UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the Month of: December 2024 (Report No.
2)
Commission File Number: 001-38428
PolyPid Ltd.
(Translation of registrant’s name into
English)
18 Hasivim Street
Petach Tikva 495376, Israel
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F:
☒
Form 20-F ☐ Form 40-F
CONTENTS
Private Placement Offering
On December 23, 2024,
PolyPid Ltd. (the “Company”) entered into a definitive securities purchase agreement (the “Securities Purchase
Agreement”) for a private placement financing led by existing institutional shareholders. Under the securities purchase agreement,
the investors have agreed to purchase 4,493,830 of the Company’s ordinary shares, no par value per share, or
pre-funded warrants in lieu thereof, at a purchase price of $3.22 per share (the “Ordinary Shares”) (or
pre-funded warrant), and warrants to purchase up to 6,740,745 Ordinary Shares at an exercise price of $4.00 per share. The
warrants expire upon the earlier of nine months from the date of issuance and 10 trading days following the Company’s
announcement of the top-line results in the Company’s SHIELD II Phase 3 trial of
D-PLEX100.
The offering is expected to result in gross proceeds to the Company
of $14.5 million. Exercise of the warrants in full would result in an additional $27 million in gross proceeds to the Company. The Company
intends to use the net proceeds from the sale of the securities for its ongoing SHIELD II Phase 3 clinical trial, working capital
and general corporate purposes.
The closing of the offering is expected to occur on or about December
26, 2024, subject to the satisfaction of customary closing conditions.
The Company’s press release dated December 23, 2024, announcing
the pricing of the private placement is attached hereto as Exhibit 99.1.
The Company also entered into
a letter agreement with Citizens JMP, as exclusive financial advisor and agent in the offering (the “Placement Agent”), dated
December 18, 2024, pursuant to which the Placement Agent agreed to serve as the placement agent for the Company in connection with the
offering. The Company agreed to pay the Placement Agent a cash placement fee equal to 7.0% of the gross proceeds received in the offering
and reimburse certain accountable expenses up to $50,000.
The securities described herein
(the “Securities”) have not been registered under the Securities Act of 1933, as amended, and may not be sold in the United
States absent registration or an applicable exemption from the registration requirements. The Company has agreed to file a registration
statement with the Securities and Exchange Commission (the “SEC”) to register the resale of the Ordinary Shares and the Ordinary
Shares underlying warrants.
This Report on Form 6-K (the
“Report”) shall not constitute an offer to sell or the solicitation of an offer to buy the Securities, nor shall there be
any sale of these Securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such state or jurisdiction.
The foregoing summaries of
the Securities Purchase Agreement, pre-funded warrants, and warrants do not purport to be complete and are qualified in their entirety
by reference to the Securities Purchase Agreement, pre-funded warrant, and warrants, which are attached as Exhibits 99.2, 99.5, and 99.4,
respectively, to this Report and are incorporated herein by reference.
This Report is incorporated
by reference into the Company’s registration statements on Form F-3 (File No. 333-276826,
File No. 333-280658 and File
No. 333-281863) and Form
S-8 (File No. 333-239517, File No.
333-271060, File No. 333-277703
and File No. 333-280662) filed
with the Securities and Exchange Commission to be a part thereof from the date on which this report is submitted, to the extent not superseded
by documents or reports subsequently filed or furnished.
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
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POLYPID LTD. |
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| Date: December 26, 2024 |
By: |
/s/ Dikla Czaczkes Akselbrad |
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Name: |
Dikla Czaczkes Akselbrad |
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Title: |
Chief Executive Officer |
3
Exhibit 99.1
PolyPid Announces Positive Recommendation by
DSMB to Continue Enrollment of Phase 3 SHIELD II Trial of D-PLEX100 to 800 Patients
with a Concurrent Private Placement of up to $41 Million
| ● | 630 Patients Enrolled To Date; Enrollment Completion Now Expected in Q1 2025 with Top-line Results Anticipated
in Q2 2025; |
| ● | Upon Potential Positive Phase 3 Data the Company Expects to Submit a New Drug Application (“NDA”)
for D-PLEX100 under Fast Track and Breakthrough Therapy Designations, Previously
Granted to D-PLEX100 by the FDA; |
| ● | Proceeds from this Financing and Exercise of Data-Triggered Warrant Expected to Extend Cash Runway Beyond
Potential NDA Approval |
PETACH TIKVA, Israel, December 23, 2024 -- PolyPid
Ltd. (Nasdaq: PYPD) (“PolyPid” or the “Company”), a late-stage biopharma
company aiming to improve surgical outcomes, announced today that following the independent Data Safety Monitoring Board’s
(“DSMB”) review of unblinded efficacy data from the first 430 enrolled patients in the SHIELD
II Phase 3 trial for D-PLEX100 for the prevention of surgical site infections (“SSIs”) in patients undergoing
abdominal colorectal surgery with large incisions, the DSMB’s recommendation was to conclude the study upon enrollment of
800 patients, which is the lowest sample size reassessment stop after the minimum planned number of 624 patients. At this interim analysis,
the DSMB also had the option to recommend stopping SHIELD II due to futility or overwhelming efficacy or to reassess the trial’s
sample size to a maximum of 1,100 patients. In addition, the DSMB’s confirmed the good safety profile of D-PLEX100 in
SHIELD II to date.
“We view the DSMB’s recommendation to conclude SHIELD II
upon the enrollment of 800 patients as a favorable outcome, as it is suggestive of positive efficacy signals from D-PLEX100,”
said Dikla Czaczkes Akselbrad, PolyPid’s Chief Executive Officer. “The sample
size reassessment is an opportunity to ensure the study has sufficient power to conclusively confirm D-PLEX100’s treatment
benefit, and we believe this increases the trial’s overall probability of success. We are now focused on completing the trial, while
advancing our planned NDA and Marketing Authorization Application (“MAA”) submissions, preparing pre-launch activities, and
expediting partnership discussions in and outside of the United States.”
The study has enrolled 630 patients to date and enrollment of the last
170 patients is expected to occur in the first quarter of 2025. The Company anticipates reporting
top-line results in the second quarter of 2025. Upon potential positive Phase 3 data, the Company expects to submit an NDA with the advantages
of the Fast Track and Breakthrough Therapy designations, which were granted to D-PLEX100 in 2020.
PolyPid also announced that it has entered into a securities purchase
agreement for a private placement financing (the “PIPE”) led by existing institutional shareholders for $14.5
million in gross proceeds priced at $3.22 per share, the closing price on December 20, 2024. In connection with the PIPE
financing, the Company has agreed to consider Yitzchak Jacobovitz, CFA, partner and lead healthcare analyst at AIGH Capital Management,
for appointment to the Company’s board of directors.
Under the securities purchase agreement, the investors have agreed
to purchase 4,493,830 of the Company’s ordinary shares, no par value per share (the “Ordinary Shares”), or pre-funded
warrants in lieu thereof, at a purchase price of $3.22 per share (or pre-funded warrant). The investors will also receive warrants
to purchase up to 6,740,745 Ordinary Shares at an exercise price of $4.00 per share. The warrants expire upon the earlier of
nine months from the date of issuance and 10 trading days following PolyPid’s announcement of top-line results from its
SHIELD II Phase 3 trial. Exercise of the warrants in full would result in an additional $27.0 million in gross proceeds to the
Company.
The PIPE is expected to close on December 26, 2024, subject to
the satisfaction of customary closing conditions. The Company intends to use the net proceeds from the sale of the securities for its
ongoing SHIELD II Phase 3 clinical trial, working capital and general corporate purposes. The gross proceeds from the financing
extend PolyPid’s cash runway into the third quarter of 2025, beyond expected top-line results from SHIELD II.
Proceeds of all warrants issued in this transaction, if exercised,
would provide the Company with capital beyond NDA approval.
Citizens JMP is acting as exclusive placement agent in the offering.
The offer and sale of the foregoing securities are being made in a
transaction not involving a public offering and the securities have not been registered under the Securities Act of 1933, as amended (the
“Securities Act”), or applicable state securities laws. Accordingly, the securities may not be reoffered or resold in the
United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements
of the Securities Act and such applicable state securities laws. Pursuant to a registration rights agreement with the PIPE investors,
the Company has agreed to file within 30 calendar days of closing one or more registration statements with the Securities and Exchange
Commission (the “SEC”) covering the resale of the Ordinary Shares and Ordinary Shares issuable upon exercise of the warrants
and pre-funded warrants.
This press release does not constitute an offer to sell or the solicitation
of an offer to buy the securities, nor shall there be any sale of the securities in any state or jurisdiction in which such offer, solicitation
or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction.
About SHIELD II
SHIELD II (Surgical site
Hospital acquired Infection prEvention with Local D-PLEX) is a prospective, multinational, randomized, double blind Phase 3 trial designed
to assess the efficacy and safety of D-PLEX100 administered concomitantly with standard of care (“SoC”), which
includes prophylactic systemic antibiotics, compared to SoC alone arm, in the prevention of post abdominal-surgery incisional infection
in patients undergoing abdominal colorectal surgeries with large incisions. The primary endpoint of the trial is measured by the proportion
of subjects with either a surgical site infection (“SSI”) event as determined by a blinded and independent adjudication committee,
reintervention, or mortality for any reason within 30 days post-surgery. Patient safety will be monitored for an additional 30 days. The
trial enrolls patients in centers in the United States, Europe and Israel.
About
D-PLEX100
D-PLEX100, PolyPid’s
lead product candidate, is designed to provide local prolonged and controlled anti-bacterial activity directly at the surgical site to
prevent SSIs. Following the administration of D-PLEX100 into the surgical site, the PLEX (Polymer-Lipid Encapsulation matriX)
technology pairs with Active Pharmaceutical Ingredients, enabling a prolonged and continuous release of the broad-spectrum antibiotic
doxycycline, resulting in a high local concentration of the drug for a period of 30 days for the prevention of SSIs, with additional potential
to prevent SSIs caused by antibiotic-resistant bacteria at the surgical site. D-PLEX100 received Breakthrough Therapy
designation from the U.S. Food and Drug Administration for the prevention of SSIs in patients undergoing elective colorectal
surgery. D-PLEX100 is currently in Phase 3 SHIELD II trial for the prevention of surgical site infections in patients
undergoing abdominal colorectal surgery with large incisions.
About PolyPid
PolyPid Ltd. (Nasdaq: PYPD) is a
late-stage biopharma company aiming to improve surgical outcomes. Through locally administered, controlled, prolonged-release therapeutics,
PolyPid’s proprietary PLEX (Polymer-Lipid Encapsulation matriX) technology pairs with Active Pharmaceutical Ingredients (APIs),
enabling precise delivery of drugs at optimal release rates over durations ranging from several days to months. PolyPid’s lead product
candidate D-PLEX100 is in Phase 3 clinical trial for the prevention of abdominal colorectal surgical site infections.
In addition, the Company is currently in preclinical stages to test the efficacy of OncoPLEX for the treatment of solid tumors, beginning
with glioblastoma.
For additional Company information, please
visit http://www.polypid.com and follow us on Twitter and LinkedIn.
Forward-looking Statements
This press release contains “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act and other securities laws. Words such as “expects,” “anticipates,”
“intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions
or variations of such words are intended to identify forward-looking statements. For example, the Company is using forward-looking statements
when it discusses the expected timing for completion of enrollment of the SHIELD II trial, expected timing for top-line results from the
SHIELD II trial, potential NDA and MAA submissions, potential clinical benefits of D-PLEX100,
including safety and efficacy, pre-launch activities and partnership discussions, the gross proceeds to be received from the PIPE, intended
use of proceeds from the PIPE, the anticipated closing date for the PIPE, the anticipated gross proceeds from the exercise of warrants
issued in the PIPE if such warrants are exercised in full, that the gross proceeds from the financing extend the Company’s cash
runway into the third quarter of 2025, that proceeds of all warrants issued in this transaction, if exercised, would provide the Company
with capital beyond NDA approval, and the potential addition of Mr. Jacobovitz to the Company’s board of directors. Forward-looking
statements are not historical facts, and are based upon management’s current expectations, beliefs and projections, many of which,
by their nature, are inherently uncertain. Such expectations, beliefs and projections are expressed in good faith. However, there can
be no assurance that management’s expectations, beliefs and projections will be achieved, and actual results may differ materially
from what is expressed in or indicated by the forward-looking statements. Forward-looking statements are subject to risks and uncertainties
that could cause actual performance or results to differ materially from those expressed in the forward-looking statements. For a more
detailed description of the risks and uncertainties affecting the Company, reference is made to the Company’s reports filed from
time to time with the Securities and Exchange Commission, including, but not limited to, the risks detailed in the Company’s
Annual Report on Form 20-F filed on March 6, 2024. Forward-looking statements speak only as of the date the statements are made.
The Company assumes no obligation to update forward-looking statements to reflect actual results, subsequent events or circumstances,
changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities
laws. If the Company does update one or more forward-looking statements, no inference should be drawn that the Company will make additional
updates with respect thereto or with respect to other forward-looking statements.
References and links to websites have been
provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release. PolyPid is
not responsible for the contents of third-party websites.
Contacts:
PolyPid Ltd.
Ori Warshavsky
COO – US
908-858-5995
IR@Polypid.com
Investors:
Brian Ritchie
LifeSci Advisors
212-915-2578
BRitchie@lifesciadvisors.com
Exhibit 99.2
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE
AGREEMENT (this “Agreement”) is dated as of December 23, 2024 by and among PolyPid Ltd., an Israeli company (the
“Company”), and each purchaser identified on the signature pages hereto (each, including its successors and assigns,
a “Purchaser” and collectively, the “Purchasers”).
WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities
Act”) and Regulation S, Regulation D or other applicable exemption from registration provided for under the Securities Act or
promulgated thereunder, the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires
to purchase from the Company, securities of the Company as more fully described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION
of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and adequacy of which are
hereby acknowledged, the Company and each Purchaser, severally and not jointly, agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions. In
addition to the terms defined elsewhere in this Agreement, the following capitalized terms have the meanings set forth in this Section
1.1:
“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.
“Action”
shall have the meaning ascribed to such term in Section 3.1(j).
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act. For the purposes of Israeli law, a Person
shall be regarded as in control of the Company if the Company owns or directly or indirectly controls more than fifty percent (50%) of
the voting rights or other ownership interest of the other person, or if it possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such person.
“BHCA”
shall have the meaning ascribed to such term in Section 3.1(hh).
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York or Israel are authorized or required by law or other governmental action to close.
“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.
“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties
thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s
obligations to deliver the Securities, in each case, have been satisfied or waived.
“Commission”
means the United States Securities and Exchange Commission.
“Company
Counsel” means Sullivan & Worcester LLP, U.S. counsel to the Company, with respect to U.S. securities matters, and of Sullivan
& Worcester Tel-Aviv (Har-Even & Co.), with respect to Israeli law matters.
“Disqualification
Event” shall have the meaning ascribed to such term in Section 3.1(mm).
“Effective
Date” means the earliest of the date that (a) the initial Registration Statement has been declared effective by the Commission,
(b) all of the Shares and Warrant Shares have been sold pursuant to Rule 144 or may be sold pursuant to Rule 144 without the requirement
for the Company to be in compliance with the current public information required under Rule 144 and without volume or manner-of-sale restrictions,
(c) following the one year anniversary of the Closing Date provided that a holder of Shares or Warrant Shares is not an Affiliate of the
Company, or (d) all of the Shares and Warrant Shares may be sold pursuant to an exemption from registration under Section 4(a)(1) of the
Securities Act without volume or manner-of-sale restrictions and Company Counsel has delivered to such holders a standing written unqualified
opinion that resales may then be made by such holders of the Shares and Warrant Shares pursuant to such exemption which opinion shall
be in form and substance reasonably acceptable to such holders.
“Environmental
Laws” shall have the meaning ascribed to such term in Section 3.1(m).
“Escrow
Agent” means Ellenoff Grossman & Schole LLP.
“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Exempt
Issuance” means the issuance of (a) Ordinary Shares or options to employees, officers or directors of the Company pursuant to
any stock or option plan duly adopted for such purpose by a majority of the non-employee members of the Board of Directors or a majority
of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b) securities
upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into Ordinary Shares issued
and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to
increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities or to
extend the term of such securities, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority
of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined
in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith
within six months following the Closing Date, and provided that any such issuance shall only be to a Person (or to the equity holders
of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with
the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not
include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities.
“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.
“Federal
Reserve” shall have the meaning ascribed to such term in Section 3.1(hh).
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).
“Hazardous
Material” shall have the meaning ascribed to such term in Section 3.1(m).
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).
“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).
“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Lock-Up
Agreement” means the Lock-Up Agreement, dated as of the date hereof, by and among the Company and the directors and officers,
in the form of Exhibit D attached hereto.
“Material
Adverse Effect” means (i) a material adverse effect on the legality, validity or enforceability (other than as it relates to
any indemnification provisions therein) of any Transaction Document, (ii) a material adverse effect on the results of operations, assets,
business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document.
“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(n).
“Ordinary
Shares” means the ordinary shares of the Company, no par value per share, and any other class of securities into which such
securities may hereafter be reclassified or changed.
“Ordinary
Shares Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Ordinary Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that
is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.
“Ordinary Warrants”
means, collectively, the Ordinary Share purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a)
hereof, which Ordinary Warrants shall be exercisable immediately and have a term of exercise equal to the earlier of (i) 5:00 p.m. (New
York City time) on the nine (9) month anniversary of the Closing Date and (ii) the 10th Trading Day following the date on which
the Company issues a press release announcing the top-line results in the Company’s SHIELD II Phase 3 trial, in the form of Exhibit
B attached hereto.
“Ordinary
Warrant Shares” means the Ordinary Shares issuable upon exercise of the Ordinary Warrants.
“Per Share
Purchase Price” equals $3.22, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations
and other similar transactions of the Ordinary Shares that occur after the date of this Agreement, provided that the purchase price per
Pre-Funded Warrant shall be the Per Share Purchase Price minus $0.0001.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Placement
Agent” means Citizens JMP Securities, LLC, 450 Park Avenue, 5th Floor, New York, NY 10022.
“Pre-Funded
Warrants” means, collectively, the Pre-Funded Ordinary Share purchase warrants delivered to the Purchasers at the Closing in
accordance with Section 2.2(a) hereof, which Pre-Funded Warrants shall be exercisable immediately and shall expire when exercised in full,
in the form of Exhibit A attached hereto.
“Pre-Funded
Warrant Shares” means the Ordinary Shares issuable upon exercise of the Pre-Funded Warrants.
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition), whether commenced or threatened.
“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.
“Registration
Rights Agreement” means the Registration Rights Agreement, dated on or about the date hereof, among the Company and the Purchasers,
in the form of Exhibit E attached hereto.
“Registration
Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering
the resale by the Purchasers of the Shares and the Warrant Shares.
“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such rule.
“Securities”
means the Shares, the Warrants and the Warrant Shares.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Shares”
means the Ordinary Shares issued or issuable to each Purchaser pursuant to this Agreement.
“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be
deemed to include locating and/or borrowing Ordinary Shares).
“Standard
Settlement Period” shall have the meaning ascribed to such term in Section 4.1(c).
“Subscription
Amount” shall mean, as to each Purchaser, the aggregate amount to be paid for the Securities purchased hereunder as specified
below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in
United States dollars and in immediately available funds (minus, if applicable, a Purchaser’s aggregate exercise price of the Pre-Funded
Warrants, which amounts shall be paid as and when such Pre-Funded Warrants are exercised for cash).
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Sullivan”
means Sullivan & Worcester LLP, with offices located at 1633 Broadway, New York, New York 10019.
“Trading
Day” means a day on which the principal Trading Market is open for trading.
“Trading
Market” means the Nasdaq Capital Market.
“Transaction
Documents” means this Agreement, the Warrants, the Registration Rights Agreement and all exhibits and schedules thereto and
hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder.
“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company, with an address at
6201 15th Ave, Brooklyn, NY 11219, and any successor transfer agent of the Company.
“Warrants”
means the Ordinary Warrants and Pre-Funded Warrants.
“Warrant
Shares” means the Ordinary Warrant Shares and Pre-Funded Warrant Shares.
ARTICLE II.
PURCHASE AND SALE
2.1 Closing. On the
Closing Date, upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, an aggregate of $14,470,132.60 of Shares and Warrants; provided, however, that, to the extent that
a Purchaser determines, in its sole discretion, that such Purchaser (together with such Purchaser’s Affiliates, and any Person acting
as a group together with such purchaser or any of such Purchaser’s Affiliates) would beneficially own in excess of the Beneficial
Ownership Limitation, or as such Purchaser may otherwise choose, in lieu of purchasing Shares such Purchaser may elect to purchase Pre-Funded
Warrants in lieu of Shares in such manner to result in the same aggregate purchase price being paid by such Purchaser to the Company;
provided, further, that to the extent that a Purchaser will beneficially own in excess of 24.99% of the the number of Ordinary Shares
outstanding immediately after giving effect to the issuance of the Securities on the Closing Date, such Purchaser shall, in lieu of purchasing
Shares, purchase Pre-Funded Warrants in such manner to result in such Purchaser not exceeding beneficial ownership of 24.99% and to result
in the same aggregate purchase price being paid by such Purchaser to the Company. The “Beneficial Ownership Limitation” shall
be 4.99% (or, at the election of the Purchaser at Closing, 9.99%) of the number of Ordinary Shares outstanding immediately after giving
effect to the issuance of the Securities on the Closing Date. Each Purchaser’s Subscription Amount as set forth on the signature
page hereto executed by such Purchaser shall be made available for “Delivery Versus Payment” settlement with the Company or
its designees. The Company shall deliver to each Purchaser its Pre-Funded Warrants in executed .pdf form as determined pursuant to Section
2.2, and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction
of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur remotely via the electronic exchange of documents
and signatures or such other location as the parties hereto shall mutually agree. The Company covenants that, if any Purchaser delivers
a Notice of Exercise (as defined in the Pre-Funded Warrant) no later than 12:00 p.m. (New York City time) on the Closing Date to exercise
any Pre-Funded Warrants between the date hereof and the Closing Date, the Company shall deliver restricted Pre-Funded Warrant Shares to
the Purchaser on the Closing Date in connection with such Notice of Exercise.
2.2 Deliveries.
(a) On or prior
to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:
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(i) |
this Agreement duly executed by the Company; |
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(ii) |
a legal opinion of Company Counsel in form and substance reasonable acceptable to the Placement Agent; |
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(iii) |
a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver, on an expedited basis, a certificate evidencing a number of Shares equal to such Purchaser’s Subscription Amount (minus the portion of such Subscription Amount applicable to Prefunded Warrants) divided by the Per Share Purchase Price, registered in the name of such Purchaser, or, at the election of such Purchaser, evidence of the issuance of such Purchaser’s Shares hereunder as held in DRS book-entry form by the Transfer Agent and registered in the name of such Purchaser, which evidence shall be reasonably satisfactory to such Purchaser; |
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(iv) |
an Ordinary Warrant registered in the name of such Purchaser to purchase up to a number of Ordinary Shares equal to 150% of the sum of such Purchaser’s Shares and Pre-Funded Warrant Shares, with an exercise price equal to $4.00, subject to adjustment therein; |
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(v) |
if applicable, Pre-Funded Warrants registered in the name of such Purchaser to purchase up to a number of Ordinary Shares equal to the portion of such Purchaser’s Subscription Amount applicable to the Prefunded Warrants divided by the Per Share Purchase Price minus $0.0001, with an exercise price equal to $0.0001, subject to adjustment therein; |
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(vi) |
the Company’s wire instructions, as set forth in Exhibit C, on Company letterhead and executed by the Company’s Chief Executive Officer or Chief Financial Officer; |
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(vii) |
on the date hereof, the duly executed Lock-Up Agreements; |
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(viii) |
on the date hereof, the Registration Rights Agreement duly executed by the Company; |
| |
(ix) |
an Officer’s Certificate, in form and substance satisfactory to the Purchasers; and |
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(x) |
a Secretary’s Certificate, in form and substance satisfactory to the Purchasers. |
(b) In addition
to delivering the Subscription Amount as contemplated by Section 2.1, on or prior to the Closing Date, each Purchaser shall deliver or
cause to be delivered to the Company or the Escrow Agent, as the case may be, the following:
| |
(i) |
this Agreement duly executed by such Purchaser; |
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(ii) |
the Registration Rights Agreement duly executed by such Purchaser; and |
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(iii) |
such Purchaser’s Subscription Amount. |
2.3 Closing
Conditions.
(a) The obligations
of the Company hereunder in connection with the Closing are subject to the following conditions being met:
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(i) |
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality, in all respects) on the Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific date therein in which case they shall be true and correct as of such date); |
| |
(i) |
all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and |
| |
(ii) |
the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement. |
(b) The respective
obligations of each of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:
| |
(i) |
the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date therein, which shall be true and correct as of such specified date); |
| |
(ii) |
all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed; |
| |
(iii) |
there shall have been no Material Adverse Effect with respect to the Company since the date hereof; |
| |
(iv) |
from the date hereof to the Closing Date, trading in the Ordinary Shares shall not have been suspended by the Commission or the Company’s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the Closing; and |
| |
(v) |
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement. |
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations and
Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser, as of the date
hereof and as of the Closing Date:
(a) Subsidiaries.
All of the direct and indirect subsidiaries of the Company as set forth in Exhibit 8.1 to the Company’s From 20-F for the period
ended December 31, 2023, filed with the Commission on March 6, 2024, are the only Subsidiaries which are currently material to the business
and operations of the Company, has corporate power and authority to own, lease and operate its properties and to conduct its business
as described in the SEC Reports. Except as set forth in the SEC Reports, the Company owns, directly or indirectly, all of the capital
stock, share capital or other equity interests of each Subsidiary free and clear of any Liens , and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities.
(b) Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing
and (where such concept exists) in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company
nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws
or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and (where
such concept exists) is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing,
as the case may be, could not have or reasonably be expected to result in a Material Adverse Effect and no Proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
(c) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and each of the other Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder
and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation
by the Company of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the
Company and no further action is required by the Company, the Board of Directors or the Company’s shareholders in connection herewith
or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which the Company
is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof
and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms,
except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws
of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions
may be limited by applicable law or public policy.
(d) No Conflicts. The
execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the
issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do not and will
not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that
with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or
assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar
adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt
or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any
Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to
the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and
state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected
(including, without limitation, those promulgated by the Food and Drug Administration of the U.S. Department of Health and Human
Services (the “FDA”), the European Medicines Agency (“EMA”), any applicable institutional
review board (“IRBs”) or by any foreign, federal, state or local regulatory authority performing functions
similar to those performed by the FDA, EMA or IRBs); except in the case of each of clauses (ii) and (iii), such as would not have or
reasonably be expected to result in a Material Adverse Effect.
(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, approval, waiver, authorization or order of, give any notice
to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory
organization, stock exchange or other trading market, or other Person in connection with the execution, delivery and performance by the
Company of the Transaction Documents, other than: (i) the filing with the Commission of the Report of Foreign Private Issuer on Form 6-K
to be filed by the Company with the Commission pursuant to Section 4.6 of this Agreement, (ii) the application to the Trading Market for
the issuance and sale of the Securities and the listing of the Shares and Warrant Shares for trading thereon, (iii) such filings as are
required to be made under applicable state securities laws or a Form D with the Commission in connection with the offering and issuance
of the Securities hereunder, (iv) the filing with the Commission pursuant to the Registration Rights Agreement, and (v) the obligation
to provide notice to the Israel Innovation Authority (the “IIA”) (collectively, the “Required Approvals”).
The Company is unaware of any facts or circumstances that might prevent the Company from obtaining the approval of the Trading Market
for the listing of the Shares and Warrant Shares for trading thereon effective immediately upon the Closing.
(f) Issuance
of the Securities. The Shares, Warrants and the Warrant Shares, are duly authorized and, when issued and paid for in accordance with
the terms of this Agreement and the Warrants, as applicable, will be duly and validly issued, fully paid and nonassessable, free and clear
of all Liens other than restrictions on transfer pursuant to applicable securities laws. The issuance and delivery of the Shares and Warrants
are not and will not be subject to preemptive, co-sale, right of first refusal or any other similar rights of any shareholder of the Company
or any other person, or any Liens or result in the triggering of any anti-dilution or other similar rights under any outstanding securities
of the Company. The Company has reserved from its duly authorized capital shares the maximum number of Shares issuable pursuant to this
Agreement and the Warrants.
(g) Capitalization.
As of the date hereof the authorized, issued and outstanding share capital of the Company was as set forth in the SEC Reports. All
of the shares of issued and outstanding share capital of the Company have been duly authorized and validly issued and are fully paid
and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of the preemptive or
other similar rights of any security holder of the Company. No Person has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as set
forth in the SEC Reports, as contemplated by this Agreement or with respect to awards of restricted stock units under the
Company’s equity incentive plans since its most recently filed periodic report under the Exchange Act, there are no
outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe
for or acquire, any Ordinary Shares, or contracts, commitments, understandings or arrangements by which the Company or any
Subsidiary is or may become bound to issue additional Ordinary Shares or Ordinary Share Equivalents (including, for the avoidance of
doubt, as a result of entering into this Agreement). There are no outstanding securities or instruments of the Company or any
Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an
issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the Company or any
Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary.
The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or
agreement. All of the outstanding shares of the Company are duly authorized, validly issued, fully paid and nonassessable, have been
issued in compliance with the Israeli Companies Law, 5759-1999 (the “Companies Law”), the Israeli Securities Law,
5728-1968, as amended, and the regulations promulgated thereunder, and all federal and state securities laws, and none of such
outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The
offers and sales of the Company’s securities were at all relevant times either registered under the Securities Act and the
applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers, exempt from
such registration requirements. No further approval or authorization of any stockholder, the Board of Directors or others is
required for the issuance and sale of the Securities. There are no shareholders agreements, voting agreements or other similar
agreements with respect to the Company’s share capital to which the Company is a party or between or among any of the
Company’s shareholders.
(h) SEC Reports;
Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by
the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding
the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the “SEC
Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements
of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of
a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The financial statements of the Company contained in the
SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally
accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”) , except as may be
otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all
footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.
(i) Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included
within the SEC Reports, (i) there has been no event, occurrence or development that has had or that could reasonably be expected to
result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A)
trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities
not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the
Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or
distribution of cash or other property to its shareholders or purchased, redeemed or made any agreements to purchase or redeem any
of its share capital, (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to
existing Company stock option plans and (vi) except as disclosed in the SEC Reports, no officer or director has resigned from any
position with the Company. The Company does not have pending before the Commission any request for confidential treatment of
information. No event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to
occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations,
assets or financial condition that would be required to be disclosed by the Company under applicable securities laws. Unless
otherwise disclosed in an SEC Report filed prior to the date hereof, the Company has not: (i) issued any securities or incurred any
liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other
distribution on or in respect to its share capital.
(j) Litigation.
There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened
against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental
or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which
(i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or (ii) could, if there
were an unfavorable decision, have or would reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any
Subsidiary, nor any director or executive officer thereof, is or has been the subject of any Action involving a claim of violation of
or liability under U.S. federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge
of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former
director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration
statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(k) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the
Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its
Subsidiaries’ employees is a member of a union, labor organization or works council that relates to such employee’s
relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective
bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. Neither
the Company nor any of its Subsidiaries is subject to, and no employee benefits from, any extension order (tzav harchava), except
for extension orders which generally apply to all employees in Israel. No executive officer of the Company or any Subsidiary, is, or
is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary
information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any
third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to
any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in material compliance with all
Israeli (and, if any, all applicable U.S. federal, state and local and foreign) laws and regulations relating to employment and
employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could
not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect. All obligations of the
Company to provide statutory severance pay to all its currently engaged employees in Israel are, with such exceptions as are not
material, in accordance with Section 14 of the Israeli Severance Pay Law, 5723-1963 (the “Severance Pay Law”),
and are fully funded or are accrued on the Company’s financial statements, and all such employees have been subject to the
provisions of Section 14 of the Severance Pay Law with respect to their entire salary, as defined under the Severance Pay Law, from
the date of commencement of their employment with the Company, and the Company has been, with such exceptions as are not material,
in full compliance with the technical and substantive requirements for a Section 14 Arrangement with respect to severance pay with
respect to 100% of such salary for which severance pay is due under the Severance Pay Law; and all amounts that the Company is
required by contract or applicable law either (A) to deduct from Israeli employees’ salaries or to transfer to such Israeli
employees’ pension or provident, life insurance, incapacity insurance, advance study fund or other similar funds or (B) to
withhold from the Israeli employees’ salaries and benefits and to pay to any Israeli governmental authority as required by
applicable Israeli tax law, have, in each case, been duly deducted, transferred, withheld and paid, and the Company has no
outstanding obligation to make any such deduction, transfer, withholding or payment.
(l) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or
any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement
or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default
or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority
or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality
and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse
Effect.
(m) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution
or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata),
including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as
all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received
all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and
(iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii),
the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(n) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (each, a “Material
Permit”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification
of any Material Permit. The disclosures in the Registration Statement concerning the effects of federal, state, local and all foreign
regulation on the Company’s business as currently contemplated are correct in all material respects.
(o) Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to, or have valid and marketable rights
to lease or otherwise use, all real property and all personal property that is material to the business of the Company and the
Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property
and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and
(ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made in accordance with GAAP,
and the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the
Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the
Subsidiaries are in compliance.
(p) Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, technologies, data, methods, processes, inventions, copyrights, works of authorship, licenses
and other intellectual property rights and similar rights necessary or required for use in connection with their respective businesses
as described in the SEC Reports (collectively, the “Intellectual Property Rights”). None of, and neither the Company
nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated
or been invalidated or abandoned, or is expected to expire or terminate or be invalidated or abandoned, within two years from the date
of this Agreement. Neither the Company nor any Subsidiary has received, since the date of the Company’s latest audited financial
statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property
Rights, or any other activities or conduct engaged in by the Company or the Subsidiaries, violate or infringe upon the rights of any Person.
To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another
Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have, where applicable, taken reasonable security
measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so could
not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(q) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited
to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business without a significant increase in cost.
(r) Transactions
With Affiliates and Employees. Except as set forth in the SEC Reports, none of the officers or directors of the Company or any Subsidiary
and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with
the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing
for the borrowing of money from or lending of money to or otherwise requiring payments to or from, any officer, director or such employee
or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is
an officer, director, trustee, shareholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary,
bonus or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee
benefits, including stock option agreements under any stock option plan of the Company.
(s) Sarbanes-Oxley;
Internal Accounting Controls. The Company is in compliance in all material respects with the applicable provisions of
Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley”) and all applicable rules of Nasdaq (“Exchange
Rules”). The Company and each of its Subsidiaries maintain a system of internal controls, including disclosure controls
and procedures, internal controls over accounting matters and financial reporting and legal and regulatory controls (collectively,
“Internal Controls”) that comply with the applicable securities laws and are sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management’s general or specific authorization, (ii)
transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain
accountability for assets, (iii) access to assets is permitted only in accordance with management’s general or specific
authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. The Internal Controls are overseen by the Audit Committee in accordance
with applicable Exchange Rules. The Company has not publicly disclosed or reported to the Audit Committee or the Board of Directors,
and within the next 135 days the Company does not reasonably expect to publicly disclose or report to the Audit Committee or the
Board of Directors, a significant deficiency, a material weakness, change in Internal Controls or fraud involving management or
other employees who have a significant role in Internal Controls, any violation of, or failure to comply with, the securities laws,
or any matter which, if determined adversely, would have a Material Adverse Effect. For purpose of this section,
“Securities Law” shall mean, collectively, the Sarbanes-Oxley, the Securities Act, the Exchange Act, the auditing
principles, rules, standards and practices applicable to auditors of “issuers” (as defined in Sarbanes-Oxley)
promulgated or approved by the Public Company Accounting Oversight Board and, as applicable, the Exchange Rules. The books, records
and accounts of the Company and its Subsidiaries accurately and fairly reflect, the transactions in, and dispositions of, the assets
of, and the results of operations of, the Company and its Subsidiaries.
(t) Certain Fees.
Except for fees payable to the Placement Agent, no brokerage or finder’s fees or commissions are or will be payable by the Company,
any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation
with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section
that may be due in connection with the transactions contemplated by the Transaction Documents.
(u) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for and the issuance of the Securities,
will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration
under the Investment Company Act of 1940, as amended.
(v) Registration
Rights. Except as disclosed in the SEC Reports and required herein, no Person has any right to cause the Company to effect the registration
under the Securities Act of any securities of the Company or any Subsidiary.
(w) Listing
and Maintenance Requirements. The Ordinary Shares are registered pursuant to Section 12(b) of the Exchange Act, and the Company
has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the
Ordinary Shares under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration. The Ordinary Shares have been approved for listing on the Trading Market. Except as disclosed in the
SEC Reports, (i) the Company has not, in the twelve (12) months preceding the date hereof, received notice from any Trading Market
on which the Ordinary Shares are or have been listed or quoted to the effect that the Company is not in compliance with the listing
or maintenance requirements of such Trading Market and (ii) the Company is, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Ordinary Shares are
currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the
Company is current in payment of the fees of the Depository Trust Company (or such other established clearing corporation) in
connection with such electronic transfer.
(x) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information
that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed in the SEC Reports.
The Company understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities
of the Company. All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries,
their respective businesses and the transactions contemplated hereby is true and does not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they
were made, not misleading. The press releases disseminated by the Company during the twelve (12) months preceding the date of this Agreement
taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the circumstances under which they were made and when made, not misleading.
The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in Section 3.2 hereof.
(y) No Integrated
Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company,
nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security
or solicited any offers to buy any security, under circumstances that would cause this offering of the Securities to be integrated with
prior offerings by the Company for purposes of the Securities Act which would require the registration of any such offering under the
Securities Act.
(z) Tax Status.
The Company and its Subsidiaries each (i) has made or filed all material United States federal, state and local income and all Israeli
and foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid
all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports
and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods
subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed
to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such
claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration Statement
are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated
financial statements. The term “taxes” mean all federal, state, local, foreign, and other net income, gross income, gross
receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges
of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto. The
term “returns” means all returns, declarations, reports, statements, and other documents required to be filed in respect to
taxes. Based upon the estimated value of the Company’s assets, including any goodwill, and the nature and estimated composition
of its income and assets, the Company may be classified as a “passive foreign investment company” for the taxable year ended
December 31, 2023 and in future taxable years.
(aa) No General
Solicitation. Neither the Company nor any person acting on behalf of the Company has offered or sold any of the Securities by any
form of general solicitation or general advertising. The Company has offered the Securities for sale only to the Purchasers and certain
other (i) “accredited investors” within the meaning of Rule 501 under the Securities Act, and (an “Accredited Investor”)
and (ii) “non-US persons” as defined in Regulation S as promulgated under the Securities Act.
(bb) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other
person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign
or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii)
failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the
Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of FCPA or Sections 291 and 291A
of the Israeli Penal Law, 5737-1977, as amended. The Company has taken reasonable steps to ensure that its accounting controls and procedures
are sufficient to cause the Company to comply in all material respects with the FCPA and Israel’s Penal Law, 5737-1977, as amended.
(cc) Acknowledgment
Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting solely
in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby.
The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their
respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely
incidental to the Purchasers’ purchase of the Securities. The Company further represents to each Purchaser that the Company’s
decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions
contemplated hereby by the Company and its representatives.
(dd) Acknowledgement
Regarding Purchasers’ Trading Activity. Anything in this Agreement or any other Transaction Document to the contrary notwithstanding
(except for Sections 3.2(f) and 4.5 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been
asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the
Company, or “derivative” securities based on securities issued by the Company or to hold the Securities for any specified
term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales
or “derivative” transactions, before or after the closing of this or future private placement transactions, may negatively
impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative”
transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short” position in the
Ordinary Shares, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party
in any “derivative” transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage
in hedging and/or trading activities at various times during the period that the Securities are outstanding or subject to issuance hereunder
and (z) such hedging and/or trading activities (if any) could reduce the value of the existing shareholders’ equity interests in the Company
at and after the time that the hedging and/or trading activities are being conducted. The Company acknowledges that such aforementioned
hedging and/or trading activities do not constitute a breach of any of the Transaction Documents.
(ee) Regulation
M Compliance. The Company has not, and to its knowledge no one acting on its behalf has: (i) taken, directly or indirectly, any action
designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale
or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of the Securities,
or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company,
other than, in the case of clauses (ii) and (iii), compensation paid to the Placement Agent in connection with the placement of the Securities.
(ff) Office of
Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department or has engaged in business in an “enemy state” pursuant to the Israeli Trade
with the Enemy Ordinance, 1939.
(gg) U.S. Real
Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.
(hh) Bank Holding
Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as
amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a
bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries
or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.
(ii) Money Laundering.
The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping
and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes
in the U.S. and Israel and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”),
and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company
and any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(jj) Application
of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company’s articles of association (or similar charter documents) or the laws of its state of incorporation
that is or could become applicable as a result of the Underwriter and the Company fulfilling their obligations or exercising their rights
under the Transaction Documents.
(kk) Off Balance
Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its Subsidiaries and
an unconsolidated or other off balance sheet entity that is required to be disclosed by the Company in its Exchange Act filings and is
not so disclosed or that otherwise could be reasonably likely to have a Material Adverse Effect.
(ll) Private
Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, no registration
under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated hereby.
(mm) No Disqualification
Events. With respect to the Securities to be offered and sold hereunder in reliance on Rule 506 under the Securities Act, none of
the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other officer of the Company participating
in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated
on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company
in any capacity at the time of sale (each, an “Issuer Covered Person”) is subject to any of the “Bad Actor”
disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except
for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer
Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations
under Rule 506(e), and has furnished to the Purchasers a copy of any disclosures provided thereunder.
(nn) Notice of
Disqualification Events. The Company will notify the Purchasers in writing, prior to the Closing Date of (i) any Disqualification
Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, reasonably be expected to become
a Disqualification Event relating to any Issuer Covered Person, in each case of which it is aware.
(oo) No Other
Agreements. Other than this Agreement the Company has not entered into any agreement or understanding with any Purchaser in connection
with such Purchaser’s direct or indirect investment in the Company.
(pp) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company
of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount
that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent
liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as
now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the
business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current
cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into
account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts
are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account
the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances
which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction
within one year from the Closing Date. The SEC Reports sets forth as of the date hereof all outstanding secured and unsecured Indebtedness
of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. Neither the Company nor any Subsidiary is
in default with respect to any Indebtedness.
(qq) Company
Auditor. To the knowledge and belief of the Company, Kost, Forer, Gabbay & Kasierer, Certified Public Accountants
(Israel), an independent registered public accounting firm and a member firm of Ernst & Young Global
(“KFGK”), (i) is an independent registered public accounting firm as required by the Exchange Act and (ii) shall
express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year
ending December 31, 2024. KFGK has not provided to the Company any non-audit services, as such term is used in Section 10A(g) of the
Exchange Act.
(rr) Form
F-3 Eligibility. The Company is eligible to register the resale of the Securities by the Purchaser on Form F-3 promulgated under the
Securities Act.
(ss) Cybersecurity.
(i)(x) To the Company’s knowledge, there has been no material security breach or other compromise of or relating to any of the Company’s
or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective
customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively,
“IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of
any event or condition that would reasonably be expected to result in, any material security breach or other compromise to its IT Systems
and Data; (ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders,
rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations
relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access,
misappropriation or modification, except as would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the
Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards to maintain and protect their material
confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company
and the Subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practices.
(tt) Compliance
with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the last three (3) years were, in
material compliance with all applicable state, federal and foreign data privacy and security laws and regulations, including, without
limitation, the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679) (collectively, “Privacy
Laws”); (ii) the Company and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed
to ensure compliance with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure,
handling and analysis of Personal Data (as defined below) (the “Policies”); (iii) the Company provides accurate
notice of its applicable Policies to its customers, employees, third party vendors and representatives as required by the Privacy Laws;
and (iv) applicable Policies provide accurate and sufficient notice of the Company’s then-current privacy practices relating
to its subject matter, and do not contain any material omissions of the Company’s then-current privacy practices, as required by
Privacy Laws. “Personal Data” means (i) a natural person’s name, street address, telephone number,
email address, photograph, social security number, bank information, or customer or account number; (ii) any information which would
qualify as “personally identifying information” under the Federal Trade Commission Act, as amended; (iii) “personal
data” as defined by GDPR; and (iv) any other piece of information that allows the identification of such natural person, or
his or her family, or permits the collection or analysis of any identifiable data related to an identified person’s health or sexual
orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive
in violation of any Privacy Laws and (ii) the execution, delivery and performance of the Transaction Documents will not result in
a material breach of any Privacy Laws or Policies. Neither the Company nor the Subsidiaries (i) to the knowledge of the Company,
has received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation
by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part,
any investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or
(iii) is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that
imposed any obligation or liability under any Privacy Law
(uu) Foreign
Private Issuer. The Company is a “foreign private issuer” as defined in Rule 405 promulgated under the Securities Act.
(vv) Consent
to Jurisdiction. The Company has the power to submit, and pursuant to Section 5.9 of this Agreement has legally, validly, effectively
and irrevocably submitted, to the jurisdiction of any federal or state court in the State of New York, County of New York, and has the
power to designate, appoint and empower, and pursuant to Section 5.9 of this Agreement has legally, validly and effectively designated,
appointed and empowered, an agent for service of process in any suit or proceeding based on or arising under this Agreement in any federal
or state court in the State of New York.
3.2 Representations and Warranties
of the Purchasers. Each Purchaser severally, for itself and for no other Purchaser, hereby represents and warrants as of the date
hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein):
(a) Organization;
Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and (where such concept
is applicable) in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership,
limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction
Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents
and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary
corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction Document
to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof,
will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except:
(i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited
by applicable law.
(b) Understandings
or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and has no direct or indirect
arrangement or understandings with any other persons to distribute or regarding the distribution of such Securities (this
representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to the Registration Statement
or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Securities hereunder
in the ordinary course of its business. Such Purchaser understands that the Securities are “restricted securities” and
have not been registered under the Securities Act or any applicable state securities law and is acquiring the Securities as
principal for its own account and not with a view to or for distributing or reselling such Securities or any part thereof in
violation of the Securities Act or any applicable state securities law, has no present intention of distributing any of such
Securities in violation of the Securities Act or any applicable state securities law and has no direct or indirect arrangement or
understandings with any other persons to distribute or regarding the distribution of such Securities in violation of the Securities
Act or any applicable state securities law (this representation and warranty not limiting such Purchaser’s right to sell the
Securities pursuant to a registration statement or otherwise in compliance with applicable federal and state securities laws). Such
Purchaser acknowledges that (i) the Company is under no legal or contractual obligation to register the Securities for sale or
resale under the Securities Act and (ii) the Placement Agent will be receiving, on the Closing Date, a cash fee of seven percent
(7%) of the gross proceeds raised by the Company for the placement of the Securities hereunder.
(c) Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is a “non-US” person”
as defined in Regulation S as promulgated under the Securities Act and/or an “accredited investor” as defined in Rule 501(a)(1),
(a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act.
(d) Experience
of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience
in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities,
and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete loss of such investment. Such Purchaser acknowledges that as of the
date hereof, the Company has very limited financial resources, and thus an investment in the Securities is subject to significant risk.
(e) Access to
Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits
and schedules thereto) and the SEC Reports and has been afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Securities
and the merits and risks of investing in the Securities; (ii) access to information about the Company and its financial condition, results
of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity
to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary
to make an informed investment decision with respect to the investment. Such Purchaser acknowledges and agrees that neither the Placement
Agent nor any Affiliate of the Placement Agent has provided such Purchaser with any information or advice with respect to the Securities
nor is such information or advice necessary or desired. Neither the Placement Agent nor any Affiliate has made or makes any representation
as to the Company or the quality of the Securities and the Placement Agent and any Affiliate may have acquired non-public information
with respect to the Company which such Purchaser agrees need not be provided to it. In connection with the issuance of the Securities
to such Purchaser, neither the Placement Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser
(f) Certain Transactions
and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has any Person acting
on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly, executed any purchases or sales, including
Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first received a term sheet
(written or oral) from the Company or any other Person representing the Company setting forth the material terms of the transactions contemplated
hereunder and ending immediately prior to the execution hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed
investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers
have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s
assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that
made the investment decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement
or to such Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal counsel and other
advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection
with this transaction (including the existence and terms of this transaction).
Notwithstanding the foregoing, for the
avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating
or borrowing shares in order to effect Short Sales or similar transactions in the future.
(g) General Solicitation.
Such Purchaser is not purchasing the Securities as a result of any advertisement, article, notice or other communication regarding the
Securities published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or,
to the knowledge of such Purchaser, any other general solicitation or general advertisement.
(h) Other Company
Holdings. Other than as previously disclosed by such Purchaser to the Company, as of the Closing Date, and prior to the consummation
of the transactions contemplated by this Agreement, such Purchaser is not, collectively with its Affiliates or any Person with whom such
Purchaser is acting in concert, a holder of Ordinary Shares or Ordinary Shares Equivalents in an amount equal to more than 9.99% of the
outstanding Ordinary Shares (assuming full exercise or conversion of any such Ordinary Shares Equivalents).
(i) Limitation
Under Section 328. Such Purchaser acknowledges and agrees that it may not beneficially own any Ordinary Shares or Ordinary Shares
Equivalents in an amount equal to more than 24.99% of the Company’s outstanding Ordinary Shares at any time without having received
approval of the Company’s shareholders under Section 328 of the Companies Law. Such Purchaser further acknowledges and agrees that
the Company has not agreed to seek shareholder approval under Section 328 of the Companies Law to permit any Purchaser to beneificially
own in excess of 24.99% of the Company’s outstanding Ordinary Shares.
(j) No Disqualification
Events. With respect to the Securities (if any) to be offered and sold hereunder in reliance on Rule 506 under the Securities Act,
such Purchaser at the time of sale is not subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i)
to (viii) under the Securities Act, except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3).
The Company acknowledges and agrees that the representations
contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations
and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other
document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated
hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty,
or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 Removal of Legends.
(a) The
Securities may only be disposed of in compliance with U.S. state and U.S. federal securities laws. In connection with any transfer
of Securities other than (i) pursuant to an effective registration statement or Rule 144, (ii) to the Company, (iii) to an Affiliate
of a Purchaser or (iv) in connection with a pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof
to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require
registration under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the
terms of this Agreement and the Registration Rights Agreement and shall have the rights and obligations of a Purchaser under this
Agreement and the Registration Rights Agreement.
(b) The Purchasers
agree to the imprinting, so long as required by this Section 4.1, of a legend on the Securities substantially in the following form (in
addition to any legend required by applicable state securities or “blue sky” laws):
[NEITHER] THIS SECURITY [NOR THE SECURITIES
INTO WHICH THIS SECURITY IS EXERCISABLE] [HAS NOT] [HAVE] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT
IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.
Each certificate representing
the Securities, if such securities are being offered to Purchasers in reliance upon Regulation S, shall be stamped or otherwise imprinted
with a legend substantially in the following form (in addition to any legend required by applicable state securities or “blue sky”
laws):
“[NEITHER] THIS SECURITY [NOR
THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE] HAS [NOT] BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SECURITIES [AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY] NOR
ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) IN ACCORDANCE WITH THE PROVISIONS OF
REGULATION S PROMULGATED UNDER THE SECURITIES ACT, AND BASED ON AN OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY
TO THE COMPANY, THAT THE PROVISIONS OF REGULATION S HAVE BEEN SATISFIED, (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (3) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES [OR THE SECURITIES ISSUABLE
UPON EXERCISE OF THIS SECURITY] MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO
AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS
INVOLVING THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”
(c) The
Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered
broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited investor”
as defined in Rule 501(a) under the Securities Act and, if required under the terms of such arrangement, such Purchaser may transfer pledged
or secured Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company and
no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further, no notice
shall be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation
as a pledgee or secured party of Securities may reasonably request in connection with a pledge or transfer of the Securities, including,
if the Securities are subject to registration pursuant to the Registration Rights Agreement, the preparation and filing of any required
prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable provision of the Securities Act to appropriately
amend the list of selling stockholders identified in the resale registration statement thereunder.
(d) Certificates
or book entry notations evidencing the Securities shall not contain any legend (including the legend set forth in Section 4.1(b) hereof),
and the Company shall take such actions as may be necessary to remove any such legend: (i) while a registration statement covering the
resale of such security is effective under the Securities Act, or (ii) following any sale of such Securities pursuant to Rule 144 (assuming
cashless exercise of the Warrants) or (iii) if such Securities are eligible for sale under Rule 144 (assuming cashless exercise of the
Warrants) or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations
and pronouncements issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion to the Transfer
Agent or the Purchaser promptly if required by the Transfer Agent to effect the removal of the legend hereunder, or if requested by a
Purchaser, respectively. If there is an effective registration statement to cover the resale of the Securities, or if such Securities
may be sold under Rule 144 or if such legend is not otherwise required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the staff of the Commission) then the certificates or book entry notations evidencing
such Securities shall be free of all legends. The Company agrees that following such time as such legend is no longer required under this
Section 4.1(c), the Company will, no later than the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising
the Standard Settlement Period (as defined below) following the delivery by a Purchaser to the Company or the Transfer Agent of a certificate
representing Securities, as applicable, issued with a restrictive legend (such first (1st) Trading Day, the “Legend Removal Date”),
deliver or cause to be delivered to such Purchaser a certificate representing such shares that is free from all restrictive and other
legends. The Company may not make any notation on its records or give instructions to the Transfer Agent that enlarge the restrictions
on transfer set forth in this Section 4. Certificates for Securities subject to legend removal hereunder shall be transmitted by the Transfer
Agent to the Purchaser by crediting the account of the Purchaser’s prime broker with the Depository Trust Company System as directed
by such Purchaser. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in
a number of Trading Days, on the Company’s primary Trading Market with respect to the Ordinary Shares as in effect on the date of
delivery of a certificate representing Securities issued with a restrictive legend.
(e) In
addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, (i) as partial
liquidated damages and not as a penalty, for each $1,000 of Shares or Warrant Shares (based on the VWAP of the Ordinary Shares on
the date such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section
4.1(c), $5 per Trading Day (increasing to $10 per Trading Day five (5) Trading Days after the Legend Removal Date) for each Trading
Day after the Legend Removal Date until such certificate is delivered without a legend and (ii) if the Company fails to (a) issue
and deliver (or cause to be delivered) to a Purchaser by the Legend Removal Date a certificate representing the Securities so
delivered to the Company by such Purchaser that is free from all restrictive and other legends and (b) if after the Legend Removal
Date such Purchaser purchases (in an open market transaction or otherwise) Ordinary Shares to deliver in satisfaction of a sale by
such Purchaser of all or any portion of the number of Ordinary Shares, or a sale of a number of Ordinary Shares equal to all or any
portion of the number of Ordinary Shares that such Purchaser anticipated receiving from the Company without any restrictive legend,
then, an amount equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and other
out-of-pocket expenses, if any) for the Ordinary Shares so purchased (including brokerage commissions and other out-of-pocket
expenses, if any) (the “Buy-In Price”) over the product of (A) such number of Shares or Warrant Shares that the Company
was required to deliver to such Purchaser by the Legend Removal Date multiplied by (B) the lowest closing sale price of the Ordinary
Shares on any Trading Day during the period commencing on the date of the delivery by such Purchaser to the Company of the
applicable Shares or Warrant Shares (as the case may be) and ending on the date of such delivery and payment under this clause
(ii).
(f) Each Purchaser,
severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell any Securities pursuant to
either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption
therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold in compliance with the plan of distribution
set forth therein, and acknowledges that the removal of the restrictive legend from certificates representing Securities as set forth
in this Section 4.1 is predicated upon the Company’s reliance upon this understanding.
4.2 Furnishing of Information;
Public Information.
(a) Until the earlier
of the time that (i) the Securities issued hereunder may be sold under Rule 144 without conditions or (ii) the Warrants have expired,
the Company covenants to maintain the registration of the Ordinary Shares under Section 12(b) or 12(g) of the Exchange Act and to timely
file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company
after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange
Act.
(b) At any
time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of the
Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public
information requirement under Rule 144(c) or (ii) has ever been an issuer described in Rule 144(i)(1)(i) or becomes an issuer in the
future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) (a “Public Information Failure”)
then, in addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, as partial
liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell the Securities, an
amount in cash equal to one percent (1.0%) of the aggregate Subscription Amount of such Purchaser’s Securities on the day of a
Public Information Failure and on every thirtieth (30th) day (pro rated for periods totaling less than thirty days) thereafter until
the earlier of (a) the date such Public Information Failure is cured and (b) such time that such public information is no longer
required for the Purchasers to transfer the Shares and Warrant Shares pursuant to Rule 144. The payments to which a Purchaser shall
be entitled pursuant to this Section 4.2(b) are referred to herein as “Public Information Failure Payments.” Public
Information Failure Payments shall be paid on the earlier of (i) the last day of the calendar month during which such Public
Information Failure Payments are incurred and (ii) the third (3rd) Business Day after the event or failure giving rise to the Public
Information Failure Payments is cured. In the event the Company fails to make Public Information Failure Payments in a timely
manner, such Public Information Failure Payments shall bear interest at the rate of 0.75% per month (prorated for partial months)
until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual damages for the Public Information
Failure, and such Purchaser shall have the right to pursue all remedies available to it at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief.
4.3 Integration. The
Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section
2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require the registration
under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of the Securities for purposes
of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent transaction.
4.4 Use of Proceeds.
The Company shall use the net proceeds from the sale of the Securities hereunder for working capital and general corporate purposes.
4.5 Certain Transactions
and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it, nor any Affiliate
acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales, of any of the
Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions
contemplated by this Agreement are first publicly announced. Each Purchaser, severally and not jointly with the other Purchasers, and
the Company covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company, it
will maintain the confidentiality of the existence and terms of this transaction and the information included in the Transaction Documents.
4.6 Securities Laws Disclosure;
Publicity. On or before 9:00 a.m., New York City time, on the first Business Day following the date of this Agreement, the Company
shall issue a press release and on or before 9:00 a.m., New York City time, on the fourth Business Day following the date of this Agreement
file a Report of Foreign Private Issuer on Form 6-K describing the terms of the transactions contemplated by this Agreement and disclosing
any other material, nonpublic information that the Company may have provided to any Purchaser at any time prior thereto and attaching
the material Transaction Documents (including, without limitation, this Agreement) as exhibits to such filing (including all attachments,
the “Form 6-K”). From and after the filing of the Form 6-K, the Company represents to the Purchasers that it shall
have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries,
or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction
Documents. In addition, effective upon the filing of the Form 6-K, the Company acknowledges and agrees that any and all confidentiality
or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective
officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or any of their Affiliates on the other
hand, shall terminate. The Company and each Purchaser shall consult with each other in issuing any press releases with respect to the
transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any
such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior
consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed,
except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice
of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser,
or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written
consent of such Purchaser, except (a) as required by federal securities law in connection with (i) any registration statement filed in
accordance with the Registration Rights Agreement and (ii) the filing of final Transaction Documents with the Commission and (b) to the
extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior
notice of such disclosure permitted under this clause (b).
4.7 Shareholder Rights
Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser
is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution
under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser
could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the Transaction Documents
or under any other agreement between the Company and the Purchasers.
4.8 Listing of Ordinary
Shares. The Company hereby agrees to use reasonable best efforts to maintain the listing or quotation of the Ordinary Shares on the
Trading Market and to secure the listing of all of the Shares and Warrant Shares on the Trading Market with immediate effect upon the
issuance of the Shares and Warrant Shares. The Company further agrees, if the Company applies to have the Ordinary Shares traded on any
other Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take such other action as
is necessary to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible.
The Company will then take all action reasonably necessary to continue the listing and trading of its Ordinary Shares on a Trading Market
and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading
Market. The Company agrees to maintain the eligibility of the Ordinary Shares for electronic transfer through the Depository Trust Company
or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company
or such other established clearing corporation in connection with such electronic transfer.
4.9 Indemnification
by Company. Subject to the provisions of this Section 4.9, the Company will indemnify and hold each Purchaser and its directors,
officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a
Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within
the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders,
agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”)
harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such
Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties,
covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted
against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any shareholder of the Company who
is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents
(unless such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the
Transaction Documents or any agreements or understandings such Purchaser Party may have with any such shareholder or any violations
by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross
negligence, willful misconduct or malfeasance) or (c) in connection with any registration statement of the Company providing for the
resale by the Purchasers of the Securities, the Company will indemnify each Purchaser Party, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable
attorneys’ fees) and expenses, as incurred, arising out of or relating to (i) any untrue or alleged untrue statement of a
material fact contained in such registration statement, any prospectus or any form of prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in the case of any prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading, except to the extent, but only to the extent, that such
untrue statements or omissions are based solely upon information regarding such Purchaser furnished in writing to the Company by
such Purchaser expressly for use therein, or (ii) any violation or alleged violation by the Company of the Securities Act, the
Exchange Act or any state securities law, or any rule or regulation thereunder in connection therewith. If any action shall be
brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party
shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its
own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in
any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such
Purchaser Party except to the extent that (x) the employment thereof has been specifically authorized by the Company in writing, (y)
the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (z) in such action there
is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the
position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more
than one such separate counsel. The Company will not be liable to any Purchaser Party under this Agreement (1) for any settlement by
a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed;
or (2) to the extent, but only to the extent that a loss, claim, damage or liability is finally adjudicated to be attributable to
any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party
in this Agreement or in the other Transaction Documents. The indemnification required by this Section 4.9 shall be made by periodic
payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred.
The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party
against the Company or others and any liabilities the Company may be subject to pursuant to law.
4.10 Reservation of Ordinary
Shares. As of the date hereof, the Company shall reserve and keep available at all times, free of preemptive rights, a sufficient
number of Ordinary Shares for the purpose of enabling the Purchasers to fully exercise the Warrants.
4.11 Equal Treatment of
Purchasers. No consideration (including any modification of any Transaction Document) shall be offered or paid to any Person to amend
or consent to a waiver or modification of any provision of the Transaction Documents unless the same consideration is also offered to
all of the parties to the Transaction Documents. For clarification purposes, this provision constitutes a separate right granted to each
Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class
and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting
of Securities or otherwise.
4.12 Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents,
which shall be disclosed pursuant to Section 4.6, the Company covenants and agrees that neither it, nor any other Person acting on its
behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes,
material non-public information, unless prior thereto such Purchaser shall have consented in writing to the receipt of such information
and agreed in writing with the Company to keep such information confidential. The Company understands and confirms that each Purchaser
shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any
of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates delivers any material, non-public
information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not
have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, employees, Affiliates
or agents, including, without limitation, the Placement Agent, or a duty to the Company, any of its Subsidiaries or any of their respective
officers, directors, employees, Affiliates or agents, including, without limitation, the Placement Agent, not to trade on the basis of,
such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that any notice
provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any
Subsidiaries, the Company shall simultaneously with the delivery of such notice file such notice with the Commission pursuant to a Form
6-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in
securities of the Company.
4.13 Subsequent
Equity Sales.
(a) From
the date hereof until the later of (1) 30 days after the Effective Date and (2) 90 days after the Closing Date (the “Initial
Standstill Period”), neither the Company nor any Subsidiary shall (i) issue, enter into any agreement to issue or announce the
issuance or proposed issuance of any Ordinary Shares or Ordinary Share Equivalents or (ii) file any registration statement or amendment
or supplement thereto, other than in accordance with the Registration Rights Agreement, or filing a registration statement on Form S-8
in connection with any employee benefit plan.
(b) From
the date hereof until the one year anniversary of the Closing Date, the Company shall be prohibited from effecting or entering into an
agreement to effect any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents (or a combination
of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right
to receive, additional Ordinary Shares either (A) at a conversion price, exercise price or exchange rate or other price that is based
upon, and/or varies with, the trading prices of or quotations for the Ordinary Shares at any time after the initial issuance of such debt
or equity securities or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the
initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related
to the business of the Company or the market for the Ordinary Shares or (ii) enters into, or effects a transaction under, any agreement,
including, but not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price regardless
of whether shares pursuant to such agreement have actually been issued and regardless of whether such agreement is subsequently canceled;
provided, however, after the Initial Standstill Period, that the entry into and/or issuance of Ordinary Shares in an “at
the market” offering shall not be deemed a Variable Rate Transaction. Any Purchaser shall be entitled to obtain injunctive relief
against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
(c) Notwithstanding
the foregoing, this Section 4.13 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an
Exempt Issuance.
4.14 Certain
Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither
it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including
Short Sales, of any of the Company’s securities during the period commencing with the execution of this Agreement and ending
at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release
as described in Section 4.6. Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as
the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as
described in Section 4.6, such Purchaser will maintain the confidentiality of the existence and terms of this transaction (other
than as disclosed to its legal and other representatives). Notwithstanding the foregoing and notwithstanding anything contained in
this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation,
warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that
the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in
Section 4.6, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in
accordance with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first
publicly announced pursuant to the initial press release as described in Section 4.6 and (iii) no Purchaser shall have any duty of
confidentiality or duty not to trade in the securities of the Company to the Company, any of its Subsidiaries, or any of their
respective officers, directors, employees, Affiliates or agent, including , without limitation, the Placement Agent after the
issuance of the initial press release as described in Section 4.6. Notwithstanding the foregoing, in the case of a Purchaser that is
a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and
the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions
of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the
portfolio manager that made the investment decision to purchase the Securities covered by this Agreement.
4.15 Lock-Up
Agreements. The Company shall not amend, modify, waive or terminate any provision of any of the Lock-Up Agreements except to extend
the term of the lock-up period and shall enforce the provisions of each of each Lock-Up Agreement in the accordance with its terms. If
any party to a Lock-Up Agreement breaches any provision of a Lock-Up Agreement, the Company shall promptly use its best efforts to seek
specific performance of the terms of such Lock-Up Agreement.
4.18 Acknowledgment
of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the outstanding Ordinary Shares,
which dilution may be substantial under certain market conditions. The Company further acknowledges that its obligations under the Transaction
Documents, including, without limitation, its obligation to issue the Shares and Warrant Shares pursuant to the Transaction Documents,
are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction, regardless of the effect of
any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive effect that such issuance may
have on the ownership of the other stockholders of the Company.
4.19 Exercise
Procedures. The form of Notice of Exercise included in the Warrants sets forth the totality of the procedures required of the Purchasers
in order to exercise the Warrants. No additional legal opinion, other information or instructions shall be required of the Purchasers
to exercise their Warrants. Without limiting the preceding sentences, no ink-original Notice of Exercise shall be required, nor shall
any
medallion guarantee (or other type of guarantee
or notarization) of any Notice of Exercise form be required in order to exercise the Warrants. The Company shall honor exercises of the
Warrants and shall deliver Warrant Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.
ARTICLE V.
MISCELLANEOUS
5.1 Termination. This
Agreement may be terminated prior to Closing by any Purchaser, as to such Purchaser’s obligations hereunder only and without any
effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties on or before
the fifth (5th) Trading Day following the date hereof; provided, however, that no such termination will affect the right of any party
to sue for any breach by any other party (or parties).
5.2 Fees and Expenses.
Except as expressly set forth in the Transaction Documents, each party shall pay the fees and expenses of its advisers, counsel, accountants
and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery
and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for
same-day processing of any instruction letter delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes
and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.
5.3 Entire Agreement.
The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding of the parties with respect
to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such
matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.
5.4 Notices. Any and
all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered via email attachment
as set forth on the signature pages attached hereto (or, with respect to an assignee or transferee of Securities as contemplated by Section
5.7, at the contact information of such Person provided to the Company in connection with such assignment or transfer) at or prior to
5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email attachment as set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following
the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached
hereto. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Report
of Foreign Private Issuer of Form 6-K.
5.5 Amendments; Waivers.
No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of
an amendment, by the Company and the Purchasers which purchased at least 50.1% in interest of the Shares based on the initial Subscription
Amounts hereunder (or, prior to the Closing, the Company and each Purchaser) or, in the case of a waiver, by the party against whom enforcement
of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely impacts
a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be
required. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall
any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment
or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable
rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser, Any amendment
effected in accordance with accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Securities and the Company.
5.6 Headings. The headings
herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions
hereof.
5.7 Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company may
not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger).
Any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or transfers any Securities,
provided that such transferee agrees in writing, as a pre-condition to such assignment or transfer, to be bound, with respect to the transferred
Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”
5.8 No Third-Party Beneficiaries.
This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person, except (i) each of the Placement Agent, their affiliates
and their representatives shall be entitled to rely on, and shall be protected in acting upon, any certificate, instrument, notice, letter
or any other document or security delivered to any of them by or on behalf of the Company, including accuracy of the representations made
by the Company and the Purchaser herein and (ii) as otherwise set forth in Section 4.9 and this Section 5.8.
5.9 Governing Law.
All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts
of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts
sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably
waives, and agrees not to assert in any action or proceeding, any claim that it is not personally subject to the jurisdiction of any such
court, that such action or proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such action or proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party shall commence an action
or proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Section
4.10, the prevailing party in such action or proceeding shall be reimbursed by the non-prevailing party for its reasonable attorneys’
fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
5.10 Execution. This
Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that
the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery
of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original
thereof.
5.11 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force
and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts
to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
5.12 Rescission and Withdrawal
Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction
Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not
timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw, in its sole discretion
from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to
its future actions and rights; provided, however, that, in the case of a rescission of an exercise of a Warrant, the applicable Purchaser
shall be required to return any Ordinary Shares subject to any such rescinded exercise notice concurrently with the return to such Purchaser
of the aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such
shares pursuant to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).
5.13 Replacement of Securities.
If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to
be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor,
a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction.
The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including
customary indemnity) associated with the issuance of such replacement Securities.
5.14 Independent Nature
of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several and not
joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance
of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document,
and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association,
a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently
protect and enforce its rights, including, without limitation, the rights arising out of this Agreement or out of the other Transaction
Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose.
Each Purchaser has been, or has had the opportunity to be, represented by its own separate legal counsel in its review and negotiation
of the Transaction Documents. For reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to
communicate with the Company through Ellenoff Grossman & Schole LLP. Ellenoff Grossman & Schole LLP does not represent any of
the Purchasers and only represents the Placement Agent. The Company has elected to provide all Purchasers with the same terms and Transaction
Documents for the convenience of the Company and not because it was required or requested to do so by any of the Purchasers. It is expressly
understood and agreed that each provision contained in this Agreement and in each other Transaction Document is between the Company and
a Purchaser, solely, and not between the Company and the Purchasers collectively and not between and among the Purchasers.
5.15 Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein
shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
5.16 Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents
and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to
share prices and Ordinary Shares in any Transaction Document shall be subject to adjustment for reverse and forward share splits, share
dividends, share combinations and other similar transactions of the Ordinary Shares that occur after the date of this Agreement.
5.17 WAIVER OF JURY
TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY
AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES
FOREVER TRIAL BY JURY.
5.18 Survival. All
of the agreements, representations and warranties made by each party hereto in this Agreement shall survive the Closing.
5.19 Remedies. In
addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the
Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary
damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction
Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that
a remedy at law would be adequate.
5.20 Payment
Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part
thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required
to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration
the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
5.21 Liquidated
Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents
is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been
paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due
and payable shall have been canceled.
(Signature Pages Follow)
IN WITNESS WHEREOF, the parties
hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first
indicated above.
| POLYPID LTD. |
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| By: |
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Name: |
Dikla Czaczkes Akselbrad |
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Title: |
Chief Executive Officer |
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| Address for Notice: |
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| 18 Hasivim Street |
| Petach Tikva |
| 495376, Israel |
| E-mail: Dikla.C@polypid.com |
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| With a copy to (which shall not constitute notice): |
| |
| Sullivan & Worcester LLP |
| 1251 Avenue of the Americas |
| New York, NY 10020 |
| Fax Number: (212) 660-3001 |
| Attention: Oded Har-Even, Esq. |
| E-mail: ohareven@sullivanlaw.com |
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
PURCHASER SIGNATURE PAGES
IN WITNESS WHEREOF, the undersigned
have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated
above.
Subscription Amount: $____________
# of Shares Purchased: ____________
# of Ordinary Warrants Purchased: ____________
# of Pre-Funded Warrants Purchased: ____________
| If Investor is an entity, sign here: |
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EIN/Social
Security Number: |
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| If Investor is an individual, sign here: |
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PLEASE COMPLETE FOLLOWING INFORMATION FOR NOTICES:
Address for Notice to Investor:
Address for Delivery of Securities to Investor (if not same as address
for notice):
Exhibit A
Form of Pre-Funded Warrant
[attached hereto]
Exhibit B
Form of Ordinary Warrant
[attached hereto]
Exhibit C
Company’s Wire Instructions
[Please provide]
Exhibit D
Form of Lock-Up Agreement
[attached hereto]
Exhibit E
Form of Registration Rights Agreement
[attached hereto]
Exhibit 99.3
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement
(this “Agreement”) is made and entered into as of December 23, 2024, between PolyPid Ltd., an Israeli company (the
“Company”), and each of the several purchasers signatory hereto (each such purchaser, a “Purchaser”
and, collectively, the “Purchasers”).
This Agreement is made pursuant
to the Securities Purchase Agreement, dated as of the date hereof, by and among the Company and each Purchaser (the “Purchase
Agreement”).
The Company and each Purchaser
hereby agrees as follows:
1. Definitions.
Capitalized terms used
and not otherwise defined herein that are defined in the Purchase Agreement shall have the meanings given such terms in the Purchase Agreement.
As used in this Agreement, the following terms shall have the following meanings:
“Advice”
shall have the meaning set forth in Section 6(c).
“Effectiveness
Date” means, with respect to the Initial Registration Statement required to be filed hereunder, the 90th calendar
day following the date hereof (or, in the event of a “full review” by the Commission, the 120th calendar day following
the date hereof) and with respect to any additional Registration Statements which may be required pursuant to Section 2(c) or Section
3(c), the 90th calendar day following the date on which an additional Registration Statement is required to be filed hereunder
(or, in the event of a “full review” by the Commission, the 120th calendar day following the date such additional
Registration Statement is required to be filed hereunder); provided, however, that in the event the Company is notified
by the Commission that one or more of the above Registration Statements will not be reviewed or is no longer subject to further review
and comments, the Effectiveness Date as to such Registration Statement shall be the fifth Trading Day following the date on which the
Company is so notified if such date precedes the dates otherwise required above, provided, further, if such Effectiveness Date falls on
a day that is not a Trading Day, then the Effectiveness Date shall be the next succeeding Trading Day.
“Effectiveness
Period” shall have the meaning set forth in Section 2(a).
“Event”
shall have the meaning set forth in Section 2(d).
“Event
Date” shall have the meaning set forth in Section 2(d).
“Filing
Date” means, with respect to the Initial Registration Statement required hereunder, the 30th calendar day following
the date hereof and, with respect to any additional Registration Statements which may be required pursuant to Section 2(c) or Section
3(c), the earliest practical date on which the Company is permitted by SEC Guidance to file such additional Registration Statement related
to the Registrable Securities.
“Holder”
or “Holders” means the holder or holders, as the case may be, from time to time of Registrable Securities.
“Indemnified
Party” shall have the meaning set forth in Section 5(c).
“Indemnifying
Party” shall have the meaning set forth in Section 5(c).
“Initial
Registration Statement” means the initial Registration Statement filed pursuant to this Agreement.
“Losses”
shall have the meaning set forth in Section 5(a).
“Plan of
Distribution” shall have the meaning set forth in Section 2(a).
“Prospectus”
means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information previously
omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated by the Commission
pursuant to the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of
any portion of the Registrable Securities covered by a Registration Statement, and all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.
“Registrable
Securities” means, as of any date of determination, (a) any Shares issued by the Company to the Purchaser pursuant to the Purchase
Agreement, (b) any Pre-Funded Warrant Shares then issued and issuable upon exercise of the Pre-Funded Warrants issued by the Company to
the Purchaser pursuant to the Purchase Agreement (assuming on such date the Pre-Funded Warrants are exercised in full without regard to
any exercise limitations therein), (c) any Ordinary Warrant Shares then issued and issuable upon exercise of the Ordinary Warrants issued
by the Company to the Purchaser pursuant to the Purchase Agreement (assuming on such date the Ordinary Warrants are exercised in full
without regard to any exercise limitations therein), (d) any additional Ordinary Shares issued and issuable in connection with any anti-dilution
provisions in the Warrants (in each case, without giving effect to any limitations on exercise set forth in the Warrants) and (e) any
securities issued or then issuable upon any stock split, dividend or other distribution, recapitalization or similar event with respect
to the foregoing; provided, however, that any such Registrable Securities shall cease to be Registrable Securities (and the Company
shall not be required to maintain the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) for
so long as (a) a Registration Statement with respect to the sale of such Registrable Securities is declared effective by the Commission
under the Securities Act and such Registrable Securities have been disposed of by the Holder in accordance with such effective Registration
Statement, (b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) such securities become eligible
for resale without volume or manner-of-sale restrictions and without a current public information requirement pursuant to Rule 144 as
set forth in a written opinion letter to such effect, addressed, delivered and acceptable to the Transfer Agent (assuming that such securities
and any securities issuable upon exercise, conversion or exchange of which, or as a dividend upon which, such securities were issued or
are issuable, were at no time held by any Affiliate of the Company), as reasonably determined by the Company, upon the advice of counsel
to the Company.
“Registration
Statement” means any registration statement required to be filed hereunder pursuant to Section 2(a) and any additional registration
statements contemplated by Section 2(c) or Section 3(c), including (in each case) the Prospectus, amendments and supplements to any such
registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated
by reference or deemed to be incorporated by reference in any such registration statement.
“Rule 415”
means Rule 415 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Selling
Stockholder Questionnaire” shall have the meaning set forth in Section 3(a).
“SEC Guidance”
means any publicly-available written or oral guidance of the Commission staff, or any comments, requirements or requests of the Commission
staff.
2. Shelf Registration.
(a)
On or prior to each Filing Date, the Company shall prepare and file with the Commission a Registration Statement covering the resale
of all of the Registrable Securities that are not then registered on an effective Registration Statement for an offering to be made on
a continuous basis pursuant to Rule 415. Each Registration Statement filed hereunder shall be on Form F-3 (except if the Company is not
then eligible to register for resale the Registrable Securities on Form F-3, in which case such registration shall be on another appropriate
form in accordance herewith, subject to the provisions of Section 2(e)) and shall contain (unless otherwise directed by at least 85% in
interest of the Holders) substantially the “Plan of Distribution” attached hereto as Annex A and substantially
the “Selling Stockholder” section attached hereto as Annex B; provided, however, that no Holder
shall be required to be named as an “underwriter” without such Holder’s express prior written consent, unless so required
by the Commission or under SEC Guidance. Subject to the terms of this Agreement, the Company shall use its commercially reasonable efforts
to cause a Registration Statement filed under this Agreement (including, without limitation, under Section 3(c)) to be declared effective
under the Securities Act as promptly as possible after the filing thereof, but in any event no later than the applicable Effectiveness
Date, and shall use its commercially reasonable efforts to keep such Registration Statement continuously effective under the Securities
Act until the date that all Registrable Securities covered by such Registration Statement (i) have been sold, thereunder or pursuant to
Rule 144, or (ii) may be sold without volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement for the Company
to be in compliance with the current public information requirement under Rule 144, as determined by the counsel to the Company pursuant
to a written opinion letter to such effect, addressed and acceptable to the Transfer Agent (the “Effectiveness Period”).
The Company shall notify the Holders via e-mail of the effectiveness of a Registration Statement on the same Trading Day that the Company
confirms effectiveness with the Commission, which shall be the date requested for effectiveness of such Registration Statement. The Company
shall, by 9:30 a.m. (New York City time) on the Trading Day after the effective date of such Registration Statement, file a final Prospectus
with the Commission if (and only if) required by Rule 424. Failure to so notify the Holder within two (2) Trading Days of such notification
of effectiveness or failure to file a final Prospectus, if required by Rule 424, as foresaid shall be deemed an Event under Section 2(d).
(b)
Notwithstanding the registration obligations set forth in Section 2(a), if the Commission informs the Company that all of the Registrable
Securities cannot, as a result of the application of Rule 415, be registered for resale as a secondary offering on a single registration
statement, the Company agrees to promptly inform each of the Holders thereof and use its commercially reasonable efforts to file amendments
to the Initial Registration Statement as required by the Commission, covering the maximum number of Registrable Securities permitted to
be registered by the Commission, on Form F-3 or such other form available to register for resale the Registrable Securities as a secondary
offering, subject to the provisions of Section 2(e); with respect to filing on Form F-3 or other appropriate form, and subject to the
provisions of Section 2(d) with respect to the payment of liquidated damages; provided, however, that prior to filing such
amendment, the Company shall be obligated to use commercially reasonable efforts to advocate with the Commission for the registration
of all of the Registrable Securities in accordance with the SEC Guidance, including without limitation, Securities Act Rules Compliance
and Disclosure Interpretation 612.09.
(c)
Notwithstanding any other provision of this Agreement and subject to the payment of liquidated damages pursuant to Section 2(d),
if the Commission or any SEC Guidance sets forth a limitation on the number of Registrable Securities permitted to be registered on a
particular Registration Statement as a secondary offering (and notwithstanding that the Company used diligent efforts to advocate with
the Commission for the registration of all or a greater portion of Registrable Securities), unless otherwise directed in writing by a
Holder as to its Registrable Securities, the number of Registrable Securities to be registered on such Registration Statement will be
reduced as follows:
| a. | First, the Company shall reduce or eliminate any securities to be included other than Registrable Securities; |
| b. | Second, the Company shall reduce Registrable Securities represented by Ordinary Warrant Shares (applied,
in the case that some Ordinary Warrant Shares may be registered, to the Holders on a pro rata basis based on the total number of unregistered
Ordinary Warrant Shares held by such Holders); and |
| c. | Third, the Company shall reduce Registrable Securities represented by Shares and Pre-Funded Warrant Shares
(applied, in the case that some Shares and Pre-Funded Warrant Shares may be registered, to the Holders on a pro rata basis based on the
total number of unregistered Shares and Pre-Funded Warrant Shares held by such Holders). |
In the event of a cutback hereunder,
the Company shall give the Holder at least three (3) Trading Days prior written notice along with the calculations as to such Holder’s
allotment. In the event the Company amends the Initial Registration Statement in accordance with the foregoing, the Company will use its
commercially reasonable efforts to file with the Commission, as promptly as allowed by Commission or SEC Guidance provided to the Company
or to registrants of securities in general, one or more registration statements on Form F-3 or such other form available to register for
resale those Registrable Securities that were not registered for resale on the Initial Registration Statement, as amended.
(d)
If: (i) the Initial Registration Statement is not filed on or prior to its Filing Date (if the Company files the Initial Registration
Statement without affording the Holders the opportunity to review and comment on the same as required by Section 3(a) herein or the Company
subsequently withdraws the filing of the Registration Statement, the Company shall be deemed to have not satisfied this clause (i) as
of the Filing Date), or (ii) the Company fails to file with the Commission a request for acceleration of a Registration Statement in accordance
with Rule 461 promulgated by the Commission pursuant to the Securities Act, within five (5) Trading Days of the date that the Company
is notified (orally or in writing, whichever is earlier) by the Commission that such Registration Statement will not be “reviewed”
or will not be subject to further review, or (iii) prior to the effective date of a Registration Statement, the Company fails to file
a pre-effective amendment and otherwise respond in writing to comments made by the Commission in respect of such Registration Statement
within ten (10) Trading Days after the receipt of comments by or notice from the Commission that such amendment is required in order for
such Registration Statement to be declared effective, or (iv) a Registration Statement registering for resale all of the Registrable Securities
is not declared effective by the Commission by the Effectiveness Date of the Initial Registration Statement (provided that, if the Registration
Statement does not allow for the resale of Registrable Securities at prevailing market prices (i.e., only allows for fixed price sales),
the Company shall have been deemed to have not satisfied this clause) or (v) after the effective date of a Registration Statement, such
Registration Statement ceases for any reason to remain continuously effective as to all Registrable Securities included in such Registration
Statement, or the Holders are otherwise not permitted to utilize the Prospectus therein to resell such Registrable Securities, for more
than ten (10) consecutive Trading Days or more than an aggregate of thirty (30) Trading Days (which need not be consecutive Trading Days)
during any 12-month period (any such failure or breach being referred to as an “Event”, and for purposes of clauses
(i) and (iv), the date on which such Event occurs, and for purpose of clause (ii) the date on which such five (5) Trading Day period is
exceeded, and for purpose of clause (iii) the date which such ten (10) Trading Day period is exceeded, and for purpose of clause (v) the
date on which such ten (10) or thirty (30) Trading Day period, as applicable, is exceeded being referred to as “Event Date”),
then, in addition to any other rights the Holders may have hereunder or under applicable law, on each such Event Date and on each monthly
anniversary of each such Event Date (if the applicable Event shall not have been cured by such date) until the applicable Event is cured,
the Company shall pay to each Holder an amount in cash, as partial liquidated damages and not as a penalty, equal to the product of one
percent (1%) multiplied by the aggregate Subscription Amount paid by such Holder pursuant to the Purchase Agreement; provided that in
no event shall the aggregate liquidated damages accruing under this Section 2(d) exceed five percent (5%) of a Holder’s
Subscription Amount. The partial liquidated damages pursuant to the terms hereof shall apply on a daily pro rata basis for any portion
of a month prior to the cure of an Event.
(e)
If Form F-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register
the resale of the Registrable Securities on another appropriate form and (ii) undertake to register the Registrable Securities on Form
F-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Registration Statement then in
effect until such time as a Registration Statement on Form F-3 covering the Registrable Securities has been declared effective by the
Commission.
(f)
Notwithstanding anything to the contrary contained herein, in no event shall the Company be permitted to name any Holder or affiliate
of a Holder as any “underwriter” without the prior written consent of such Holder, except as required by the Commission or
under SEC Guidance.
3. Registration Procedures.
In connection with the Company’s
registration obligations hereunder, the Company shall:
(a)
Not less than five (5) Trading Days prior to the filing of each Registration Statement and not less than one (1) Trading Day prior
to the filing of any related Prospectus or any amendment or supplement thereto (including any document that would be incorporated or deemed
to be incorporated therein by reference), the Company shall (i) furnish to each Holder copies of all such documents proposed to be filed,
which documents (other than those incorporated or deemed to be incorporated by reference) will be subject to the review of such Holders,
and (ii) cause its officers and directors, counsel and independent registered public accountants to respond to such inquiries as shall
be necessary, in the reasonable opinion of respective counsel to each Holder, to conduct a reasonable investigation within the meaning
of the Securities Act. The Company shall not file a Registration Statement or any such Prospectus or any amendments or supplements thereto
to which the Holders of a majority of the Registrable Securities shall reasonably object in good faith, provided that, the Company is
notified of such objection in writing no later than five (5) Trading Days after the Holders have been so furnished copies of a Registration
Statement or one (1) Trading Day after the Holders have been so furnished copies of any related Prospectus or amendments or supplements
thereto. Each Holder agrees to furnish to the Company a completed questionnaire in the form attached to this Agreement as Annex C
(a “Selling Stockholder Questionnaire”) on a date that is not less than two (2) Trading Days prior to the Filing Date
or by the end of the fourth (4th) Trading Day following the date on which such Holder receives draft materials in accordance
with this Section.
(b)
(i) Prepare and file with the Commission such amendments, including post-effective amendments, to a Registration Statement and
the Prospectus used in connection therewith as may be necessary to keep a Registration Statement continuously effective as to the applicable
Registrable Securities for the Effectiveness Period and prepare and file with the Commission such additional Registration Statements in
order to register for resale under the Securities Act all of the Registrable Securities, (ii) cause the related Prospectus to be amended
or supplemented by any required Prospectus supplement (subject to the terms of this Agreement), and, as so supplemented or amended, to
be filed pursuant to Rule 424, (iii) respond as promptly as reasonably possible to any comments received from the Commission with respect
to a Registration Statement or any amendment thereto and provide as promptly as reasonably possible to the Holders true and complete copies
of all correspondence from and to the Commission relating to a Registration Statement (provided that, the Company shall excise any information
contained therein which would constitute material non-public information regarding the Company or any of its Subsidiaries), and (iv) comply
in all material respects with the applicable provisions of the Securities Act and the Exchange Act with respect to the disposition of
all Registrable Securities covered by a Registration Statement during the applicable period in accordance (subject to the terms of this
Agreement) with the intended methods of disposition by the Holders thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.
(c)
If during the Effectiveness Period, the number of Registrable Securities at any time exceeds 100% of the number of Ordinary Shares
then registered in a Registration Statement, then the Company shall file as soon as reasonably practicable, but in any case prior to the
applicable Filing Date, an additional Registration Statement covering the resale by the Holders of not less than the number of such Registrable
Securities.
(d)
Notify the Holders of Registrable Securities to be sold (which notice shall, pursuant to clauses (iii) through (vi) hereof, be
accompanied by an instruction to suspend the use of the Prospectus until the requisite changes have been made) as promptly as reasonably
possible (and, in the case of (i)(A) below, not less than one (1) Trading Day prior to such filing) and (if requested by any such Person)
confirm such notice in writing no later than one (1) Trading Day following the day (i)(A) when a Prospectus or any Prospectus supplement
or post-effective amendment to a Registration Statement is proposed to be filed, (B) when the Commission notifies the Company whether
there will be a “review” of such Registration Statement and whenever the Commission comments in writing on such Registration
Statement, and (C) with respect to a Registration Statement or any post-effective amendment, when the same has become effective, (ii)
of any request by the Commission or any other federal or state governmental authority for amendments or supplements to a Registration
Statement or Prospectus or for additional information, (iii) of the issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of a Registration Statement covering any or all of the Registrable Securities
or the initiation of any Proceedings for that purpose, (iv) of the receipt by the Company of any notification with respect to the suspension
of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation
or threatening of any Proceeding for such purpose, (v) of the occurrence of any event or passage of time that makes the financial statements
included in a Registration Statement ineligible for inclusion therein or any statement made in a Registration Statement or Prospectus
or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires any revisions
to a Registration Statement, Prospectus or other documents so that, in the case of a Registration Statement or the Prospectus, as the
case may be, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (vi) of the
occurrence or existence of any pending corporate development with respect to the Company that the Company believes may be material and
that, in the determination of the Company, makes it not in the best interest of the Company to allow continued availability of a Registration
Statement or Prospectus; provided, however, that in no event shall any such notice contain any information which would constitute
material, non-public information regarding the Company or any of its Subsidiaries, and the Company agrees that the Holders shall not have
any duty of confidentiality to the Company or any of its Subsidiaries and shall not have any duty to the Company or any of its Subsidiaries
not to trade on the basis of such information.
(e)
Use its best efforts to avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order stopping or suspending the
effectiveness of a Registration Statement, or (ii) any suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest practicable moment.
(f)
Furnish to each Holder, without charge, at least one conformed copy of each such Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or deemed to be incorporated therein by reference to the extent
requested by such Person, and all exhibits to the extent requested by such Person (including those previously furnished or incorporated
by reference) promptly after the filing of such documents with the Commission, provided that any such item which is available on the EDGAR
system (or successor thereto) need not be furnished in physical form.
(g)
Subject to the terms of this Agreement, the Company hereby consents to the use of such Prospectus and each amendment or supplement
thereto by each of the selling Holders in connection with the offering and sale of the Registrable Securities covered by such Prospectus
and any amendment or supplement thereto, except after the giving of any notice pursuant to Section 3(d).
(h)
Prior to any resale of Registrable Securities by a Holder, use its commercially reasonable efforts to register or qualify or cooperate
with the selling Holders in connection with the registration or qualification (or exemption from the registration or qualification) of
such Registrable Securities for the resale by the Holder under the securities or Blue Sky laws of such jurisdictions within the United
States as any Holder reasonably requests in writing, to keep each registration or qualification (or exemption therefrom) effective during
the Effectiveness Period and to do any and all other acts or things reasonably necessary to enable the disposition in such jurisdictions
of the Registrable Securities covered by each Registration Statement, provided that the Company shall not be required to qualify generally
to do business in any jurisdiction where it is not then so qualified, subject the Company to any material tax in any such jurisdiction
where it is not then so subject or file a general consent to service of process in any such jurisdiction.
(i)
If requested by a Holder, cooperate with such Holder to facilitate the timely preparation and delivery of certificates (or book
entry or other evidence) representing Registrable Securities to be delivered to a transferee pursuant to a Registration Statement, which
evidence shall be free, to the extent permitted by the Purchase Agreement, of all restrictive legends, and to enable such Registrable
Securities to be in such denominations and registered in such names as any such Holder may request.
(j)
Upon the occurrence of any event contemplated by Section 3(d), as promptly as reasonably possible under the circumstances taking
into account the Company’s good faith assessment of any adverse consequences to the Company and its stockholders of the premature
disclosure of such event, prepare a supplement or amendment, including a post-effective amendment, to a Registration Statement or a supplement
to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, and file any other required
document so that, as thereafter delivered, neither a Registration Statement nor such Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. If the Company notifies
the Holders in accordance with clauses (iii) through (vi) of Section 3(d) above to suspend the use of any Prospectus until the requisite
changes to such Prospectus have been made, then the Holders shall suspend use of such Prospectus. The Company will use its best efforts
to ensure that the use of the Prospectus may be resumed as promptly as is practicable. The Company shall be entitled to exercise its right
under this Section 3(j) to suspend the availability of a Registration Statement and Prospectus, subject to the payment of partial liquidated
damages otherwise required pursuant to Section 2(d), for a period not to exceed ninety (90) calendar days (which need not be consecutive
days) in any 12-month period.
(k)
Otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the Commission under the Securities
Act and the Exchange Act, including, without limitation, Rule 172 under the Securities Act, file any final Prospectus, including any supplement
or amendment thereof, with the Commission pursuant to Rule 424 under the Securities Act, promptly inform the Holders in writing if, at
any time during the Effectiveness Period, the Company does not satisfy the conditions specified in Rule 172 and, as a result thereof,
the Holders are required to deliver a Prospectus in connection with any disposition of Registrable Securities and take such other actions
as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder.
(l)
The Company shall use its commercially reasonable efforts to maintain eligibility for use of Form F-3 (or any successor form thereto)
for the registration of the resale of Registrable Securities.
(m)
The Company may require each selling Holder to furnish to the Company a certified statement as to the number of Ordinary Shares
beneficially owned by such Holder and, if required by the Commission, the natural persons thereof that have voting and dispositive control
over the shares. During any periods that the Company is unable to meet its obligations hereunder with respect to the registration of the
Registrable Securities solely because any Holder fails to furnish such information within three Trading Days of the Company’s request,
any liquidated damages that are accruing at such time as to such Holder only shall be tolled and any Event that may otherwise occur solely
because of such delay shall be suspended as to such Holder only, until such information is delivered to the Company.
4. Registration
Expenses. All fees and expenses incident to the performance of or compliance with, this Agreement by the Company shall be borne by
the Company whether or not any Registrable Securities are sold pursuant to a Registration Statement. The fees and expenses referred to
in the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees
and expenses of the Company’s counsel and independent registered public accountants) (A) with respect to filings made with the Commission,
(B) with respect to filings required to be made with any Trading Market on which the Ordinary Shares are then listed for trading, and
(C) in compliance with applicable state securities or Blue Sky laws reasonably agreed to by the Company in writing (including, without
limitation, fees and disbursements of counsel for the Company in connection with Blue Sky qualifications or exemptions of the Registrable
Securities), (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities), (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Company, (v) Securities Act liability insurance,
if the Company so desires such insurance, and (vi) fees and expenses of all other Persons retained by the Company in connection with the
consummation of the transactions contemplated by this Agreement. In addition, the Company shall be responsible for all of its internal
expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including, without limitation,
all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit and the
fees and expenses incurred in connection with the listing of the Registrable Securities on any securities exchange as required hereunder.
In no event shall the Company be responsible for any broker or similar commissions of any Holder or, except to the extent provided for
in the Transaction Documents, any legal fees or other costs of the Holders.
5. Indemnification.
(a)
Indemnification by the Company. The Company shall, notwithstanding any termination of this Agreement, indemnify and hold
harmless each Holder, the officers, directors, members, partners, agents and employees of each of them, each Person who controls any such
Holder (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, members,
stockholders, partners, agents and employees (and any other Persons with a functionally equivalent role of a Person holding such titles,
notwithstanding a lack of such title or any other title) of each such controlling Person, to the fullest extent permitted by applicable
law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’
fees) and expenses (collectively, “Losses”), as incurred, arising out of or relating to (1) any untrue or alleged untrue
statement of a material fact contained in a Registration Statement, any Prospectus or any form of prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein (in the case of any Prospectus or supplement thereto, in light of the
circumstances under which they were made) not misleading or (2) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act or any state securities law, or any rule or regulation thereunder, in connection with the performance of its obligations
under this Agreement, except to the extent, but only to the extent, that (i) such untrue statements or omissions are based solely upon
information regarding such Holder furnished in writing to the Company by such Holder expressly for use therein, or to the extent that
such information relates to such Holder or such Holder’s proposed method of distribution of Registrable Securities and was reviewed
and expressly approved in writing by such Holder expressly for use in a Registration Statement, such Prospectus or in any amendment or
supplement thereto (it being understood that the Holder has approved Annex A hereto for this purpose) or (ii) in the case of an occurrence
of an event of the type specified in Section 3(d)(iii)-(vi), the use by such Holder of an outdated, defective or otherwise unavailable
Prospectus after the Company has notified such Holder in writing that the Prospectus is outdated, defective or otherwise unavailable for
use by such Holder and prior to the receipt by such Holder of the Advice contemplated in Section 6(c). The Company shall notify the Holders
promptly of the institution, threat or assertion of any Proceeding arising from or in connection with the transactions contemplated by
this Agreement of which the Company is aware. Such indemnity shall remain in full force and effect regardless of any investigation made
by or on behalf of such indemnified person and shall survive the transfer of any Registrable Securities by any of the Holders in accordance
with Section 6(f).
(b)
Indemnification by Holders. Each Holder shall, severally and not jointly, indemnify and hold harmless the Company, its directors,
officers, agents and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to the fullest extent permitted
by applicable law, from and against all Losses, as incurred, to the extent arising out of or based solely upon: any untrue or alleged
untrue statement of a material fact contained in any Registration Statement, any Prospectus, or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein (in the case of any Prospectus or supplement thereto, in light of the circumstances
under which they were made) not misleading (i) to the extent, but only to the extent, that such untrue statement or omission is contained
in any information so furnished in writing by such Holder to the Company expressly for inclusion in such Registration Statement or such
Prospectus or (ii) to the extent, but only to the extent, that such information relates to such Holder’s information provided in
the Selling Stockholder Questionnaire or the proposed method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in a Registration Statement (it being understood that the Holder has approved Annex
A hereto for this purpose), such Prospectus or in any amendment or supplement thereto. In no event shall the liability of a selling Holder
be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such Holder in connection with any claim relating
to this Section 5 and the amount of any damages such Holder has otherwise been required to pay by reason of such untrue statement or omission)
received by such Holder upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification
obligation.
(c)
Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity
hereunder (an “Indemnified Party”), such Indemnified Party shall promptly notify the Person from whom indemnity is
sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall have the right to assume the defense
thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all fees and expenses
incurred in connection with defense thereof, provided that the failure of any Indemnified Party to give such notice shall not relieve
the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be
finally determined by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure
shall have materially and adversely prejudiced the Indemnifying Party.
An Indemnified
Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in
writing to pay such fees and expenses, (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding
and to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding, or (3) the named parties to any such Proceeding
(including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and counsel to the Indemnified Party
shall reasonably believe that a material conflict of interest is likely to exist if the same counsel were to represent such Indemnified
Party and the Indemnifying Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense
thereof and the reasonable fees and expenses of no more than one separate counsel shall be at the expense of the Indemnifying Party).
The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent
shall not be unreasonably withheld or delayed. No Indemnifying Party shall, without the prior written consent of the Indemnified Party,
effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes
an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.
Subject to the
terms of this Agreement, all reasonable fees and expenses of the Indemnified Party (including reasonable fees and expenses to the extent
incurred in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall
be paid to the Indemnified Party, as incurred, within ten Trading Days of written notice thereof to the Indemnifying Party, provided that
the Indemnified Party shall promptly reimburse the Indemnifying Party for that portion of such fees and expenses applicable to such actions
for which such Indemnified Party is finally determined by a court of competent jurisdiction (which determination is not subject to appeal
or further review) not to be entitled to indemnification hereunder.
(d)
Contribution. If the indemnification under Section 5(a) or 5(b) is unavailable to an Indemnified Party or insufficient to
hold an Indemnified Party harmless for any Losses, then each Indemnifying Party shall contribute to the amount paid or payable by such
Indemnified Party, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and Indemnified Party
in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission of a material
fact, has been taken or made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission. The amount
paid or payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in this Agreement,
any reasonable attorneys’ or other fees or expenses incurred by such party in connection with any Proceeding to the extent such
party would have been indemnified for such fees or expenses if the indemnification provided for in this Section was available to such
party in accordance with its terms.
The parties hereto
agree that it would not be just and equitable if contribution pursuant to this Section 5(d) were determined by pro rata allocation or
by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding
paragraph. In no event shall the contribution obligation of a Holder of Registrable Securities be greater in amount than the dollar amount
of the proceeds (net of all expenses paid by such Holder in connection with any claim relating to this Section 5 and the amount of any
damages such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission)
received by it upon the sale of the Registrable Securities giving rise to such contribution obligation.
The indemnity and
contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the Indemnified
Parties.
6. Miscellaneous.
(a)
Remedies. In the event of a breach by the Company or by a Holder of any of their respective obligations under this Agreement,
each Holder or the Company, as the case may be, in addition to being entitled to exercise all rights granted by law and under this Agreement,
including recovery of damages, shall be entitled to specific performance of its rights under this Agreement. Each of the Company and each
Holder agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event of any action for specific performance in respect of
such breach, it shall not assert or shall waive the defense that a remedy at law would be adequate.
(b)
No Piggyback on Registrations; Prohibition on Filing Other Registration Statements. Neither the Company nor any of its security
holders (other than the Holders in such capacity pursuant hereto) may include securities of the Company in any Registration Statements
other than the Registrable Securities. The Company shall not file any other registration statements other than the Registration Statement
during the prohibition period set forth in Section 4.13(a) of the Purchase Agreement.
(c)
Discontinued Disposition. By its acquisition of Registrable Securities, each Holder agrees that, upon receipt of a notice
from the Company of the occurrence of any event of the kind described in Section 3(d)(iii) through (vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until it is advised in writing (the “Advice”)
by the Company that the use of the applicable Prospectus (as it may have been supplemented or amended) may be resumed. The Company will
use its best efforts to ensure that the use of the Prospectus may be resumed as promptly as is practicable. The Company agrees and acknowledges
that any periods during which the Holder is required to discontinue the disposition of the Registrable Securities hereunder shall be subject
to the provisions of Section 2(d).
(d)
Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be
in writing and signed by the Company and the Holders of 50.1% or more of the then outstanding Registrable Securities (for purposes of
clarification, this includes any Registrable Securities issuable upon exercise or conversion of any Security), provided that, if any amendment,
modification or waiver disproportionately and adversely impacts a Holder (or group of Holders), the consent of such disproportionately
impacted Holder (or group of Holders) shall be required. If a Registration Statement does not register all of the Registrable Securities
pursuant to a waiver or amendment done in compliance with the previous sentence, then the number of Registrable Securities to be registered
for each Holder shall be reduced pro rata among all Holders and each Holder shall have the right to designate which of its Registrable
Securities shall be omitted from such Registration Statement. Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of a Holder or some Holders and that does not directly or indirectly
affect the rights of other Holders may be given only by such Holder or Holders of all of the Registrable Securities to which such waiver
or consent relates; provided, however, that the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the first sentence of this Section 6(d). No consideration shall be offered or paid to any
Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration also is offered
to all of the parties to this Agreement.
(e)
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be delivered as set forth in the Purchase Agreement.
(f)
Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns
of each of the parties and shall inure to the benefit of each Holder. The Company may not assign (except by merger) its rights or obligations
hereunder without the prior written consent of all of the Holders of the then outstanding Registrable Securities. Each Holder may assign
their respective rights hereunder in the manner and to the Persons as permitted under Section 5.7 of the Purchase Agreement.
(g)
No Inconsistent Agreements. Neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall
the Company or any of its Subsidiaries, on or after the date of this Agreement, enter into any agreement with respect to its securities,
that would have the effect of impairing the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions
hereof. Neither the Company nor any of its Subsidiaries has previously entered into any agreement granting any registration rights with
respect to any of its securities to any Person that have not been satisfied in full.
(h)
Execution and Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together
shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered
to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered
by e-mail delivery of a “.pdf” format data file or any electronic signature complying with the U.S. federal ESIGN Act of 2000
(e.g., www.docusign.com), such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such “.pdf” signature page were an original thereof.
(i)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall
be determined in accordance with the provisions of the Purchase Agreement.
(j)
Cumulative Remedies. The remedies provided herein are cumulative and not exclusive of any other remedies provided by law.
(k)
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
(l)
Headings. The headings in this Agreement are for convenience only, do not constitute a part of the Agreement and shall not
be deemed to limit or affect any of the provisions hereof.
(m)
Independent Nature of Holders’ Obligations and Rights. The obligations of each Holder hereunder are several and not
joint with the obligations of any other Holder hereunder, and no Holder shall be responsible in any way for the performance of the obligations
of any other Holder hereunder. Nothing contained herein or in any other agreement or document delivered at any closing, and no action
taken by any Holder pursuant hereto or thereto, shall be deemed to constitute the Holders as a partnership, an association, a joint venture
or any other kind of group or entity, or create a presumption that the Holders are in any way acting in concert or as a group or entity
with respect to such obligations or the transactions contemplated by this Agreement or any other matters, and the Company acknowledges
that the Holders are not acting in concert or as a group, and the Company shall not assert any such claim, with respect to such obligations
or transactions. Each Holder shall be entitled to protect and enforce its rights, including without limitation the rights arising out
of this Agreement, and it shall not be necessary for any other Holder to be joined as an additional party in any proceeding for such purpose.
The use of a single agreement with respect to the obligations of the Company contained was solely in the control of the Company, not the
action or decision of any Holder, and was done solely for the convenience of the Company and not because it was required or requested
to do so by any Holder. It is expressly understood and agreed that each provision contained in this Agreement is between the Company and
a Holder, solely, and not between the Company and the Holders collectively and not between and among Holders.
********************
(Signature
Pages Follow)
IN WITNESS WHEREOF, the parties
have executed this Registration Rights Agreement as of the date first written above.
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PolyPid Ltd. |
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By: |
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Name: Dikla Czaczkes Akselbrad |
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Title: Chief Executive Officer |
[SIGNATURE PAGE OF HOLDERS FOLLOWS]
[SIGNATURE
PAGE OF HOLDERS TO PYPD RRA]
Name of Holder: __________________________
Signature of Authorized Signatory of Holder: __________________________
Name of Authorized Signatory: _________________________
Title of Authorized Signatory: __________________________
[SIGNATURE PAGES CONTINUE]
Annex A
Plan of Distribution
Each Selling Stockholder,
or the Selling Stockholders, of the securities and any of their pledgees, assignees and successors-in-interest may, from time to time,
sell any or all of their securities covered hereby on the principal Trading Market or any other stock exchange, market or trading facility
on which the securities are traded or in private transactions. These sales may be at fixed or negotiated prices. A Selling Stockholder
may use any one or more of the following methods when selling securities:
| · | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
| · | block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the
block as principal to facilitate the transaction; |
| · | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
| · | an exchange distribution in accordance with the rules of the applicable exchange; |
| · | privately negotiated transactions; |
| · | settlement of short sales; |
| · | in transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a
stipulated price per security; |
| · | through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
| · | a combination of any such methods of sale; or |
| · | any other method permitted pursuant to applicable law. |
The Selling Stockholders may
also sell securities under Rule 144 or any other exemption from registration under the Securities Act of 1933, as amended, or the Securities
Act, if available, rather than under this prospectus.
Broker-dealers engaged by
the Selling Stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts
from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts
to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a
customary brokerage commission in compliance with FINRA Rule 2121; and in the case of a principal transaction a markup or markdown in
compliance with FINRA Rule 2121.
In connection with the sale
of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling
Stockholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities
to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer
or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution
may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The Selling Stockholders and
any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the meaning
of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any
profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities
Act. Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding, directly
or indirectly, with any person to distribute the securities.
The Company is required to
pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
We agreed to keep this prospectus
effective until the earlier of (i) the date on which the securities may be resold by the Selling Stockholders without registration and
without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for the Company to be in compliance
with the current public information under Rule 144 under the Securities Act or any other rule of similar effect or (ii) all of the securities
have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect. The resale securities
will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in
certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is available and is complied with.
Under applicable rules and
regulations under the Securities Exchange Act of 1934, as amended, or the Exchange Act, any person engaged in the distribution of the
resale securities may not simultaneously engage in market making activities with respect to the ordinary shares for the applicable restricted
period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the Selling Stockholders will be subject
to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing
of purchases and sales of the ordinary shares by the Selling Stockholders or any other person. We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or
prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).
Annex B
SELLING SHAREHOLDERS
The ordinary shares being
offered by the selling shareholders are those previously issued to the selling shareholders, and those issuable to the selling shareholders,
upon exercise of the warrants. For additional information regarding the issuances of those ordinary shares and warrants, see “Private
Placement of Ordinary Shares and Warrants” above. We are registering the ordinary shares in order to permit the selling shareholders
to offer the shares for resale from time to time. Except for the ownership of the ordinary shares and the warrants, the selling shareholders
have not had any material relationship with us within the past three years.
To our knowledge,
within the past three years, none of the selling shareholders has held a position as an officer or a director of ours, nor had any other
material relationship of any kind with us or any of our affiliates.
A selling
shareholder who is an affiliate of a broker-dealer and any participating broker-dealer is deemed to be an “underwriter” within
the meaning of the Securities Act of 1933, as amended, or the Securities Act, and any commissions or discounts given to any such selling
shareholder or broker-dealer may be regarded as underwriting commissions or discounts under the Securities Act. To our knowledge, none
of the selling shareholders is an affiliate of a broker-dealer and there are no participating broker-dealers.
The term
“selling shareholder” also includes any transferees, pledgees, donees, or other successors in interest to the selling shareholders
named in the table below.
The table below lists the
selling shareholders and other information regarding the beneficial ownership of the ordinary shares by each of the selling shareholders.
The second column lists the number of ordinary shares beneficially owned by each selling shareholder, based on its ownership of the ordinary
shares and warrants, as of ________, 2024, assuming exercise of the warrants held by the selling shareholders on that date, without regard
to any limitations on exercises.
The third column lists the
ordinary shares being offered by this prospectus by the selling shareholders.
In accordance with the terms
of a registration rights agreement with the selling shareholders, this prospectus generally covers the resale of the sum of (i) the number
of ordinary shares issued to the selling shareholders in the “Private Placement of Ordinary Shares and Warrants” described
above and (ii) the maximum number of ordinary shares issuable upon exercise of the related warrants, determined as if the outstanding
warrants were exercised in full as of the trading day immediately preceding the date this registration statement was initially filed with
the SEC, each as of the trading day immediately preceding the applicable date of determination and all subject to adjustment as provided
in the registration right agreement, without regard to any limitations on the exercise of the warrants. The fourth column assumes the
sale of all of the shares offered by the selling shareholders pursuant to this prospectus.
Under the terms of the warrants,
a selling shareholder may not exercise the warrants to the extent such exercise would cause such selling shareholder, together with its
affiliates and attribution parties, to beneficially own a number of ordinary shares which would exceed [4.99% or 9.99%], as applicable,
of our then outstanding ordinary shares following such exercise, excluding for purposes of such determination ordinary shares issuable
upon exercise of such warrants which have not been exercised. The number of shares in the second and fourth columns do not reflect this
limitation. The selling shareholders may sell all, some or none of their shares in this offering. See "Plan of Distribution."
The selling shareholders are
not making any representation that any ordinary shares covered by this prospectus will be offered for sale. Because we do not know how
long each of the selling shareholders will hold the warrants, whether any will exercise the warrants and, upon such exercise, how long
each such selling shareholder will hold the ordinary shares before selling them, and because each of the selling shareholders may dispose
of all, none or some portion of its securities, no estimate can be given as to the number of securities that will be beneficially owned
by a selling shareholder upon completion of this offering. In addition, each selling shareholder may have sold, transferred or otherwise
disposed of its securities in transactions exempt from the registration requirements of the Securities Act after the date on which the
information in the table is presented.
We may amend or supplement
this prospectus from time to time in the future to update or change the selling shareholders list and the securities that may be resold.
| Name of 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 Offering |
| | |
| |
| |
|
| | |
| |
| |
|
| | |
| |
| |
|
Annex C
POLYPID
LTD.
Selling Stockholder Notice and Questionnaire
The undersigned beneficial
owner of Ordinary Shares (Pre-Funded Warrants or Warrants exercisable into Ordinary Shares) (the “Registrable Securities”)
of POLYPID LTD., an Israeli company (the “Company”), understands that the Company has filed or intends to file with
the Securities and Exchange Commission (the “Commission”) a registration statement (the “Registration Statement”)
for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of
the Registrable Securities, in accordance with the terms of the Registration Rights Agreement (the “Registration Rights Agreement”)
to which this document is annexed. A copy of the Registration Rights Agreement is available from the Company upon request at the address
set forth below. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.
Certain legal consequences
arise from being named as a selling stockholder in the Registration Statement and the related prospectus. Accordingly, holders and beneficial
owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or
not being named as a selling stockholder in the Registration Statement and the related prospectus.
NOTICE
The undersigned beneficial
owner (the “Selling Stockholder”) of Registrable Securities hereby elects to include the Registrable Securities owned
by it in the Registration Statement.
The undersigned hereby provides the following
information to the Company and represents and warrants that such information is accurate:
QUESTIONNAIRE
| (a) | Full Legal Name of Selling Stockholder |
| (b) | Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities
are held: |
| (c) | Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone
or with others has power to vote or dispose of the securities covered by this Questionnaire): |
2. Address for Notices to Selling Stockholder:
| Telephone: |
|
| E-Mail: |
|
| Contact Person: |
|
3. Broker-Dealer Status:
| (a) | Are you a broker-dealer? |
Yes ☐ No ☐
| (b) | If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for
investment banking services to the Company? |
Yes ☐ No ☐
| Note: | If “no” to Section 3(b), the Commission’s
staff has indicated that you should be identified as an underwriter in the Registration Statement. |
| (c) | Are you an affiliate of a broker-dealer? |
Yes ☐ No ☐
| (d) | If you are an affiliate of a broker-dealer, do you certify that you purchased the Registrable Securities
in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements
or understandings, directly or indirectly, with any person to distribute the Registrable Securities? |
Yes ☐ No ☐
| Note: | If “no” to Section 3(d), the Commission’s
staff has indicated that you should be identified as an underwriter in the Registration Statement. |
4. Beneficial Ownership of Securities
of the Company Owned by the Selling Stockholder.
Except as set forth below in this
Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the securities issuable
pursuant to the Purchase Agreement.
| Please specify the type and amount of other securities owned by the Selling Stockholder (including beneficially owned, as applicable) before the current offering. Please specify how many shares are held, how many are subject to warrants, options, and other conditions (exercise price, etc.): |
Please specify the type and amount of securities to be acquired by the Selling Stockholder in the current offering. Please specify how many shares, how many will be subject to warrants, options, and other conditions (exercise price, etc.): |
| |
|
5. Relationships with the Company:
Except as set forth below, neither
the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities
of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.
State any exceptions here:
The undersigned agrees to
promptly notify the Company of any material inaccuracies or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective; provided, that the undersigned shall not be required to notify
the Company of any changes to the number of securities held or owned by the undersigned or its affiliates.
By
signing below, the undersigned consents to the disclosure of the information contained herein in its answers to Items 1 through 5 and
the inclusion of such information in the Registration Statement and the related prospectus and any amendments or supplements thereto.
Further, by signing below, the undersigned agrees to distribute its securities subject to the Registration
Statement as described in Annex B to the Registration Rights Agreement. The undersigned understands that
such information will be relied upon by the Company in connection with the preparation or amendment of the Registration Statement and
the related prospectus and any amendments or supplements thereto.
IN WITNESS WHEREOF the undersigned,
by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized
agent.
PLEASE EMAIL A .PDF COPY OF THE COMPLETED AND
EXECUTED NOTICE AND QUESTIONNAIRE TO:
Tal Vilnai, Adv.
General Counsel & Corporate
Secretary
PolyPid Ltd.
Tal.V@polypid.com
With a copy to: hberkenblit@sullivanlaw.com
and evictorson@sullivanlaw.com
Exhibit 99.4
NEITHER THIS SECURITY NOR THE SECURITIES FOR
WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
ORDINARY SHARE PURCHASE WARRANT
POLYPID
LTD.
| Warrant Shares: [_______] |
Issuance Date: December 26, 2024 |
THIS ORDINARY SHARES PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, [__________] or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after
the Issuance Date (the “Initial Exercise Date”) and on or prior to the earlier of (i) 5:00 p.m. (New York City time)
on the nine (9) month anniversary of the Closing Date and (ii) the 10th Trading Day following the date on which the Company
issues a press release announcing the top-line results in the Company’s SHIELD II Phase 3 trial (the “Termination Date”)
but not thereafter, to subscribe for and purchase from PolyPid Ltd., an Israeli company (the “Company”), up to [______] ordinary
shares, no par value per share (the “Ordinary Share(s)”) (as subject to adjustment hereunder, the “Warrant
Shares”). The purchase price of one Ordinary Share under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
This Warrant was issued pursuant to that certain Securities Purchase Agreement, dated as of December 23, 2024, by and between the Company,
the Holder and other purchasers signatory thereto (as may be amended, amended and restated, supplemented or otherwise modified from time
to time in accordance with its terms, the “Purchase Agreement”).
Section 1. Definitions.
In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:
“Affiliate”
means any person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 of the Securities Act. A Person shall be regarded as in control
of the Company if the Company owns or directly or indirectly controls more than fifty percent (50%) of the voting rights or other ownership
interest of the other person, or if it possesses, directly or indirectly, the power to direct or cause the direction of the management
and policies of such person.
“Bid Price”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then
listed or quoted on a Trading Market, the bid price of the Ordinary Shares for the time in question (or the nearest preceding date) on
the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) the volume weighted average price of the Ordinary Shares
for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed or
quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets” published
by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per share of the Ordinary Shares so reported, or (d) in all other cases, the fair market value of an Ordinary Shares as
determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“Commission”
means the United States Securities and Exchange Commission.
“Ordinary
Shares Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Ordinary Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that
is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Trading
Day” means a day on which the Ordinary Shares are traded on a Trading Market.
“Trading
Market” means any of the following markets or exchanges on which the Ordinary Shares are listed or quoted for trading on the
date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York
Stock Exchange (or any successors to any of the foregoing).
“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company and any successor transfer
agent of the Company.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then
listed or quoted on a Trading Market, the daily volume weighted average price of the Ordinary Shares for such date (or the nearest preceding
date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) the volume weighted average price of the Ordinary
Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed
or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets” published
by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per share of the Ordinary Shares so reported, or (d) in all other cases, the fair market value of the Ordinary Shares as
determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Warrants”
means this Warrant and other Ordinary Shares purchase warrants issued by the Company pursuant to the Purchase Agreement.
Section 2. Exercise.
a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on
or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy
or PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “Notice of Exercise”).
Within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period
(as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise
Price for the shares specified in the applicable Notice of Exercise, required to be paid by the Holder pursuant to Section 2(d)(vi) herein,
by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below
is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee
(or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the
Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares
available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company
for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial
exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the
effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant
Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such
purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The
Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following
the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given
time may be less than the amount stated on the face hereof unless such Warrant is surrendered to the Company and reissued to the Holder
pursuant to Section 2(d)(ii).
b) Exercise
Price. The exercise price per Ordinary Share under this Warrant shall be $4.00, subject to adjustment hereunder (the “Exercise
Price”).
c) Cashless
Exercise. On or after the earlier of (i) the nine (9) month anniversary of the Issuance Date and (ii) the 10th Trading
Day following the date on which the Company issues a press release announcing the top-line results in the Company’s SHIELD II Phase
3 trial, if at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained therein
is not available for the resale of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part, at
such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal
to the quotient obtained by dividing [(A-B) (X)] by (A), where:
| (A) | = |
as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such
Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day
or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading
Day, (ii) at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable
Notice of Exercise or (z) the Bid Price of the Ordinary Shares on the principal Trading Market as reported by Bloomberg L.P. as
of the time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular
trading hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after
the close of “regular trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on
the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is
both executed and delivered pursuant to Section 2(a) hereof after the close of “regular trading hours” on such
Trading Day; |
| (B) | = |
the Exercise Price of this Warrant, as adjusted hereunder; and |
| (X) | = |
the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise. |
If Warrant Shares
are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities
Act, the holding period of the Warrant Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees
not to take any position contrary to this Section 2(c).
d) Mechanics
of Exercise.
i. Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company
through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system
and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant
Shares by Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant
to Rule 144 (assuming cashless exercise of the Warrants), and otherwise by physical delivery of a certificate, registered in the Company’s
share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to
such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) one (1) Trading
Day after the delivery to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise
Price to the Company and (iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company
of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise,
the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which
this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise
Price (other than in the case of a cashless exercise) is received by the Company within the earlier of (i) one (1) Trading Day
and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the
Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery
Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject
to such exercise (based on the VWAP of the Ordinary Shares on the date of the applicable Notice of Exercise), $5 per Trading Day (increasing
to $10 per Trading Day on the third Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery
Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is
a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading
Market with respect to the Ordinary Shares as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing,
with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date,
which may be delivered at any time after the time of execution of the Purchase Agreement, the Company agrees to deliver the Warrant Shares
subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date and the Initial Exercise Date shall
be the Warrant Share Delivery Date for purposes hereunder.
ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and
upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing
the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects
be identical with this Warrant.
iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by
the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if
the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section
2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its
broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Ordinary Shares
to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a
“Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total
purchase price (including brokerage commissions, if any) for the Ordinary Shares so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times
(2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either
reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such
exercise shall be deemed rescinded) or deliver to the Holder the number of Ordinary Shares that would have been issued had the Company
timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Ordinary Shares having a total
purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Ordinary Shares with an aggregate sale price giving
rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay
the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the
Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue
any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Company’s failure to timely deliver Ordinary Shares upon exercise of the Warrant as required
pursuant to the terms hereof.
v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this
Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall,
at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the
Exercise Price or round up to the next whole share.
vi. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant
Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however,
that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for
exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as
a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all
Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another
established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing
of Books. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.
e) Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise
as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting
as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would
beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number
of Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Ordinary Shares
issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of Ordinary
Shares which would be issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder
or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or non-converted portion of any other
securities of the Company (including, without limitation, any other Common Share Equivalents) subject to a limitation on conversion or
exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties.
Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance
with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that
the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder
is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this
Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the
Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this
Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify
or confirm the accuracy of such determination and shall have no liability for exercises of this Warrant that are not in compliance with
the Beneficial Ownership Limitation (as defined herein). In addition, a determination as to any group status as contemplated above shall
be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, provided,
however, the Company shall have no obligation to verify or confirm the accuracy of such determination. For purposes of this Section
2(e), in determining the number of outstanding Ordinary Shares, a Holder may rely on the number of outstanding Ordinary Shares as reflected
in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public
announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Ordinary
Shares outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing
to the Holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates
or Attribution Parties since the date as of which such number of outstanding Ordinary Shares was reported. The “Beneficial Ownership
Limitation” shall be [24.99%.] OR [4.99% (or, upon election by a Holder prior to the issuance of any Warrants,
9.99%) of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of Ordinary Shares issuable upon exercise
of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this
Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Ordinary Shares outstanding
immediately after giving effect to the issuance of Ordinary Shares upon exercise of this Warrant held by the Holder and the provisions
of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st
day after such notice is delivered to the Company.] The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable
to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
In addition to the above, the Holder will not hold at any time Ordinary Shares (whether issued at the Closing, or issued as Warrant
Shares or purchased or otherwise obtained) that would cause the Holder and its Affiliates’ holdings together with the holdings
of any Person acting as a group together with such Holder and/or its Affiliate to represent 25% or more of the total voting rights in
the Company, unless in compliance with the special tender offer rules as provided in sections 328-335 of the Israeli Companies Law 5759-1999
and guidance of the Israel Securities Authority. If the Warrant is unexercisable as a result of the Holder’s Beneficial Ownership
Limitation, no alternate consideration is owing to the Holder.
Section 3. Certain
Adjustments.
a) Share
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes
a distribution or distributions on shares of its Ordinary Shares or any other equity or equity equivalent securities payable in Ordinary
Shares (which, for avoidance of doubt, shall not include any Ordinary Shares issued by the Company upon exercise of this Warrant), (ii) subdivides
outstanding Ordinary Shares into a larger number of shares, (iii) combines (including by way of reverse share split) outstanding
Ordinary Shares into a smaller number of shares, or (iv) issues by reclassification of Ordinary Shares any shares of the Company,
then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of Ordinary Shares (excluding
treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Ordinary Shares
outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall
become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
b) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues
or sells any Ordinary Shares Equivalents or rights to purchase shares, warrants, securities or other property pro rata to the record holders
of Ordinary Shares (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable
to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Ordinary
Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase
Rights, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the grant,
issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such
Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Purchase Right to such extent (or beneficial ownership of such Ordinary Shares as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not
result in the Holder exceeding the Beneficial Ownership Limitation).
c) Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution
of its assets (or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including, without
limitation, any distribution of cash, shares or other securities, property or options by way of a dividend, spin off, reclassification,
corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after
the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent
that the Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon complete exercise
of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the
record holders of Ordinary Shares are to be determined for the participation in such Distribution (provided, however,
that, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial
Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership
of any Ordinary Shares as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance
for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership
Limitation).
d)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly
or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the
Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Ordinary Shares are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of more than 50% of the outstanding
Ordinary Shares, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Ordinary Shares or any compulsory share exchange pursuant to which the Ordinary Shares are effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than
50% of the outstanding Ordinary Shares (not including any Ordinary Shares held by the other Person or other Persons making or party to,
or associated or affiliated with the other Persons making or party to, such share purchase agreement or other business combination) (each
a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to
receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental
Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant),
the number of Ordinary Shares of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any
additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by
a holder of the number of Ordinary Shares for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Ordinary Shares in such Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Ordinary Shares are given any choice as to the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the
survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in
accordance with the provisions of this Section 3(d) pursuant to written agreements prior to such Fundamental Transaction and
shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by
a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares
of such Successor Entity (or its parent entity) equivalent to the Ordinary Shares acquirable and receivable upon exercise of this Warrant
(without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price
which applies the exercise price hereunder to such shares (but taking into account the relative value of the Ordinary Shares pursuant
to such Fundamental Transaction and the value of such shares, such number of shares and such exercise price being for the purpose of protecting
the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction). Upon the occurrence of any
such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may
exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same
effect as if such Successor Entity had been named as the Company herein.
e) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For
purposes of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding as of a given date shall be the sum
of the number of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.
f) Notice
to Holder.
i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Ordinary Shares, (C) the
Company shall authorize the granting to all holders of the Ordinary Shares rights or warrants to subscribe for or purchase any shares
of any class or of any rights, (D) the approval of any shareholders of the Company shall be required in connection with any reclassification
of the Ordinary Shares, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all
of the assets of the Company, or any compulsory share exchange whereby the Ordinary Shares are converted into other securities, cash or
property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of
the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile number
or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record
or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Ordinary Shares
of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on
which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the
date as of which it is expected that holders of the Ordinary Shares of record shall be entitled to exchange their Ordinary Shares for
securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided
that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate
action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material,
non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission
pursuant to a Report of Foreign Private Issuer on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period
commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set
forth herein.
Section 4. Transfer
of Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions of
Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration rights)
are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent,
together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent
or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required,
such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable,
and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing
the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full,
in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder
delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may
be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or
its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date and shall be identical with this
Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder
of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.
d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this
Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable
state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information
requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of
this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase Agreement.
e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise
hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or
reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant
to sales registered or exempted under the Securities Act.
Section 5. Miscellaneous.
a) No
Rights as Shareholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends
or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly
set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant
to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company
be required to net cash settle an exercise of this Warrant.
b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant or any share certificate relating to the Warrant Shares, and in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include
the posting of any bond), and upon surrender and cancellation of such Warrant or share certificate, if mutilated, the Company will make
and deliver a new Warrant or share certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or share certificate.
c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business
Day.
d) Authorized
Shares.
(i) The
Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Ordinary Shares
a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the
duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such
reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable
law or regulation, or of any requirements of the Trading Market upon which the Ordinary Shares may be listed. The Company covenants that
all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the
purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued,
fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other
than taxes in respect of any transfer occurring contemporaneously with such issue).
(ii) Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (A) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (B) take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (C) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof,
as may be, necessary to enable the Company to perform its obligations under this Warrant.
(iii) Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and
construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of
law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders,
partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York.
Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough
of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address
in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted
by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in
such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys’ fees and other costs and
expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not
utilize cashless exercise (other than within 6 months of the Issuance Date), will have restrictions upon resale imposed by state and federal
securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder
on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without
limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in
accordance with the notice provisions of the Purchase Agreement.
i) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase
price of any Ordinary Shares or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of
the Company.
j) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any
action for specific performance that a remedy at law would be adequate.
k) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the
benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder.
The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable
by the Holder or holder of Warrant Shares.
l) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand, and
the Holder, on the other hand.
m) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
n) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
o) Pre-Funded
Warrants. The Company covenants and agrees that in lieu of issuing Ordinary Shares upon exercise of this Warrant, the Company shall,
at the option of the Holder, issue Pre-Funded Warrants to such Holder if, as a result of the exercise of this Warrant, the Holder’s
(along with its Affiliates) beneficial ownership of Ordinary Shares would exceed 4.99% (or, at the discretion of the Holder, 9.99%) of
the Company’s outstanding Ordinary Shares immediately following such exercise. A Holder electing to receive Pre-Funded Warrants
in lieu of Ordinary Shares upon exercise of this Warrant shall indicate such preference on the Notice of Exercise and shall withhold from
the Exercise Price of the Warrants so exercised $0.0001 per Warrant Share (which, for the avoidance of doubt, shall be the exercise price
of the Pre-Funded Warrant).
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company
has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
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[Signature Page to Private Placement Ordinary Warrant]
NOTICE OF EXERCISE
TO: POLYPID
LTD.
(1) The undersigned
hereby elects to purchase:
________ Warrant Shares of the
Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price
in full, together with all applicable transfer taxes, if any.
_________ Pre-Funded Warrants
of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise
price in full, together with all applicable transfer taxes, if any.
(2) Payment
shall take the form of (check applicable box):
☐ in lawful money of the United States;
or
☐ if permitted, the cancellation of
such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with
respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).
(3) Please
issue said Warrant Shares and/or Pre-Funded Warrants in the name of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following
DWAC Account Number and the Pre-Funded Warrants, if any, shall be delivered to the following address:
(4) Accredited Investor.
The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended.
[SIGNATURE
OF HOLDER]
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| Signature of Authorized Signatory of Investing Entity: |
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ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this
form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and
all rights evidenced thereby are hereby assigned to
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| Dated: _______________ __, ______ |
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15
Exhibit 99.5
NEITHER THIS SECURITY NOR THE SECURITIES FOR
WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
PRE-FUNDED ORDINARY SHARE PURCHASE WARRANT
POLYPID
LTD.
| Warrant Shares: [_______] |
Issuance Date: December 26, 2024 |
THIS PRE-FUNDED ORDINARY SHARES
PURCHASE WARRANT (the “Warrant”) certifies that, for value received, [__________] or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after
the Issuance Date (the “Initial Exercise Date”) and until this Warrant is exercised in full (the “Termination
Date”) but not thereafter, to subscribe for and purchase from PolyPid Ltd., an Israeli company (the “Company”),
up to [______] ordinary shares, no par value per share (the “Ordinary Share(s)”) (as subject to adjustment hereunder,
the “Warrant Shares”). The purchase price of one Ordinary Share under this Warrant shall be equal to the Exercise Price,
as defined in Section 2(b). This Warrant was issued pursuant to that certain Securities Purchase Agreement, dated as of December
23, 2024, by and between the Company, the Holder and other purchasers signatory thereto (as may be amended, amended and restated, supplemented
or otherwise modified from time to time in accordance with its terms, the “Purchase Agreement”).
Section 1. Definitions.
In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this
Section 1:
“Affiliate”
means any person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 of the Securities Act. A Person shall be regarded as in control
of the Company if the Company owns or directly or indirectly controls more than fifty percent (50%) of the voting rights or other ownership
interest of the other person, or if it possesses, directly or indirectly, the power to direct or cause the direction of the management
and policies of such person.
“Bid Price”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then
listed or quoted on a Trading Market, the bid price of the Ordinary Shares for the time in question (or the nearest preceding date) on
the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) the volume weighted average price of the Ordinary Shares
for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed or
quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets” published
by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per share of the Ordinary Shares so reported, or (d) in all other cases, the fair market value of an Ordinary Shares as
determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Board
of Directors” means the board of directors of the Company.
“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“Commission”
means the United States Securities and Exchange Commission.
“Ordinary
Shares Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Ordinary Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that
is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Subsidiary”
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed
or acquired after the date hereof.
“Trading
Day” means a day on which the Ordinary Shares are traded on a Trading Market.
“Trading
Market” means any of the following markets or exchanges on which the Ordinary Shares are listed or quoted for trading on the
date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York
Stock Exchange (or any successors to any of the foregoing).
“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company and any successor transfer
agent of the Company.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then
listed or quoted on a Trading Market, the daily volume weighted average price of the Ordinary Shares for such date (or the nearest preceding
date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) the volume weighted average price of the Ordinary
Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed
or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets” published
by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per share of the Ordinary Shares so reported, or (d) in all other cases, the fair market value of the Ordinary Shares as
determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Warrants”
means this Warrant and other prefunded Ordinary Shares purchase warrants issued by the Company pursuant to the Purchase Agreement.
Section 2. Exercise.
a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on
or after the Initial Exercise Date by delivery to the Company of a duly executed facsimile copy or PDF copy submitted by e-mail (or e-mail
attachment) of the Notice of Exercise in the form annexed hereto (the “Notice of Exercise”). Within the earlier of
(i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein)
following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable
Notice of Exercise, required to be paid by the Holder pursuant to Section 2(d)(vi) herein, by wire transfer or cashier’s
check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the
applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type
of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall
not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available
hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation
within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of
this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering
the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased.
The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company
shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The Holder and
any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the
purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time
may be less than the amount stated on the face hereof unless such Warrant is surrendered to the Company and reissued to the Holder pursuant
to Section 2(d)(ii).
b) Exercise
Price. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.0001 per Warrant Share, was pre-funded
to the Company on or prior to the Initial Exercise Date and, consequently, no additional consideration (other than the nominal exercise
price of $0.0001 per Warrant Share) shall be required to be paid by the Holder to the Company to effect any exercise of this Warrant.
The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance
or for any reason whatsoever. The remaining unpaid exercise price per Ordinary Share under this Warrant shall be $0.0001, subject to adjustment
hereunder (the “Exercise Price”).
c) Cashless
Exercise. This Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which
the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as
applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of
Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both
executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours”
(as defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the
option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise
or (z) the Bid Price of the Ordinary Shares on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a
Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular
trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable
Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof
after the close of “regular trading hours” on such Trading Day;
(B) = the
Exercise Price of this Warrant, as adjusted hereunder; and
X) = the
number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise
were by means of a cash exercise rather than a cashless exercise.
If Warrant Shares
are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities
Act, the holding period of the Warrant Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees
not to take any position contrary to this Section 2(c).
d) Mechanics
of Exercise.
i. Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company
through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system
and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant
Shares by Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant
to Rule 144 (assuming cashless exercise of the Warrants), and otherwise by physical delivery of a certificate, registered in the Company’s
share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to
such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) one (1) Trading
Day after the delivery to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise
Price to the Company and (iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company
of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise,
the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which
this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise
Price (other than in the case of a cashless exercise) is received by the Company within the earlier of (i) one (1) Trading Day
and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the
Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery
Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject
to such exercise (based on the VWAP of the Ordinary Shares on the date of the applicable Notice of Exercise), $5 per Trading Day (increasing
to $10 per Trading Day on the third Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery
Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is
a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading
Market with respect to the Ordinary Shares as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing,
with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date,
which may be delivered at any time after the time of execution of the Purchase Agreement, the Company agrees to deliver the Warrant Shares
subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date and the Initial Exercise Date shall
be the Warrant Share Delivery Date for purposes hereunder.
ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and
upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing
the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects
be identical with this Warrant.
iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by
the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if
the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section
2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its
broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Ordinary Shares
to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a
“Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total
purchase price (including brokerage commissions, if any) for the Ordinary Shares so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times
(2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either
reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such
exercise shall be deemed rescinded) or deliver to the Holder the number of Ordinary Shares that would have been issued had the Company
timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Ordinary Shares having a total
purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Ordinary Shares with an aggregate sale price giving
rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay
the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the
Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue
any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Company’s failure to timely deliver Ordinary Shares upon exercise of the Warrant as required
pursuant to the terms hereof.
v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this
Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall,
at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the
Exercise Price or round up to the next whole share.
vi. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant
Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however,
that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for
exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as
a condition thereto, the payment of a
sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day
processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing
similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing
of Books. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant,
pursuant to the terms hereof.
e) Holder’s Exercise
Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any
portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise
as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons
acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution
Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the
foregoing sentence, the number of Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall
include the number of Ordinary Shares issuable upon exercise of this Warrant with respect to which such determination is being made,
but shall exclude the number of Ordinary Shares which would be issuable upon (i) exercise of the remaining, non-exercised portion of
this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the
unexercised or non-converted portion of any other securities of the Company (including, without limitation, any other Common Share
Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by
the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this
Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such
calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required
to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of
whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and
Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the
submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in
relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this
Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination and shall have no liability for exercises of this Warrant that are not in
compliance with the Beneficial Ownership Limitation (as defined herein). In addition, a determination as to any group status as
contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder, provided, however, the Company shall have no obligation to verify or confirm the accuracy of such
determination. For purposes of this Section 2(e), in determining the number of outstanding Ordinary Shares, a Holder may rely on the
number of outstanding Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report filed with the
Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the
Company or the Transfer Agent setting forth the number of Ordinary Shares outstanding. Upon the written or oral request of a Holder,
the Company shall within one Trading Day confirm orally and in writing to the Holder the number of Ordinary Shares then outstanding.
In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which
such number of outstanding Ordinary Shares was reported. The “Beneficial Ownership Limitation” shall be [24.99%] OR
[4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of Ordinary Shares outstanding
immediately after giving effect to the issuance of Ordinary Shares issuable upon exercise of this Warrant. The Holder, upon notice
to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the
Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Ordinary Shares outstanding immediately after giving
effect to the issuance of Ordinary Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e)
shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day
after such notice is delivered to the Company.] The provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may
be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a
successor holder of this Warrant. In addition to the above, the Holder will not hold at any time Ordinary Shares (whether
issued at the Closing, or issued as Warrant Shares or purchased or otherwise obtained) that would cause the Holder and its
Affiliates’ holdings together with the holdings of any Person acting as a group together with such Holder and/or its
Affiliate to represent 25% or more of the total voting rights in the Company, unless in compliance with the special tender offer
rules as provided in sections 328-335 of the Israeli Companies Law, 5759-1999 and guidance of the Israel Securities Authority.
Section 3. Certain
Adjustments.
a) Share
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes
a distribution or distributions on shares of its Ordinary Shares or any other equity or equity equivalent securities payable in Ordinary
Shares (which, for avoidance of doubt, shall not include any Ordinary Shares issued by the Company upon exercise of this Warrant), (ii) subdivides
outstanding Ordinary Shares into a larger number of shares, (iii) combines (including by way of reverse share split) outstanding
Ordinary Shares into a smaller number of shares, or (iv) issues by reclassification of Ordinary Shares any shares of the Company,
then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of Ordinary Shares (excluding
treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Ordinary Shares
outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall
become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
b) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues
or sells any Ordinary Shares Equivalents or rights to purchase shares, warrants, securities or other property pro rata to the record holders
of Ordinary Shares (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable
to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Ordinary
Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase
Rights, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the grant,
issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such
Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Purchase Right to such extent (or beneficial ownership of such Ordinary Shares as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not
result in the Holder exceeding the Beneficial Ownership Limitation).
c) Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution
of its assets (or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including, without
limitation, any distribution of cash, shares or other securities, property or options by way of a dividend, spin off, reclassification,
corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after
the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent
that the Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon complete exercise
of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the
record holders of Ordinary Shares are to be determined for the participation in such Distribution (provided, however,
that, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial
Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership
of any Ordinary Shares as a result of such
Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time,
if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
d)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly
or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the
Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Ordinary Shares are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of more than 50% of the outstanding
Ordinary Shares, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Ordinary Shares or any compulsory share exchange pursuant to which the Ordinary Shares are effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than
50% of the outstanding Ordinary Shares (not including any Ordinary Shares held by the other Person or other Persons making or party to,
or associated or affiliated with the other Persons making or party to, such share purchase agreement or other business combination) (each
a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to
receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental
Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant),
the number of Ordinary Shares of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any
additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by
a holder of the number of Ordinary Shares for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Ordinary Shares in such Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Ordinary Shares are given any choice as to the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the
survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in
accordance with the provisions of this Section 3(d) pursuant to written agreements prior to such Fundamental Transaction and
shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by
a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares
of such Successor Entity (or its parent entity) equivalent to the Ordinary Shares acquirable and receivable upon exercise of this Warrant
(without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price
which applies the exercise price hereunder to such shares (but taking into account the relative value of the Ordinary Shares pursuant
to such Fundamental Transaction and the value of such shares, such number of shares and such exercise price being for the purpose of protecting
the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction). Upon the occurrence of any
such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may
exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same
effect as if such Successor Entity had been named as the Company herein.
e) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For
purposes of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding
as of a given date shall be the sum of the number of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.
f) Notice
to Holder.
i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Ordinary Shares, (C) the
Company shall authorize the granting to all holders of the Ordinary Shares rights or warrants to subscribe for or purchase any shares
of any class or of any rights, (D) the approval of any shareholders of the Company shall be required in connection with any reclassification
of the Ordinary Shares, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all
of the assets of the Company, or any compulsory share exchange whereby the Ordinary Shares are converted into other securities, cash or
property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of
the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile number
or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record
or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Ordinary Shares
of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on
which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the
date as of which it is expected that holders of the Ordinary Shares of record shall be entitled to exchange their Ordinary Shares for
securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided
that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate
action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material,
non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission
pursuant to a Report of Foreign Private Issuer on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period
commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set
forth herein.
Section 4. Transfer
of Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions of
Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration rights)
are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent,
together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent
or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required,
such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable,
and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing
the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company
unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three
(3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant,
if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new
Warrant issued.
b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or
its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination,
the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date and shall be identical with this
Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder
of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other
purposes, absent actual notice to the contrary.
d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this
Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable
state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information
requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or transferee of
this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase Agreement.
e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise
hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or
reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant
to sales registered or exempted under the Securities Act.
Section 5. Miscellaneous.
a) No
Rights as Shareholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends
or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly
set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant
to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company
be required to net cash settle an exercise of this Warrant.
b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory
to it of the loss, theft, destruction or mutilation of this Warrant or any share certificate relating to the Warrant Shares, and in case
of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include
the posting of any bond), and upon surrender and cancellation of such Warrant or share certificate, if mutilated, the Company will make
and deliver a new Warrant or share certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or share certificate.
c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business
Day.
d) Authorized
Shares.
(i) The
Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Ordinary Shares
a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the
duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such
reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable
law or regulation, or of any requirements of the Trading Market upon which the Ordinary Shares may be listed. The Company covenants that
all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the
purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued,
fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other
than taxes in respect of any transfer occurring contemporaneously with such issue).
(ii) Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (A) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (B) take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (C) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof,
as may be, necessary to enable the Company to perform its obligations under this Warrant.
(iii) Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
e) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by
and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of
conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of
the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors,
officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts
sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts
sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this
Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall
commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall
be reimbursed by the other party for their reasonable attorneys’ fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such action or proceeding.
f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not
utilize cashless exercise (other than within 6 months of the Issuance Date), will have restrictions upon resale imposed by state and federal
securities laws.
g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder
on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without
limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
h) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in
accordance with the notice provisions of the Purchase Agreement.
i) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase
price of any Ordinary Shares or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of
the Company.
j) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any
action for specific performance that a remedy at law would be adequate.
k) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the
benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder.
The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable
by the Holder or holder of Warrant Shares.
l) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand, and
the Holder, on the other hand.
m) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
n) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company
has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
| |
POLYPID LTD. |
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By: |
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|
Name: |
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|
Title: |
[Signature Page to Private Placement Pre-Funded
Warrant]
NOTICE OF EXERCISE
TO: POLYPID
LTD.
(1) The undersigned
hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full),
and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2) Payment
shall take the form of (check applicable box):
☐ in lawful money of the
United States; or
☐ if permitted, the
cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to
exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).
(3) Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following
DWAC Account Number:
(4) Accredited Investor.
The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended.
[SIGNATURE
OF HOLDER]
| Name of Investing Entity: |
|
| Signature of Authorized Signatory of Investing Entity: |
|
| Name of Authorized Signatory: |
|
| Title of Authorized Signatory: |
|
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this
form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and
all rights evidenced thereby are hereby assigned to
| Name: |
|
| |
(Please Print) |
| |
|
| Address: |
|
| |
(Please Print) |
| |
|
| Phone Number: |
|
| |
|
| Email Address: |
|
| |
|
| Dated: _______________ __, ______ |
|
| |
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| Holder’s Signature: |
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| Holder’s Address: |
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15
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