Item 8.01 Other Events
On December 11, 2019, Zion Oil & Gas,
Inc. (the “Company”) filed with the Securities and Exchange Commission (the “SEC”) the prospectus supplement
dated as of December 11, 2019 and accompanying base prospectus dated November 27, 2019 (collectively, the “Prospectus”)
relating to the Company’s Dividend Reinvestment and Direct Stock Purchase Plan (the “Plan” or “DSPP”).
The Prospectus forms a part of the Company’s Registration Statement on Form S-1 (File No. 333-235299), as amended,
which was declared effective by the SEC on December 11, 2019 (the “Registration Statement”).
An Amendment No. 2 to the Prospectus Supplement
is being filed on February 1, 2021. This Amendment No. 2 to Prospectus Supplement amends the Prospectus Supplement. This Amendment
No. 2 to Prospectus Supplement should be read in conjunction with the Original Prospectus Supplement and the base Prospectus effective
December 11, 2019. This Amendment No. 2 is incorporated by reference into the Original Prospectus Supplement. This Amendment No.
2 is not complete without, and may not be delivered or utilized except in connection with, the Original Prospectus Supplement,
including any amendments or supplements thereto.
Amendment No. 2 - New Unit Option under
the Unit Program
Under our Plan, we
are providing a Unit Option under Amendment No. 2. Our Unit Program consists of the combination of Common Stock and warrants with
basic Unit Program features, conditions and terms outlined in the Original Prospectus Supplement and Amendment No. 1. Amendment
No. 2 provides the option period, unit price and the determination of the number of shares of Common Stock and warrants per unit.
This Unit Option begins on February 1, 2021 and is scheduled to terminate on March 17, 2021. The Unit Option consists of Units
of our securities where each Unit (priced at $250.00 each) is comprised of (i) a certain number of shares of Common Stock determined
by dividing $250.00 (the price of one Unit) by the average of the high and low sale prices of the Company’s publicly traded
common stock as reported on the OTCQX on the Unit Purchase Date and (ii) Common Stock purchase warrants to purchase an additional
twenty five (25) shares of Common Stock at a per share exercise price of $1.00. The participant’s Plan account will be credited
with the number of shares of the Company’s Common Stock and Warrants that are acquired under the Units purchased. Each warrant
affords the participant the opportunity to purchase one share of our Common Stock at a warrant exercise price of $1.00. The warrant
shall have the company notation of “ZNWAN.” The warrants will not be registered for trading on the OTCQX or any other
stock market or trading market.
For Plan participants
who enroll into the Unit Program with the purchase of at least one Unit and also enroll in the separate Automatic Monthly Investments
(“AMI”) program at a minimum of $50.00 per month or more, will receive an additional ten (10) Warrants at an exercise
price of $1.00 during this Unit Option Program. The ten (10) additional warrants are for enrolling into the AMI program. Existing
subscribers to the AMI are entitled to the additional ten (10) warrants once, if they purchase at least one (1) Unit during the
Unit program.
Checks, bank wire payments,
or electronic bank payments for purchases received by the Plan Agent, or at the offices of the Company, before 4 p.m. (EST) on
a business day generally will be recorded as purchased on the same business day (the “Purchase Date”). Checks, bank
wire payments, or electronic bank payments for purchases received by the Plan Agent, or at the offices of Company, after 4 p.m.
(EST) on a business day generally will be recorded as purchased on the next business day for the Purchase Date. Electronic bank
payments are treated as received and recorded on the date of receipt of the funds into the Plan Agent’s or the Company’s
bank account. Under the AMI program, all optional cash payments will be invested in our Common Stock on the 20th day
of each calendar month and if such day falls on a holiday or a weekend, then on the next trading day.
The warrants will become
exercisable on May 16, 2021, which is the first trading day after the 60th day following the Unit Option Termination
Date (i.e., on March 17, 2021) and continue to be exercisable through May 16, 2023 (2 years) at a per share exercise price of $1.00.
Use of Proceeds
While we cannot estimate the proceeds to
us of the unit program or from sales of our common stock under the Plan, the following table set forth the planned use of the proceeds
under the unit program or under the Plan:
Action Item
|
|
$ Amount
|
|
Acquisition cost of new Seismic 3D and other equipment
|
|
$
|
4,000,000
|
|
Drilling and completing two additional wells plus additional equipment purchases
|
|
$
|
36,000,000
|
|
The foregoing reflects only estimates of
the use of the proceeds, and allocation of any proceeds could be materially different from what is reflected above. In addition,
no assurance can be given that the Company will be able to successfully raise the needed capital.
Accordingly, all references
in the Original Prospectus Supplement concerning the Unit Option Program continue, except for the substitution of the Unit Option
Program details under Amendment No. 2 and the prior Amendment No. 1. All other Plan features, conditions and terms remain unchanged.
Warrant Agent Agreement
Effective February 1, 2021, the Company
executed a Warrant Agent Agreement with AST as the Warrant Agent, Exhibit 4.9, below, for the warrant notated as ZNWAN under the
Unit Option Program beginning February 1, 2021 as described under Amendment No. 2.
The Company is filing the items included
in Exhibits 4.8 and 4.9 to this Current Report on Form 8-K, each of which relates to the above Registration Statement, for the
purpose of incorporating such items as exhibits to the Registration Statement for the DSPP Unit Option Program beginning February1,
2021.