuable upon exercise of placement
agent warrants issued in our February 2020 financing.
|
DESCRIPTION
OF SHARE CAPITAL
The
following description of our share capital summarizes certain provisions of our Amended and Restated Articles of Association.
Such summaries do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all of the
provisions of our Amended and Restated Articles of Association, copies of which have been filed as exhibits to the registration
statement of which this prospectus forms a part.
Ordinary
Shares
As
of July 9, 2020, our authorized share capital consists of 1,000,000,000 ordinary shares, par value NIS 0.25 per share, of which
462,419,463 are outstanding.
All
of our outstanding ordinary shares will be validly issued, fully paid and non-assessable. Our ordinary shares are not redeemable
and do not have any preemptive rights. Pursuant to Israeli securities laws, a company whose shares are traded on the TASE may
not have more than one class of shares (subject to an exception which is not applicable to us), and all outstanding shares must
be validly issued and fully paid. Shares and convertible securities may not be issued without the consent of the Israeli Securities
Authority and the TASE and all outstanding shares must be registered for trading on the TASE.
We
effected a 1-for-25 reverse share split with respect to our ordinary shares, options and warrants on May 12, 2013. Unless indicated
otherwise by the context, all ordinary share, option, warrant and per share amounts as well as stock prices appearing in this
prospectus have been adjusted to give retroactive effect to the share split for all periods presented.
Registration
Number and Purposes of the Company
Our
number with the Israeli Registrar of Companies is 512022153. Our purpose is set forth in Section 3 of our Articles of Association
and includes every lawful purpose.
Our
ordinary shares that are fully paid for are issued in registered form and may be freely transferred under our Amended and Restated
Articles of Association, unless the transfer is restricted or prohibited by applicable law or the rules of a stock exchange on
which the shares are traded. The ownership or voting of our ordinary shares by non-residents of Israel is not restricted in any
way by our Amended and Restated Articles of Association or the laws of the State of Israel, except for ownership by nationals
of some countries that are, or have been, in a state of war with Israel.
Pursuant
to the Israeli Companies Law and our Amended and Restated Articles of Association, our board of directors may exercise all powers
and take all actions that are not required under law or under our Amended and Restated Articles of Association to be exercised
or taken by our shareholders, including the power to borrow money for company purposes.
Our
Amended and Restated Articles of Association enable us to increase or reduce our share capital. Any such changes are subject to
the provisions of the Israeli Companies Law and must be approved by a resolution duly passed by our shareholders at a general
or special meeting by voting on such change in the capital. In addition, transactions that have the effect of reducing capital,
such as the declaration and payment of dividends in the absence of sufficient retained earnings and profits and an issuance of
shares for less than their nominal value, require a resolution of our board of directors and court approval.
Dividends
We
may declare a dividend to be paid to the holders of our ordinary shares in proportion to their respective shareholdings. Under
the Israeli Companies Law, dividend distributions are determined by the board of directors and do not require the approval of
the shareholders of a company unless such company’s articles of association provide otherwise. Our Amended and Restated
Articles of Association do not require shareholder approval of a dividend distribution and provide that dividend distributions
may be determined by our board of directors.
Pursuant
to the Israeli Companies Law, we may only distribute dividends from our profits accrued over the previous two years, as defined
in the Israeli Companies Law, according to our then last reviewed or audited financial reports, or we may distribute dividends
with court approval. In each case, we are only permitted to pay a dividend if there is no reasonable concern that payment of the
dividend will prevent us from satisfying our existing and foreseeable obligations as they become due.
Election
of Directors
Our
Amended and Restated Articles of Association provide that the maximum number of members of the Board of Directors is 13. The Board
of Directors is presently comprised of six members.
In
February 2020, a special general meeting of our shareholders approved an amendment to the our Amended and Restated Articles of
Association, according to which the Board of Directors, excluding the external directors, if any (who shall be elected and serve
in office in strict accordance with the provisions of the Companies Law, if so required by the Companies Law), shall consist of
three classes of directors as nearly equal in number as practicable, which are appointed for fixed terms of office in accordance
with the Israeli Companies Law and our Amended and Restated Articles of Association, as follows: (i) the term of office of the
initial Class I directors shall expire at the first annual general meeting of our shareholders to be held in 2020 and when their
successors are elected and qualified, (ii) the term of office of the initial Class II directors shall expire at the first annual
general meeting of our shareholders following the annual general meeting of our shareholders referred to in clause (i) above and
when their successors are elected and qualified, and (iii) the term of office of the initial Class III directors shall expire
at the first annual general meeting of our shareholders following the annual general meeting of our shareholders referred to in
clause (ii) above and when their successors are elected and qualified.
Directors
(other than external directors), may be elected only in annual general meetings of our shareholders. At each annual general meeting
of our shareholders, commencing with the annual general meeting of our shareholders to be held in 2020, each of the successors
elected to replace the directors of a class whose term shall have expired at such annual general meeting of our shareholders shall
be elected to hold office until the third annual general meeting of our shareholders next succeeding his or her election and until
his or her respective successor shall have been elected and qualified. Notwithstanding anything to the contrary, each director
shall serve until his or her successor is elected and qualified or until such earlier time as such director’s office is
vacated.
If
the number of directors (excluding external directors) that constitutes the Board of Directors is hereafter changed, the then-serving
directors shall be re-designated to other classes and/or any newly created directorships or decrease in directorships shall be
apportioned by the Board of Directors among the classes so as to make all classes as nearly equal in number as is practicable,
provided that no decrease in the number of Directors constituting the Board of Directors shall shorten the term of any incumbent
director.
Directors
so elected may not be dismissed from office by the shareholders or by a general meeting of our shareholders prior to the expiration
of their term of office. The directors do not receive any benefits upon the expiration of their term of office.
The
three classes of directors are Class I Directors, Class II Directors and Class III Directors. Abraham Sartani serves as our Class
I Director until the close of the annual meeting to be held in 2020; Ilan Cohn serves as our Class II Director until the close
of the annual meeting to be held in 2021; and Dr. Pnina Fishman and Mr. Guy Regev serve as our Class III Directors until the close
of the annual meeting to be held in 2022.
Any
amendment, replacement or suspension of our Amended and Restated Articles of Association regarding the election of directors,
as described above, require a majority of 65% of the voting power represented at the general meeting of our shareholders in person
or by proxy and voting thereon, disregarding abstentions from the count of the voting power present and voting, provided that
such majority constitutes more than 20% of our then issued and outstanding share capital.
A
nominee for service as a director in a public company may not be elected without submitting a declaration to the company, prior
to election, specifying that he or she has the requisite qualifications to serve as a director, independent director or external
director (if required), as applicable, and the ability to devote the appropriate time to performing his or her duties as such.
A
director, who ceases to meet the statutory requirements to serve as a director, external director or independent director, as
applicable, must notify the company to that effect immediately and his or her service as a director will expire upon submission
of such notice.
Shareholder
Meetings
Under
Israeli Companies Law, we are required to hold an annual general meeting of our shareholders once every calendar year that must
be no later than 15 months after the date of the previous annual general meeting. All meetings other than the annual general meeting
of shareholders are referred to as special meetings. Our board of directors may call special meetings whenever it sees fit, at
such time and place, within or outside of Israel, as it may determine. In addition, the Israeli Companies Law and our Amended
and Restated Articles of Association provide that our board of directors is required to convene a special meeting upon the written
request of (i) any two of our directors or one quarter of our board of directors or (ii) one or more shareholders holding, in
the aggregate, either (1) 5% of our outstanding shares and 1% of our outstanding voting power or (2) 5% of our outstanding voting
power.
Subject
to the provisions of the Israeli Companies Law and the regulations promulgated thereunder, shareholders entitled to participate
and vote at general meetings are the shareholders of record on a date to be decided by the board of directors, which may be between
four and forty days prior to the date of the meeting. Furthermore, the Israeli Companies Law and our Amended and Restated Articles
of Association require that resolutions regarding the following matters must be passed at a general meeting of our shareholders:
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amendments
to our Amended and Restated Articles of Association;
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appointment
or termination of our auditors;
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appointment
of directors and appointment and dismissal of external directors;
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approval
of acts and transactions requiring general meeting approval pursuant to the Israeli Companies Law;
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director
compensation, indemnification and change of the principal executive officer;
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increases
or reductions of our authorized share capital;
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the
exercise of our Board of Director’s powers by a general meeting, if our board of directors is unable to exercise its
powers and the exercise of any of its powers is required for our proper management.
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The
Israeli Companies Law requires that a notice of any annual or special shareholders meeting be provided at least 21 days prior
to the meeting and if the agenda of the meeting includes the appointment or removal of directors, the approval of transactions
with office holders or interested or related parties, or an approval of a merger, notice must be provided at least 35 days prior
to the meeting.
The
Israeli Companies Law does not allow shareholders of publicly traded companies to approve corporate matters by written consent.
Consequently, our Amended and Restated Articles of Association does not allow shareholders to approve corporate matters by written
consent.
Pursuant
to our Amended and Restated Articles of Association, holders of our ordinary shares have one vote for each ordinary share held
on all matters submitted to a vote before the shareholders at a general meeting.
Quorum
The
quorum required for our general meetings of shareholders consists of at least two shareholders present in person, by proxy or
written ballot who hold or represent between them at least 25% of the total outstanding voting rights.
A
meeting adjourned for lack of a quorum is adjourned to the same day in the following week at the same time and place or on a later
date if so specified in the summons or notice of the meeting. At the reconvened meeting, any number of our shareholders present
in person or by proxy shall constitute a lawful quorum.
Resolutions
Our
Amended and Restated Articles of Association provide that all resolutions of our shareholders require a simple majority vote,
unless otherwise required by applicable law.
Israeli
law provides that a shareholder of a public company may vote in a meeting and in a class meeting by means of a written ballot
in which the shareholder indicates how he or she votes on resolutions relating to the following matters:
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an
appointment or removal of directors;
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an
approval of transactions with office holders or interested or related parties;
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an
approval of a merger or any other matter in respect of which there is a provision in the articles of association providing
that decisions of the general meeting may also be passed by written ballot;
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authorizing
the chairman of the board of directors or his relative to act as our chief executive officer or act with such authority; or
authorize our chief executive officer or his relative to act as the chairman of the board of directors or act with such authority;
and
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other
matters which may be prescribed by Israel’s Minister of Justice.
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The
provision allowing the vote by written ballot does not apply where the voting power of the controlling shareholder is sufficient
to determine the vote. Our Amended and Restated Articles of Association provide that our board of directors may prevent voting
by means of a written ballot and this determination is required to be stated in the notice convening the general meeting.
The
Israeli Companies Law provides that a shareholder, in exercising his or her rights and performing his or her obligations toward
the company and its other shareholders, must act in good faith and in a customary manner, and avoid abusing his or her power.
This is required when voting at general meetings on matters such as changes to the articles of association, increasing our registered
capital, mergers and approval of related party transactions. A shareholder also has a general duty to refrain from depriving any
other shareholder of its rights as a shareholder. In addition, any controlling shareholder, any shareholder who knows that its
vote can determine the outcome of a shareholder vote and any shareholder who, under such company’s articles of association,
can appoint or prevent the appointment of an office holder, is required to act with fairness towards the company. The Israeli
Companies Law does not describe the substance of this duty except to state that the remedies generally available upon a breach
of contract will also apply to a breach of the duty to act with fairness, and, to the best of our knowledge, there is no binding
case law that addresses this subject directly.
Under
the Israeli Companies Law, unless provided otherwise in a company’s articles of association, a resolution at a shareholders
meeting requires approval by a simple majority of the voting rights represented at the meeting, in person, by proxy or written
ballot, and voting on the resolution. A resolution for the voluntary winding up of the company requires the approval of holders
of 75% of the voting rights represented at the meeting, in person, by proxy or by written ballot and voting on the resolution.
In
the event of our liquidation, after satisfaction of liabilities to creditors, our assets will be distributed to the holders of
our ordinary shares in proportion to their shareholdings. This right, as well as the right to receive dividends, may be affected
by the grant of preferential dividend or distribution rights to the holders of a class of shares with preferential rights that
may be authorized in the future.
Access
to Corporate Records
Under
the Israeli Companies Law, all shareholders of a company generally have the right to review minutes of our general meetings, its
shareholders register and principal shareholders register, articles of association, financial statements and any document it is
required by law to file publicly with the Israeli Companies Registrar and the Israel Securities Authority. Any of our shareholders
may request access to review any document in our possession that relates to any action or transaction with a related party, interested
party or office holder that requires shareholder approval under the Israeli Companies Law. We may deny a request to review a document
if we determine that the request was not made in good faith, that the document contains a commercial secret or a patent or that
the document’s disclosure may otherwise prejudice our interests.
Acquisitions
under Israeli Law
Full
Tender Offer
A
person wishing to acquire shares of a public Israeli company and who would as a result hold over 90% of the target company’s
issued and outstanding share capital is required by the Israeli Companies Law to make a tender offer to all of our shareholders
for the purchase of all of the issued and outstanding shares of the company. A person wishing to acquire shares of a public Israeli
company and who would as a result hold over 90% of the issued and outstanding share capital of a certain class of shares is required
to make a tender offer to all of the shareholders who hold shares of the same class for the purchase of all of the issued and
outstanding shares of the same class. If the shareholders who do not accept the offer hold less than 5% of the issued and outstanding
share capital of the company or of the applicable class, all of the shares that the acquirer offered to purchase will be transferred
to the acquirer by operation of law (provided that a majority of the offerees that do not have a personal interest in such tender
offer shall have approved the tender offer except that if the total votes to reject the tender offer represent less than 2% of
the company’s issued and outstanding share capital, in the aggregate, approval by a majority of the offerees that do not
have a personal interest in such tender offer is not required to complete the tender offer). However, a shareholder that had its
shares so transferred may petition the court within six months from the date of acceptance of the full tender offer, whether or
not such shareholder agreed to the tender or not, to determine whether the tender offer was for less than fair value and whether
the fair value should be paid as determined by the court unless the acquirer stipulated in the tender offer that a shareholder
that accepts the offer may not seek appraisal rights. If the shareholders who did not accept the tender offer hold 5% or more
of the issued and outstanding share capital of the company or of the applicable class, the acquirer may not acquire shares of
the company that will increase its holdings to more than 90% of our issued and outstanding share capital or of the applicable
class from shareholders who accepted the tender offer.
Special
Tender Offer
The
Israeli Companies Law provides that an acquisition of shares of a public Israeli company must be made by means of a special tender
offer if as a result of the acquisition the purchaser would become a holder of 25% or more of the voting rights in the company,
unless one of the exemptions in the Israeli Companies Law is met. This rule does not apply if there is already another holder
of at least 25% of the voting rights in the company. Similarly, the Israeli Companies Law provides that an acquisition of shares
in a public company must be made by means of a tender offer if as a result of the acquisition the purchaser would become a holder
of 45% or more of the voting rights in the company, if there is no other shareholder of the company who holds 45% or more of the
voting rights in the company, unless one of the exemptions in the Israeli Companies Law is met.
A
special tender offer must be extended to all shareholders of a company but the offeror is not required to purchase shares representing
more than 5% of the voting power attached to our outstanding shares, regardless of how many shares are tendered by shareholders.
A special tender offer may be consummated only if (i) at least 5% of the voting power attached to our outstanding shares will
be acquired by the offeror and (ii) the number of shares tendered in the offer exceeds the number of shares whose holders objected
to the offer.
If
a special tender offer is accepted, then the purchaser or any person or entity controlling it or under common control with the
purchaser or such controlling person or entity may not make a subsequent tender offer for the purchase of shares of the target
company and may not enter into a merger with the target company for a period of one year from the date of the offer, unless the
purchaser or such person or entity undertook to effect such an offer or merger in the initial special tender offer.
Merger
The
Israeli Companies Law permits merger transactions if approved by each party’s board of directors and, unless certain requirements
described under the Israeli Companies Law are met, a majority of each party’s shares voted on the proposed merger at a shareholders’
meeting called with at least 35 days’ prior notice.
For
purposes of the shareholder vote, unless a court rules otherwise, the merger will not be deemed approved if a majority of the
shares represented at the shareholders meeting that are held by parties other than the other party to the merger, or by any person
who holds 25% or more of the outstanding shares or the right to appoint 25% or more of the directors of the other party, vote
against the merger. If the transaction would have been approved but for the separate approval of each class or the exclusion of
the votes of certain shareholders as provided above, a court may still approve the merger upon the request of holders of at least
25% of the voting rights of a company, if the court holds that the merger is fair and reasonable, taking into account the value
of the parties to the merger and the consideration offered to the shareholders.
Upon
the request of a creditor of either party to the proposed merger, the court may delay or prevent the merger if it concludes that
there exists a reasonable concern that, as a result of the merger, the surviving company will be unable to satisfy the obligations
of any of the parties to the merger, and may further give instructions to secure the rights of creditors.
In
addition, a merger may not be completed unless at least 50 days have passed from the date that a proposal for approval of the
merger was filed by each party with the Israeli Registrar of Companies and 30 days have passed from the date the merger was approved
by the shareholders of each party.
Antitakeover
Measures
The
Israeli Companies Law allows us to create and issue shares having rights different from those attached to our ordinary shares,
including shares providing certain preferred rights, distributions or other matters and shares having preemptive rights. As of
the date of this prospectus, we do not have any authorized or issued shares other than our ordinary shares. In the future, if
we do create and issue a class of shares other than ordinary shares, such class of shares, depending on the specific rights that
may be attached to them, may delay or prevent a takeover or otherwise prevent our shareholders from realizing a potential premium
over the market value of their ordinary shares. The authorization of a new class of shares will require an amendment to our Amended
and Restated Articles of Association which requires the prior approval of the holders of a majority of our shares at a general
meeting. In addition, the rules and regulations of the TASE also limit the terms permitted with respect to a new class of shares
and prohibit any such new class of shares from having voting rights. Shareholders voting in such meeting will be subject to the
restrictions provided in the Israeli Companies Law as described above.
Borrowing
Powers
Under
the Israeli Companies Law and our Amended and Restated Articles of Association, our board of directors may exercise all powers
and take all actions that are not required under law or under our amended and restated articles of association to be exercised
or taken by our shareholders or other corporate bodies, including the power to borrow money for company purposes.
Changes
in Capital
Our
Amended and Restated Articles of Association enable us to increase or reduce our share capital. Any such changes are subject to
the provisions of the Israeli Companies Law and must be approved by a resolution duly passed by our shareholders at a general
meeting by voting on such change in the capital. In addition, transactions that have the effect of reducing capital, such as the
declaration and payment of dividends in the absence of sufficient retained earnings or profits and, in certain circumstances,
an issuance of shares for less than their nominal value, require the approval of both our board of directors and an Israeli court.
Description
of American Depositary Shares
The
Bank of New York Mellon, as Depositary, will register and deliver American Depositary Shares, or ADSs. Each ADS will represent
thirty (30) ordinary shares (or a right to receive thirty (30) ordinary shares) deposited with the principal Tel Aviv office of
Bank Hapoalim, as custodian for the Depositary. Each ADS will also represent any other securities, cash or other property which
may be held by the Depositary. The Depositary’s corporate trust office at which the ADSs will be administered is located
at 101 Barclay Street, New York, New York 10286. The Bank of New York Mellon’s principal executive office is located at
One Wall Street, New York, New York 10286.
You
may hold ADSs either (i) directly (a) by having an American Depositary Receipt, or an ADR, which is a certificate evidencing a
specific number of ADSs, registered in your name, or (b) by having ADSs registered in your name in the Direct Registration System,
or DRS, or (ii) indirectly by holding a security entitlement in ADSs through your broker or other financial institution. If you
hold ADSs directly, you are a registered ADS holder, or an ADS holder. The description in this section assumes you are an ADS
holder. If you hold the ADSs indirectly, you must rely on the procedures of your broker or other financial institution to assert
the rights of ADS holders described in this section. You should consult with your broker or financial institution to find out
what those procedures are.
The
DRS is a system administered by The Depository Trust Company, or DTC, pursuant to which the Depositary may register the ownership
of uncertificated ADSs, which ownership is confirmed by periodic statements sent by the Depositary to the registered holders of
uncertificated ADSs.
As
an ADS holder, we will not treat you as one of our shareholders and you will not have shareholder rights. Israeli law governs
shareholder rights. The Depositary will be the holder of the shares underlying your ADSs. As a registered holder of ADSs, you
will have ADS holder rights. The Deposit Agreement, or the Deposit Agreement, among us, the Depositary and you, as an ADS holder,
and all other persons indirectly holding ADSs sets out ADS holder rights as well as the rights and obligations of the Depositary.
New York law governs the Deposit Agreement and the ADSs.
The
following is a summary of the material provisions of the Deposit Agreement. For more complete information, you should read the
entire Deposit Agreement and the form of ADS. Directions on how to obtain copies of those documents are provided under “Where
You Can Find More Information”.
Dividends
and Other Distributions
How
will you receive dividends and other distributions on the shares?
The
Depositary has agreed to pay to ADS holders the cash dividends or other distributions it or the custodian receives on shares or
other deposited securities, after deducting its fees and expenses. You will receive these distributions in proportion to the number
of ordinary shares your ADSs represent.
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Cash.
The Depositary will convert any cash dividend or other cash distribution we pay on the shares into U.S. dollars, if it can
do so on a reasonable basis and can transfer the U.S. dollars to the United States. If that is not possible or if any government
approval is needed and cannot be obtained, the Deposit Agreement allows the Depositary to distribute the foreign currency
only to those ADS holders to whom it is possible to do so. It will hold the foreign currency it cannot convert for the account
of the ADS holders who have not been paid. It will not invest the foreign currency and it will not be liable for any interest.
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Before
making a distribution, any withholding taxes, or other governmental charges that must be paid will be deducted. It will distribute
only whole U.S. dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate
during a time when the Depositary cannot convert the foreign currency, you may lose some or all of the value of the distribution.
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Shares.
The Depositary may distribute additional ADSs representing any shares we distribute as a dividend or free distribution. The
Depositary will only distribute whole ADSs. It will sell shares which would require it to deliver a fractional ADS and distribute
the net proceeds in the same way as it does with cash. If the Depositary does not distribute additional ADSs, the outstanding
ADSs will also represent the new shares. The Depositary may sell a portion of the distributed shares sufficient to pay its
fees and expenses in connection with that distribution.
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Rights
to purchase additional shares. If we offer holders of our securities any rights to subscribe for additional shares or
any other rights, the Depositary may make these rights available to ADS holders. If the Depositary decides it is not legal
and practical to make the rights available but that it is practical to sell the rights, the Depositary will use reasonable
efforts to sell the rights and distribute the proceeds in the same way as it does with cash. The Depositary will allow rights
that are not distributed or sold to lapse. In that case, you will receive no value for them.
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If
the Depositary makes rights available to ADS holders, it will exercise the rights and purchase the shares on your behalf.
The Depositary will then deposit the shares and deliver ADSs to the persons entitled to them. It will only exercise rights
if you pay it the exercise price and any other charges the rights require you to pay.
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U.S.
securities laws may restrict transfers and cancellation of the ADSs represented by shares purchased upon exercise of rights.
For example, you may not be able to tradethese ADSs freely in the United States. In this case, the Depositary may deliver
restricted Depositary shares that have the sameterms as the ADSs described in this section except for changes needed to put
the necessary restrictions in place.
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Other
Distributions. The Depositary will send to ADS holders anything else we distribute on deposited securities by any means
it thinks is legal, fair and practicable. If it cannot make the distribution in that way, the Depositary has a choice. It
may decide to sell what we distributed and distribute the net proceeds, in the same way as it does with cash. Or, it may decide
to hold what we distributed, in which case ADSs will also represent the newly distributed property. However, the Depositary
is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from
us that it is legal to make that distribution. The Depositary may sell a portion of the distributed securities or property
sufficient to pay its fees and expenses in connection with that distribution.
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The
Depositary is not responsible if it decides that it is unlawful or impracticable to make a distribution available to any ADS holders.
We
have no obligation to register ADSs, shares, rights or other securities under the Securities Act other than in accordance with
a registration rights agreement entered into in connection with our March 2014 private placement. We also have no obligation to
take any other action to permit the distribution of ADSs, shares, rights or anything else to ADS holders. This means that you
may not receive the distributions we make on our shares or any value for them if it is illegal or impracticable for us to make
them available to you.
Deposit,
Withdrawal and Cancellation
How
are ADSs issued?
The
Depositary will deliver ADSs if you or your broker deposit shares or evidence of rights to receive shares with the custodian.
Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the Depositary
will register the appropriate number of ADSs in the names you request and will deliver the ADSs to or upon the order of the person
or persons that made the deposit.
How
can ADS holders withdraw the deposited securities?
You
may surrender your ADSs at the Depositary’s corporate trust office. Upon payment of its fees and expenses and of any taxes
or charges, such as stamp taxes or stock transfer taxes or fees, the Depositary will deliver the shares and any other deposited
securities underlying the ADSs to the ADS holder or a person the ADS holder designates at the office of the custodian. Or, at
your request, risk and expense, the Depositary will deliver the deposited securities at its corporate trust office, if feasible.
How
do ADS holders interchange between certificated ADSs and uncertificated ADSs?
You
may surrender your ADR to the Depositary for the purpose of exchanging your ADR for uncertificated ADSs. The Depositary will cancel
that ADR and will send to the ADS holder a statement confirming that the ADS holder is the registered holder of uncertificated
ADSs. Alternatively, upon receipt by the Depositary of a proper instruction from a registered holder of uncertificated ADSs requesting
the exchange of uncertificated ADSs for certificated ADSs, the Depositary will execute and deliver to the ADS holder an ADR evidencing
those ADSs.
Voting
Rights
How
do you vote?
ADS
holders may instruct the Depositary to vote the number of deposited shares their ADSs represent. The Depositary will notify ADS
holders of shareholders’ meetings and arrange to deliver our voting materials to them if we ask it to. Those materials will
describe the matters to be voted on and explain how ADS holders may instruct the Depositary how to vote. For instructions to be
valid, they must reach the Depositary by a date set by the Depositary. Otherwise, you will not be able to exercise your right
to vote unless you withdraw the shares. To do so, however, you would need to know about the meeting sufficiently in advance to
withdraw the shares.
The
Depositary will try, as far as practical, subject to the laws of Israel and of our Amended and Restated Articles of Association
or similar documents, to vote or to have its agents vote the shares or other deposited securities as instructed by ADS holders.
The Depositary will only vote or attempt to vote as instructed.
We
cannot assure you that you will receive the voting materials in time to ensure that you can instruct the Depositary to vote your
shares. In addition, the Depositary and its agents are not responsible for failing to carry out voting instructions or for the
manner of carrying out voting instructions. This means that you may not be able to exercise your right to vote and there may
be nothing you can do if your shares are not voted as you requested.
In
order to give you a reasonable opportunity to instruct the Depositary as to the exercise of voting rights relating to deposited
securities, if we request the Depositary to act, we agreed under the Deposit Agreement to give the Depositary notice of any such
meeting and details concerning the matters to be voted upon not less than 45 days in advance of the meeting date.
Fees
and Expenses
Persons
depositing or withdrawing shares or ADS holders must pay:
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For:
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$5.00
(or less) per 100 ADSs (or portion of 100 ADSs)
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Issuance
of ADSs, including issuances resulting from a distribution of shares or rights or other property
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Cancellation
of ADSs for the purpose of withdrawal, including if the Deposit Agreement terminates
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$.05
(or less) per ADS
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Any
cash distribution to ADS holders
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Persons
depositing or withdrawing shares or ADS holders must pay:
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For:
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A
fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited
for issuance of ADSs
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Distribution
of securities distributed to holders of deposited securities which are distributed by the Depositary to ADS holders
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$.05
(or less) per ADSs per calendar year
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Depositary
services
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Registration
or transfer fees
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Transfer
and registration of shares on our share register to or from the name of the Depositary or its agent when you deposit or withdraw
shares
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Expenses
of the Depositary
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Cable,
telex and facsimile transmissions (when expressly provided in the Deposit Agreement)
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Converting
foreign currency to U.S. dollars
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Taxes
and other governmental charges the Depositary or the custodian have to pay on any ADS or share underlying an ADS, for example,
stock transfer taxes, stamp duty or withholding taxes
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As
necessary
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Any
charges incurred by the Depositary or its agents for servicing the deposited securities
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As
necessary
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The
Depositary collects its fees for delivery and surrender of ADSs directly from investors depositing shares or surrendering ADSs
for the purpose of withdrawal or from intermediaries acting for them. The Depositary collects fees for making distributions to
investors by deducting those fees from the amounts distributed or by selling a portion of distributable property to pay the fees.
The Depositary may collect its annual fee for depositary services by deduction from cash distributions, by directly billing investors
or by charging the book-entry system accounts of participants acting for them. The Depositary may generally refuse to provide
fee-attracting services until its fees for those services are paid.
From
time to time, the Depositary may make payments to us to reimburse us for expenses and/or share revenue with us from the fees collected
from ADS holders, or waive fees and expenses for services provided, generally relating to costs and expenses arising out of the
establishment and maintenance of the ADS program. In performing its duties under the Deposit Agreement, the Depositary may use
brokers, dealers or other service providers that are affiliates of the Depositary and that may earn or share fees or commissions.
Payment
of Taxes
You
will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities represented
by any of your ADSs. The Depositary may refuse to register any transfer of your ADSs or allow you to withdraw the deposited securities
represented by your ADSs until such taxes or other charges are paid. It may apply payments owed to you or sell deposited securities
represented by your ADSs to pay any taxes owed and you will remain liable for any deficiency. If the Depositary sells deposited
securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to ADS holders any proceeds, or send
to ADS holders any property, remaining after it has paid the taxes.
Reclassifications,
Recapitalizations and Mergers
If
we:
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Then:
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● Change
the nominal or par value of our ordinary shares
● Reclassify,
split up or consolidate any of the deposited securities
● Distribute
securities on the shares that are not distributed to you
● Recapitalize,
reorganize, merge, liquidate, sell all or substantially all of our assets, or take any similar action
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The
cash, shares or other securities received by the Depositary will become deposited securities. Each ADS will automatically
represent its equal share of the new deposited securities.
The
Depositary may, and will if we ask it to, distribute some or all of the cash, shares or other securities it received.
It may also deliver new ADRs or ask you to surrender your outstanding ADRs in exchange for new ADRs identifying the new
deposited securities.
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Amendment
and Termination
How
may the Deposit Agreement be amended?
We
may agree with the Depositary to amend the Deposit Agreement and the ADRs without your consent for any reason. If an amendment
adds or increases fees or charges, except for taxes and other governmental charges or expenses of the Depositary for registration
fees, facsimile costs, delivery charges or similar items, or prejudices a substantial right of ADS holders, it will not become
effective for outstanding ADSs until 30 days after the Depositary notifies ADS holders of the amendment. At the time an amendment
becomes effective, you are considered, by continuing to hold your ADSs, to agree to the amendment and to be bound by the ADRs
and the Deposit Agreement, as amended.
How
may the Deposit Agreement be terminated?
The
Depositary will terminate the Deposit Agreement at our direction by mailing notice of termination to the ADS holders then outstanding
at least 30 days prior to the date fixed in such notice for such termination. The Depositary may also terminate the Deposit Agreement
by mailing notice of termination to us and the ADS holders if 60 days have passed since the Depositary told us it wants to resign
but a successor depositary has not been appointed and accepted its appointment.
After
termination, the Depositary and its agents will do the following under the Deposit Agreement, but nothing else: collect distributions
on the deposited securities, sell rights and other property, and deliver shares and other deposited securities upon cancellation
of ADSs. Four months after termination, the Depositary may sell any remaining deposited securities by public or private sale.
After that, the Depositary will hold the money it received on the sale, as well as any other cash it is holding under the Deposit
Agreement for the pro rata benefit of the ADS holders that have not surrendered their ADSs. It will not invest the money and has
no liability for interest. The Depositary’s only obligations will be to account for the money and other cash. After termination,
our only obligations will be to indemnify the Depositary and to pay fees and expenses of the Depositary that we agreed to pay.
Limitations
on Obligations and Liability
Limits
on our Obligations and the Obligations of the Depositary; Limits on Liability to ADS Holders
The
Deposit Agreement expressly limits our obligations and the obligations of the Depositary. It also limits our liability and the
liability of the Depositary. We and the Depositary:
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are
only obligated to take the actions specifically set forth in the Deposit Agreement without negligence or bad faith;
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are
not liable if we are or it is prevented or delayed by law or circumstances beyond our control from performing our or its obligations
under the Deposit Agreement;
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are
not liable if we or it exercises discretion permitted under the Deposit Agreement;
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are
not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made
available to holders of ADSs under the terms of the Deposit Agreement, or for any special, consequential or punitive damages
for any breach of the terms of the Deposit Agreement;
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have
no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the Deposit Agreement on your behalf
or on behalf of any other person; and
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may
rely upon any documents we believe or it believes in good faith to be genuine and to have been signed or presented by the
proper person.
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In
the Deposit Agreement, we and the Depositary agree to indemnify each other under certain circumstances.
Requirements
for Depositary Actions
Before
the Depositary will deliver or register a transfer of an ADS, make a distribution on an ADS, or permit withdrawal of shares, the
Depositary may require:
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payment
of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties
for the transfer of any shares or other deposited securities;
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satisfactory
proof of the identity and genuineness of any signature or other information it deems necessary; and
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compliance
with regulations it may establish, from time to time, consistent with the Deposit Agreement, including presentation of transfer
documents.
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The
Depositary may refuse to deliver ADSs or register transfers of ADSs generally when the transfer books of the Depositary or our
transfer books are closed or at any time if the Depositary or we think it advisable to do so.
Your
Right to Receive the Shares Underlying your ADSs
ADS
holders have the right to cancel their ADSs and withdraw the underlying shares at any time except:
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when
temporary delays arise because: (i) the Depositary has closed its transfer books or we have closed our transfer books; (ii)
the transfer of shares is blocked to permit voting at a shareholders’ meeting; or (iii) we are paying a dividend on
our ordinary shares;
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when
you owe money to pay fees, taxes and similar charges; or
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when
it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or
to the withdrawal of shares or other deposited securities.
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This
right of withdrawal may not be limited by any other provision of the Deposit Agreement.
Pre-release
of ADSs
Subject
to the provisions of the Deposit Agreement, the Depositary may issue ADSs before deposit of the underlying shares. This is called
a pre-release of ADSs. The Depositary may also deliver shares prior to the receipt and cancellation of pre-released ADSs even
if the ADSs are cancelled before the pre-release transaction has been closed out. A pre-release is closed out as soon as the underlying
shares are delivered to the Depositary. The Depositary may receive ADSs instead of shares to close out a pre-release. The Depositary
may pre-release ADSs only under the following conditions:
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before
or at the time of the pre-release, the person to whom the pre-release is being made must represent to the Depositary in writing
that it or its customer, as the case may be, (i) owns the shares or ADSs to be remitted, (ii) will assign all beneficial rights,
title and interest in the ADSs or shares to the Depositary and for the benefit of the ADS holders, and (iii) will not take
any action with respect to the ADSs or shares that is inconsistent with the assignment of beneficial ownership (including,
without the consent of the Depositary, disposing of the ADSs or shares) other than in satisfaction of the pre-release;
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the
pre-release must be fully collateralized with cash or collateral that the Depositary considers appropriate; and
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the
Depositary must be able to close out the pre-release on not more than five business days’ notice.
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The
pre-release will be subject to whatever indemnities and credit regulations that the Depositary considers appropriate. In addition,
the Depositary will limit the number of ADSs that may be outstanding at any time as a result of pre-release, although the Depositary
may disregard the limit from time to time, if it thinks it is appropriate to do so. At our instruction, a pre-release may be discontinued
entirely.
Direct
Registration System
In
the Deposit Agreement, all parties to the Deposit Agreement acknowledge that the DRS and Profile Modification System, or Profile,
will apply to uncertificated ADSs upon acceptance thereof to DRS by DTC. DRS is the system administered by DTC under which the
Depositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by
the Depositary to the registered holders of uncertificated ADSs. Profile is a required feature of DRS that allows a DTC participant,
claiming to act on behalf of a registered holder of ADSs, to direct the Depositary to register a transfer of those ADSs to DTC
or its nominee and to deliver those ADSs to the DTC account of that DTC participant without receipt by the Depositary of prior
authorization from the ADS holder to register that transfer.
In
connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the Deposit Agreement
understand that the Depositary will not determine whether the DTC participant that is claiming to be acting on behalf of an ADS
holder in requesting registration of transfer and delivery described in the paragraph above has the actual authority to act on
behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the Deposit Agreement, the parties
agree that the Depositary’s reliance on and compliance with instructions received by the Depositary through the DRS/Profile
and in accordance with the Deposit Agreement will not constitute negligence or bad faith on the part of the Depositary.
Shareholder
Communications; Inspection of Register ADS Holders
The
Depositary will make available for your inspection at its office all communications that it receives from us as a holder of deposited
securities that we make generally available to holders of deposited securities. The Depositary will send you copies of those communications
if we ask it to. You have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders
about a matter unrelated to our business or the ADSs.
Disclosure
of Beneficial Ownership
We
may from time to time request that ADS holders provide information as to the capacity in which they hold ADSs or a beneficial
interest in such ADSs and regarding the identity of any other persons then or previously having a beneficial interest in ADSs,
and the nature of such interest and various other matters. ADS holders agree to provide such information reasonably requested
by us pursuant to the Deposit Agreement. The Depositary agrees to comply with reasonable written instructions received from time
to time from us requesting that the Depositary forward any such written requests to the Owners and to forward to us any such responses
to such requests received by the Depositary.
Each
ADS holder agrees to comply with any applicable provision of Israeli law with regard to the notification to us of the holding
or proposed holding of certain interests in the underlying ordinary shares and the obtaining of certain consents, to the same
extent as if such ADS holder were a registered holder or beneficial owner of the underlying ordinary shares. The Depositary is
not required to take any action with respect to such compliance on behalf of any ADS holder, including the provision of the notifications
described below.
As
of the date of the Deposit Agreement, under Israeli law, persons who hold a direct or indirect interest in 5% or more of the voting
securities of us (including persons who hold such an interest through the holding of ADSs) are required to give written notice
of their interest and any subsequent changes in their interest to us within the timeframes set forth in Israeli law. The foregoing
is a summary of the relevant provision of Israeli law and does not purport to be a complete review of this or other provisions
that may be applicable to ADS holders. We undertake no obligation to update this summary in the future.
Description
of the Warrants
June
2020 Warrants
The
following is a brief summary of the warrants and placement agent warrants issued in connection with our June 2020 financing and
is subject in all respects to the provisions contained in the warrants and placement agent warrants, the form filed as an exhibit
to our Current Report on Form 6-K dated June 12, 2020. Unless otherwise stated, references to warrants in this section include
the placement agent warrants.
Exercisability.
Holders may exercise warrants at any time after June 12, 2020 until close of business on December 12, 2024. The warrants are exercisable,
at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment
in full for the number of shares of ordinary shares represented by ADSs purchased upon such exercise (except in the case of a
cashless exercise in limited circumstances discussed below).
Cashless
Exercise. If after June 12, 2020, a registration statement covering the issuance of the ordinary shares represented ADS issuable
upon exercise of the warrants is not effective at the time of exercise of the warrants, the holder may, at its option, exercise
its warrants on a cashless basis. When exercised on a cashless basis, a portion of the warrant is cancelled in payment of the
purchase price payable in respect of the number of shares of our common stock purchasable upon such exercise.
Exercise
Price. The exercise price of ADSs purchasable upon exercise of the warrants is $2.50 per ADS. The exercise price and the number
of ADS issuable upon exercise of the warrants is subject to appropriate adjustment in the event of recapitalization events, stock
dividends, stock splits, stock combinations, reclassifications or similar events affecting our ordinary shares, and also upon
any distributions of assets, including cash, stock or other property to our stockholders.
Transferability.
Subject to certain transfer restrictions, the warrants may be transferred at the option of the holder upon surrender of the warrants
with the appropriate instruments of transfer. In addition, the holder (or permitted assignees under Rule 5110(g)(1)) of the placement
agent warrants may not sell, transfer, assign, pledge, or hypothecate the warrants or the securities underlying these warrants,
nor may they engage in any hedging, short sale, derivative, put, or call transaction that would result in the effective economic
disposition of the warrants or the underlying securities for a period of 180 days from the effective date or commencement of sales
of the public offering of the ordinary shares represented by the ADSs issuable upon exercise of the warrants.
Purchase
Rights, Fundamental Transactions and Change of Control. If we sell or grant any rights to purchase stock, warrants or securities
or other property to our stockholders on a pro rata basis, we will provide the holders of warrants with the right to acquire,
upon the same terms, the securities subject to such purchase rights as though the warrant had been exercised immediately prior
to the declaration of such rights. If we consummate any fundamental transaction, as described in the warrants and generally including
any consolidation or merger into another corporation, the consummation of a transaction whereby another entity acquires more than
50% of our outstanding ordinary shares, the sale of all or substantially all of our assets, or another transaction in which our
common stock is converted into or exchanged for other securities or other consideration, the holder of warrants will thereafter
receive upon exercise of the warrants the securities or other consideration to which a holder of the number of shares of common
stock then deliverable upon the exercise or conversion of such warrants would have been entitled upon such consolidation, merger
or other transaction.
Exchange
Listing. We do not plan on making an application to list the warrants on the NYSE American, any national securities exchange
or other nationally recognized trading system. Our ADSs underlying the warrants are listed on the NYSE American and our ordinary
shares are traded on the TASE.
Rights
as Stockholder. Except as otherwise provided in the warrants (such as the rights described above of a warrant holder upon
our sale or grant of any rights to purchase shares, warrants or securities or other property to our shareholders on a pro rata
basis) or by virtue of such holder’s ownership of our ordinary shares, the holders of the warrants do not have the rights
or privileges of holders of our ordinary shares, including any voting rights, until they exercise their warrants.
July
2020 Warrants
The
following is a brief summary of the warrants and placement agent warrants issued in connection with our June 2020 financing and
is subject in all respects to the provisions contained in the warrants and placement agent warrants, the form filed as an exhibit
to our Current Report on Form 6-K dated July 8, 2020. Unless otherwise stated, references to warrants in this section include
the placement agent warrants.
Exercisability.
Holders may exercise warrants at any time after July 8, 2020 until close of business on January 8, 2025. The warrants are exercisable,
at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment
in full for the number of shares of ordinary shares represented by ADSs purchased upon such exercise (except in the case of a
cashless exercise in limited circumstances discussed below).
Cashless
Exercise. If after July 8, 2020, a registration statement covering the issuance of the ordinary shares represented ADS issuable
upon exercise of the warrants is not effective at the time of exercise of the warrants, the holder may, at its option, exercise
its warrants on a cashless basis. When exercised on a cashless basis, a portion of the warrant is cancelled in payment of the
purchase price payable in respect of the number of shares of our common stock purchasable upon such exercise.
Exercise
Price. The exercise price of ADSs purchasable upon exercise of the warrants is $2.50 per ADS. The exercise price and the number
of ADS issuable upon exercise of the warrants is subject to appropriate adjustment in the event of recapitalization events, stock
dividends, stock splits, stock combinations, reclassifications or similar events affecting our ordinary shares, and also upon
any distributions of assets, including cash, stock or other property to our stockholders.
Transferability.
Subject to certain transfer restrictions, the warrants may be transferred at the option of the holder upon surrender of the warrants
with the appropriate instruments of transfer. In addition, the holder (or permitted assignees under Rule 5110(g)(1)) of the placement
agent warrants may not sell, transfer, assign, pledge, or hypothecate the warrants or the securities underlying these warrants,
nor may they engage in any hedging, short sale, derivative, put, or call transaction that would result in the effective economic
disposition of the warrants or the underlying securities for a period of 180 days from the effective date or commencement of sales
of the public offering of the ordinary shares represented by the ADSs issuable upon exercise of the warrants.
Purchase
Rights, Fundamental Transactions and Change of Control. If we sell or grant any rights to purchase stock, warrants or securities
or other property to our stockholders on a pro rata basis, we will provide the holders of warrants with the right to acquire,
upon the same terms, the securities subject to such purchase rights as though the warrant had been exercised immediately prior
to the declaration of such rights. If we consummate any fundamental transaction, as described in the warrants and generally including
any consolidation or merger into another corporation, the consummation of a transaction whereby another entity acquires more than
50% of our outstanding ordinary shares, the sale of all or substantially all of our assets, or another transaction in which our
common stock is converted into or exchanged for other securities or other consideration, the holder of warrants will thereafter
receive upon exercise of the warrants the securities or other consideration to which a holder of the number of shares of common
stock then deliverable upon the exercise or conversion of such warrants would have been entitled upon such consolidation, merger
or other transaction.
Exchange
Listing. We do not plan on making an application to list the warrants on the NYSE American, any national securities exchange
or other nationally recognized trading system. Our ADSs underlying the warrants are listed on the NYSE American and our ordinary
shares are traded on the TASE.
Rights
as Stockholder. Except as otherwise provided in the warrants (such as the rights described above of a warrant holder upon
our sale or grant of any rights to purchase shares, warrants or securities or other property to our shareholders on a pro rata
basis) or by virtue of such holder’s ownership of our ordinary shares, the holders of the warrants do not have the rights
or privileges of holders of our ordinary shares, including any voting rights, until they exercise their warrants.
PLAN
OF DISTRIBUTION
We
are registering the ordinary shares represented by ADSs issuable upon exercise of the warrants and placement agent warrants issued
in our July 2020 and June 2020 private placements to permit the resale of these ordinary shares represented by ADSs by the holders
of these warrants from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by
the selling shareholders of the ordinary shares represented by ADSs other than proceeds from the cash exercise of the warrants
and placement agent warrants. We will bear all fees and expenses incident to our obligation to register the ordinary shares represented
by ADSs.
The
selling shareholders may sell all or a portion of the ordinary shares represented by ADSs beneficially owned by them and offered
hereby from time to time directly or through one or more underwriters, broker-dealers or agents. If the ordinary shares represented
by ADSs are sold through underwriters or broker-dealers, the selling shareholders will be responsible for underwriting discounts
or commissions or agent’s commissions. The ordinary shares represented by ADSs may be sold in one or more transactions at
fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated
prices. These sales may be effected in transactions, which may involve crosses or block transactions,
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on
any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;
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in
the over-the-counter market;
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in
transactions otherwise than on these exchanges or systems or in the over-the-counter market;
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through
the writing of options, whether such options are listed on an options exchange or otherwise;
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;
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block
trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;
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an
exchange distribution in accordance with the rules of the applicable exchange;
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privately
negotiated transactions;
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sales
pursuant to Rule 144;
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broker-dealers
may agree with the selling security holders to sell a specified number of such shares at a stipulated price per share;
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a
combination of any such methods of sale; and
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any
other method permitted pursuant to applicable law.
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If
the selling shareholders effect such transactions by selling ordinary shares represented by ADSs to or through underwriters, broker-dealers
or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions
from the selling shareholders or commissions from purchasers of the ordinary shares represented by ADSs for whom they may act
as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers
or agents may be in excess of those customary in the types of transactions involved). In connection with sales of ordinary shares
represented by ADSs or otherwise, the selling shareholders may enter into hedging transactions with broker-dealers, which may
in turn engage in short sales of the ordinary shares represented by ADSs in the course of hedging in positions they assume. The
selling shareholders may also sell ordinary shares represented by ADSs short and deliver ordinary shares represented by ADSs covered
by this prospectus to close out short positions and to return borrowed shares in connection with such short sales. The selling
shareholders may also loan or pledge ordinary shares represented by ADSs to broker-dealers that in turn may sell such shares.
The
selling shareholders may pledge or grant a security interest in some or all of the warrants, placement agent warrants or ADSs
owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer
and sell the ordinary shares represented by ADSs from time to time pursuant to this prospectus or any amendment to this prospectus
under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933, as amended, amending, if necessary, the list
of selling shareholders to include the pledgee, transferee or other successors in interest as selling shareholders under this
prospectus. The selling shareholders also may transfer and donate the ordinary shares represented by ADSs in other circumstances
in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes
of this prospectus.
The
selling shareholders and any broker-dealer participating in the distribution of the ordinary shares represented by ADSs may be
deemed to be “underwriters” within the meaning of the Securities Act, and any commission paid, or any discounts or
concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities
Act. At the time a particular offering of the ordinary shares represented by ADSs is made, a prospectus supplement, if required,
will be distributed which will set forth the aggregate amount of ordinary shares represented by ADSs being offered and the terms
of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions and other terms constituting
compensation from the selling shareholders and any discounts, commissions or concessions allowed or reallowed or paid to broker-dealers.
Under
the securities laws of some states ordinary shares represented by ADSs may be sold in such states only through registered or licensed
brokers or dealers. In addition, in some states ordinary shares represented by ADSs may not be sold unless such ordinary shares
have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is
complied with.
There
can be no assurance that any selling shareholder will sell any or all of the ordinary shares represented by ADSs registered pursuant
to the registration statement, of which this prospectus forms a part.
The
selling shareholders and any other person participating in such distribution will be subject to applicable provisions of the Exchange
Act, and the rules and regulations thereunder, including, without limitation, Regulation M of the Exchange Act, which may limit
the timing of purchases and sales of any of the ordinary shares represented by ADSs by the selling shareholders and any other
participating person. Regulation M may also restrict the ability of any person engaged in the distribution of the ordinary shares
represented by ADSs to engage in market-making activities with respect to the ordinary shares represented by ADSs. All of the
foregoing may affect the marketability of the ordinary shares represented by ADSs and the ability of any person or entity to engage
in market-making activities with respect to the ordinary shares represented by ADSs.
We
will pay all expenses of the registration of the ordinary shares represented by ADSs, estimated to be $50,000 in total, including,
without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities or “blue
sky” laws; provided, however, that a selling shareholder will pay all underwriting discounts and selling commissions, if
any.
Once
sold under the registration statement, of which this prospectus forms a part, the ordinary shares represented by ADSs will be
freely tradable in the hands of persons other than our affiliates.
LEGAL
MATTERS
McDermott
Will & Emery LLP, New York, New York, has passed upon certain legal matters regarding the securities offered hereby under
U.S. law, and Doron, Tikotzky, Kantor, Gutman, Ness, Amit Gross and Co., Bnei Brak, Israel, has passed upon certain legal matters
regarding the securities offered hereby under Israeli law. If the securities are distributed in an underwritten offering, certain
legal matters will be passed upon for the underwriters by counsel identified in the applicable prospectus supplement.
EXPERTS
The
consolidated financial statements of Can-Fite BioPharma Ltd. and its subsidiaries as of December 31, 2019 and 2018 and for each
of the three years in the period ended December 31, 2019 incorporated by reference in this prospectus have been audited by Kost,
Forer, Gabbay & Kasierer, a member of Ernst & Young Global, an independent registered public accounting firm, as set forth
in their report thereon, included therein, and incorporated herein by reference in reliance upon such report given on the authority
of such firm as experts in accounting and auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form F-1, including amendments and relevant exhibits and schedules, under
the Securities Act covering the ordinary shares represented by ADSs to be sold in this offering. This prospectus, which constitutes
a part of the registration statement, summarizes material provisions of contracts and other documents that we refer to in the
prospectus. Since this prospectus does not contain all of the information contained in the registration statement, you should
read the registration statement and its exhibits and schedules for further information with respect to us and our ordinary shares
and the ADSs. Our SEC filings, including the registration statement, are also available to you on the SEC’s Web site at
http://www.sec.gov.
In
addition, since our ordinary shares are traded on the TASE, in the past we filed Hebrew language periodic and immediate reports
with, and furnished information to, the TASE and the Israel Securities Authority, or the ISA, as required under Chapter Six of
the Israel Securities Law, 1968. On March 31, 2014, we transitioned solely to U.S. reporting standards in accordance with an applicable
exemption under the Israel Securities Law. Copies of our SEC filings and submissions are submitted to the Israeli Securities Authority
and TASE. Such copies can be retrieved electronically through the MAGNA distribution site of the Israeli Securities Authority
(www.magna.isa.gov.il) and the TASE website (maya.tase.co.il).
We
are subject to the information reporting requirements of the Exchange Act that are applicable to foreign private issuers, and
under those requirements we file reports with the SEC. Those other reports or other information may be inspected without charge
at the locations described above. As a foreign private issuer, we are exempt from the rules under the Exchange Act related to
the furnishing and content of proxy statements, and our officers, directors and principal shareholders are exempt from the reporting
and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we are not required under
the Exchange Act to file annual, quarterly and current reports and financial statements with the SEC as frequently or as promptly
as United States companies whose securities are registered under the Exchange Act. However, we file with the SEC, within four
months after the end of each fiscal year, or such applicable time as required by the SEC, an annual report on Form 20-F containing
financial statements audited by an independent registered public accounting firm, and submit to the SEC, on Form 6-K, unaudited
quarterly financial information for the first three quarters of each fiscal year within 60 days after the end of each such quarter,
or such applicable time as required by the SEC.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
We
are allowed to incorporate by reference the information we file with the SEC, which means that we can disclose important information
to you by referring to those documents. The information incorporated by reference is considered to be part of this prospectus.
We incorporate by reference in this prospectus the documents listed below:
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(1)
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Our
Annual Report on Form 20-F for the year ended December 31, 2019 filed with the SEC on March 27, 2020;
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(2)
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Our
Current Reports on Form
6-K filed with the SEC on March 27, 2020; March 30, 2020; April 1, 2020; April 2, 2020; April 7, 2020; April 13, 2020;
April 21, 2020; April 27, 2020; April 28, 2020; May 15, 2020; May 18, 2020; May 15, 2020; May 18, 2020; May 21, 2020; June 1, 2020; June 4, 2020; June 9, 2020; June 10, 2020, June 12, 2020, June 30, 2020, June 30, 2020, July 6, 2020, July 8, 2020, July 15, 2020 and July 20, 2020 (to the extent expressly incorporated by reference into our effective registration statements filed by us under the Securities
Act); and
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(3)
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The
description of our ADSs and ordinary shares contained in Form 8-A filed with the SEC on November 15, 2013, including any amendment or report filed for the purpose of updating such
description.
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The
information relating to us contained in this prospectus does not purport to be comprehensive and should be read together with
the information contained in the documents incorporated or deemed to be incorporated by reference in this prospectus.
As
you read the above documents, you may find inconsistencies in information from one document to another. If you find inconsistencies
between the documents and this prospectus, you should rely on the statements made in the most recent document. All information
appearing in this prospectus is qualified in its entirety by the information and financial statements, including the notes thereto,
contained in the documents incorporated by reference herein.
We
will provide to each person, including any beneficial owner, to whom this prospectus is delivered, a copy of these filings, at
no cost, upon written or oral request to us at the following address:
Can-Fite
BioPharma Ltd.
10
Bareket Street, Kiryat Matalon
PO
Box 7537
Petach
Tikva, Israel
Tel:
+ 972 3 924-1114
Attention:
Investor Relations
You
also may access the incorporated reports and other documents referenced above on our website at www.canfite.com. The information
contained on, or that can be accessed through, our website is not part of this prospectus.
You
should rely only on the information contained or incorporated by reference in this prospectus or a prospectus supplement. We have
not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent
information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer
or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date
on the front cover of this prospectus, or such earlier date, that is indicated in this prospectus. Our business, financial condition,
results of operations and prospects may have changed since that date.
ENFORCEABILITY
OF CIVIL LIABILITIES
We
are incorporated under the laws of the State of Israel. Service of process upon us, our Israeli subsidiaries, our directors and
officers and the Israeli experts, if any, named in this prospectus, substantially all of whom reside outside the United States,
may be difficult to obtain within the United States. Furthermore, because the majority of our assets and investments, and substantially
all of our directors, officers and such Israeli experts, if any, are located outside the United States, any judgment obtained
in the United States against us or any of them may be difficult to collect within the United States.
We
have been informed by our legal counsel in Israel that it may also be difficult to assert U.S. securities law claims in original
actions instituted in Israel. Israeli courts may refuse to hear a claim based on an alleged violation of U.S. securities laws
reasoning that Israel is not the most appropriate forum to bring such a claim. In addition, even if an Israeli court agrees to
hear a claim, it may determine that Israeli law and not U.S. law is applicable to the claim. There is little binding case law
in Israel addressing these matters. If U.S. law is found to be applicable, the content of applicable U.S. law must be proved as
a fact, which can be a time-consuming and costly process. Certain matters of procedure will also be governed by Israeli law.
Subject
to specified time limitations and legal procedures, under the rules of private international law currently prevailing in Israel,
Israeli courts may enforce a U.S. judgment in a civil matter, including a judgment based upon the civil liability provisions of
the U.S. securities laws, as well as a monetary or compensatory judgment in a non-civil matter, provided that the following conditions
are met:
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subject
to limited exceptions, the judgment is final and non-appealable;
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the
judgment was given by a court competent under the laws of the state of the court and is otherwise enforceable in such state;
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the
judgment was rendered by a court competent under the rules of private international law applicable in Israel;
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the
laws of the state in which the judgment was given provide for the enforcement of judgments of Israeli courts;
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adequate
service of process has been effected and the defendant has had a reasonable opportunity to present his arguments and evidence;
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the
judgment and its enforcement are not contrary to the law, public policy, security or sovereignty of the State of Israel;
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the
judgment was not obtained by fraud and does not conflict with any other valid judgment in the same matter between the same
parties; and
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an
action between the same parties in the same matter was not pending in any Israeli court at the time the lawsuit was instituted
in the U.S. court.
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We
have appointed Puglisi & Associates as our agent to receive service of process in any action against us in any United States
federal or state court arising out of this offering or any purchase or sale of securities in connection with this offering.
If
a foreign judgment is enforced by an Israeli court, it generally will be payable in Israeli currency, which can then be converted
into non-Israeli currency and transferred out of Israel. The usual practice in an action before an Israeli court to recover an
amount in a non-Israeli currency is for the Israeli court to issue a judgment for the equivalent amount in Israeli currency at
the rate of exchange in force on the date of the judgment, but the judgment debtor may make payment in foreign currency. Pending
collection, the amount of the judgment of an Israeli court stated in Israeli currency ordinarily will be linked to the Israeli
consumer price index plus interest at the annual statutory rate set by Israeli regulations prevailing at the time. Judgment creditors
must bear the risk of unfavorable exchange rates.
July 24, 2020
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