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 of
the Securities Exchange Act of 1934
For
the Month of October 2015
Commission
File Number 001-33042
Rosetta Genomics Ltd.
(Translation of registrant’s name into English)
10 Plaut Street, Science Park
Rehovot 76706, 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 x
Form 40-F ¨
Indicate by check mark if the registrant is submitting the
Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the
Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
Rosetta Genomics Ltd.
Update on Financial Statements for the Six Months Ended
June 30, 2015
As previously reported, due to complications
associated with the accounting treatment regarding its acquisition of CynoGen, Inc. (d/b/a PersonalizeDx) in April 2015, Rosetta
Genomics Ltd. (“Rosetta” or, the “Company”) announced that there will be a delay in filing its financial
statements for the six months ended June 30, 2015. The Company is working to facilitate the completion and submission of its financial
statements, and expects to do so on or before October 28, 2015 and expects to report unaudited pro forma revenue for the six months
ended June 30, 2015 of approximately $4.0 million at that time.
Private Placement
On October 13, 2015, Rosetta entered into
a Securities Purchase Agreement (the “Securities Purchase Agreement”), pursuant to which Rosetta agreed to sell securities
to various accredited investors (the “Purchasers”) in a private placement transaction (the “Private Placement”). The
Private Placement is expected to close on or about October 16, 2015, subject to the satisfaction of customary closing conditions.
Under the terms of the Private Placement,
Rosetta will sell an aggregate of 3,333,333 units at $2.40 per unit, with each unit consisting of (i) one ordinary share (collectively,
the “Shares”), (ii) a Series A Warrant to purchase one-half of an ordinary share at an exercise price of $2.75 per
ordinary share (subject to adjustment), exercisable for a period of five years from the closing date, and (iii) a partially pre-funded
Series B Warrant (collectively and together with the Series A Warrants, the “Warrants”). The Series B Warrants
have an exercise price of NIS 0.6 (which has been prepaid) plus $0.0001 per share. The Series B Warrants are intended to
reset the price of the units, and will be exercisable for an aggregate number of ordinary shares based on a reset price per unit
equal to 85% of the arithmetic average of the five lowest weighted average prices calculated during the ten trading days following
the effective date of the Resale Registration Statement (as defined below); provided that the maximum aggregate number of ordinary
shares issuable upon exercise of the Series B Warrants will not exceed 2,666,667. The Series B Warrants are exercisable
for 60 days following the effective date of the Resale Registration Statement.
The Company has also entered into a Registration
Rights Agreement (the “Registration Rights Agreement”) with the Purchasers pursuant to which the Company is required
to file a registration statement on Form F-3 within 60 days to cover the resale of the Shares and the ordinary shares issuable
upon exercise of the Warrants (the “Resale Registration Statement”). The failure on the part of the Company
to satisfy certain conditions and deadlines described in the Registration Rights Agreement may subject the Company to payment
of certain liquidated damages.
The Shares and the Warrants are being sold
in transactions exempt from registration under the Securities Act of 1933, in reliance on Section 4(a)(2) thereof and Rule 506
of Regulation D thereunder.
For its services as placement agent in
the Private Placement, Aegis Capital Corp. (“Aegis”), will receive cash compensation in the amount of approximately
$480,000 and a warrant to purchase 150,000 ordinary shares on the same terms as the Series A Warrants. The net proceeds
to Rosetta from the Private Placement, after deducting placement agent fees and expenses (not including the placement agent warrants),
Rosetta’s estimated offering expenses, and excluding the proceeds, if any, from the exercise of the Warrants, are expected
to be approximately $7.4 million.
Copies of the Securities Purchase Agreement,
the Registration Rights Agreement, the form of Series A Warrant and the form of Series B Warrant are filed as exhibits 10.1, 10.2,
4.1 and 4.2 respectively, to this report and are incorporated by reference herein. The foregoing summaries of such documents
are subject to, and qualified in their entirety by reference to, such exhibits. The Securities Purchase Agreement contains
representations and warranties that the parties made to, and solely for the benefit of, the other in the context of all of the
terms and conditions of that agreement and in the context of the specific relationship between the parties. The provisions
of the Securities Purchase Agreement, including the representations and warranties contained therein, are not for the benefit
of any party other than the parties to such agreements and are not intended as documents for investors and the public to obtain
factual information about the current state of affairs of the parties to those documents and agreements. Rather, investors and
the public should look to other disclosures contained in Rosetta’s filings with the Securities and Exchange Commission.
A copy of the press release, dated October
14, 2015, announcing the Private Placement is filed as Exhibit 99.1 hereto and incorporated by reference herein.
The information contained in this Report
(including the exhibits hereto) is hereby incorporated by reference into the Company’s Registration Statements on Form F-3,
File Nos. 333-163063, 333-171203, 333-172655, 333-177670 and 333-185338.
Exhibits
Exhibit
Number |
|
Description of Exhibit |
|
|
|
4.1 |
|
Form of Series A Warrant to be issued by Rosetta Genomics Ltd. to the Purchasers and Aegis. |
|
|
|
4.2 |
|
Form of Series B Warrant to be issued by Rosetta Genomics Ltd. to the Purchasers. |
|
|
|
10.1 |
|
Securities Purchase Agreement, dated October 13, 2015, by and between Rosetta Genomics Ltd.
and the Purchasers. |
|
|
|
10.2 |
|
Registration Rights Agreement, dated October 13, 2015, by and between Rosetta Genomics Ltd.
and the Purchasers. |
|
|
|
99.1 |
|
Press release dated October 14, 2015 announcing the Private Placement. |
Signatures
Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
ROSETTA GENOMICS LTD. |
|
|
Date: October 14, 2015 |
By: |
/s/ Oded Biran |
|
|
Oded Biran
Chief Legal Officer and Corporate Secretary |
Exhibit 4.1
ROSETTA
GENOMICS LTD.
SERIES A Warrant
To Purchase Ordinary Shares
Warrant No.: A-[__]
Number of Ordinary Shares: [_________]
Date of Issuance: October __, 2015 ("Issuance Date")
Rosetta Genomics Ltd.,
a company organized under the laws of the State of Israel (the "Company"), hereby certifies that, for good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, [_______________],
the registered holder hereof or its permitted assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, at any time or times on or after______________,
2015 (the "Initial Exercisability Date"), but not after 11:59 p.m., New York time, on the Expiration Date, (as
defined below), up to such number of fully paid and nonassessable Ordinary Shares equal to the Warrant Share Number, subject to
adjustment as provided herein (the "Warrant Shares"). Except as otherwise defined herein, capitalized terms
in this Warrant to Purchase Ordinary Shares (including any warrants to purchase Ordinary Shares issued in exchange, transfer or
replacement hereof, this "Warrant"), shall have the meanings set forth in Section 17. This Warrant is one of the
Series A Warrants to purchase Ordinary Shares (the "Series A Warrants") issued pursuant to Section 2.2 of that
certain Securities Purchase Agreement, dated as of October 13, 2015 (the "Subscription Date"), by and among the
Company and the investors (the "Purchasers") referred to therein (the "Securities Purchase Agreement").
Capitalized terms used herein and not otherwise defined shall have the definitions ascribed to such terms in the Securities Purchase
Agreement.
1.
EXERCISE OF WARRANT.
(a)
Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations
set forth in Section 1(f)), this Warrant may be exercised by the Holder at any time or times on or after the Initial Exercisability
Date, in whole or in part, by (i) delivery of a written notice, in the form attached hereto as Exhibit A (the "Exercise
Notice"), of the Holder's election to exercise this Warrant, (ii) (A) payment to the Company of an amount equal
to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the "Aggregate
Exercise Price") in cash by wire transfer of immediately available funds or (B) if the provisions of Section 1(d) are
applicable, by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section
1(d)), and (iii) if required in accordance with the provisions of the Securities Purchase Agreement, delivery to the Company of
an undertaking towards the OCS substantially in the form that was attached to the Securities Purchase Agreement as Annex A
or in any other form required by the OCS (the “OCS Undertaking”) duly executed by the Holder. The Holder shall
not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise
Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and
issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. Execution and delivery of an
Exercise Notice for all of the then remaining Warrant Shares shall have the same effect as cancellation of the original of this
Warrant after delivery of the Warrant Shares in accordance with the terms hereof. On or before the first (1st) Trading
Day following the date on which the Company has received the Exercise Notice, the Company shall transmit by facsimile an acknowledgment
of confirmation of receipt of the Exercise Notice to the Holder and the Company's transfer agent (the "Transfer Agent").
On or before the third (3rd) Trading Day following the date on which the Company has received the Exercise Notice (the second (2nd)
Trading Day if physical certificates are being delivered), so long as the Holder delivers the Aggregate Exercise Price (other than
in a case of Cashless Exercise) and, where applicable, the executed OCS Undertaking, on or prior to the second (2nd) Trading Day
following the date on which the Company has received the Exercise Notice (first (1st) Trading Day where physical certificates
are being delivered) (the "Share Delivery Date") (provided that if the Aggregate Exercise Price and, where applicable,
the executed OCS Undertaking, has not been delivered by such date, the Share Delivery Date shall be one (1) Trading Day after the
Aggregate Exercise Price (or notice of a Cashless Exercise) and, where applicable, the executed OCS Undertaking, are delivered),
the Company shall (X) provided that the Transfer Agent is participating in The Depository Trust Company ("DTC")
Fast Automated Securities Transfer Program, credit such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder's or its designee's balance account with DTC through its Deposit / Withdrawal At Custodian system,
or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and dispatch by
overnight courier to the address as specified in the Exercise Notice, 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.
The Company shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the
issuance of Warrant Shares via DTC, if any. 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. Upon delivery of the Exercise Notice, and, where applicable, the executed
OCS Undertaking, 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 such Warrant Shares are credited to the Holder's
DTC account or the date of delivery of the certificates evidencing such Warrant Shares, as the case may be; provided payment of
the Aggregate Exercise Price (other than in the case of a Cashless Exercise) is received within two Trading Days of delivery of
the Exercise Notice. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the number
of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired
upon an exercise, then the Company shall as soon as practicable and in no event later than three (3) Trading Days after receipt
by the Company of the original Warrant and at its own expense, issue a new Warrant (in accordance with Section 7(d)) representing
the right to purchase the number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number
of Warrant Shares with respect to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise
of this Warrant, but rather the number of Warrant Shares to be issued shall be rounded up to the nearest whole number. The Company
shall pay any and all taxes (other than the Holder's income taxes) which may be payable with respect to the issuance and delivery
of Warrant Shares upon exercise of this Warrant. The Company's obligations to issue and deliver Warrant Shares in accordance with
the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder
to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person
or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination.
(b)
Exercise Price. For purposes of this Warrant, "Exercise Price" means $2.75, subject to adjustment
as provided herein.
(c) Company's
Failure to Timely Deliver Securities. If, at any time after the Effective Date, the Company shall fail for any reason or for
no reason to issue to the Holder on or prior to the Share Delivery Date such number of Ordinary Shares to which the Holder is
entitled upon the Holder's exercise of this Warrant without any restrictive legend, and if on or after such Share Delivery Date
the Holder (or any other Person in respect, or on behalf, of the Holder) purchases (in an open market transaction or otherwise)
Ordinary Shares to deliver in satisfaction of a sale by the Holder of all or any portion of the number of Ordinary Shares equal
to or any portion of the number of Ordinary Shares issuable upon such exercise that the Holder anticipated receiving from the
Company (a "Buy-In"), then, in addition to all other remedies available to the Holder, the Company shall, within
three (3) Trading Days after the Holder's request and in the Holder's discretion, either (i) pay cash to the Holder in an amount
equal to the Holder's total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for the
Ordinary Shares so purchased (the "Buy-In Price"), at which point the Company's obligation to deliver such certificate
(and to issue such Ordinary Shares) or credit such Holder's balance account with DTC for such Ordinary Shares shall terminate,
or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Ordinary Shares
or credit such Holder's balance account with DTC, as applicable, and pay cash to the Holder in an amount equal to the excess (if
any) of the Buy-In Price over the product of (A) such number of Ordinary Shares, times (B) the price at which the sell order giving
rise to such purchase obligation was executed. Nothing shall limit the 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 certificates representing Ordinary Shares (or to electronically deliver such
Ordinary Shares) upon the exercise of this Warrant as required pursuant to the terms hereof.
(d)
Cashless Exercise. Notwithstanding anything contained herein to the contrary, if a Registration Statement
under the 1933 Act (the "Registration Statement"), covering the resale of the Warrant Shares is not available
for the resale of such Warrant Shares by the Holder, the Holder may, in its sole discretion, exercise this Warrant in whole or
in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment
of the Aggregate Exercise Price, elect instead to receive upon such exercise the "Net Number" of Ordinary Shares determined
according to the following formula (a "Cashless Exercise"):
Net Number
= (A x B) - (A x C)
D
For purposes
of the foregoing formula:
| A= | the total number of shares with respect to which this
Warrant is then being exercised. |
| B= | the arithmetic average of the Closing Sale Prices of
the Ordinary Shares for the five (5) consecutive Trading Days ending on the date immediately preceding the date of the Exercise
Notice. |
| C= | the Exercise Price then in effect for the applicable
Warrant Shares at the time of such exercise. |
| D= | the Closing Sale Price of the Ordinary Shares on the
date of the Exercise Notice. |
If Warrant Shares are
issued in a Cashless Exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the 1933 Act, the Warrant
Shares shall take on the registered characteristics of the warrants being exercised, and the holding period of the warrants being
exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees not to take any position contrary to
this Section 1(d).
(e)
Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of
the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve
such dispute in accordance with Section 12.
(f)
Beneficial Ownership Limitation on Exercises. Notwithstanding anything to the contrary contained herein, the Company
shall not effect the exercise of any portion of this Warrant, and the Holder shall not have the right to exercise any portion of
this Warrant, pursuant to the terms and conditions of this Warrant and any such exercise shall be null and void and treated as
if never made, to the extent that after giving effect to such exercise, the Holder together with the other Attribution Parties
collectively would beneficially own in excess of 4.99% (the "Maximum Percentage") of the number of Ordinary Shares
outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Ordinary
Shares beneficially owned by the Holder and the other Attribution Parties shall include the number of Ordinary Shares held by the
Holder and all other Attribution Parties plus the number of Ordinary Shares issuable upon exercise of this Warrant with respect
to which the determination of such sentence is being made, but shall exclude the number of Ordinary Shares which would be issuable
upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including,
without limitation, any convertible notes or convertible preferred stock or warrants, including the Warrants beneficially owned
by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained
in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d)
of the Securities Exchange Act of 1934, as amended (the "1934 Act"). For purposes of this Warrant, in determining
the number of outstanding Ordinary Shares the Holder may acquire upon the exercise of this Warrant without exceeding the Maximum
Percentage, the Holder may rely on the number of outstanding Ordinary Shares as reflected in (x) the Company's most recent Annual
Report on Form 20-F, Report on Form 6-K or other public filing with the Securities and Exchange Commission (the "SEC"),
as the case may be, (y) a more recent public announcement by the Company or (3) any other written notice by the Company or the
Transfer Agent setting forth the number of Ordinary Shares outstanding (the "Reported Outstanding Share Number").
If the Company receives an Exercise Notice from the Holder at a time when the actual number of outstanding Ordinary Shares is less
than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of Ordinary Shares
then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder's beneficial ownership, as determined
pursuant to this Section 1(f), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant
Shares to be purchased pursuant to such Exercise Notice (the number of shares by which such purchase is reduced, the "Reduction
Shares") and (ii) as soon as reasonably practicable, and only if then permitted by Israeli corporate law, the Company
shall return to the Holder any exercise price paid by the Holder for the Reduction Shares. For any reason at any time, upon the
written or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic
mail 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
and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that
the issuance of Ordinary Shares to the Holder upon exercise of this Warrant results in the Holder and the other Attribution Parties
being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding Ordinary Shares
(as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which the Holder's and the other Attribution
Parties' aggregate beneficial ownership exceeds the Maximum Percentage (the "Excess Shares") shall be returned
to the Company and thereafter shall be cancelled by the Company, and the Holder shall not have the power to vote or to transfer
the Excess Shares. As soon as reasonably practicable after the Excess Shares have been returned to the Company, the Company shall
return to the Holder the exercise price paid by the Holder for the Excess Shares, if then permitted by the Israeli Companies Law,
1999. Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase not effective
until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage
not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective
until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease
will apply only to the Holder and the other Attribution Parties and not to any other holder of SPA Warrants that is not an Attribution
Party of the Holder. For purposes of clarity, the Ordinary Shares issuable pursuant to the terms of this Warrant in excess of the
Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose including for purposes of Section
13(d) or Rule 16a-1(a)(1) of the 1934 Act. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion
of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section
1(f) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained
in this paragraph may not be waived and shall apply to a successor holder of this Warrant.
(g)
Insufficient Authorized Shares. Subject to the Company’s obligations otherwise set forth in this Section 1(g),
the Company shall not issue shares upon exercise of this Warrant if such shares are not then authorized. The number of Ordinary
Shares that the Company is required from time to time to reserve from its authorized and unissued capital for the exercise of this
Warrant and all of the Additional Warrants is herein referred to as the "Required Reserve Amount" and the failure
to have such sufficient number of authorized and unreserved Ordinary Shares is herein referred to as an "Authorized Share
Failure". If at any time while this Warrant remains outstanding the Company does not have at least the Required Reserve
Amount of authorized and unreserved Ordinary Shares to satisfy its obligation to reserve for issuance upon exercise of this Warrant
and the Additional Warrants, then the Company shall promptly take all action reasonably necessary to increase the Company's authorized
Ordinary Shares to an amount sufficient to allow the Company to reserve the Required Reserve Amount for this Warrant and the Additional
Warrants then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than seventy-five (75) days after the occurrence of such Authorized
Share Failure, the Company shall hold a meeting of its shareholders for the approval of an increase in the number of authorized
Ordinary Shares. In connection with such meeting, the Company shall provide each shareholder with a proxy statement and shall use
its reasonable best efforts to solicit its shareholders' approval of such increase in authorized Ordinary Shares and to cause its
board of directors to recommend to the shareholders that they approve such proposal. In the event that upon any exercise of this
Warrant, the Company does not have sufficient authorized shares to deliver in satisfaction of such exercise, then unless the Holder
elects to void such attempted exercise, the Holder may require in lieu of delivering the number of Warrant Shares that the Company
is unable to deliver pursuant to this Section 1(g), the Company to pay to the Holder within three (3) Trading Days of the applicable
exercise, cash in an amount equal to the product of (i) the number of Warrant Shares that the Company is unable to deliver pursuant
to this Section 1(g) and (ii) (a) the greatest Closing Sale Price of the Ordinary Shares on any Trading Day at any time during
the period beginning on the date of the applicable Exercise Notice and ending on the date the Company makes the payment provided
for in this sentence minus (b) the Exercise Price. The initial number of Ordinary Shares reserved for exercise of this Warrant
and the Additional Warrants and each increase in the number of shares so reserved shall be allocated pro rata among the Holder
and the holders of the other Warrants and Additional Warrants, based on the number of Ordinary Shares issuable upon exercise of
this Warrant (without regard to any limitations in exercise) issued to the Holder on the Issuance Date (the "Authorized
Share Allocation"). In the event that the Holder shall sell or otherwise transfer this Warrant or any of its other Additional
Warrants, each transferee shall be allocated a pro rata portion of such holder's Authorized Share Allocation. Any Ordinary Shares
reserved and allocated to any Person which ceases to hold any Warrants shall be allocated to the Holder and the remaining holders
of Warrants, pro rata based on the Ordinary Shares issuable upon exercise of the Warrants then held by such holders (without regard
to any limitations on the exercise of the Warrants).
(h)
Holder’s Right of Alternative Exercise Price Following Issuance of Certain Options or Convertible Securities.
In addition to and not in limitation of the other provisions of this Section 1, if the Company in any manner issues or sells
or enters into any agreement to issue or sell, any Ordinary Shares, Options or Convertible Securities in a Variable Rate Transaction
(as defined in the Purchase Agreement) after the Subscription Date (each of the formulations for such variable price being herein
referred to as, the “Variable Price” and the securities so issued, the “Variable Price Securities”),
the Company shall provide written notice thereof pursuant to the notice provisions hereof to the Holder on the date of such agreement
and the issuance of such Variable Price Securities. From and after the date the Company enters into such agreement or issues
any such Variable Price Securities, the Holder shall have the right, but not the obligation, in its sole discretion to substitute
the Variable Price in effect at the time of the exercise of this Warrant, for the Exercise Price upon exercise of this Warrant
by designating in the Exercise Notice delivered upon any exercise of this Warrant that solely for purposes of such exercise the
Holder is relying on the Variable Price rather than the Exercise Price then in effect. The Holder’s election to rely
on a Variable Price for a particular exercise of this Warrant shall not obligate the Holder to rely on a Variable Price for any
future exercises of this Warrant. This paragraph 1(h) shall not apply if the Variable Rate Transaction is an at-the-market offering
conducted through a registered broker dealer under Commission Rule 415.
2.
ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall
be adjusted from time to time as follows:
(a) Adjustment
Upon Issuance of Ordinary Shares. If and whenever on or after the Subscription Date, and prior to the first anniversary of
the Closing Date, the Company issues or sells, or in accordance with this Section 2 is deemed to have issued or sold, or publicly
announces the issuance or sale of, any Ordinary Shares (including the issuance or sale of Ordinary Shares owned or held by or
for the account of the Company, but excluding Ordinary Shares deemed to have been issued or sold by the Company in connection
with any Exempt Issuance for a consideration per share (the "New Issuance Price") less than a price (the "Applicable
Price") equal to the Exercise Price in effect immediately prior to such issue or sale or deemed issuance or sale (the
foregoing a "Dilutive Issuance"), then immediately after such Dilutive Issuance, the Exercise Price then in effect
shall be reduced to an amount equal to the New Issuance Price, provided that under no circumstances will the Exercise Price be
reduced below the par value of the Ordinary Shares. For purposes of determining the adjusted Exercise Price under this Section
2(a), the following shall be applicable:
(i) Issuance
of Options. If the Company grants or sells, or publicly announces the grant or sale of, any Options and the lowest price per
share for which one Ordinary Share is issuable upon the exercise of any such Option or upon conversion, exercise or exchange of
any Convertible Securities issuable upon exercise of any such Option is less than the Applicable Price, then such Ordinary Share
shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale of such Option
for such price per share. For purposes of this Section 2(a)(i), the "lowest price per share for which one Ordinary Share is
issuable upon the exercise of any such Options or upon conversion, exercise or exchange of any Convertible Securities issuable
upon exercise of any such Option" shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable
by the Company with respect to any one Ordinary Share upon the granting or sale of the Option, upon exercise of the Option and
upon conversion, exercise or exchange of any Convertible Security issuable upon exercise of such Option less any consideration
paid or payable by the Company with respect to such one Ordinary Share upon the granting or sale of such Option, upon exercise
of such Option and upon conversion exercise or exchange of any Convertible Security issuable upon exercise of such Option. No further
adjustment of the Exercise Price shall be made upon the actual issuance of such Ordinary Shares or of such Convertible Securities
upon the exercise of such Options or upon the actual issuance of such Ordinary Shares upon conversion, exercise or exchange of
such Convertible Securities.
(ii) Issuance
of Convertible Securities. If the Company in any manner issues or sells, or publicly announces the issuance or sale of, any
Convertible Securities and the lowest price per share for which one Ordinary Share is issuable upon the conversion, exercise or
exchange thereof is less than the Applicable Price, then such Ordinary Share shall be deemed to be outstanding and to have been
issued and sold by the Company at the time of the issuance or sale of such Convertible Securities for such price per share. For
the purposes of this Section 2(a)(ii), the "lowest price per share for which one Ordinary Share is issuable upon the conversion,
exercise or exchange thereof" shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable
by the Company with respect to any one Ordinary Share upon the issuance or sale of the Convertible Security and upon conversion,
exercise or exchange of such Convertible Security less any consideration paid or payable by the Company with respect to such one
Ordinary Share upon the issuance or sale of such Convertible Security and upon conversion, exercise or exchange of such Convertible
Security. No further adjustment of the Exercise Price shall be made upon the actual issuance of such Ordinary Shares upon conversion,
exercise or exchange of such Convertible Securities, and if any such issue or sale of such Convertible Securities is made upon
exercise of any Options for which adjustment of this Warrant has been or is to be made pursuant to other provisions of this Section
2(a), no further adjustment of the Exercise Price shall be made by reason of such issue or sale.
(iii) Change
in Option Price or Rate of Conversion. If the purchase price provided for in any Options, the additional consideration, if
any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for Ordinary Shares increases or decreases at any time, the Exercise
Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price, which would have been in effect
at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional consideration
or increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of this
Section 2(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the Subscription Date are increased
or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Ordinary
Shares deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such
increase or decrease. No adjustment pursuant to this Section 2(a) shall be made if such adjustment would result in an increase
of the Exercise Price then in effect.
(iv) Calculation
of Consideration Received. In case any Option is issued in connection with the issue or sale of other securities of the Company,
together comprising one integrated transaction, (x) the Options will be deemed to have been issued for the Option Value of such
Options and (y) the other securities issued or sold in such integrated transaction shall be deemed to have been issued or sold
for the difference of (I) the aggregate consideration received by the Company less any consideration paid or payable by the Company
pursuant to the terms of such other securities of the Company, less (II) the Option Value. If any Ordinary Shares, Options or Convertible
Securities are issued or sold or deemed to have been issued or sold for cash, the consideration other than cash received therefor
will be deemed to be the net amount received by the Company therefor. If any Ordinary Shares, Options or Convertible Securities
are issued or sold for a consideration other than cash, the amount of such consideration received by the Company will be the fair
value of such consideration, except where such consideration consists of publicly traded securities, in which case the amount of
consideration received by the Company will be the Closing Sale Price of such publicly traded securities on the date of receipt.
If any Ordinary Shares, Options or Convertible Securities are issued to the owners of the non-surviving entity in connection with
any merger in which the Company is the surviving entity, the amount of consideration therefor will be deemed to be the fair value
of such portion of the net assets and business of the non-surviving entity as is attributable to such Ordinary Shares, Options
or Convertible Securities, as the case may be. The fair value of any consideration other than cash or publicly traded securities
will be determined jointly by the Company and the Required Holders. If such parties are unable to reach agreement within ten (10)
days after the occurrence of an event requiring valuation (the "Valuation Event"), the fair value of such consideration
will be determined within five (5) Business Days after the tenth (10th) day following the Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the Required Holders. The determination of such appraiser shall be final
and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Company.
(v) Record
Date. If the Company takes a record of the holders of Ordinary Shares for the purpose of entitling them (A) to receive
a dividend or other distribution payable in Ordinary Shares, Options or in Convertible Securities or (B) to subscribe for
or purchase Ordinary Shares, Options or Convertible Securities, then such record date will be deemed to be the date of the issue
or sale of the Ordinary Shares deemed to have been issued or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or purchase, as the case may be.
(vi) No
Readjustments. For the avoidance of doubt, in the event the Exercise Price has been adjusted pursuant to this Section 2(a)
and the Dilutive Issuance that triggered such adjustment does not occur, is not consummated, is unwound or is cancelled after the
facts for any reason whatsoever, in no event shall the Exercise Price be readjusted to the Exercise Price that would have been
in effect if such Dilutive Issuance had not occurred or been consummated.
(b)
Adjustment Upon Subdivision or Combination of Ordinary Shares. If the Company at any time on or after the Subscription
Date subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding Ordinary
Shares into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately
reduced and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription
Date combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding Ordinary Shares into a
smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased
and the number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective
at the close of business on the date the subdivision or combination becomes effective.
(c)
Adjustment Upon Effective Date. The Exercise Price shall be adjusted (downward only), if necessary, upon the eleventh
Trading Day after the Effective Date of the Registration Statement to equal 110% of the Market Price, provided that under no circumstances
will the Exercise Price be reduced below the par value of the Ordinary Shares..
(d)
Voluntary Adjustment By Company. Subject to any requirements or approvals from the Principal Market, the Company
may at any time during the term of this Warrant, with the prior written consent of the Required Holders, reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.
(e)
Other Events. If any event occurs of the type contemplated by the provisions of this Section 2 but not expressly
provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights
or other rights with equity features), then the Company's Board of Directors will make an appropriate adjustment in the Exercise
Price and the number of Warrant Shares, as mutually determined by the Company's Board of Directors and the Required Holders, so
as to protect the rights of the Holder; provided that no such adjustment pursuant to this Section 2(e) will increase the
Exercise Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 2; and provided further
that under no circumstances will the Exercise Price be reduced below the par value of the Ordinary Shares.
3.
RIGHTS UPON DISTRIBUTION OF ASSETS. 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, stock or other securities, property, options, evidence of indebtedness or any other assets
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 or
restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) 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 and the other Attribution Parties exceeding
the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to such extent (and shall not
be entitled to beneficial ownership of such Ordinary Shares as a result of such Distribution (and beneficial ownership) to such
extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time or times as
its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time
or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or
on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
4.
PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.
(a) Purchase
Rights. In addition to any adjustments pursuant to Section 2 above, if at any time the Company grants, issues or sells any
Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders
of all outstanding 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 or
restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) 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
and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such
Purchase Right to such extent (and shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Purchase
Right (and beneficial ownership) to such extent) and such Purchase Right to such extent shall be held in abeyance for the benefit
of the Holder until such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued
or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance) to the same extent as if
there had been no such limitation).
(b)
Fundamental Transactions. 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 or group of
Persons whereby such other Person or group acquires more than 50% of the outstanding Ordinary Shares, (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 50% or more 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 (other than any such transaction effected solely
for the purpose of changing the Company’s jurisdiction of incorporation), or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off 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
stock or 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 1(f) on the exercise of this Warrant), the number of shares of Common Stock of the successor
or acquiring corporation or of Ordinary Shares 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 1(f) 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 Ordinary Share 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 and the other Transaction Documents in accordance with the provisions of this Section 4(b) pursuant to customary
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 capital stock 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 of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to
such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock 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), and which is reasonably satisfactory in form and substance to the Holder. 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 and the other Transaction Documents 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 and the other Transaction Documents with the same effect as if such Successor Entity had been
named as the Company herein
(c)
Notwithstanding the foregoing, in the event of a Fundamental Transaction, at the request of the Holder delivered before
the thirtieth (30th) day after either the occurrence or consummation of such Fundamental Transaction and subject to
any applicable law, including the limitations under the Israeli Companies Law, 1999 on the purchase of shares of an Israeli company
or of securities convertible to shares of an Israeli company by the same company or by its subsidiary or by any other corporate
body controlled by it, the Company or the Successor Entity, or any other party who agreed, in connection with such Fundamental
Transaction, to purchase this Warrant in the event that the Holder shall exercise its rights under this Section 4(c) (a “Purchasing
Party”), shall purchase this Warrant from the Holder by paying to the Holder, within five (5) Business Days after such
request (or, if later, on the effective date of the Fundamental Transaction), cash in an amount equal to the Black Scholes Value
of the remaining unexercised portion of this Warrant on the date of such Fundamental Transaction. The Company shall not cause or
suffer to be completed any Fundamental Transaction if the Company or its Successor Entity cannot pay the Black Scholes Value as
a result of any restriction on such payment pursuant to the Israeli Companies Law, 1999 or otherwise, and there is no other Purchasing
Party under the terms of the Fundamental Transaction that is obligated to pay the Black Scholes Value.
5.
NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles
of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, 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, and will at all times in good faith carry out all of the provisions of this Warrant and take all action
as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall
not increase the par value of any Ordinary Shares receivable upon the exercise of this Warrant above the Exercise Price then in
effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Ordinary Shares upon the exercise of this Warrant, and (iii) shall, so long as any of the Series
A Warrants are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued Ordinary
Shares, solely for the purpose of effecting the exercise of the Series A Warrants, the Required Reserve Amount to effect the exercise
of the Series A Warrants then outstanding (without regard to any limitations on exercise).
6.
WARRANT HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely
in such Person's capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder
of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder,
solely in such Person's capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right
to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock,
consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise,
prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of
this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase
any securities (upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted
by the Company or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder with copies
of the same notices and other information given to the shareholders of the Company generally, contemporaneously with the giving
thereof to the shareholders.
7.
REISSUANCE OF WARRANTS.
(a) Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company,
whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)),
registered as the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the
Holder and, if less than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in
accordance with Section 7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.
(b)
Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company
of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification
undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this
Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right
to purchase the Warrant Shares then underlying this Warrant. The Holder shall also pay any reasonable third-party costs associated
with the issuance of such replacement Warrant.
(c)
Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new warrant or warrants (in accordance with Section 7(d)) representing in the aggregate
the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right
to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided,
however, that no Series A Warrants for fractional Warrant Shares shall be given.
(d)
Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant,
such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant,
the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to
Section 7(a) or Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of Ordinary Shares underlying
the other new warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date,
and (iv) shall have the same rights and conditions as this Warrant.
8.
NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice
shall be given in accordance with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail a description of such action
and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice to the Holder (i)
immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with
respect to any dividend or distribution upon the Ordinary Shares, (B) with respect to any grants, issuances or sales of any Options,
Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of all outstanding Ordinary
Shares or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation; provided
in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided
to the Holder
9.
AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended and
the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, if the Company
has obtained the written consent of the Required Holders. Any Holder may waive any provision of this Warrant as to itself.
10. GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws
of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State
of New York. The Company 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 brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company 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
to the Company at the address set forth in Section 9(f) of the Securities Purchase 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 manner permitted by law. Nothing contained herein shall be deemed or operate to preclude
the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company's
obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or
other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST,
A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
11.
CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and all the Purchasers
and shall not be construed against any Person as the drafter hereof. The headings of this Warrant are for convenience of reference
and shall not form part of, or affect the interpretation of, this Warrant.
12. DISPUTE RESOLUTION. In the case of a dispute
as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two (2) Business Days of receipt of the Exercise Notice
giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination
or calculation of the Exercise Price or the Warrant Shares within three (3) Business Days of such disputed determination or arithmetic
calculation being submitted to the Holder, then the Company shall, within two (2) Business Days submit via facsimile (a) the disputed
determination of the Exercise Price to an independent, reputable investment bank selected by the Holder and approved by the Company,
such approval not to be unreasonably withheld or delayed or (b) the disputed arithmetic calculation of the Warrant Shares to the
Company's independent, outside accountant, selected by the Holder and approved by the Company, such approval not to be unreasonably
withheld or delayed. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform
the determinations or calculations and notify the Company and the Holder of the results no later than ten (10) Business Days from
the time it receives the disputed determinations or calculations. Such investment bank's or accountant's determination or calculation,
as the case may be, shall be binding upon all parties absent demonstrable error.
13.
REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative
and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including
a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue
actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach
by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may
be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant
shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity
of showing economic loss and without any bond or other security being required.
14.
TRANSFER. Subject to restrictions imposed by applicable securities laws, this Warrant and the Warrant Shares
may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company.
15.
SEVERABILITY. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid
or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable
shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified
continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited
nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations
or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the
parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s)
with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
16. DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless the Company has in
good faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the
Company or its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall within one (1) Business Day after
any such receipt or delivery publicly disclose such material, nonpublic information on a Current Report on Form 6-K or otherwise.
In the event that the Company believes that a notice delivered in accordance with the terms of this Warrant contains material,
nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to such Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters
relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries.
17.
CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a)
"1933 Act" means the Securities Act of 1933, as amended.
(b)
"Additional Warrants" means the Series B Warrants, if any (as defined in the Securities Purchase
Agreement).
(c)
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is
controlled by, or is under common control with, such Person, it being understood for purposes of this definition that "control"
of a Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the
election of directors of such Person or direct or cause the direction of the management and policies of such Person whether by
contract or otherwise.
(d)
"Attribution Parties" means, collectively, the following Persons and entities: (i) any investment vehicle,
including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly
managed or advised by the Holder's investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates
of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the
Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company's Ordinary Shares would or
could be aggregated with the Holder's and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity,
the purpose of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(e)
"Black Scholes Value" means the value of this Warrant based on the Black-Scholes Option Pricing Model obtained
from the "OV" function on Bloomberg determined as of the day immediately following the public announcement of the applicable
Fundamental Transaction, or, if the Fundamental Transaction is not publicly announced, the date the Fundamental Transaction is
consummated, for pricing purposes and reflecting (i) a risk-free interest rate corresponding to the U.S. Treasury rate for a period
equal to the remaining term of this Warrant as of such date of request, (ii) an expected volatility equal to the greater of 100%
and the 100 day volatility obtained from the HVT function on Bloomberg as of the day immediately following the public announcement
of the applicable Fundamental Transaction, or, if the Fundamental Transaction is not publicly announced, the date the Fundamental
Transaction is consummated, (iii) the underlying price per share used in such calculation shall be the sum of the price per share
being offered in cash, if any, plus the value of any non-cash consideration, if any, being offered in the Fundamental Transaction,
(iv) a zero cost of borrow and (v) a 360 day annualization factor.
(f)
"Bloomberg" means Bloomberg Financial Markets.
(g)
"Business Day" means any day other than Saturday, Sunday or other day on which commercial banks in The
City of New York are authorized or required by law to remain closed; provided, however, for calculating Business
Days with respect to any action to be taken by the Company hereunder, Friday after 1:00 p.m. (New York City time) shall not be
considered a Business Day.
(h)
"Closing Bid Price" and "Closing Sale Price" means, for any security as of any date, the
last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg,
or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00
p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading
market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities
exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply,
the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic
bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported
for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security
as reported in the OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink OTC Markets Inc.). If the Closing
Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the
Closing Bid Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12. All such determinations to be appropriately adjusted
for any stock dividend, stock split, stock combination, reclassification or other similar transaction during the applicable calculation
period.
(i)
"Convertible Securities" means any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for Ordinary Shares.
(j)
"Eligible Market" means the Principal Market, the NYSE MKT LLC, The NASDAQ Capital Market, The NASDAQ Global
Market, The NASDAQ Global Select Market, The New York Stock Exchange, Inc., the OTC QX or the OTC QB.
(k)
"Expiration Date" means the date that is sixty (60) months after the Initial Exercisability Date, or,
if such date falls on a day other than a Business Day or on which trading does not take place on the Principal Market (a "Holiday"),
the next day that is not a Holiday.
(l)
"Group" means a "group" as that term is used in Section 13(d) of the 1934 Act and as defined
in Rule 13d-5 thereunder.
(m)
“Market Price” means the arithmetic average of the five lowest Weighted Average Prices calculated during
of the ten Trading Days immediately following the Effective Date.
(n)
"Option Value" means the value of an Option based on the Black and Scholes Option Pricing model obtained
from the "OV" function on Bloomberg determined as of (A) the Trading Day prior to the public announcement of the issuance
of the applicable Option, if the issuance of such Option is publicly announced or (B) the Trading Day immediately following the
issuance of the applicable Option if the issuance of such Option is not publicly announced, for pricing purposes and reflecting
(i) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of the applicable
Option as of the applicable date of determination, (ii) an expected volatility equal to the greater of 100% and the 100 day volatility
obtained from the HVT function on Bloomberg as of (A) the Trading Day immediately following the public announcement of the applicable
Option if the issuance of such Option is publicly announced or (B) the Trading Day immediately following the issuance of the applicable
Option if the issuance of such Option is not publicly announced, (iii) the underlying price per share used in such calculation
shall be the highest Weighted Average Price of the Ordinary Shares during the period beginning on the Trading Day prior to the
execution of definitive documentation relating to the issuance of the applicable Option and ending on (A) the Trading Day immediately
following the public announcement of such issuance, if the issuance of such Option is publicly announced or (B) the Trading Day
immediately following the issuance of the applicable Option if the issuance of such Option is not publicly announced, (iv) a zero
cost of borrow and (v) a 360 day annualization factor.
(o)
"Options" means any rights, warrants or options to subscribe for or purchase Ordinary Shares or Convertible
Securities.
(p)
"Ordinary Shares" means (i) the Company's ordinary shares, and (ii) any share capital into which
such Ordinary Shares shall have been changed or any share capital resulting from a reclassification of such Ordinary Shares.
(q)
"Parent Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person,
including such entity whose common shares or Ordinary Shares or equivalent equity security is quoted or listed on an Eligible Market
(or, if so elected by the Required Holders, any other market, exchange or quotation system), or, if there is more than one such
Person or such entity, the Person or such entity designated by the Required Holders or in the absence of such designation, such
Person or entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.
(r) "Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.
(s) "Principal Market" means The
NASDAQ Capital Market.
(t) "Required Holders" means the
holders of the Series A Warrants representing at least a majority of the Ordinary Shares underlying the Series A Warrants then
outstanding
(u)
"Subject Entity" means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons
or Group.
(v)
"Successor Entity" means one or more Person or Persons (or, if so elected by the Holder, the Company or
Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected
by the Holder, the Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.
(w) "Trading
Day" means any day on which the Ordinary Shares is traded on the Principal Market, or, if the Principal Market is not
the principal trading market for the Ordinary Shares, then on the principal securities exchange or securities market on which
the Ordinary Shares is then traded; provided that "Trading Day" shall not include any day on which the Ordinary
Shares is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Ordinary Shares is suspended
from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).
(x)
"Warrant Share Number" means [_______________] [(_______)].
(y)
"Warrants" shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(z)
"Weighted Average Price" means, for any security as of any date, the dollar volume-weighted average price
for such security on the Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the
Principal Market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other
time as the Principal Market publicly announces is the official close of trading), as reported by Bloomberg through its "Volume
at Price" function or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter
market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other
time as such market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other
time as such market publicly announces is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the OTC Link or "pink sheets" by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Weighted Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Weighted Average Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12 with the term "Weighted Average Price" being
substituted for the term "Exercise Price." All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.
[Signature Page Follows]
IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Ordinary Shares to be duly executed as of the Issuance Date set out above.
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EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS
WARRANT TO PURCHASE ORDINARY SHARES
ROSETTA GENOMICS LTD.
The
undersigned holder hereby exercises the right to purchase _________________ of the Ordinary Shares ("Warrant Shares")
of Rosetta Genomics Ltd., a company organized under the laws of the State of Israel (the "Company"),
evidenced by the attached Series __ Warrant to purchase Ordinary Shares No. ______ (the "Warrant"). Capitalized
terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.
1. Form of Exercise
Price. The holder intends that payment of the Exercise Price shall be made as:
____________ a
"Cash Exercise" with respect to _________________ Warrant Shares; or
____________ a
"Cashless Exercise" with respect to _______________ Warrant Shares.
2. Payment of Exercise
Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance
with the terms of the Warrant.
3. Delivery of Warrant
Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.
4.
By signing this Exercise Notice the holder hereby confirms his compliance with the representations and warranties detailed in Section
3.2(d) of the Securities Purchase Agreement. Without derogating from the above, the holder acknowledge and agrees that in the event
that following issuance of the Warrant Shares he will hold 5% or more of the issued share capital of the Company, the issuance
of the Warrant Shares shall be subject to the delivery by the holder to the Company of an executed Undertaking towards the
OCS (as such terms are defined in the Securities Purchase Agreement) substantially in the form that was attached to the Securities
Purchase Agreement as Annex A or in any other form required by the OCS.
Please issue the Warrant Shares in the following name and to the following account: |
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Exhibit 4.2
ROSETTA
GENOMICS LTD.
SERIES B Warrant
To Purchase Ordinary Shares
(PARTIALLY
PREPAID)
Warrant No.: B-[__]
Number of Ordinary Shares: Determined in
accordance with the formula set forth in the definition of Warrant Share Number.
Date of Issuance: October __, 2015 ("Issuance Date")
Rosetta Genomics Ltd.,
a company organized under the laws of the State of Israel (the "Company"), hereby certifies that, for good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, [_______________],
the registered holder hereof or its permitted assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, at any time or times on or after
the Issuance Date (the "Initial Exercisability Date"), but not after 11:59 p.m., New York time, on the Expiration
Date, (as defined below), up to such number of fully paid and nonassessable Ordinary Shares equal to the Warrant Share Number,
subject to adjustment as provided herein (the "Warrant Shares"). Except as otherwise defined herein, capitalized
terms in this Warrant to Purchase Ordinary Shares (including any warrants to purchase Ordinary Shares issued in exchange, transfer
or replacement hereof, this "Warrant"), shall have the meanings set forth in Section 17. This Warrant is one of
the Series B Warrants to purchase Ordinary Shares (the "Series B Warrants") issued pursuant to Section 2.2 of
that certain Securities Purchase Agreement, dated as of October 13, 2015 (the "Subscription Date"), by and among
the Company and the investors (the "Purchasers") referred to therein (the "Securities Purchase Agreement").
Capitalized terms used herein and not otherwise defined shall have the definitions ascribed to such terms in the Securities Purchase
Agreement.
1.
EXERCISE OF WARRANT.
(a)
Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations
set forth in Section 1(f)), this Warrant may be exercised by the Holder at any time or times on or after the Initial Exercisability
Date, in whole or in part, by (i) delivery of a written notice, in the form attached hereto as Exhibit A (the "Exercise
Notice"), of the Holder's election to exercise this Warrant; (ii) (A) payment to the Company of an amount equal
to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the "Aggregate
Exercise Price") in cash by wire transfer of immediately available funds or (B) if the provisions of Section 1(d) are
applicable, by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section
1(d)), and (iii) if required in accordance with the provisions of the Securities Purchase Agreement, delivery to the Company of
an undertaking towards the OCS substantially in the form that was attached to the Securities Purchase Agreement as Annex A
or in any other form required by the OCS (the “OCS Undertaking”) duly executed by the Holder. The Holder shall
not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise
Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and
issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. Execution and delivery of an
Exercise Notice for all of the then remaining Warrant Shares shall have the same effect as cancellation of the original of this
Warrant after delivery of the Warrant Shares in accordance with the terms hereof. On or before the first (1st) Trading
Day following the date on which the Company has received the Exercise Notice, the Company shall transmit by facsimile an acknowledgment
of confirmation of receipt of the Exercise Notice to the Holder and the Company's transfer agent (the "Transfer Agent").
On or before the third (3rd) Trading Day following the date on which the Company has received the Exercise Notice (the second (2nd)
Trading Day if physical certificates are being delivered), so long as the Holder delivers the Aggregate Exercise Price (other than
in case of a Cashless Exercise) and, where applicable, the executed OCS Undertaking, on or prior to the second (2nd) Trading Day
following the date on which the Company has received the Exercise Notice (1st Trading Day if physical certificates are
being delivered) (the "Share Delivery Date") (provided that if the Aggregate Exercise Price and, where applicable,
the executed OCS Undertaking), has not been delivered by such date, the Share Delivery Date shall be one (1) Trading Day after
the Aggregate Exercise Price (or notice of a Cashless Exercise) and, where applicable, the executed OCS Undertaking is delivered),
the Company shall (X) provided that the Transfer Agent is participating in The Depository Trust Company ("DTC")
Fast Automated Securities Transfer Program, credit such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder's or its designee's balance account with DTC through its Deposit / Withdrawal At Custodian system,
or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and dispatch by
overnight courier to the address as specified in the Exercise Notice, 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.
The Company shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the
issuance of Warrant Shares via DTC, if any. 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. Upon delivery of the Exercise Notice and, where applicable, the executed
OCS Undertaking, 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 such Warrant Shares are credited to the Holder's
DTC account or the date of delivery of the certificates evidencing such Warrant Shares, as the case may be; provided payment of
the Aggregate Exercise Price (other than in case of a Cashless Exercise) is received within two Trading Days of delivery of the
Exercise Notice. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the number of Warrant
Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three (3) Trading Days after receipt by the Company of
the original Warrant and at its own expense, issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase
the number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant Shares
with respect to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise of this Warrant,
but rather the number of Warrant Shares to be issued shall be rounded up to the nearest whole number. The Company shall pay any
and all taxes (other than the Holder's income taxes) which may be payable with respect to the issuance and delivery of Warrant
Shares upon exercise of this Warrant. The Company's obligations to issue and deliver Warrant Shares in accordance with the terms
and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce
the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action
to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination.
NOTWITHSTANDING ANY PROVISION OF THIS WARRANT TO THE CONTRARY, NO MORE THAN THE HOLDER’S PRO RATA SHARE OF THE MAXIMUM ELIGIBILITY
NUMBER OF WARRANT SHARES SHALL BE EXERCISABLE HEREUNDER.
(b)
Exercise Price. For purposes of this Warrant, the "Exercise Price" means NIS 0.6 per Warrant Share,
the prior payment of which is acknowledged by the Company, plus $0.0001 per Warrant Share to be paid at the time of exercise, in
each case subject to adjustment as provided herein. The number of Warrant Shares issuable shall be determined as otherwise set
forth herein.
(c)
Company's Failure to Timely Deliver Securities. If the Company shall fail for any reason or for no reason to issue
to the Holder on or prior to the Share Delivery Date such number of Ordinary Shares to which the Holder is entitled upon the Holder's
exercise of this Warrant without any restrictive legend, and if on or after such Share Delivery Date the Holder (or any other Person
in respect, or on behalf, of the Holder) purchases (in an open market transaction or otherwise) Ordinary Shares to deliver in satisfaction
of a sale by the Holder of all or any portion of the number of Ordinary Shares equal to or any portion of the number of Ordinary
Shares issuable upon such exercise that the Holder anticipated receiving from the Company (a "Buy-In"), then, in addition
to all other remedies available to the Holder, the Company shall, within three (3) Trading Days after the Holder's request and
in the Holder's discretion, either (i) pay cash to the Holder in an amount equal to the Holder's total purchase price (including
brokerage commissions and other out-of-pocket expenses, if any) for the Ordinary Shares so purchased (the "Buy-In Price"),
at which point the Company's obligation to deliver such certificate (and to issue such Ordinary Shares) or credit such Holder's
balance account with DTC for such Ordinary Shares shall terminate, or (ii) promptly honor its obligation to deliver to the Holder
a certificate or certificates representing such Ordinary Shares or credit such Holder's balance account with DTC, as applicable,
and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of
Ordinary Shares, times (B) the price at which the sell order giving rise to such purchase obligation was executed. Nothing shall
limit the 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 certificates
representing Ordinary Shares (or to electronically deliver such Ordinary Shares) upon the exercise of this Warrant as required
pursuant to the terms hereof.
(d)
Cashless Exercise. Notwithstanding anything contained herein to the contrary, the Holder may, in its sole
discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made
to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the "Net
Number" of Ordinary Shares determined according to the following formula (a "Cashless Exercise"):
Net Number
= (A x B) - (A x C)
B
For purposes
of the foregoing formula:
A=
the total number of shares with respect to which this Warrant is then being exercised.
B=
the Market Price.
C=
the portion of the Exercise Price to be paid at the time of such exercise.
If Warrant Shares are
issued in a Cashless Exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the 1933 Act, the Warrant
Shares shall take on the registered characteristics of the warrants being exercised, and the holding period of the warrants being
exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees not to take any position contrary to
this Section 1(d).
(e)
Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of
the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve
such dispute in accordance with Section 12.
(f)
Beneficial Ownership Limitation on Exercises. Notwithstanding anything to the contrary contained herein, the Company
shall not effect the exercise of any portion of this Warrant, and the Holder shall not have the right to exercise any portion of
this Warrant, pursuant to the terms and conditions of this Warrant and any such exercise shall be null and void and treated as
if never made, to the extent that after giving effect to such exercise, the Holder together with the other Attribution Parties
collectively would beneficially own in excess of 4.99% (the "Maximum Percentage") of the number of Ordinary Shares
outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Ordinary
Shares beneficially owned by the Holder and the other Attribution Parties shall include the number of Ordinary Shares held by the
Holder and all other Attribution Parties plus the number of Ordinary Shares issuable upon exercise of this Warrant with respect
to which the determination of such sentence is being made, but shall exclude the number of Ordinary Shares which would be issuable
upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including,
without limitation, any convertible notes or convertible preferred stock or warrants, including the Warrants beneficially owned
by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained
in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with Section 13(d)
of the Securities Exchange Act of 1934, as amended (the "1934 Act"). For purposes of this Warrant, in determining
the number of outstanding Ordinary Shares the Holder may acquire upon the exercise of this Warrant without exceeding the Maximum
Percentage, the Holder may rely on the number of outstanding Ordinary Shares as reflected in (x) the Company's most recent Annual
Report on Form 20-F, Report on Form 6-K or other public filing with the Securities and Exchange Commission (the "SEC"),
as the case may be, (y) a more recent public announcement by the Company or (3) any other written notice by the Company or the
Transfer Agent setting forth the number of Ordinary Shares outstanding (the "Reported Outstanding Share Number").
If the Company receives an Exercise Notice from the Holder at a time when the actual number of outstanding Ordinary Shares is less
than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of Ordinary Shares
then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder's beneficial ownership, as determined
pursuant to this Section 1(f), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant
Shares to be purchased pursuant to such Exercise Notice (the number of shares by which such purchase is reduced, the "Reduction
Shares") and (ii) as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by
the Holder for the Reduction Shares. For any reason at any time, upon the written or oral request of the Holder, the Company shall
within one (1) Business Day confirm orally and in writing or by electronic mail 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 and any other Attribution Party since the date as
of which the Reported Outstanding Share Number was reported. In the event that the issuance of Ordinary Shares to the Holder upon
exercise of this Warrant results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate,
more than the Maximum Percentage of the number of outstanding Ordinary Shares (as determined under Section 13(d) of the 1934 Act),
the number of shares so issued by which the Holder's and the other Attribution Parties' aggregate beneficial ownership exceeds
the Maximum Percentage (the "Excess Shares") shall be returned to the Company and thereafter shall be cancelled
by the Company, and the Holder shall not have the power to vote or to transfer the Excess Shares. As soon as reasonably practicable
after the Excess Shares have been returned to the Company, the Company shall return to the Holder the exercise price paid by the
Holder for the Excess Shares, if then permitted by the Israeli Companies Law, 1999. Upon delivery of a written notice to the Company,
the Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery
of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice;
provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day
after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other
Attribution Parties and not to any other holder of SPA Warrants that is not an Attribution Party of the Holder. For purposes of
clarity, the Ordinary Shares issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed
to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934
Act. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the
terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion of this paragraph which may be defective
or inconsistent with the intended beneficial ownership limitation contained in this Section 1(f) or to make changes or supplements
necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived
and shall apply to a successor holder of this Warrant.
(g)
Insufficient Authorized Shares. The Company shall not issue shares upon exercise of this Warrant if such shares are
not then authorized. The number of Ordinary Shares that the Company is required from time to time to reserve from its authorized
and unissued capital for the exercise of this Warrant and all of the Series A Warrants is herein referred to as the "Required
Reserve Amount" and the failure to have such sufficient number of authorized and unreserved Ordinary Shares is herein
referred to as an "Authorized Share Failure". If at any time while this Warrant remains outstanding the Company
does not have at least the Required Reserve Amount of authorized and unreserved Ordinary Shares to satisfy its obligation to reserve
for issuance upon exercise of this Warrant and the Additional Warrants, then the Company shall promptly take all action reasonably
necessary to increase the Company's authorized Ordinary Shares to an amount sufficient to allow the Company to reserve the Required
Reserve Amount for this Warrant and the Additional Warrants then outstanding. Without limiting the generality of the foregoing
sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than seventy-five
(75) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its shareholders for the approval
of an increase in the number of authorized Ordinary Shares. In connection with such meeting, the Company shall provide each shareholder
with a proxy statement and shall use its reasonable best efforts to solicit its shareholders' approval of such increase in authorized
Ordinary Shares and to cause its board of directors to recommend to the shareholders that they approve such proposal. In the event
that upon any exercise of this Warrant, the Company does not have sufficient authorized shares to deliver in satisfaction of such
exercise, then unless the Holder elects to void such attempted exercise, the Holder may require in lieu of delivering the number
of Warrant Shares that the Company is unable to deliver pursuant to this Section 1(g), the Company to pay to the Holder within
three (3) Trading Days of the applicable exercise, cash in an amount equal to the product of (i) the number of Warrant Shares that
the Company is unable to deliver pursuant to this Section 1(g) and (ii) (a) the greatest Closing Sale Price of the Ordinary Shares
on any Trading Day at any time during the period beginning on the date of the applicable Exercise Notice and ending on the date
the Company makes the payment provided for in this sentence minus (b) the Exercise Price. The initial number of Ordinary Shares
reserved for exercise of this Warrant and the Additional Warrants and each increase in the number of shares so reserved shall be
allocated pro rata among the Holder and the holders of the other Warrants and Series A Warrants, based on the number of Ordinary
Shares issuable upon exercise of this Warrant (without regard to any limitations in exercise) issued to the Holder on the Issuance
Date (the "Authorized Share Allocation"). In the event that the Holder shall sell or otherwise transfer this Warrant
or any of its other Series B Warrants, each transferee shall be allocated a pro rata portion of such holder's Authorized Share
Allocation. Any Ordinary Shares reserved and allocated to any Person which ceases to hold any Warrants shall be allocated to the
Holder and the remaining holders of Warrants, pro rata based on the Ordinary Shares issuable upon exercise of the Warrants then
held by such holders (without regard to any limitations on the exercise of the Warrants).
2.
ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall
be adjusted from time to time as follows:
(a) Voluntary Adjustment By Company.
Subject to any requirements or approvals from the Principal Market, the Company may at any time during the term of this Warrant,
with the prior written consent of the Required Holders, reduce the then current Exercise Price to any amount and for any period
of time deemed appropriate by the Board of Directors of the Company.
(b) Adjustment Upon Subdivision or Combination of Ordinary Shares. If the Company at any time on or after the Subscription
Date subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding Ordinary
Shares into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately
reduced and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription
Date combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding Ordinary Shares into a
smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased
and the number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective
at the close of business on the date the subdivision or combination becomes effective.
3.
RIGHTS UPON DISTRIBUTION OF ASSETS. 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, stock or other securities, property, options, evidence of indebtedness or any other assets
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 or
restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) 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 and the other Attribution Parties exceeding
the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to such extent (and shall not
be entitled to beneficial ownership of such Ordinary Shares as a result of such Distribution (and beneficial ownership) to such
extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time or times as
its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time
or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or
on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
4.
PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.
(a)
Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if at any time the Company grants, issues
or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the
record holders of all outstanding 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
or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) 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
and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such
Purchase Right to such extent (and shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Purchase
Right (and beneficial ownership) to such extent) and such Purchase Right to such extent shall be held in abeyance for the benefit
of the Holder until such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued or
sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance) to the same extent as if there
had been no such limitation).
(b)
Fundamental Transactions. 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 50% or more 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 stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off 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
stock or 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 1(f) on the exercise of this Warrant), the number of shares of Common Stock of the successor
or acquiring corporation or of Ordinary Shares 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 1(f) 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 Ordinary Share 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 and the other Transaction Documents in accordance with the provisions of this Section 4(b) pursuant to customary
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 capital stock 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 of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to
such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock 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), and which is reasonably satisfactory in form and substance to the Holder. 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 and the other Transaction Documents 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 and the other Transaction Documents with the same effect as if such Successor Entity had been
named as the Company herein.
5.
NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles
of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, 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, and will at all times in good faith carry out all of the provisions of this Warrant and take all action
as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall
not increase the par value of any Ordinary Shares receivable upon the exercise of this Warrant above the Exercise Price then in
effect, (ii) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Ordinary Shares upon the exercise of this Warrant, and (iii) shall, so long as any of the Series
B Warrants are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued Ordinary
Shares, solely for the purpose of effecting the exercise of the Series B Warrants, the Required Reserve Amount to effect the exercise
of the Series B Warrants then outstanding (without regard to any limitations on exercise).
6.
WARRANT HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person's
capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital
of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in
such Person's capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote,
give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to
the issuance to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant.
In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities
(upon exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the
Company or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder with copies of the
same notices and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof
to the shareholders.
7.
REISSUANCE OF WARRANTS.
(a) Transfer
of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the
Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section
7(d)), registered as the Holder may request, representing the right to purchase the number of Warrant Shares being
transferred by the Holder and, if less than the total number of Warrant Shares then underlying this Warrant is being
transferred, a new Warrant (in accordance with Section 7(d)) to the Holder representing the right to purchase the number of
Warrant Shares not being transferred.
(b)
Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company
of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification
undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this
Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right
to purchase the Warrant Shares then underlying this Warrant. The Holder shall also pay any reasonable third-party costs associated
with the issuance of such replacement Warrant.
(c)
Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new warrant or warrants (in accordance with Section 7(d)) representing in the aggregate
the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right
to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender; provided,
however, that no Series A Warrants for fractional Warrant Shares shall be given.
(d)
Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant,
such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant,
the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to
Section 7(a) or Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of Ordinary Shares underlying
the other new warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date,
and (iv) shall have the same rights and conditions as this Warrant.
8.
NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice
shall be given in accordance with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail a description of such action
and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice to the Holder
(i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the calculation
of such adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a record
(A) with respect to any dividend or distribution upon the Ordinary Shares, (B) with respect to any grants, issuances or sales
of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of all outstanding
Ordinary Shares or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation;
provided in each case that such information shall be made known to the public prior to or in conjunction with such notice
being provided to the Holder.
9.
AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended and the
Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, if the Company
has obtained the written consent of the Required Holders. Any Holder may waive any provision of this Warrant as to itself.
10.
GOVERNING LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance
with, and all questions concerning the construction, validity, interpretation and performance of this Warrant shall be governed
by, the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions
other than the State of New York. The Company 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 brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The
Company 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 to the Company at the address set forth in Section 9(f) of the Securities Purchase 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 manner permitted by law. Nothing contained herein shall
be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company's obligations to the Holder, to realize on any collateral or any other security for such obligations,
or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT
OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.
11. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and all the Purchasers and shall not be construed
against any Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part
of, or affect the interpretation of, this Warrant.
12. DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation
of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two
(2) Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder
and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three
(3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall,
within two (2) Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable
investment bank selected by the Holder and approved by the Company, such approval not to be unreasonably withheld or delayed or
(b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent, outside accountant, selected by the
Holder and approved by the Company, such approval not to be unreasonably withheld or delayed. The Company shall cause at its expense
the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company
and the Holder of the results no later than ten (10) Business Days from the time it receives the disputed determinations or calculations.
Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon all parties absent
demonstrable error.
13. REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative
and in addition to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including
a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue
actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach
by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may
be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant
shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity
of showing economic loss and without any bond or other security being required.
14. TRANSFER. Subject to restrictions imposed by applicable securities laws, this Warrant and the Warrant Shares
may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company.
15. SEVERABILITY. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid
or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable
shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified
continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited
nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations
or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the
parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s)
with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
16. DISCLOSURE. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless
the Company has in good faith determined that the matters relating to such notice do not constitute material, nonpublic information
relating to the Company or its Subsidiaries (as defined in the Securities Purchase Agreement), the Company shall within one (1)
Business Day after any such receipt or delivery publicly disclose such material, nonpublic information on a Current Report on Form
6-K or otherwise. In the event that the Company believes that a notice delivered in accordance with the terms of this Warrant contains
material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to such Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters
relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries.
17. CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a)
"1933 Act" means the Securities Act of 1933, as amended.
(b)
"Additional Warrants" means the Series A Warrants, if any (as defined in the Securities Purchase
Agreement).
(c)
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is
controlled by, or is under common control with, such Person, it being understood for purposes of this definition that "control"
of a Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the
election of directors of such Person or direct or cause the direction of the management and policies of such Person whether by
contract or otherwise.
(d)
"Attribution Parties" means, collectively, the following Persons and entities: (i) any investment vehicle,
including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly
managed or advised by the Holder's investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates
of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the
Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company's Ordinary Shares would or
could be aggregated with the Holder's and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity,
the purpose of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(e)
"Bloomberg" means Bloomberg Financial Markets.
(f)
"Business Day" means any day other than Saturday, Sunday or other day on which commercial banks in The
City of New York are authorized or required by law to remain closed; provided, however, for calculating Business
Days with respect to any action to be taken by the Company hereunder, Friday after 1:00 p.m. (New York City time) shall not be
considered a Business Day.
(g)
"Closing Bid Price" and "Closing Sale Price" means, for any security as of any date, the
last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg,
or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00
p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading
market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities
exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply,
the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic
bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported
for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security
as reported in the OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink OTC Markets Inc.). If the Closing
Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the
Closing Bid Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12. All such determinations to be appropriately adjusted
for any stock dividend, stock split, stock combination, reclassification or other similar transaction during the applicable calculation
period.
(h)
"Convertible Securities" means any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for Ordinary Shares.
(i)
"Eligible Market" means the Nasdaq Capital Market, the NYSE MKT LLC, The NASDAQ Global Market, The NASDAQ
Global Select Market, The New York Stock Exchange, Inc., the OTC QX or the OTC QB.
(j)
"Expiration Date" means the 60th calendar day after the Effective Date.
(k)
"Group" means a "group" as that term is used in Section 13(d) of the 1934 Act and as defined
in Rule 13d-5 thereunder.
(l)
“Market Price” means the arithmetic average of the five lowest Weighted Average Prices calculated during
of the ten Trading Days immediately following the Effective Date of the Registration Statement.
(m)
"Maximum Eligibility Number" means initially zero (0) and such number shall be increased on the eleventh
Trading Day after the Effective Date to Six Million (6,000,000) minus the number of Ordinary Shares issued to all Purchasers on
the Closing Date pursuant to the Purchase Agreement (adjusted for any stock split, reverse split or similar capital adjustment
effected after the Subscription Date).
(n)
"Options" means any rights, warrants or options to subscribe for or purchase Ordinary Shares or Convertible
Securities.
(o)
"Ordinary Shares" means (i) the Company's ordinary shares, and (ii) any share capital into which
such Ordinary Shares shall have been changed or any share capital resulting from a reclassification of such Ordinary Shares.
(p)
"Parent Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person,
including such entity whose common shares or Ordinary Shares or equivalent equity security is quoted or listed on an Eligible Market
(or, if so elected by the Required Holders, any other market, exchange or quotation system), or, if there is more than one such
Person or such entity, the Person or such entity designated by the Required Holders or in the absence of such designation, such
Person or entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.
(q)
"Person" means an individual, a limited liability company, a partnership, a joint venture, a corporation,
a trust, an unincorporated organization, any other entity and a government or any department or agency thereof.
(r)
"Principal Market" means The NASDAQ Capital Market.
(s)
"Required Holders" means the holders of the Series A Warrants representing at least a majority of the Ordinary
Shares underlying the Series A Warrants then outstanding.
(t)
“Reset Price” means 85% of the Market Price.
(u)
"Series A Warrants" shall have the meaning ascribe to such term in the Securities Purchase Agreement.
(v)
"Subject Entity" means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons
or Group.
(w)
"Successor Entity" means one or more Person or Persons (or, if so elected by the Holder, the Company or
Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected
by the Holder, the Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.
(x)
"Trading Day" means any day on which the Ordinary Shares is traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the Ordinary Shares, then on the principal securities exchange or securities
market on which the Ordinary Shares is then traded; provided that "Trading Day" shall not include any day on which
the Ordinary Shares is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Ordinary Shares
is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate
in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).
(y)
"Warrant Share Number" means the number (if positive) obtained by subtracting (I) the aggregate number
of Ordinary Shares (as defined in the Securities Purchase Agreement) issued pursuant to the Securities Purchase Agreement to the
initial Holder of this Warrant on the Closing Date from (II) the quotient determined by dividing (x) the aggregate Purchase Price
(as defined in the Securities Purchase Agreement) for the Ordinary Shares and the Warrants paid by the initial Holder of this Warrant
to the Company on the Issuance Date by (y) the Reset Price, provided, however, that the Warrant Share Number shall not exceed the
Holder’s pro rata share of the Maximum Eligibility Number based upon such Holder’s original Subscription Amount in
relation to to the aggregate of all Subscription Amounts of all original Holders, provided, further, if 85% of the Market Price
is $2.40 or greater (adjusted for any stock splits, reverse splits and similar capital adjustments after the Subscription Date),
then the Warrant Share Number shall be Zero.
(z)
"Warrants" shall have the meaning ascribed to such term in the Securities Purchase Agreement.
(aa)"Weighted
Average Price" means, for any security as of any date, the dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its "Volume at Price" function
or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on
the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time
as such market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time
as such market publicly announces is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the OTC Link or "pink sheets" by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Weighted Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Weighted Average Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12 with the term "Weighted Average Price" being
substituted for the term "Exercise Price." All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.
[Signature Page Follows]
IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Ordinary Shares to be duly executed as of the Issuance Date set out above.
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ROSETTA GENOMICS LTD. |
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EXHIBIT A
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS
WARRANT TO PURCHASE ORDINARY SHARES
ROSETTA GENOMICS LTD.
The
undersigned holder hereby exercises the right to purchase _________________ of the Ordinary Shares ("Warrant Shares")
of Rosetta Genomics Ltd., a company organized under the laws of the State of Israel (the "Company"),
evidenced by the attached Series __ Warrant to purchase Ordinary Shares No. ______ (the "Warrant"). Capitalized
terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.
1. Form of Exercise
Price. The holder intends that payment of the Exercise Price shall be made as:
____________
a "Cash Exercise" with respect to _________________ Warrant Shares; or
____________
a "Cashless Exercise" with respect to _______________ Warrant Shares.
2. Payment of Exercise
Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance
with the terms of the Warrant.
3. Delivery of Warrant
Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.
4.
By signing this Exercise Notice the holder hereby confirms his compliance with the representations and warranties detailed in Section
3.2(d) of the Securities Purchase Agreement. Without derogating from the above, the holder acknowledge and agrees that in the event
that following issuance of the Warrant Shares he will hold 5% or more of the issued share capital of the Company, the issuance
of the Warrant Shares shall be subject to the delivery by the holder to the Company of an executed Undertaking towards the
OCS (as such terms are defined in the Securities Purchase Agreement) substantially in the form that was attached to the Securities
Purchase Agreement as Annex A or in any other form required by the OCS.
Please issue the Warrant Shares in the following name and to the following account: |
Issue to: |
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Facsimile Number and Electronic Mail: |
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Transaction Code Number: |
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Exhibit
10.1
SECURITIES
PURCHASE AGREEMENT
This
Securities Purchase Agreement (this “Agreement”) is dated as of October 13, 2015, between Rosetta Genomics
Ltd., a company organized under the laws of the State of Israel (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 Rule 506 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 agree as follows:
ARTICLE
I.
DEFINITIONS
1.1
Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following
terms have the meanings set forth in this Section 1.1:
“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.5.
“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.
“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; provided, however, for calculating Business Days with respect to any action to be taken by the Company
hereunder, Friday after 1:00 p.m. (New York City time) shall not be considered a Business Day.
“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
Israeli Counsel” means AYR - Amar Reiter Jeanne Shochatovitch & Co. Lawyers, with offices located at 14 Aba Hillel
Silver Rd., Ramat Gan 5250607, Israel.
“Company
U.S. Counsel” means Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., with offices located at One Financial Center,
Boston, MA 02111.
“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.
“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.
“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 or (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, all of the Shares and Warrant Shares may be sold pursuant to an exemption
from registration under Section 4(1) of the Securities Act without volume or manner-of-sale restrictions and Company U.S. 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.
“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, options or other stock grants to employees, officers, directors
or consultants (provided that issuances to consultants shall not exceed, in the aggregate, 5% of the issued and outstanding Ordinary
Shares on the date hereof) 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
issued hereunder (including any subsequent adjustments of such securities as provided for therein) and/or other 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 (other than in connection with stock splits or combinations)
or to extend the term of such securities, (c) securities issued pursuant to stock splits, stock dividends or distributions, recapitalizations
and similar events affecting the Ordinary Shares, (d) securities issued pursuant to the Transaction Documents and (e) securities
issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company,
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.
“FDA”
shall have the meaning ascribed to such term in Section 3.1(kk).
“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).
“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(bb).
“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, other
than restrictions imposed by securities laws.
“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(n).
“OCS”
means the Office of the Chief Scientist of the Israeli Ministry of Economy.
“Ordinary
Shares” means the ordinary shares of the Company, par value NIS 0.6 per share, and any other class of securities into
which such securities may hereafter be reclassified or changed.
“Ordinary
Share 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 stock, 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.
“Per
Share Purchase Price” equals $2.40, 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 and prior to the
Closing. A portion of the Per Share Purchase Price equal to NIS 0.6 per share has been allocated as a non-refundable partial prepayment
for the Series B Warrant Shares.
“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.
“Pharmaceutical
Product” shall have the meaning ascribed to such term in Section 3.1(jj).
“Placement
Agent” means Aegis Capital Corp.
“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.
“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.2(b).
“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.2(b).
“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.8.
“Registration
Rights Agreement” means the Registration Rights Agreement, dated the date hereof, among the Company and the Purchasers,
in the form of Exhibit A 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.
“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.
“SEC
Reports” shall have the meaning ascribed to such term in Section 3.1(h).
“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.
“Series
A Warrants” means, collectively, the Ordinary Share purchase warrants delivered to the Purchasers at the Closing in
accordance with Section 2.2(a) hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to 5
years, in the form of Exhibit C-1 attached hereto.
“Series
B Warrants” means, collectively, the partially prepaid Ordinary Share purchase warrants to purchase up to an aggregate
of 2,666,667 Ordinary Shares (the “Series B Warrant Shares”) delivered to the Purchasers at the Closing in
accordance with Section 2.2(a) hereof, in the form of Exhibit C-2 attached hereto.
“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 the location and/or reservation of borrowable Ordinary Shares).
“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for Shares and Warrants 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.
“Subsidiary”
means each of (i) Rosetta Genomics, Inc., a Delaware corporation, (ii) Minuet Diagnostics, Inc., a Delaware corporation and (iii)
CynoGen, Inc., a Delaware corporation (collectively, the “US Subsidiaries”), 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 principal Trading Market is open for trading.
“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 MKT, 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).
“Transaction
Documents” means this Agreement, the Warrants, the Registration Rights Agreement, 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, the current transfer agent of the Company, with a mailing
address of 59 Maiden Lane New York, New York 10038 and a facsimile number of 718-236-4588, and any successor transfer agent of
the Company.
“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.11(b).
“Warrants”
means, collectively, the Series A Warrants and the Series B Warrants.
“Warrant
Shares” means the Ordinary Shares issuable upon exercise of the Warrants.
“Weighted
Average Price” has the meaning set forth in the Series A Warrant.
ARTICLE
II.
PURCHASE AND SALE
2.1
Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with
the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, up to an aggregate of $8,000,000 of Shares and Warrants. Each Purchaser shall deliver to the
Company, via wire transfer, immediately available funds equal to such Purchaser’s Subscription Amount as set forth on the
signature page hereto executed by such Purchaser, and the Company shall deliver to each Purchaser its respective Shares and a
Series A Warrant and a Series B Warrant, as determined pursuant to Section 2.2(a), 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 at the offices of EGS or such other location as the parties shall mutually agree.
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:
(i)
this Agreement duly executed by the Company;
(ii)
a legal opinion of Company U.S. Counsel, in form and substance reasonably satisfactory to EGS;
(iii)
a legal opinion of Company Israeli Counsel, in form and substance reasonably satisfactory to EGS;
(iv)
an Officers’ Certificate, in customary form and reasonably satisfactory to EGS;
(v)
a Secretary’s Certificate, in customary form and reasonably satisfactory to EGS;
(vi)
Good Standing (or Israeli equivalent consisting of an extract from the Israel Registrar of Companies) certificates for
the Company and each Subsidiary;
(vii)
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 divided by the Per Share
Purchase Price, registered in the name of such Purchaser;
(viii)
a Series A Warrant registered in the name of such Purchaser to purchase up to a number of Ordinary Shares equal to 50%
of such Purchaser’s Shares, with an exercise price equal to $2.75, subject to adjustment therein (such Warrant certificate
may be delivered within three Trading Days of the Closing Date);
(ix)
a Series B Warrant registered in the name of such Purchaser (such Warrant certificate may be delivered within three Trading
Days of the Closing Date); and
(x)
the Registration Rights Agreement duly executed by the Company.
(b)
On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:
(i)
this Agreement duly executed by such Purchaser;
(ii)
to the Company, such Purchaser’s Subscription Amount by wire transfer to the account designated in writing by the
Company prior to the Closing Date; and
(iii)
the Registration Rights Agreement duly executed by such Purchaser.
(iv)
in the event that, upon the issuance of the Shares to a certain Purchaser, such Purchaser will hold 5% or more of the Company’s
issued share capital or of the voting rights in the Company- the Undertaking (as defined in Annex A attached hereto) towards
the OCS substantially in the form attached hereto as Annex A duly executed by such Purchaser (the “OCS
Undertaking”).
2.3
Closing Conditions.
(a) The
obligations of the Company 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) 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 accurate as of such date);
(ii)
all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall
have been performed; and
(iii)
the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.
(b)
The respective obligations 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 in which case they shall be accurate as of such 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)
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;
(iv)
there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and
(v)
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.
ARTICLE
III.
REPRESENTATIONS AND WARRANTIES
3.1
Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules
shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained
in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and warranties
to each Purchaser:
(a)
Subsidiaries. The US Subsidiaries are the only direct and indirect subsidiaries of the Company. The Company owns,
directly or indirectly, all of the capital stock 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 in good standing (where such concept is recognized) 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 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: (i) a material adverse effect on the legality, validity or enforceability 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 (any of (i), (ii) or (iii), 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. For the purpose of this Agreement, the term Material Adverse Effect shall not
include any such effects resulting, directly or indirectly, from (i) the filing of the Registration Statement or the performance
of the transactions contemplated by, or pursuant to the Transaction Documents, (ii) changes in GAAP or any applicable laws, (iii)
changes in the industry in which the Company or any of the Subsidiaries operate, (iv) changes in general economic conditions or
the financial or securities markets generally, or (v) any adverse change or effect that is cured by the Company prior to the Closing
Date.
(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 and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of each of this Agreement and the other Transaction Documents by the Company
and the consummation by it 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 stockholders
in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction
Document to which it 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, assuming due authorization, execution and delivery by the applicable Purchaser thereof,
will constitute the valid and binding obligation of the Company enforceable against the Company in respect of such Purchaser 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, (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,
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 foreign, federal and state securities
laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case
of each of clauses (ii) and (iii), such as could 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, 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 or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents,
other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii) the filing of one or more registration statements
with the Commission pursuant to the Registration Rights Agreement, (iii) the notice and/or application(s) to each applicable Trading
Market for the issuance and sale of the Securities and the listing of the Shares and Warrant Shares for trading thereon in the
time and manner required thereby, (iv) the filing of Form D with the Commission and such filings as are required to be made under
applicable state securities laws and (v) filings required by the OCS and the Israeli Registrar of Companies, consisting of, if
applicable, of a report to the OCS on a change in the holding of means of control in the Company which transforms a Purchaser
not being a citizen or resident of Israel or corporate incorporated in Israel into an interested party (as defined in the Encouragement
of Research and Development in Industry Law, 1984) directly in the Company, together with the OCS Undertaking signed by such Purchaser
and filing of notices on issuances of shares to the Israeli Registrar of Companies (collectively, the “Required Approvals”).
(f)
Issuance of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with
the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens
imposed by the Company other than restrictions on transfer provided for in the Transaction Documents. The Warrant Shares, when
issued and paid for in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable, free and
clear of all Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents. The Company
has reserved from its duly authorized capital stock the maximum number of Ordinary Shares issuable pursuant to this Agreement
and the Warrants.
(g)
Capitalization. The capitalization of the Company is as set forth in Schedule 3.1(g). The Company has not
issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise
of employee stock options under the Company’s stock option plans, the issuance of Ordinary Shares to employees pursuant
to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Ordinary Share Equivalents
outstanding as of the date of the most recently filed periodic report under the Exchange Act. 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 Schedule 3.1(g), pursuant to the Company’s stock plans, and as a result
of the purchase and sale of the Securities, 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 the capital stock of any Subsidiary, 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 or capital stock of any Subsidiary. The issuance and sale of the Securities
will not obligate the Company or any Subsidiary to issue Ordinary Shares or other securities to any Person (other than the Purchasers)
and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price
under any of such securities. 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 any similar plan or agreement. All of the outstanding shares
of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance
with all applicable foreign, 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. 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 stockholders agreements,
voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party
or, to the knowledge of the Company, between or among any of the Company’s stockholders.
(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 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 Exchange Act, 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 Company has
never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company included 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, except as specifically disclosed in Schedule 3.1(i): (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
stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company
has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans.
The Company does not have pending before the Commission any request for confidential treatment of information. Except for the
issuance of the Securities contemplated by this Agreement or as set forth in Schedule 3.1(i), 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, properties, operations, assets or financial condition, that would
be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed
made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made.
(j)
Litigation. Except as set forth in Schedule 3.1(j), 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”) including any one that adversely
affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities. Nothing
on Schedule 3.1(j) is reasonably expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary,
nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under
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 to the knowledge of the Company
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 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. To the knowledge of the Company,
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 compliance with all U.S. federal, state, 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, reasonably be expected to have a Material Adverse Effect.
(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, 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 (“Material Permits”), and neither the Company nor any Subsidiary has received any notice
of proceedings relating to the revocation or modification of any Material Permit.
(o)
Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property
owned by them and good and marketable title in all personal property owned by them 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 created under license or collaboration agreements
relating to the Company’s products or Intellectual Property Rights, (ii) 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 (iii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor
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, inventions, copyrights, licenses and other intellectual
property rights and similar rights as described in the SEC Reports as necessary or required for use in connection with their respective
businesses and which the failure to so have could have a Material Adverse Effect (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 abandoned, or is expected to expire or terminate or be abandoned,
within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary has received, since the date of the
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 violate or infringe upon the rights of any Person, except as could not have or reasonably
be expected to not have a Material Adverse Effect. 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 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. Notwithstanding the above, the Company participates in a consortium which is supported by the OCS. The consent
of the OCS will be required for the transfer of know how developed in the framework of the consortium or rights to manufacture
based on and/or incorporating such know how to third parties who are not members of the consortium. The Company also participates
in a mini-consortium which is supported by the OCS. The consent of the OCS will be required for the transfer of know how developed
in the framework of the mini-consortium or rights to manufacture based on and/or incorporating such know how to third parties
who are not members of the mini-consortium.
(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 at least equal to the aggregate Subscription
Amount. 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 Schedule 3.1(r), 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, stockholder, member
or partner, in each case in excess of $120,000 other than for: (i) payment of salary 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 and the Subsidiaries are in compliance with any and all
applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable
rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing
Date. The Company maintains a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (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 Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for
the Company and the Subsidiaries and designed such disclosure controls and procedures to ensure that information required to be
disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission’s rules and forms. The Company’s certifying officers have evaluated
the effectiveness of the disclosure controls and procedures of the Company as of December 31, 2014 (such date, the “Evaluation
Date”). The Company presented in its Annual Report on Form 20-F for the year ended December 31, 2014 the conclusions
of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of
the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as
such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably
likely to materially affect, the internal control over financial reporting of the Company.
(t)
Certain Fees. Other than to the Placement Agent (and registered Persons compensated by the Placement Agent), no
brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiary 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)
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. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the
Trading Market.
(v)
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for
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.
(w)
Registration Rights. Other than each of the Purchasers and the Placement Agent, 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.
(x)
Listing and Maintenance Requirements. The Ordinary Shares are registered pursuant to Section 12(b) or 12(g) 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 Company has not, in the 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. After giving effect to the receipt by the Company
of the proceeds from the sale of the Securities hereunder, 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 to the Depository Trust Company (or such other established clearing corporation) in connection
with such electronic transfer.
(y)
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 certificate of incorporation (or
similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a
result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction Documents,
including without limitation as a result of the Company’s issuance of the Securities and the Purchasers’ ownership
of the Securities.
(z)
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.
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, including the Disclosure Schedules
to this Agreement, is true and correct 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 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.
(aa)
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 (i) the Securities
Act which would require the registration of any such securities under the Securities Act, or (ii) any applicable shareholder approval
provisions of any Trading Market on which any of the securities of the Company are listed or designated.
(bb)
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. Schedule 3.1(bb) 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. For the purposes of this Agreement, “Indebtedness”
means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred
in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness
of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes
thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to
be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
(cc)
Tax Status. Except as set forth in Schedule 3.1(cc), the Company and its Subsidiaries each (i) has made or filed all United
States federal, state and local income and all 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.
(dd)
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 “accredited investors” within the meaning of Rule 501 under the Securities Act.
(ee)
Foreign Corrupt Practices. Neither the Company nor any Subsidiary, 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.
(ff)
Accountants. The Company’s independent registered public accounting firm is Kost Forer Gabbay & Kasierer, a member
of Ernst & Young Global. To the knowledge and belief of the Company, such accounting firm: (i) is a 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 on Form 20-F for the fiscal year ending December 31, 2015.
(gg)
No Disagreements with Accountants and Lawyers. There are no disagreements of any kind presently existing, or
reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed
by the Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the
Company’s ability to perform any of its obligations under any of the Transaction Documents.
(hh)
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.
(ii)
Acknowledgment Regarding Purchaser’s Trading Activity. Anything
in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(h) and 4.13 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, may presently 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 activities
at various times during the period that the Securities are outstanding, including, without limitation, during the periods that
the value of the Warrant Shares deliverable with respect to Securities are being determined, and (z) such hedging activities (if
any) could reduce the value of the existing stockholders' equity interests in the Company at and after the time that the hedging
activities are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute a
breach of any of the Transaction Documents.
(jj)
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 Company’s placement agent in connection with the placement of the Securities.
(kk)
FDA. No test conducted in the Company’s laboratory is currently being promoted or sold in a manner that would
require the Company to submit a premarket notice or premarket approval application to the U.S. Food and Drug Administration (“FDA”).
There is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit, arbitration, or legal
or administrative or regulatory proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries,
and none of the Company or any of its Subsidiaries has received any notice, warning letter or other communication from the FDA
or any other governmental entity, which alleges that any Company test is being offered in violation of any laws, rules or regulations.
The Company has not been informed by the FDA that the FDA will prohibit the marketing, sale, license or use in the United States
of any product proposed to be developed, produced or marketed by the Company.
(ll)
Form F-3 Eligibility. The Company is eligible to register the resale of the Securities for resale by the Purchaser
on Form F-3 promulgated under the Securities Act.
(mm)
Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted
(i) in accordance with the terms of the Company’s stock option plan and (ii) in accordance with applicable law. No stock
option granted under the Company’s stock option plan has been backdated. The Company has not knowingly granted, and there
is no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate
the grant of stock options with, the release or other public announcement of material information regarding the Company or its
Subsidiaries or their financial results or prospects.
(nn)
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 (“OFAC”).
(oo)
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.
(pp)
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
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.
(qq)
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 and applicable rules and regulations thereunder (collectively, the
“Money Laundering Laws”), and no Action or Proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to
the knowledge of the Company or any Subsidiary, threatened.
(rr)
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" and, together, "Issuer Covered Persons") 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.
(ss)
Other Covered Persons. Other than the Placement Agent, the Company is not aware of any Person (other than any Issuer
Covered Person) that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection
with the sale of any Regulation D Securities. The Company will not pay any of its officers, directors or employees any special
compensation in connection with the transactions contemplated by the Transaction Documents.
(tt)
Notice of Disqualification Events. The Company will notify the Purchasers and the Placement Agent 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, become a Disqualification Event relating to any Issuer Covered Person.
3.2
Representations and Warranties of the Purchasers. Each Purchaser, 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
in which case they shall be accurate as of such date):
(a)
Organization; Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly
existing and 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)
No Conflicts. The execution, delivery and performance by such Purchaser of the Transaction Documents and the consummation
by it of the transactions contemplated hereby and thereby to which it is a party do not and will not (i) conflict with or violate
any provision of such Purchaser’s certificate or articles of incorporation, bylaws or other organizational or charter documents,
or (ii) 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 such Purchaser is subject (including federal and state securities laws and regulations),
or by which any property or asset of such Purchaser is bound or affected except, in the case of each of clause (ii), such as would
not reasonably be expected to have a material adverse effect on such Purchaser’s ability to perform in any material respect
its obligations under any Transaction Documents.
(c)
Own Account. 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 the Registration Statement or otherwise in compliance with applicable foreign, federal and state securities laws). Such Purchaser
is acquiring the Securities hereunder in the ordinary course of its business.
(d)
Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is,
and on the Closing Date and on each date on which it exercises any Warrants, it will (i) be an “accredited investor”
as defined in Rule 501 under the Securities Act, (ii) not be in Israel or an Israeli citizen, corporation or resident, or controlled
by an Israeli citizen, corporation or resident, (iii) not be related to any officer or director of the Company, and (iv) not hold
(in accordance with the term “holding” in the Israeli Securities Law, 1968) 5% or more of the Company's issued share
capital or of the voting rights in the Company. In the event that, upon the issuance of the Shares and/or the Warrant Shares to
a Purchaser, such Purchaser holds 5% or more of the Company's issued share capital or of the voting rights in the Company, then,
upon such issuance and as a condition thereto, such Purchaser shall deliver to the Company an executed copy of the OCS Undertaking.
Without derogating from the above, following the issuance of the Shares and/or the Warrant Shares, the purchaser will not hold
(in accordance with the term “holding” in the Israeli Securities Law, 1968), either alone or in cooperation with other(s),
either directly or indirectly, through a trustee or in any other way, 25% or more of the Company’s issued share capital
or voting rights.
(e)
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.
(f)
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 its knowledge, any other general solicitation or general advertisement.
(g)
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 Shares and the merits and risks of investing in the Shares; (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.
(h)
Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such
Purchaser has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser,
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 and other advisors,
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 avoidance of doubt, nothing
contained herein shall constitute a representation or warranty, or preclude any actions, with respect to the identification of
the availability of, or securing of, available shares to borrow in order to effect Short Sales or similar transactions in the
future.
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 transaction contemplated hereby.
ARTICLE
IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 Transfer Restrictions.
(a)
The Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer
of Securities other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser
or 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
of such transferred Securities 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 is required by this Section 4.1, of a legend on any of the Securities
in the following form:
THIS
SECURITY HAS NOT 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 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.
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
(as defined in the Registration Rights Agreement) thereunder.
(c)
Certificates evidencing the Shares and Warrant Shares shall not contain any legend (including the legend set forth in Section
4.1(b) hereof), (i) while a registration statement (including the Registration Statement) covering the resale of such security
is effective under the Securities Act, (ii) following any sale of such Shares or Warrant Shares pursuant to Rule 144, (iii) if
such Shares or Warrant Shares are eligible for sale under Rule 144, without the requirement for the Company to be in compliance
with the current public information required under Rule 144 as to such Shares and Warrant Shares and without volume or manner-of-sale
restrictions, 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 promptly after the Effective Date if required by the Transfer Agent to effect the removal of the legend hereunder.
If all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the resale
of the Warrant Shares, or if such Shares or Warrant Shares may be sold under Rule 144 and the Company is then in compliance with
the current public information required under Rule 144, or if the Shares or Warrant Shares may be sold under Rule 144 without
the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Shares
or Warrant Shares 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 such Warrant Shares shall be issued free of all
legends. The Company agrees that following the Effective Date or at such time as such legend is no longer required under this
Section 4.1(c), it will, no later than three Trading Days following the delivery by a Purchaser to the Company or the Transfer
Agent of a certificate representing Shares or Warrant Shares, as the case may be, issued with a restrictive legend (such third
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.
(d)
In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, the greater
of (i) as partial liquidated damages and not as a penalty, for each $1,000 of Underlying Shares (based on the Weighted Average
Price 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 such damages
have begun to accrue) for each Trading Day after the Legend Removal Date until such certificate is delivered without a legend
and (ii) if the Company fails to (i) issue and deliver (or cause to be delivered) to a Purchaser by the Required Delivery Date
a certificate representing the Securities so delivered to the Company by such Purchaser that is free from all restrictive and
other legends or (ii) if after the Required Delivery 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 Underlying 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 Underlying Shares
(as the case may be) and ending on the date of such delivery and payment under this clause (ii).
(e)
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 earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants have expired, the Company covenants
to use commercially reasonable efforts 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 two percent (2.0%) 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 1.5% 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
Securities Laws Disclosure; Publicity. The Company shall by 9:30 a.m. (New York City time) on the Trading Day immediately
following the date hereof (a) issue a press release disclosing the material terms of the transactions contemplated hereby, and
(b) file a Report on Form 6-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required
by the Exchange Act. From and after the issuance of such 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 issuance of such 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 other 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 contemplated by 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).
4.5
Shareholder Rights Plan. Subject to the representation and warranty of the Purchasers under the last sentence of Section
3.2(d), 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.
4.6
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 4.4, 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 to the receipt of such information and agreed 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 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 Company, any of its
Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, and of
its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates 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 file such notice with the Commission pursuant to a Current Report
on 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.
4.7
Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital purposes
and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s outstanding debt (other than payment
of trade payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Ordinary
Shares or Ordinary Share Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC
regulations.
4.8
Indemnification of Purchasers. Subject to the provisions of this Section 4.8, 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 stockholder of
the Company who is not an Affiliate of the applicable 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 Parties may have with any such
stockholder or any violations by such Purchaser Parties of state or federal securities laws or any applicable foreign securities
laws or any conduct by such Purchaser Parties which constitutes fraud, gross negligence, willful misconduct or malfeasance). 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 (i) the employment thereof has been specifically authorized
by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ
counsel or (iii) 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 (x) for any incidental, indirect, punitive, special or consequential damages; (y) for any settlement by a Purchaser
Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z)
to the extent, but only to the extent that a loss, claim, damage or liability is attributable to such 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 4.8 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.
4.9
Reservation of Ordinary Shares. As of the date hereof, the Company has reserved and the Company shall continue to
reserve and keep available at all times, free of preemptive rights, a sufficient number of Ordinary Shares for the purpose of
enabling the Company to issue Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of the Warrants.
4.10
Listing of Ordinary Shares. The Company hereby agrees to use commercially reasonable efforts to maintain the listing
or quotation of the Ordinary Shares on the Trading Market on which it is currently listed, and concurrently with the Closing,
the Company shall apply to list or quote all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing
of all of the Shares and Warrant Shares on such Trading Market. 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 or
quotation 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.
4.11
Subsequent Equity Sales.
(a)
From the date hereof until forty-five (45) days after the Effective Date, neither the Company nor any Subsidiary shall
issue, enter into any agreement to issue or announce the issuance or proposed issuance of any Ordinary Shares or Ordinary Share
Equivalents.
(b)
From the date hereof until such time as no Purchaser holds any of the Warrants, 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 Ordinary Shares or Ordinary
Share 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 (but not including customary price-based antidilution adjustments) or (ii) enters into any agreement, including, but not
limited to, an equity line of credit, whereby the Company may issue securities at a future determined price; provided,
that commencing 60 days after the Effective Date, the Company may engage in at-the-market offerings through a broker-dealer pursuant
to Rule 415; provided further, that any transaction with a maximum number of shares issuable that is fixed at the time
of closing shall not be a Variable Rate Transaction; and provided further, no registered public offering shall be 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, Section 4.11(a) shall not apply in respect of an Exempt Issuance except that no Variable
Rate Transaction shall be an Exempt Issuance.
4.12
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.
4.13
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 4.4. 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 Form 6-K as described in Section 4.4, such Purchaser will maintain the confidentiality of the existence and terms of this
transaction and the information included in the Transaction Documents and the Disclosure Schedules. Notwithstanding the
foregoing, and notwithstanding anything contained in this Agreement to the contrary (other than pursuant to Section 4.17), 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 Form 6-K as described in Section 4.4, (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 Form 6-K
as described in Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the securities
of the Company to the Company or its Subsidiaries after the issuance of the Form 6-K as described in Section 4.4. 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.
4.14
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.
4.15
Capital Changes. Until the one year anniversary of the Effective Date, the Company shall not undertake a reverse or forward
stock split or reclassification of the Ordinary Shares without the prior written consent of the Purchasers holding a majority
in interest of the Shares then outstanding; provided, however, that this Section 4.15 shall not apply solely in connection with
any reverse stock split conducted to meet or maintain compliance with the listing standards of any Trading Market..
4.16
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.
4.17
Limitations on Sales While Reset Price is Being Determined. During the period from and after the Closing Date through the
date on which the Reset Price of the Series B Warrant is being determined, as set forth therein, each Purchaser together with
its Affiliates acting on behalf of or pursuant to any understanding with such Purchaser, severally and not jointly, agrees separately
with the Company that it shall not sell a number of Ordinary Shares on a particular Trading Day that exceeds 10% of the daily
trading volume of the Ordinary Shares on such Trading Day; and such Purchaser further agrees separately with the Company to not
make any Net Short Sales during such same period, and during the period between the Effective Date and the date the Reset Price
is determined, to not make any Short Sales. “Net Short Sales” means a short sale that cannot be fully covered by the
Purchaser’s existing long Ordinary Shares and Series A Warrant Shares assuming full exercise of the Series A Warrant.
ARTICLE
V.
MISCELLANEOUS
5.1
Termination. This Agreement may be terminated 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, if the Closing has not been consummated on or before October 21, 2015; provided, however, that such termination
will not 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 to the contrary, 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 facsimile at the facsimile number or email attachment as set forth on the signature pages attached hereto 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.
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 holding at least a majority in interest of the
Shares then outstanding (which amendment shall, subject to the proviso below, be binding on all Purchasers) 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. To the extent that any notice provided pursuant to any
Transaction Document 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 Current Report on Form 6-K.
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, consolidation or sale of all or substantially all of the Company’s assets).
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 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. The Placement Agent shall be the third party beneficiary of the representations and warranties
of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. 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 as otherwise set forth in Section 4.8 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 hereto 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 4.8, 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
Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.
5.11
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.
5.12
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.
5.13
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.
5.14
Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar
provisions of) any of the other Transaction Documents, and subject to any applicable requirements and limitations of the Israeli
Companies Law, 1999, 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.
5.15
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.
5.16
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 hereof 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 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 EGS. EGS 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 (including without limitation,
Section 4.17) 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 Purchaser.
5.17
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.
5.18
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.
5.19
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 stock splits, stock dividends, stock combinations and other similar transactions of the
Ordinary Shares that occur after the date of this Agreement.
5.20
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.
(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.
ROSETTA GENOMICS LTD.
|
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Address for Notice: |
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By: |
/s/ Kenneth A. Berlin |
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Rosetta Genomics Ltd. |
|
Name: Kenneth A. Berlin |
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3711 Market Street, Suite 730-740 |
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Title: President & Chief Executive Officer |
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Philadelphia, PA 19104 USA |
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Attn: Oded Biran, General Counsel |
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Fax: 1-215-382-0815 |
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With a copy to (which shall not constitute notice): |
|
Mintz, Levin, Cohn, Ferris |
|
|
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Glovsky and Popeo, P.C. |
|
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One Financial Center |
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Boston, MA 02111 |
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|
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Attn: Brian P. Keane |
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Fax: 617-542-2241 |
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and to: |
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AYR - Amar Reiter Jeanne |
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Shochatovitch & Co. Lawyers |
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14 Aba Hillel Silver Rd. |
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Ramat Gan 5250607, Israel |
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Attn: Nir Oren |
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Fax: (+)972-3-6019602 |
[REMAINDER OF
PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE
FOR PURCHASER FOLLOWS]
[PURCHASER SIGNATURE
PAGES TO ROSG SECURITIES PURCHASE AGREEMENT]
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.
Signature
of Authorized Signatory of Purchaser: |
|
Name
of Authorized Signatory: |
|
Title
of Authorized Signatory: |
|
Email
Address of Authorized Signatory: |
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Facsimile Number of Authorized
Signatory: |
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Address for Notice to Purchaser:
Address for Delivery of Securities
to Purchaser (if not same as address for notice):
[SIGNATURE PAGES
CONTINUE]
ANNEX A
| To: | The Research Committee |
The
Office of the Chief Scientist
Jerusalem
Relating to
projects that have been financed by or are currently being financed by the Office of the Chief Scientist of the Ministry of Industry,
Trade and Labor (the "OCS") _______________ [Please specify project title and OCS' file number] and to projects
of the Company (as this term is defined below) that may be financed by the OCS in the future (the "Projects").
Undertaking
We, the
undersigned, of [Foreign investor's name] a company incorporated, organized and existing under the laws of
_______________ and whose registered office is at _________________ ("______"), having, by an agreement dated ,
committed to invest in _____________Ltd. (the "Company"), in exchange for [number and type of shares] ________ shares of
the Company;
Recognizing
that the Company's research and development Projects are currently, have been or will be financially supported by the Government
of the State of Israel, through the OCS under and subject to the provisions of The Encouragement of Research and Development in
Industry Law 5744-1984 (the "R&D Law") and the regulations, rules and procedures promulgated there under;
Recognizing
that the R&D Law places strict constraints on the transfer of know-how and/or production rights, making all such transfers
subject to the absolute discretion of the OCS' research committee (the "Research Committee"), acting in accordance
with the aims of the R&D Law and requiring that any such transfer receive the prior written approval of the Research Committee;
Hereby declare
and undertake:
| 1. | To
observe strictly all the requirements of the R&D Law and the regulations, rules and
procedures promulgated there under, as applied to the Company and as directed by the
Research Committee, in particular those requirements stipulated under Sections 19, 19A
and 19B of the R&D Law relating to the prohibitions on the transfer of know-how and/or
production rights. |
| 2. | As
a shareholder of the Company, to make all reasonable efforts that the Company shall observe
strictly all the requirements of the R&D Law and the regulations, rules and procedures
promulgated there under, as applied to the Company and as directed by the Research Committee,
in particular those requirements stipulated under Sections 19, 19A and 19B of the R&D
Law relating to the prohibitions on the transfer of know-how and/or production rights. |
Date Name
(block letters) and signature of Authorized Company Representative and Company Seal
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights
Agreement (this “Agreement”) is made and entered into as of October 13, 2015, between Rosetta Genomics Ltd.,
a company organized under the laws of the State of Israel (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, between 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(d).
“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 30th 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 60th 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 60th 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) all Shares, (b) all Warrant Shares then issued or issuable upon
exercise of the Warrants, in each case including all possible shares issuable upon exercise of the Series B Warrants (assuming
on such date the Warrants are exercised in full without regard to any exercise limitations therein), (c) 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) (d) any securities issued or then issuable upon any stock split, dividend
or other distribution, recapitalization or similar event with respect to the foregoing and (e) any Ordinary Shares issuable upon
exercise of warrants issued to the Placement Agent; 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 current public information pursuant to Rule 144 as set forth in a written opinion letter to such effect,
addressed, delivered and acceptable to the Transfer Agent and the affected Holders (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, and all Warrants are exercised by “cashless exercise” as provided
in Section 2(c) of each of the Warrants), 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 (i) any publicly-available written or oral guidance of the Commission staff, or any comments, requirements
or requests of the Commission staff and (ii) the Securities Act.
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 (or such maximum portion thereof as permitted by the SEC Guidance) 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 a majority 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. Subject to the terms of this Agreement, the Company shall use
its best 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 reasonably practicable after the filing thereof, but in any event
no later than the applicable Effectiveness Date, and shall use 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 and the affected Holders (the “Effectiveness Period”). The Company shall telephonically
request effectiveness of a Registration Statement as of 5:00 p.m. Eastern Time on a Trading Day. The Company shall immediately
notify the Holders via facsimile or by e-mail of the effectiveness of a Registration Statement on the same Trading Day that the
Company telephonically 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. Eastern Time on the Trading Day after the effective date of such Registration
Statement, file a final Prospectus with the Commission as required by Rule 424. Failure to so notify the Holder within one (1)
Trading Day of such notification of effectiveness or failure to file a final Prospectus 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 S-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 diligent efforts
to advocate with the Commission for the registration of all of the Registrable Securities in accordance with the SEC Guidance,
including without limitation, 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 or eliminate any securities to be included for exercise of the
Placement Agent’s warrants; and |
| c. | Third,
the Company shall reduce Registrable Securities represented by Warrant Shares (applied,
in the case that some Warrant Shares may be registered, to the Holders on a pro rata
basis based on the total number of unregistered Warrant Shares held by such Holders).
|
In
the event of a cutback hereunder, the Company shall give the Holder at least five (5) 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 best 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, the Company shall be deemed to have not satisfied this clause (i)), 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 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) Business 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, 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 Business Days or more than an aggregate of fifteen (15)
Business Days (which need not be consecutive Business 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) Business Day period is exceeded, and for purpose of clause (v) the date on which such ten (10) or fifteen (15) Business
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 (and pro-rated for any
part of a month in which a cure is effected), 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 2.0% multiplied by the aggregate Subscription Amount paid by such Holder pursuant
to the Purchase Agreement for any such unregistered Registrable Securities then held by such Holder. The parties agree that the
maximum aggregate liquidated damages payable to a Holder under this Agreement shall be 12% of the aggregate Subscription Amount
paid by such Holder pursuant to the Purchase Agreement. If the Company fails to pay any partial liquidated damages pursuant to
this Section in full within seven days after the date payable, the Company will pay interest thereon at a rate of 18% per annum
(or such lesser maximum amount that is permitted to be paid by applicable law) to the Holder, accruing daily from the date such
partial liquidated damages are due until such amounts, plus all such interest thereon, are paid in full. 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 S-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 an Underwriter in any public disclosure without the prior written consent of such Holder; provided
that if the Company is required by the SEC to name a Holder as an Underwriter, the Company shall promptly notify each such Holder
of the legal requirement and give each such Holder an opportunity to persuade the SEC that said disclosure in not required. If
the applicable Holders(s) are unable to eliminate the legal requirement to be identified as an underwriter and such Holder does
not provide written consent within five (5) Trading Days of the initial notification by the Company, this Agreement shall terminate
with respect to such Holder.
3. Registration Procedures.
In connection with
the Company’s registration obligations hereunder, the Company shall:
(a) Not less than three (3) 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 (three (3) Trading Days if the Company
is changing the Selling Stockholder section or Plan of Distribution section) (including any document that would be incorporated
or deemed to be incorporated therein by reference, but not including (i) any Exchange Act filing or (ii) any supplement or post-effective
amendment to a registration statement that is not related to such Holder’s Registrable Securities), 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 three (3) 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.
In the event that the Company is prevented from making such filing on account of the objections described in the previous sentence
(provided that the Company uses reasonable best efforts to address the objections described in the previous sentence and to promptly
file thereafter), the failure of the Company to make such filing shall not be deemed a breach or default hereunder or otherwise
be subject to the provisions of Section 2(d) with respect to the payment of liquidated damages. Each Holder agrees to furnish to
the Company a completed questionnaire in the form attached to this Agreement as Annex B (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 second
(2nd) 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 subject to any
SEC Guidance that sets forth a limitation on the number of Registrable Securities permitted to be registered on a particular Registration
Statement, (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 written 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 (but not including
(i) any Exchange Act filing or (ii) any supplement or post-effective amendment to a registration statement that is not related
to such Holder’s Registrable Securities), (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, if any notice
contemplated by this Agreement contains any information which would constitute material, non-public information regarding the Company
or any of its Subsidiaries, the Company shall contemporaneously publicly disclose such material non-public information.
(e) Use commercially reasonable 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, upon request and 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 representing
Registrable Securities to be delivered to a transferee pursuant to a Registration Statement, which certificates 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 commercially reasonable 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 60 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 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, brokers (including brokers who offer and sell Registrable
Securities as principal as a result of a pledge or any failure to perform under a margin call of Ordinary Shares), investment advisors
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 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(d). 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(h).
(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 reasonably 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 and the Placement Agent with respect to the Ordinary
Shares underlying the warrants issued to the Placement Agent) may include securities of the Company in any Registration Statements
other than the Registrable Securities. The Company shall not file any other registration statements until all Registrable Securities
are registered pursuant to a Registration Statement that is declared effective by the Commission, provided that this Section 6(b)
shall not prohibit the Company from filing supplements or amendments to registration statements filed prior to the date of this
Agreement or from filing any registration statements on Form S-8.
(c) [Reserved]
(d) 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 commercially reasonable 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).
(e) Piggy-Back Registrations. If, at any time during the Effectiveness Period, there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall determine to prepare and file with the Commission a
registration statement relating to an offering for its own account or the account of others under the Securities Act of any of
its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities
issuable in connection with the Company’s stock option or other employee benefit plans, then the Company shall deliver to
each Holder a written notice of such determination and, if within fifteen days after the date of the delivery of such notice, any
such Holder shall so request in writing, the Company shall include in such registration statement all or any part of such Registrable
Securities such Holder requests to be registered; provided, however, that the Company shall not be required to register
any Registrable Securities pursuant to this Section 6(e) that are eligible for resale pursuant to Rule 144 promulgated by the Commission
pursuant to the Securities Act or that are the subject of a then effective Registration Statement that is available for resales
or other dispositions by such Holder.
(f) 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 a majority 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(f). 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.
(g) 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.
(h) 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 5.8 of the
Purchase Agreement.
(i) 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.
(j) 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 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.
(k) 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.
(l) Cumulative Remedies. The remedies provided herein are cumulative and not exclusive of any other remedies provided
by law.
(m) 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.
(n) 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.
(o) 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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rosetta genomics ltd. |
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By: |
/s/ Kenneth A. Berlin |
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Name: Kenneth A. Berlin |
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Title: President & Chief Executive Officer |
[SIGNATURE PAGE OF HOLDERS FOLLOWS]
[SIGNATURE
PAGE OF HOLDERS TO rosg 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
(the “Selling Stockholders”) of the Ordinary Shares and any of their pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of their Ordinary Shares covered hereby on the Nasdaq Capital Market or any other stock
exchange, market or trading facility on which the shares 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 shares:
| · | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
| · | block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction; |
| · | 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 shares at
a stipulated price per share; |
| · | 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 shares under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if
available, or any other available exemption, 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 shares, 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 2440; and in the case of a principal transaction
a markup or markdown in compliance with FINRA IM-2440.
In connection with
the sale of the Ordinary Shares 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 Ordinary Shares in the course of hedging the positions
they assume. The Selling Stockholders may also sell Ordinary Shares short and deliver these Ordinary Shares to close out their
short positions, or loan or pledge the Ordinary Shares to broker-dealers that in turn may sell these Ordinary Shares. 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 Ordinary Shares
offered by this prospectus, which Ordinary Shares 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 Ordinary Shares 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 Ordinary Shares 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 Ordinary Shares.
The Company is required
to pay certain fees and expenses incurred by the Company incident to the registration of the Ordinary Shares. 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 Ordinary Shares 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 Ordinary Shares have been sold pursuant to this prospectus or Rule 144 under the Securities Act
or any other rule of similar effect. The Ordinary Shares will be sold only through registered or licensed brokers or dealers if
required under applicable state securities laws. In addition, in certain states, the Ordinary Shares 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 Exchange Act, any person engaged in the distribution of the Ordinary Shares 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 Purchased 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.
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 ________, 2015, 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 at least the sum of (i) the maximum
number of ordinary shares issued 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,
to beneficially own a number of ordinary shares which would exceed [4.99]% of our then outstanding ordinary shares following such
exercise, excluding for purposes of such determination ordinary shares issuable upon exercise of the warrants which have not been
exercised. The number of shares in the second column does not reflect this limitation. The selling shareholders may sell all, some
or none of their shares in this offering. See "Plan of Distribution."
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 |
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Annex B
rosetta
genomics ltd.
Selling Stockholder Notice and Questionnaire
The undersigned beneficial
owner of ordinary shares (the “Registrable Securities”) of Rosetta Genomics Ltd., a company organized under
the laws of the State of Israel (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
1. |
Name. |
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(a) |
Full Legal Name of Selling Stockholder |
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(b) |
Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities are held: |
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(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): |
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2. |
Address for Notices to Selling Stockholder: |
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Broker-Dealer Status: |
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(a) |
Are you a broker-dealer? |
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Yes ¨ No ¨ |
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(b) |
If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for investment banking services to the Company? |
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Yes ¨ No ¨ |
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If “no” to Section 3(b), the Commission’s staff has indicated that you should be identified as an underwriter in the Registration Statement. |
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(c) |
Are you an affiliate of a broker-dealer? |
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Yes ¨ No ¨ |
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(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? |
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Yes ¨ No ¨ |
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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. |
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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. |
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(a) |
Type and Amount of other securities beneficially owned by the Selling Stockholder: |
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5. |
Relationships with the Company: |
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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. |
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State any exceptions here: |
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The undersigned agrees
to promptly notify the Company of any 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. 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 FAX A COPY (OR EMAIL A .PDF COPY)
OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO:
Exhibit
99.1
Rosetta Genomics
Raises $8,000,000 in Private Placement
October 14, 2015
PHILADELPHIA, PA. and REHOVOT,
Israel (October 14, 2015) – Rosetta Genomics Ltd. (NASDAQ: ROSG), a leading developer and provider of microRNA-based
and other molecular diagnostics, today announced it has entered into definitive agreements with investors to purchase an aggregate
of $8,000,000 in units, consisting of ordinary shares and warrants, in a private placement. The closing is expected to occur on
or about October 16, 2015 and is subject to the satisfaction of customary closing conditions.
Under the terms of the private placement,
Rosetta will sell an aggregate of 3,333,333 units at $2.40 per unit, with each unit consisting of (i) one ordinary share, (ii)
a Series A Warrant to purchase one-half of an ordinary share at an exercise price of $2.75 per ordinary share (subject to adjustment),
exercisable for a period of five years from the closing date, and (iii) a partially pre-funded Series B Warrant. The Series
B Warrants have an exercise price of NIS 0.6 (which has been prepaid) plus $0.0001 per share. The Series B Warrants are
intended to reset the price of the units, and will be exercisable for an aggregate number of ordinary shares based on a reset
price per unit equal to 85% of the arithmetic average of the five lowest weighted average prices calculated during the ten trading
days following the effective date of the Company’s resale registration statement to be filed for the private placement;
provided that the maximum aggregate number of ordinary shares issuable upon exercise of the Series B Warrants will not exceed
2,666,667. The Series B Warrants are exercisable for 60 days following the effective date of the resale registration statement.
Rosetta is required to file a resale registration statement within 60 days following the closing of the private placement that
covers the resale by the purchasers of the ordinary shares and the ordinary shares issuable upon exercise of the warrants issued
in the private placement.
Aegis Capital Corp. acted as the
exclusive placement agent in connection with the private placement.
The securities offered and sold
in the private placement have not been registered under the Securities Act of 1933, as amended, or any state securities laws,
and may not be offered or sold in the United States absent registration, or an applicable exemption from registration under the
Securities Act and applicable state securities laws.
This announcement is neither an
offer to sell nor a solicitation of an offer to buy any securities of Rosetta.
About Rosetta Genomics
Rosetta develops and commercializes
a broad range of microRNA-based and other high-value molecular diagnostics. Rosetta’s integrative research platform combining
bioinformatics and state-of-the-art laboratory processes has led to the discovery of hundreds of biologically validated novel
human microRNAs. Building on its strong patent position and proprietary platform technologies, Rosetta is working on the application
of these technologies in the development and commercialization of a full range of microRNA-based diagnostic tools. Through the
acquisition of PersonalizeDx, the Company also offers core FISH, IHC and PCR-based testing capabilities and partnerships in oncology
and urology that provide additional content and platforms that complement the Rosetta offerings. Rosetta’s cancer testing
services are commercially available through the Philadelphia, PA- and Lake Forest, CA-based CAP-accredited, CLIA-certified labs.
Forward-Looking Statement Disclaimer
Various statements in this release
concerning Rosetta’s future expectations, plans and prospects, including without limitation, statements relating to the
expected closing of the transaction constitute forward-looking statements for the purposes of the safe harbor provisions under
The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking
statements as a result of various important factors, including those risks more fully discussed in the “Risk Factors”
section of Rosetta’s Annual Report on Form 20-F for the year ended December 31, 2014 as filed with the Securities and Exchange
Commission. In addition, any forward-looking statements represent Rosetta’s views only as of the date of this release and
should not be relied upon as representing its views as of any subsequent date. Rosetta does not assume any obligation to update
any forward-looking statements unless required by law.
Company Contacts:
Rosetta Genomics
Ken Berlin, President & CEO (609) 419-9003 investors@rosettagenomics.com
Investor Contacts:
LHA
Anne Marie Fields (212) 838-3777 afields@lhai.com or
Bruce Voss (310) 691-7100 bvoss@lhai.com
Rosetta Genomics (CE) (USOTC:ROSGQ)
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