PROSPECTUS
SUPPLEMENT
(to the Prospectus Dated
December 15, 2016)
Filed Pursuant to Rule
424(b)(5)
Registration No. 333-214439
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Ordinary
Shares Represented by American Depositary Shares
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We are offering
1,500,000 American Depositary Shares (“ADSs”)
representing 60,000,000 of our ordinary shares, par value NIS
0.0000001 per share, at a price of $6.00 per ADS, pursuant to
this prospectus supplement. Each ADS represents forty (40) Ordinary
Shares. See “Description of American Depositary Shares”
and “Description of Share Capital” in the accompanying
prospectus for more information.
Our ADSs and ADS
warrants are currently traded on the NASDAQ Capital Market under
the symbols “BVXV” and “BVXVW”,
respectively. The last reported sale prices of our ADSs and ADS
Warrants on the NASDAQ Capital Market on September 12, 2017, were
$6.67 and $1.80, respectively. Our ordinary shares currently trade
on the Tel Aviv Stock Exchange (the “TASE”) under the
symbol “BVXV.” On September 13, 2017, the last reported
sale price of our ordinary shares on the TASE was NIS 0.685, or
$0.19 per share (based on the exchange rate reported by the Bank of
Israel on such date).
As of
September 13, 2017, the aggregate market value of our outstanding
ordinary shares held by non-affiliates, or public float, was
approximately $40.22 million based on 154,400,187 outstanding
ordinary shares, or 3,860,004 ADSs, at a price of $10.42 per ADSs,
which was the last reported sale price of our ADSs on The NASDAQ
Capital Market on July 24, 2017, a date that is within 60 days of
filing this Prospectus Supplement. As of the date hereof, we have
sold 366,666 ADSs at a total of $3,314,103.17 pursuant to General
Instruction I.B.5 of Form F-3 during the prior 12 calendar month
period that ends on and includes the date hereof. Pursuant to
General Instruction I.B.5 of Form F-3, in no event will we sell
securities registered on this registration statement of which this
prospectus supplement forms a part in a public primary offering
with a value exceeding more than one-third of our public float in
any 12-month period so long as our public float remains below $75.0
million.
Investing in
our securities involves certain significant risks. See “Risk
Factors” beginning on page S-
6
of this prospectus. You
should carefully consider these risk factors, as well as the
information contained in this prospectus, before you
invest.
Neither the Securities and Exchange Commission, the Israeli
Securities Authority nor any other state or foreign regulatory body
has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the
contrary is a criminal offense.
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Public offering price
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$
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6.00
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$
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9,000,000
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Underwriting Discount and
Commissions
(1)
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$
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0.33
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$
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385,000
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Proceeds, before expenses, to us
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$
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5.67
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$
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8,615,000
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We have
granted the underwriters an option for a period of 45 days to
purchase up to 166,667 additional ADSs representing 6,666,680
ordinary shares. If the underwriters exercise the option in full,
the total underwriting discounts and commissions payable by us will
be $385,000 and the total proceeds to us, before expenses, will be
$9,615,000, assuming 500,000 ADSs are sold to Nacht.
We
expect to deliver the securities being offered pursuant to this
prospectus supplement on or about September 18, 2017.
Joseph Gunnar
& Co.
The date of this
prospectus supplement is September 13, 2017.
TABLE OF
CONTENTS
pROSPECTUS
SUPPLEMENT
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ABOUT THIS PROSPECTUS SUMMARY
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S-1
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SUMMARY
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S-2
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THE OFFERING
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S-4
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FORWARD-LOOKING STATEMENTS
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S-5
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RISK FACTORS
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S-6
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USE OF PROCEEDS
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S-7
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CAPITALIZATION
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S-8
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DILUTION
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S-9
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PRICE RANGE OF OUR ADSs AND ADS
WARRANTS
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S-10
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PRICE RANGE OF OUR ORDINARY SHARES
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S-12
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UNDERWRITING
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S-13
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EXPERTS
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S-20
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LEGAL MATTERS
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S-20
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INCORPORATION BY REFERENCE
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S-20
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WHERE YOU CAN FIND MORE INFORMATION
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S-20
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ENFORCEMENT OF FOREIGN JUDGMENTS
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S-21
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PROSPECTUS
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About this
prospectus
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1
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Where You Can
Find More Information
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2
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Forward-Looking Statements
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3
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The
company
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4
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Documents
incorporated by reference
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6
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Risk
Factors
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7
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Use of
Proceeds
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8
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Exchange Rate
Information
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8
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Price Range
of our ADSs
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9
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Price Range
of our Ordinary Shares
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10
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Description
of Share Capital
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11
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Description
of American Depositary Shares
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17
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Description
of Warrants
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24
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Description
of Units
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27
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Taxation
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28
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Plan of
Distribution
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28
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Experts
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32
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Legal
Matters
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32
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Enforceability of Civil
Liabilities
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32
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S-i
ABOUT THIS PROSPECTUS
SUPPLEMENT
This prospectus supplement is a supplement to the prospectus dated
December 15, 2016, that is also a part of this document. This
prospectus supplement is a part of a registration statement that we
filed with the Securities and Exchange Commission, or the SEC,
using a “shelf” registration process, or the base
prospectus. Under the shelf registration process, from time to
time, we may sell any of the securities described in the base
prospectus in one or more offerings, subject to General Instruction
I.B.5. of Form F-3, according to which in no event will we sell
securities with a value exceeding more than one-third of our
“public float” (the market value of our ordinary shares
and any other equity securities that we may issue in the future
that are held by non-affiliates) in any 12-calendar month period so
long as our public float remains below $75.0 million.
In this prospectus supplement, we provide you with specific
information about this offering. This prospectus supplement, the
base prospectus and the documents incorporated by reference herein
and therein include important information about us, the ADSs, and
other information you should know before investing in the ADSs.
This prospectus supplement also adds, updates and changes
information contained in the base prospectus. To the extent that
any statement we make in this prospectus supplement is inconsistent
with the statements made in the base prospectus or in any document
incorporated by reference that was filed with the SEC before the
date of this prospectus supplement, the statements made in the base
prospectus, or such an earlier filing, as applicable, are deemed
modified or superseded by the statements made in this prospectus
supplement. You should read both this prospectus supplement and the
base prospectus as well as the additional information described in
this prospectus supplement under the headings “Incorporation
by Reference” and “Where You Can Find More
Information” on pag
e S-20
before investing in the
ADSs.
You should rely only on the information contained in or
incorporated by reference in this prospectus or any related
prospectus supplement. We have not authorized any other person to
provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it.
We will not make an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should
assume that the information appearing in this prospectus and the
applicable prospectus supplement to this prospectus is accurate
only as of the date on its respective cover, and that any
information incorporated by reference is accurate only as of the
date of the document incorporated by reference, unless we indicate
otherwise. Our business, financial condition, results of operations
and prospects may have changed since those dates.
Unless the context otherwise requires, all references to
“BiondVax”, “we”, “us”,
“our”, the “Company” and similar
designations refer to BiondVax Pharmaceuticals Ltd.
Market data and certain industry data and forecasts used throughout
this prospectus were obtained from sources we believe to be
reliable, including market research databases, publicly available
information, reports of governmental agencies and industry
publications and surveys. We have not sought the consent of the
sources to refer to the publicly available reports in this
prospectus.
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S-1
SUMMARY
This summary
highlights selected information presented in greater detail
elsewhere in this prospectus supplement and the accompanying
prospectus that we consider important. This summary does not
include all of the information you should consider before investing
in our securities. You should read this summary together with the
entire prospectus supplement and the accompanying prospectus,
including the risks related to our business, our industry,
investing in our ordinary shares and our location in Israel, that
we describe under “Risk Factors” and our consolidated
financial statements and the related notes, which are incorporated
by reference herein.
Our Business
We are a clinical stage biopharmaceutical company focused on
developing and, ultimately, commercializing immunomodulation
therapies for infectious diseases. Our current product candidate,
M-001, is a synthetic peptide-based protein targeting both seasonal
and pandemic strains of the influenza virus. Unlike existing
influenza vaccines, which offer only strain specific seasonal
protection or pandemic prevention, M-001 is designed to provide
long-lasting protection against multiple existing and future
influenza strains. As a result, we believe that M-001 has the
potential to become an attractive alternative to existing influenza
vaccines.
To date, we have completed two Phase 1/2 clinical trials and three
Phase 2 clinical trials conducted in Israel pursuant to clinical
trial protocols approved by the Israeli Ministry of Health and a
Phase 2 clinical trial in Europe. Because our product candidate is
a vaccine, we conducted our Phase 1/2 clinical trials on healthy
participants to test both safety of M-001 as our primary endpoint
and the immunogenicity of M-001 as our secondary endpoint. Results
from all our Phase 1/2 and Phase 2 clinical trials indicated that
M-001 was well tolerated and safe across all treatment groups
within the trial population and that M-001 was effective in causing
an immune reaction in clinical trial participants administered with
M-001. Although we have not yet submitted a Phase 3 Investigational
New Drug Application, or IND, to the U.S. Food and Drug
Administration, or FDA, we believe that the results of the Phase 2
clinical trials conducted by us so far, or to be conducted in the
future, will further expand our data to provide greater support for
any Phase 3 clinical trial of M-001 we may conduct in the
future.
We intend, following the receipt of all requisite regulatory
approvals, to conduct Phase 3 clinical trials in the U.S., either
with one or more future collaborators, or, subject to available
funds, on our own, in support of FDA approval to market M-001 in
the U.S. While all of our preclinical and clinical trials to date
have been conducted outside the United States, considering the
FDA’s review and comments to this IND application, we believe
that the FDA will consider the results of our completed preclinical
and clinical trials in reviewing any future IND application. We
expect to conduct an end of Phase 2 meeting with the FDA during
2018.
We do not currently have sufficient financial resources to conduct
Phase 3 clinical trials of M-001 on our own. Subject to the
approval of an IND application for Phase 3 clinical trials, we
intend to seek to establish collaborations with large multinational
pharmaceutical companies and/or national health authorities to
finance Phase 3 clinical trials of M-001. However, to the extent
that we have sufficient capital to do so (whether through sales of
debt or equity securities or otherwise), we may seek to conduct
Phase 3 clinical trials of M-001 for some or all of our indications
without such collaborations.
In October 2015 we entered into a Development and Manufacturing
Agreement for the production of clinical batches of M-001, with a
CMO based in the USA, for the purpose of upscaling the small-scale
cGMP manufacturing process of M-001 for Phase 3. On March 28, 2017,
we received an approval from the Investment Center of the Ministry
of Economy and Industry of the State of Israel for a grant of
approximately NIS 4 million, representing 20% of NIS 20 million
budgets to be utilized towards the construction for the production
of Phase 3 and commercial batches of M-001. This grant is subject
to certain terms and conditions, including those outlined under the
Encouragement of Capital Investment Law 1959, and the following:
(a) at least 24% of the investments in the planned manufacturing
facility’s fixed assets will be financed by additional share
capital of the Company; (b) the Company will maintain its
intellectual property and manufacturing facility in Israel for a
period of at least 10 years following receipt of the grant.
On June 19, 2017, we entered into a Finance Contract with the
European Investment Bank, or EIB, for the financing of up to Euro
20 million and up to 50% of the Company’s expected cost of
developing and marketing the Company’s product candidate,
M-001, used as a primer in combination with existing seasonal or
pandemic vaccines, providing multi-season and multi-strain
protection against all human influenza virus strains. The Finance
Contract
S-2
is subject to the Horizon 2020 framework Programme of the European
Union for Research and Technological Development (2014-2020)
(Horizon 2020 Framework EU Programme), which is designed to provide
financing in the interest of the European Bank. The funding will be
provided as no interest long-term loan, with variable remuneration
based on royalties of net sales of our universal flu vaccine. The
Finance Contract shall be subject to a security agreement, whereby
the Company, prior to utilizing the first tranche of the loan,
shall create a first ranking floating charge over all assets of the
Company in favor of EIB, which will exclude assets and/or
intellectual property rights subject to the license agreement
between the Company and YEDA Research and Development Company
Limited, or Yeda. As of the date of this prospectus supplement, we
did not yet finalize and execute a security agreement but we
anticipate we will do so prior to utilizing the first tranche of
the EIB loan.
We plan to build a mid-sized factory in Jerusalem, with potential
capacity to annually produce up to tens of millions of doses of
M-001. For this purpose, on July 18, 2017, we entered into an
agreement to lease approximately 1,800 square meters in the
Jerusalem BioPark, located in the Ein Kerem Hadassah campus, next
to Hadassah University Hospitals and Hebrew University’s
Medical School. We have commenced planning and design work of this
facility, and we expect construction to begin prior to our first
monthly lease payment on October 2018. We expect to finance the
cost of construction, estimated to be approximately $10 million,
with funds received from the Investment Center funds, the EIB
Finance Contract and with our own financial resources.
On August 14, 2017, we announced that the Israel Innovation
Authority (IIA), formerly known as the Office of the Chief
Scientist, agreed to fund up to 40% of a NIS 2.7 million
(approximately US$ 750,000) budget towards ongoing development of
M-001. Since 2006 the IIA has granted us over US$ 6 million in
funding.
On August 31, 2017, we announced that our board of Directors
decided to (1) consolidate trading of the Company’s
securities on the NASDAQ Capital Market and delist from the TASE;
and (2) identify a new Chairman of the Board with relevant global
experience to guide the Company through the anticipated upcoming
international Phase 3 trials and global commercialization. The
delisting process of BiondVax’s ordinary shares from trading
on the TASE will take place by the end of 2017, and an announcement
regarding the delisting procedure and timeline will follow. During
the interim period, BiondVax’s ordinary shares will continue
to be traded on the TASE. All shareholders will retain their
pro-rated holdings, as trading will migrate to the NASDAQ Capital
Market.
Our Corporate
Information
Our principal executive offices are located at 14 Einstein Street,
Nes Ziona, Israel, 74036, and our telephone number is (+972) (8)
930-2529. Our agent for service of process in the United States is
Puglisi & Associates, whose address is 850 Library Avenue,
Suite 204, Newark, Delaware, and whose telephone number is (302)
738-6680.
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S-3
THE OFFERING
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Issuer
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BiondVax Pharmaceutical Ltd.
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Securities offered
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1,500,000 American Depositary Shares (ADSs),
each representing 40 of our ordinary shares.
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The ADSs will be evidenced by American
depositary receipts to be issued pursuant to the Deposit Agreement
dated May 11, 2015 among the Company, the Bank of New York Mellon,
as depositary, and all holders and beneficial owners from time to
time of the ADSs.
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Offering Price
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$6.00 per ADS
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Option to purchase additional ADSs
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We have granted the underwriters an option for a
period of 45 days to purchase up to an additional 166,667 ADSs
representing 6,666,680 Ordinary Shares.
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Ordinary shares outstanding immediately prior to
the offering
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194,752,919 ordinary shares.
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Ordinary shares to be outstanding after the
offering
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254,752,919 ordinary shares, and 261,419,599 ordinary shares
assuming full exercise of option granted to underwriters to
purchase additional ADSs.
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Use of proceeds
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We estimate the net proceeds from this offering, assuming 500,000 ADSs are sold to Nacht,
will be approximately
$8.520 million (
or $9.52 million
if the underwriters exercise in full their option to purchase
additional ADSs in full), after deducting the underwriting
discounts and commissions and estimated offering expenses payable
by us. We currently expect to use the net proceeds of this offering
to fund M-001 clinical trials, build a mid-sized factory in
Jerusalem, working capital, operating expenses and other general
corporate purposes. See “Use of Proceeds” beginning on
page S-7.
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Listings
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Our ADSs and ADS warrants are currently traded
on the NASDAQ Capital Market under the symbols “BVXV”
and “BVXVW”, respectively. Our ordinary shares
currently trade on the TASE under the symbol “BVXV.” On
August 31, 2017, we announced our intention to voluntarily delist
our ordinary shares from TASE while maintaining a continued listing
of ADSs and ADS warrants on NASDAQ. We expect the delisting process
will take place by the end of 2017.
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Depositary
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The Bank of New York Mellon.
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Risk Factors
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Investing in our securities involves significant
risks. Please read the information contained in or incorporated by
reference under the heading “Risk Factors” beginning on
page S-6 of this prospectus supplement, and under similar headings
in other documents filed after the date hereof and incorporated by
reference into this prospectus supplement and the accompanying
prospectus.
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The number of ordinary shares that will be outstanding immediately
after this offering is based on 194,752,919 ordinary shares
outstanding as of September 13, 2017, based on the exchange rate
reported by the Bank of Israel on September 13, 2017 which is
3.537=$1.00. This number excludes, as of such date:
•
ordinary shares issuable upon the exercise of 13,178,272 options at
a weighted average exercise price of NIS 0.75 (or $0.21) per
share;
•
ordinary shares issuable upon the exercise of 6,302,000 options
(series 5) outstanding at a weighted average exercise price of NIS
1.50 (or $0.42) per share;
•
73,132,880 ordinary shares underlying ADS warrants at an exercise
price per ADS of $6.25.
Unless otherwise indicated, all information in this prospectus
assumes or gives effect to no exercise of outstanding options or
ADS warrants described above, and also assumes no exercise by the
underwriters of their option to purchase additional ADSs.
S-4
FORWARD-LOOKING
STATEMENTS
This prospectus supplement, the base prospectus and the documents
incorporated herein and therein by reference contain statements and
information that involve known and unknown risks, uncertainties and
other factors that may cause our actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements. In some cases, you can identify
forward-looking statements by terms including
“anticipates,” “believes,”
“could,” “estimates,”
“expects,” “intends,” “may,”
“plans,” “potential,”
“predicts,” “projects,”
“should,” “will,” “would,” and
similar expressions intended to identify forward-looking
statements, but these are not the only ways these statements are
identified. Forward-looking statements reflect our current views
with respect to future events and are based on assumptions and
subject to risks and uncertainties. You should not put undue
reliance on any forward-looking statements. Unless we are required
to do so under U.S. federal securities laws or other applicable
laws, we do not intend to update or revise any forward-looking
statements. Readers are encouraged to consult the Company’s
filings made on Form 6-K, which are periodically filed with or
furnished to the SEC.
Factors that could cause our actual results to differ materially
from those expressed or implied in such forward-looking statements
include, but are not limited to:
•
the initiation, timing, progress and results of our clinical
trials;
•
the clinical development, commercialization and market acceptance
of our product candidate;
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estimates of our expenses, future revenues, capital requirements
and our needs for additional financing;
•
our receipt of regulatory approvals for our product candidate, and
the timing of other regulatory filings and approvals;
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our ability to obtain and maintain ongoing regulatory requirements,
even if our product candidate receives marketing approvals;
•
our ability to maintain and expand our intellectual property in
connection with our product candidate;
S-5
RISK FACTORS
Investing in our
securities involves a high degree of risk. You should carefully
consider the specific risks described below and the risk factors
and matters set forth in “Item 3.D. Risk Factors” in
Part I of our Annual Report on Form 20-F for the fiscal year ended
December 31, 2016, which is incorporated by reference herein,
together with the other information in this prospectus supplement,
the base prospectus, our Annual Report on Form 20-F and the other
information and documents incorporated by reference herein, before
making an investment decision. See the section of this prospectus
supplement entitled “Where You Can Find More
Information.” Any of the risks we describe below and in our
documents incorporated by reference could cause our business,
financial condition or operating results to suffer. The market
price of our ordinary shares and ADSs could decline if one or more
of these risks and uncertainties develop into actual events. You
could lose all or part of your investment.
Risks Related to this
Offering
Management has broad discretion as to the use of proceeds of this
offering, and we may not use these proceeds in a manner desired by
our shareholders.
Our management will have broad discretion as to the use of the net
proceeds from this offering and could use them for purposes other
than those contemplated at the time of this offering. Accordingly,
you will be relying on the judgment of our management with regard
to the use of these net proceeds, and you will not have the
opportunity as part of your investment decision to assess whether
the proceeds are being used appropriately. Our needs may change as
our business evolves. As a result, the proceeds to be received in
this offering may be used in a manner significantly different from
our current expectations. It is possible that the proceeds will be
invested in a way that does not yield a favorable, or any,
return.
If you purchase ADSs sold in this offering, you will experience
immediate and substantial dilution in the net tangible book value
of your ADSs or ordinary shares. In addition, we may issue
additional equity securities in the future, which may result in
additional dilution to investors
.
The price per ADSs being offered may be higher than the net
tangible book value per ADSs of our outstanding ADSs and ordinary
shares prior to this offering. Assuming that an aggregate of
1,500,000 ADSs are sold at a price of $6.67 per share, the last
reported sale price of our ADSs on The NASDAQ Capital Market on
September 12, 2017, for aggregate gross proceeds of approximately
$10.00 million, and after deducting commissions and estimated
offering expenses payable by us, new investors in this offering
will incur immediate dilution of $3.20 per ADSs. For a more
detailed discussion of the foregoing, see the section entitled
“Dilution” below. To the extent outstanding stock
options or warrants are exercised, there will be further dilution
to new investors. In addition, to the extent we need to raise
additional capital in the future and we issue additional ADSs or
ordinary shares or securities convertible or exchangeable for our
ordinary shares or ADSs our then existing shareholders may
experience dilution.
If we sign a security agreement in favor of EIB pursuant to the
finance contract we will grant EIB priority as a secured creditor
over all our assets except those assets connected with our
agreement with Yeda.
In June 2017 the Company and EIB entered into a finance contract
pursuant to which the Company is entitled to borrow up to 50% of
its expected cost for developing its vaccine candidate, up to a
total of 20 million euros. The financing provides for three
separate tranche funding, each subject to conditions specified
therein. According to the finance contract, we must sign a security
agreement with EIB prior to receipt of any amounts drawn under the
finance contract, that creates a first rank floating charge over
all assets of the Company, except for assets and/or intellectual
property in connection with our agreement with Yeda. As of the date
of this prospectus supplement, we have not drawn down any financing
tranche or part thereof and therefore have not finalized and
executed a security agreement under the aforementioned terms.
However, if the Board determines to utilize the finance contract,
any outstanding amounts will be subject to a security interest as
noted above in favor of EIB. In the event we default on our loan
pursuant to the finance contract or in the event of liquidation of
our assets excluding those in connection with our agreement with
Yeda, EIB shall have priority over non-secured creditors and you
may not receive a repayment of your outstanding debt.
S-6
USE OF
PROCEEDS
We estimate that the net proceeds from this offering of securities,
after deducting the underwriting discounts and commissions and
estimated offering expenses, will be approximately $8.520 million
(or approximately $9.52
mil
lion if the underwriters
exercise in full their option to purchase 166,667 ADSs, assuming we sell 500,000 ADSs to Nacht. We intend
to use the net proceeds from this offering to fund clinical trials
for M-001, build a mid-sized factory in Jerusalem, Israel, and for
working capital, operating expenses and other general corporate
purposes.
Our management will have broad discretion in the application of
these proceeds. The amounts and timing of our actual expenditures
will depend on numerous factors, including the amount of cash.
Investors will be relying on the judgment of our management
regarding the application of these net proceeds.
S-7
CAPITALIZATION
The following table presents our capitalization as determined in
accordance with IFRS as of June 30, 2017:
•
on an actual basis; and
•
on an as adjusted basis to reflect the sale of 1,500,000 ADSs
representing 60,000,0000 ordinary shares at the public offering
price of $6.00 per ADS and the receipt by us of net proceeds
of approximately $8.575 million, after deducting the underwriting
discounts and commissions and the estimated offering expenses
payable by us, assuming a sale of 500,000 ADS to Nacht.
This table should be read in conjunction with our financial
statements and the notes thereto incorporated by reference herein
and the accompanying prospectus.
The data below is based
on the June 30, 2017 exchange rate of the NIS to the dollar of
3.496 = $1.00
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In
thousands, in $
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Cash and cash equivalents, and marketable
securities
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10,469
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19,044
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Liabilities:
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Warrants to purchase ADS’s
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5,215
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5,215
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Shareholders’ equity:
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|
|
Ordinary shares
|
|
—
|
*)
|
|
—
|
*)
|
|
Share Premium
|
|
37,993
|
|
|
46,568
|
|
|
Options
|
|
152
|
|
|
152
|
|
|
Accumulated deficit
|
|
(32,142
|
)
|
|
(32,142
|
)
|
|
Total shareholders’ equity
|
|
6,003
|
|
|
14,578
|
|
|
Total capitalization
|
|
11,218
|
|
|
19,793
|
|
The number of ordinary shares outstanding after this offering is
based on 179,595,199 ordinary shares outstanding as of June 30,
2017, based on the exchange rate reported by the Bank of Israel on
June 30, 2017, which is 3.496=$1.00, and excludes:
•
ordinary shares issuable upon the exercise of 13,178,272 options at
a weighted average exercise price of NIS 0.75 (or $0.21) per
share;
•
ordinary shares issuable upon the exercise of 6,302,000 options
(series 5) outstanding at a weighted average exercise price of NIS
1.50 (or $0.43) per share; and
•
178,943 ADS warrants, 7,157,720 shares exercised during the period
between June 30, 2017 and until September 13, 2017, and 73,132,880
ordinary shares underlying ADS warrants at an exercise price per
ADS of $6.25;
•
8,000,000 shares underlying 200,000 ADSs issued under our
at-the-market sales agreement with FBR Capital Markets & Co.
during the period between June 30, 2017 and until September 13,
2017.
Except as otherwise indicated, all information in this prospectus
supplement assumes no exercise by the underwriters of their option
to purchase additional ADSs.
S-8
DILUTION
If you invest in the ADSs, your ownership interest will be diluted
to the extent of the difference between the public offering price
per share and the net tangible book value per share after this
offering. We calculate net tangible book value per share by
dividing the net tangible book value, which is tangible assets less
total liabilities, by the number of outstanding ordinary shares as
represented by ADSs.
Our net tangible book value as June 30, 2017 was $2.5 per ADS.
After giving effect to the sale of the ADSs at an offering price of
$6.00 per ADS, and after deducting the underwriting discount and
estimated offering expenses payable by us, and assuming a sale of 500,000 ADSs to Nacht, our net tangible book
value as of June 30, 2017 would have been $3.31 per ADS. This
represents an immediate increase in the net tangible book value of
$0.81 per ADS to our existing shareholders and an immediate and
substantial dilution in net tangible book value of $2.7 per ADS to
new investors. The following table illustrates this per share
dilution:
|
Assumed public offering price per ADS
|
|
$
|
6.00
|
|
Net tangible book value (deficit) per
ADS
|
|
$
|
2.5
|
|
Increase in net tangible book value per ADS
attributable to the offering
|
|
$
|
0.81
|
|
|
|
|
|
|
As adjusted net tangible book value per ADS
after giving effect to the offering
|
|
$
|
3.31
|
|
|
|
|
|
|
Dilution per share to investors purchasing our
ADSs in this offering
|
|
$
|
2.7
|
If the underwriters exercise in full their option to purchase
166,667 additional ADSs at the assumed public offering price
of $6.00 per ADS, the as adjusted net tangible book value
after this offering would be approximately $3.37 per ADS,
representing an increase in net tangible book value of
approximately $0.87 per ADS to existing securityholders and
immediate dilution in net tangible book value of approximately
$2.63 per ADS to new investors purchasing our ADSs in this offering
at the public offering price.
For purposes of the above table, the number of ordinary shares
assumed to be outstanding after this offering is based on
179,595,199 ordinary shares outstanding as of June 30, 2017, based
on the exchange rate reported by the Bank of Israel on June 30,
2017, which is 3.496=$1.00), and excludes:
•
ordinary shares issuable upon the exercise of 13,178,272 options at
a weighted average exercise price of NIS 0.75 (or $0.22) per
share;
•
ordinary shares issuable upon the exercise of 6,302,000 options
(series 5) outstanding at a weighted average exercise price of NIS
1.50 (or $0.43) per share;
•
178,943 ADS warrants, 7,157,720 shares exercised during the period
between June 30, 2017 and until September 13, 2017, and 73,132,880
ordinary shares underlying ADS warrants at an exercise price per
ADS of $6.25;
•
8,000,000 shares underlying 200,000 ADSs issued under our
at-the-market sales agreement with FBR Capital Markets & Co.
during the period between June 30, 2017 and until September 13,
2017.
•
exercise by the underwriters of their option to purchase additional
ADSs.
To the extent that outstanding ADS warrants and options are
exercised, you will experience further dilution. In addition, we
may choose to raise additional capital due to market conditions or
strategic considerations even if we believe we have sufficient
funds for our current or future operating plans. To the extent that
additional capital is raised through the sale of equity or
convertible debt securities, the issuance of these securities could
result in further dilution to our securityholders.
S-9
PRICE RANGE
FOR OUR ADS and ADS
WARRANTS
We listed ADSs and ADS warrants on the NASDAQ Capital Market on May
12, 2015, under the symbols “BVXV” and
“BVXVW”, respectively. Prior to that date, there was no
public trading market for our securities on NASDAQ. Our initial
public offering was priced at $5.00 per ADS and $0.01 per ADS
warrant on May 11, 2015. Each whole ADS warrant entitles the holder
to purchase one ADS at an exercise price of $6.25. The following
tables set forth for the periods indicated the high and low sales
prices per ADS and ADS warrants as reported on the NASDAQ Capital
Market:
BVXV
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
2017 (though September 12, 2017)
|
|
$
|
10.75
|
|
$
|
3.58
|
|
2016
|
|
$
|
4.1
|
|
$
|
3.25
|
|
2015 (from May 12, 2015 and through December 31,
2015)
|
|
$
|
5.78
|
|
$
|
3.28
|
|
|
|
|
|
|
|
|
|
Quarterly:
|
|
|
|
|
|
|
|
Third Quarter
2017
(though September 12,
2017)
|
|
$
|
10.75
|
|
$
|
6.51
|
|
Second Quarter 2017
|
|
$
|
9.25
|
|
$
|
6.25
|
|
First Quarter 2017
|
|
$
|
7.4
|
|
$
|
4.89
|
|
Fourth Quarter 2016
|
|
$
|
3.94
|
|
$
|
3.25
|
|
Third Quarter 2016
|
|
$
|
3.94
|
|
$
|
3.31
|
|
Second Quarter 2016
|
|
$
|
4.1
|
|
$
|
3.3
|
|
First Quarter 2016
|
|
$
|
4.05
|
|
$
|
3.4
|
|
Fourth Quarter 2015
|
|
$
|
4.08
|
|
$
|
3.57
|
|
Third Quarter 2015
|
|
$
|
5.78
|
|
$
|
3.28
|
|
Second Quarter 2015
|
|
$
|
5.75
|
|
$
|
3.81
|
|
|
|
|
|
|
|
|
|
Most
recent Six Months:
|
|
|
|
|
|
|
|
September 2017 (though September 12,
2017)
|
|
$
|
8.60
|
|
$
|
6.51
|
|
Aug-17
|
|
$
|
10
|
|
$
|
7.52
|
|
Jul-17
|
|
$
|
10.75
|
|
$
|
7.4
|
|
Jun-17
|
|
$
|
9.25
|
|
$
|
7.10
|
|
May-17
|
|
$
|
8.69
|
|
$
|
6.31
|
|
Apr-17
|
|
$
|
7.4
|
|
$
|
6.25
|
|
Mar-17
|
|
$
|
6.21
|
|
$
|
5.19
|
S-10
BVXVW
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
2017 (though September 12, 2017)
|
|
$
|
4.8
|
|
$
|
0.37
|
|
2016
|
|
$
|
71
|
|
$
|
0.37
|
|
2015 (from May 12, 2015 and through December 31,
2015)
|
|
$
|
1.4
|
|
$
|
0.61
|
|
|
|
|
|
|
|
|
|
Quarterly:
|
|
|
|
|
|
|
|
Third Quarter
2017
(though September 12,
2017)
|
|
$
|
4.8
|
|
$
|
1.30
|
|
Second Quarter 2017
|
|
$
|
2.63
|
|
$
|
0.9
|
|
First Quarter 2017
|
|
$
|
1.6
|
|
$
|
0.7
|
|
Fourth Quarter 2016
|
|
$
|
0.6
|
|
$
|
0.37
|
|
Third Quarter 2016
|
|
$
|
0.7
|
|
$
|
0.37
|
|
Second Quarter 2016
|
|
$
|
0.825
|
|
$
|
0.4
|
|
First Quarter 2016
|
|
$
|
71
|
|
$
|
0.4
|
|
Fourth Quarter 2015
|
|
$
|
0.98
|
|
$
|
0.71
|
|
Third Quarter 2015
|
|
$
|
1.25
|
|
$
|
0.7
|
|
Second Quarter 2015
|
|
$
|
1.4
|
|
$
|
0.61
|
|
|
|
|
|
|
|
|
|
Most
recent Six Months:
|
|
|
|
|
|
|
|
September 2017 (though September 12,
2017)
|
|
$
|
2.35
|
|
$
|
1.74
|
|
August 2017
|
|
$
|
3.65
|
|
$
|
2.22
|
|
July 2017
|
|
$
|
4.8
|
|
$
|
1.3
|
|
June 2017
|
|
$
|
2.63
|
|
$
|
1.11
|
|
May 2017
|
|
$
|
2.5
|
|
$
|
0.94
|
|
April 2017
|
|
$
|
1.6
|
|
$
|
0.9
|
|
March 2017
|
|
$
|
1.45
|
|
$
|
0.75
|
On September 12, 2017, the last reported sale prices of our ADS and
the ADS warrants on the Nasdaq Capital Market were $6.67 and $1.80,
respectively.
S-11
PRICE
RANGE OF OUR ORDINARY
SHARES
Our ordinary shares have been trading on the TASE under the symbol
“BNDX” since June 18, 2007 and under the symbol
“BVXV” since May 18, 2015. No trading market currently
exists for our ordinary shares in the United States. On August 31,
2017 we announced our intention to voluntarily delist our ordinary
shares from TASE while maintaining a continued listing of ADSs and
ADS warrants on NASDAQ. We expect the delisting process of
BiondVax’s ordinary shares from trading on the TASE will take
place by the end of 2017.
The following table sets forth, for the periods indicated, the
reported high and low closing sale prices of our ordinary shares on
the TASE in NIS and U.S. dollars.
|
|
|
NIS
Price Per Ordinary Share
|
|
U.S.
dollar ($)
Price Per Ordinary Share
(1)
|
|
|
|
|
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
|
|
2017 (though September 12, 2017)
|
|
0.947
|
|
0.320
|
|
0.269
|
|
0.090
|
|
2016
|
|
0.389
|
|
0.323
|
|
0.110
|
|
0.091
|
|
2015
|
|
0.769
|
|
0.33
|
|
0.217
|
|
0.093
|
|
2014
|
|
0.796
|
|
0.575
|
|
0.225
|
|
0.163
|
|
2013
|
|
1.052
|
|
0.597
|
|
0.297
|
|
0.169
|
|
2012
|
|
1.712
|
|
0.736
|
|
0.484
|
|
0.208
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly:
|
|
|
|
|
|
|
|
|
|
Third Quarter
2017
(though September 12,
2017)
|
|
0.947
|
|
0.320
|
|
0.268
|
|
0.090
|
|
Second Quarter 2017
|
|
0.78
|
|
0.565
|
|
0.220
|
|
0.160
|
|
First Quarter 2017
|
|
0.57
|
|
0.451
|
|
0.161
|
|
0.127
|
|
Fourth Quarter 2016
|
|
0.373
|
|
0.323
|
|
0.105
|
|
0.091
|
|
Third Quarter 2016
|
|
0.369
|
|
0.325
|
|
0.104
|
|
0.092
|
|
Second Quarter 2016
|
|
0.389
|
|
0.326
|
|
0.110
|
|
0.092
|
|
First Quarter 2016
|
|
0.389
|
|
0.338
|
|
0.110
|
|
0.096
|
|
Fourth Quarter 2015
|
|
0.405
|
|
0.351
|
|
0.114
|
|
0.099
|
|
Third Quarter 2015
|
|
0.462
|
|
0.33
|
|
0.131
|
|
0.093
|
|
Second Quarter 2015
|
|
0.728
|
|
0.42
|
|
0.206
|
|
0.119
|
|
First Quarter 2015
|
|
0.769
|
|
0.623
|
|
0.217
|
|
0.176
|
|
|
|
|
|
|
|
|
|
|
|
Most
Recent Six Months
|
|
|
|
|
|
|
|
|
|
September 2017 (though September 12,
2017)
|
|
0.749
|
|
0.693
|
|
0.213
|
|
0.197
|
|
August 2017
|
|
0.866
|
|
0.779
|
|
0.246
|
|
0.221
|
|
July 2017
|
|
0.947
|
|
0.672
|
|
0.269
|
|
0.191
|
|
June 2017
|
|
0.78
|
|
0.636
|
|
0.222
|
|
0.181
|
|
May 2017
|
|
0.78
|
|
0.59
|
|
0.222
|
|
0.168
|
|
April 2017
|
|
0.672
|
|
0.565
|
|
0.191
|
|
0.160
|
|
March 2017
|
|
0.57
|
|
0.482
|
|
0.162
|
|
0.137
|
As of September 12, 2017, there were two shareholders of record of
our ordinary shares. The number of record holders is not
representative of the number of beneficial holders of our ordinary
shares, as the shares of most our shareholders who hold ordinary
shares that are traded on the TASE are recorded in the name of our
Israeli share registrar, Mizrahi Tefahot Bank Registration Company
Ltd.
S-12
UNDERWRITING
We have entered into an underwriting agreement with the
representative of the underwriters set forth in the table below
with respect to ADSs being offered hereby. Joseph Gunner & Co.,
LLC is the representative of the underwriters. We refer to the
several underwriters listed in the table below as the
“underwriters.”
Under the terms and subject to the conditions contained in the
underwriting agreement, we have agreed to sell to each underwriter,
and each underwriter has severally and not jointly agreed to
purchase from us, the respective number of ADSs set forth opposite
its name below:
|
|
|
|
|
Joseph Gunner & Co., LLC
|
|
1,500,000
|
Our ADSs and warrants are listed on the Nasdaq Capital Market under
the symbols “BVXV” and “BVXVW”,
respectively. Our ordinary shares are listed on the TASE under the
symbol “BVXV”. The ADSs are expected to be delivered on
or about September 18, 2017, against payment in immediately
available funds.
The underwriting agreement provides that the obligation of the
underwriters to purchase the ADSs offered by this prospectus
supplement and the accompanying base prospectus is subject to the
approval of certain legal matters by counsel for the representative
and to certain other conditions. Each underwriter is obligated,
severally and not jointly, to purchase all of the ADSs offered
hereby if any such ADSs are purchased.
We have granted the underwriters an option to buy up to an
additional 166,667 ADSs from us. The underwriters may exercise this
option at any time and from time to time during the 45-day period
from the date of this prospectus supplement. If any additional ADSs
are purchased, the underwriters will offer the additional ADSs on
the same terms as those on which the ADSs are being offered.
The underwriting discounts and commissions are equal to the public offering price per ADS less the amount paid by
the underwriters to us per ADS. The underwriters may offer some of the ADSs to other securities dealers at the public
offering price per ADS less a concession of $0.1511 per share. The following table shows the per ADS and total
underwriting discounts and commissions to be paid to the underwriters in this offering assuming both no exercise and full
exercise of their option to purchase additional ADSs:
|
|
|
|
|
No Exercise of Additional ADS Option
|
|
Full Exercise of Additional ADS
Option
|
|
Public offering Price
|
|
$
|
6.00
|
|
$
|
9,000,000
|
|
$
|
10,000,000
|
|
Underwriting discounts and
commissions
(1)
|
|
$
|
0.33
|
|
$
|
385,000
|
|
$
|
385,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds, before expenses, to us
|
|
$
|
5.67
|
|
$
|
8,615,000
|
|
$
|
9,520,000
|
In addition, we have agreed to reimburse the representative at
closing for all fees and expenses incurred in connection with this
offering, up to a maximum aggregate amount of $40,000. We
estimate that expenses payable by us in connection with this
offering of our securities, other than the underwriting discounts
and commissions, will be approximately $55,000. We have paid a
deposit of $10,000 to the representative, which will be applied
against the expenses that will be paid by us to the underwriters in
connection with this offering.
S-13
Indemnification
Pursuant to the underwriting agreement, we have agreed to indemnify
each underwriter against certain liabilities, including liabilities
under the Securities Act, or to contribute to payments that each
underwriter or such other indemnified parties may be required to
make in respect of those liabilities.
Electronic
Distribution
This prospectus supplement
and the accompanying prospectus may be made available in electronic
format on websites or through other online services maintained by
underwriters or by their affiliates. In those cases, prospective
investors may view offering terms online and prospective investors
may be allowed to place orders online. Other than this prospectus
supplement and the accompanying prospectus in electronic format,
the information on an underwriter’s websites or our website
and any information contained in any other websites maintained by
an underwriters or by us is not part of this prospectus supplement,
the accompanying prospectus or the registration statement of which
this prospectus supplement and the accompanying prospectus forms a
part, has not been approved and/or endorsed by us or any
underwriter in its capacity as underwriter, and should not be
relied upon by investors.
Price Stabilization,
Short Positions and Penalty Bids
In connection with the offering, the underwriters may engage in
stabilizing transactions, over-allotment transactions and syndicate
covering transactions and penalty bids in accordance with
Regulation M under the Exchange Act:
•
Stabilizing transactions permit bids to purchase the underlying
security so long as the stabilizing bids do not exceed a specified
maximum.
•
Over-allotment involves sales by the underwriters of shares in
excess of the number of securities the underwriters are obligated
to purchase, which creates a short position. The short position may
be either a covered short position or a naked short position. In a
covered short position, the number of securities over-allotted by
the underwriters is not greater than the number of securities that
they may purchase in the over-allotment option. In a naked short
position, the number of securities involved is greater than the
number of ADSs in the over-allotment option. The underwriters may
close out any covered short position by either exercising their
over-allotment option and/or purchasing securities in the open
market.
•
Syndicate covering transactions involve purchases of securities in
the open market after the distribution has been completed in order
to cover syndicate short positions. In determining the source of
securities to close out the short position, the underwriters will
consider, among other things, the price of securities available for
purchase in the open market as compared to the price at which it
may purchase securities through the over-allotment option. A naked
short position occurs if the underwriters sell more securities than
could be covered by the over-allotment option. This position can
only be closed out by buying securities in the open market. A naked
short position is more likely to be created if the underwriters are
concerned that there could be downward pressure on the price of the
securities in the open market after pricing that could adversely
affect investors who purchase in the offering.
•
Penalty bids permit the underwriters to reclaim a selling
concession from a syndicate member when the securities originally
sold by the syndicate member is purchased in a stabilizing or
syndicate covering transaction to cover syndicate short
positions.
These stabilizing transactions and syndicate covering transactions
may have the effect of raising or maintaining the market price of
our ADSs and Ordinary Shares or preventing or retarding a decline
in the market price of the ADSs and Ordinary Shares. As a result,
the price of our ADSs and Ordinary Shares may be higher than the
price that might otherwise exist in the open market. These
transactions may be discontinued at any time.
Passive market
making.
In connection with this offering, underwriters
and selling group members may engage in passive market making
transactions in our ADSs on The Nasdaq Capital Market in accordance
with Rule 103 of Regulation M under the Exchange Act, during a
period before the commencement of offers or sales of the shares and
extending through the completion of the distribution. A passive
market maker must display its bid at a price not in excess of the
highest independent bid of that security. However, if all
independent bids are lowered
S-14
below the passive market maker’s bid, then that bid must then
be lowered when specified purchase limits are exceeded.
Right of First
Refusal
Until three (3) months from the offering, the representative shall
have an irrevocable right of first refusal to act as sole
investment banker, sole book-runner, and/or sole placement agent,
at the representative’s sole discretion, for each and every
future public and private equity and debt offering, including all
equity linked financings on terms customary to the representative.
The representative shall have the sole right to determine whether
or not any other broker-dealer shall have the right to participate
in any such offering and the economic terms of any such
participation. Notwithstanding the foregoing, this provision shall
not apply to a private placement to existing investors of the
Company.
Fee Tail
Until three (3) months from the offering, the representative shall
be entitled to 5.5% of the proceeds from each and every future
public and private equity and debt offering, including all equity
linked financings, to the extent that such financing or capital is
provided to the Company by investors whom the representative had
introduced, directly or indirectly, to the Company on or after
August 15, 2017.
Offer Restrictions
Outside the United States
Other than in the United States, no action has been taken by us or
the underwriters that would permit a public offering of the
securities offered by this prospectus in any jurisdiction where
action for that purpose is required. The securities offered by this
prospectus may not be offered or sold, directly or indirectly, nor
may this prospectus or any other offering material or
advertisements in connection with the offer and sale of any such
securities be distributed or published in any jurisdiction, except
under circumstances that will result in compliance with the
applicable rules and regulations of that jurisdiction. Persons into
whose possession this prospectus comes are advised to inform
themselves about and to observe any restrictions relating to the
offering and the distribution of this prospectus. This prospectus
does not constitute an offer to sell or a solicitation of an offer
to buy any securities offered by this prospectus in any
jurisdiction in which such an offer or a solicitation is
unlawful.
Australia
This prospectus is not a disclosure document under Chapter 6D of
the Australian Corporations Act, has not been lodged with the
Australian Securities and Investments Commission and does not
purport to include the information required of a disclosure
document under Chapter 6D of the Australian Corporations Act.
Accordingly, (i) the offer of the securities under this prospectus
is only made to persons to whom it is lawful to offer the
securities without disclosure under Chapter 6D of the Australian
Corporations Act under one or more exemptions set out in section
708 of the Australian Corporations Act, (ii) this prospectus is
made available in Australia only to those persons as set forth in
clause (i) above, and (iii) the offeree must be sent a notice
stating in substance that by accepting this offer, the offeree
represents that the offeree is such a person as set forth in clause
(i) above, and, unless permitted under the Australian Corporations
Act, agrees not to sell or offer for sale within Australia any of
the securities sold to the offeree within 12 months after its
transfer to the offeree under this prospectus.
China
The information in this document does not constitute a public offer
of the securities, whether by way of sale or subscription, in the
People’s Republic of China (excluding, for purposes of this
paragraph, Hong Kong Special Administrative Region, Macau Special
Administrative Region and Taiwan). The securities may not be
offered or sold directly or indirectly in the PRC to legal or
natural persons other than directly to “qualified domestic
institutional investors.”
European Economic Area
— Belgium, Germany, Luxembourg and Netherlands
The information in this document has been prepared on the basis
that all offers of securities will be made pursuant to an exemption
under the Directive 2003/71/EC (“Prospectus
Directive”), as implemented in Member
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States of the European Economic Area (each, a “Relevant
Member State”), from the requirement to produce a prospectus
for offers of securities.
An offer to the public of securities has not been made, and may not
be made, in a Relevant Member State except pursuant to one of the
following exemptions under the Prospectus Directive as implemented
in that Relevant Member State:
(a)
to legal
entities that are authorized or regulated to operate in the
financial markets or, if not so authorized or regulated, whose
corporate purpose is solely to invest in securities;
(b)
to any
legal entity that has two or more of (i) an average of at least 250
employees during its last fiscal year; (ii) a total balance sheet
of more than €43,000,000 (as shown on its last annual
unconsolidated or consolidated financial statements) and (iii) an
annual net turnover of more than €50,000,000 (as shown on its
last annual unconsolidated or consolidated financial
statements);
(c)
to fewer
than 100 natural or legal persons (other than qualified investors
within the meaning of
Article 2(
1)(e) of the Prospectus
Directive) subject to obtaining the prior consent of the Company or
any underwriter for any such offer; or
(d)
in any
other circumstances falling within Article3(2) of the Prospectus
Directive, provided that no such offer of securities shall result
in a requirement for the publication by the Company of a prospectus
pursuant to Article 3 of the Prospectus Directive.
France
This document is not being distributed in the context of a public
offering of financial securities (offre au public de titres
financiers) in France within the meaning of Article L.411-1 of the
French Monetary and Financial Code (Code monétaire et
financier) and Articles 211-1 et seq. of the General Regulation of
the French Autorité des marchés financiers
(“AMF”). The securities have not been offered or sold
and will not be offered or sold, directly or indirectly, to the
public in France.
This document and any other offering material relating to the
securities have not been, and will not be, submitted to the AMF for
approval in France and, accordingly, may not be distributed or
caused to distributed, directly or indirectly, to the public in
France.
Such offers, sales and distributions have been and shall only be
made in France to (i) qualified investors (investisseurs
qualifiés) acting for their own account, as defined in and
in accordance with Articles L.411-2-II-2° and D.411-1 to
D.411-3, D. 744-1, D.754-1 and D.764-1 of the French Monetary and
Financial Code and any implementing regulation and/or (ii) a
restricted number of non-qualified investors (cercle restreint
d’investisseurs) acting for their own account, as defined in
and in accordance with Articles L.411-2-II-2° and D.411-4,
D.744-1, D.754-1 and D.764-1 of the French Monetary and Financial
Code and any implementing regulation.
Pursuant to Article 211-3 of the General Regulation of the AMF,
investors in France are informed that the securities cannot be
distributed (directly or indirectly) to the public by the investors
otherwise than in accordance with Articles L.411-1, L.411-2,
L.412-1 and L.621-8 to L.621-8-3 of the French Monetary and
Financial Code.
Ireland
The information in this document does not constitute a prospectus
under any Irish laws or regulations and this document has not been
filed with or approved by any Irish regulatory authority as the
information has not been prepared in the context of a public
offering of securities in Ireland within the meaning of the Irish
Prospectus (Directive 2003/71/EC) Regulations 2005 (the
“Prospectus Regulations”). The securities have not been
offered or sold, and will not be offered, sold or delivered
directly or indirectly in Ireland by way of a public offering,
except to (i) qualified investors as defined in Regulation 2(l) of
the Prospectus Regulations and (ii) fewer than 100 natural or legal
persons who are not qualified investors.
The securities offered by this prospectus have not been approved or
disapproved by the Israeli Securities Authority (the ISA), or ISA,
nor have such securities been registered for sale in Israel. The
shares may not be offered or sold, directly or indirectly, to the
public in Israel, absent the publication of a prospectus. The ISA
has not issued
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permits, approvals or licenses in connection with the offering or
publishing the prospectus; nor has it authenticated the details
included herein, confirmed their reliability or completeness, or
rendered an opinion as to the quality of the securities being
offered. Any resale in Israel, directly or indirectly, to the
public of the securities offered by this prospectus is subject to
restrictions on transferability and must be effected only in
compliance with the Israeli securities laws and regulations.
Italy
The offering of the securities in the Republic of Italy has not
been authorized by the Italian Securities and Exchange Commission
(Commissione Nazionale per le Società e la Borsa,
“CONSOB” pursuant to the Italian securities legislation
and, accordingly, no offering material relating to the securities
may be distributed in Italy and such securities may not be offered
or sold in Italy in a public offer within the meaning of Article
1.1(t) of Legislative Decree No. 58 of 24 February 1998
(“Decree No. 58”), other than:
•
to Italian qualified investors, as defined in Article 100 of Decree
no.58 by reference to Article 34-ter of CONSOB Regulation no. 11971
of 15 May 1999 (“Regulation no. 11971”) as amended
(“Qualified Investors”);
•
in other circumstances that are exempt from the rules on public
offer pursuant to Article 100 of Decree No. 58 and Article 34-ter
of Regulation No. 11971 as amended.
Any offer, sale or delivery of the securities or distribution of
any offer document relating to the securities in Italy (excluding
placements where a Qualified Investor solicits an offer from the
issuer) under the paragraphs above must be:
•
made by investment firms, banks or financial intermediaries
permitted to conduct such activities in Italy in accordance with
Legislative Decree No. 385 of 1 September 1993 (as amended), Decree
No. 58, CONSOB Regulation No. 16190 of 29 October 2007 and any
other applicable laws; and
•
in compliance with all relevant Italian securities, tax and
exchange controls and any other applicable laws.
Any subsequent distribution of
the securities in Italy must be made in compliance with the public
offer and prospectus requirement rules provided under Decree No. 58
and the Regulation No. 11971 as amended, unless an exception from
those rules applies. Failure to comply with such rules may result
in the sale of such securities being declared null and void and in
the liability of the entity transferring the securities for any
damages suffered by the investors.
Japan
The securities have not been and will not be registered under
Article 4, paragraph 1 of the Financial Instruments and Exchange
Law of Japan (Law No. 25 of 1948), as amended (the
“FIEL”) pursuant to an exemption from the registration
requirements applicable to a private placement of securities to
Qualified Institutional Investors (as defined in and in accordance
with Article 2, paragraph 3 of the FIEL and the regulations
promulgated thereunder). Accordingly, the securities may not be
offered or sold, directly or indirectly, in Japan or to, or for the
benefit of, any resident of Japan other than Qualified
Institutional Investors. Any Qualified Institutional Investor who
acquires securities may not resell them to any person in Japan that
is not a Qualified Institutional Investor, and acquisition by any
such person of securities is conditional upon the execution of an
agreement to that effect.
Portugal
This document is not being distributed in the context of a public
offer of financial securities (oferta pública de valores
mobiliários) in Portugal, within the meaning of Article 109
of the Portuguese Securities Code (Código dos Valores
Mobiliários). The securities have not been offered or sold
and will not be offered or sold, directly or indirectly, to the
public in Portugal. This document and any other offering material
relating to the securities have not been, and will not be,
submitted to the Portuguese Securities Market Commission
(Comissão do Mercado de Valores Mobiliários) for
approval in Portugal and, accordingly, may not be distributed or
caused to distributed, directly or indirectly, to the public in
Portugal, other than under circumstances that are deemed not to
qualify as a public offer under the Portuguese Securities Code.
Such offers, sales and distributions of securities in Portugal are
limited
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to persons who are “qualified investors” (as defined in
the Portuguese Securities Code). Only such investors may receive
this document and they may not distribute it or the information
contained in it to any other person.
Sweden
This document has not been, and will not be, registered with or
approved by Finansinspektionen (the Swedish Financial Supervisory
Authority). Accordingly, this document may not be made available,
nor may the securities be offered for sale in Sweden, other than
under circumstances that are deemed not to require a prospectus
under the Swedish Financial Instruments Trading Act (1991:980) (Sw.
lag (1991:980) om handel med finansiella instrument). Any offering
of securities in Sweden is limited to persons who are
“qualified investors” (as defined in the Financial
Instruments Trading Act). Only such investors may receive this
document and they may not distribute it or the information
contained in it to any other person.
Switzerland
The securities may not be publicly offered in Switzerland and will
not be listed on the SIX Swiss Exchange (“SIX”) or on
any other stock exchange or regulated trading facility in
Switzerland. This document has been prepared without regard to the
disclosure standards for issuance prospectuses under art. 652a or
art. 1156 of the Swiss Code of Obligations or the disclosure
standards for listing prospectuses under art. 27 ff. of the SIX
Listing Rules or the listing rules of any other stock exchange or
regulated trading facility in Switzerland. Neither this document
nor any other offering material relating to the securities may be
publicly distributed or otherwise made publicly available in
Switzerland.
Neither this document nor any other offering material relating to
the securities have been or will be filed with or approved by any
Swiss regulatory authority. In particular, this document will not
be filed with, and the offer of securities will not be supervised
by, the Swiss Financial Market Supervisory Authority (FINMA).
This document is personal to the recipient only and not for general
circulation in Switzerland.
United Arab
Emirates
Neither this document nor the securities have been approved,
disapproved or passed on in any way by the Central Bank of the
United Arab Emirates or any other governmental authority in the
United Arab Emirates, nor has the Company received authorization or
licensing from the Central Bank of the United Arab Emirates or any
other governmental authority in the United Arab Emirates to market
or sell the securities within the United Arab Emirates. This
document does not constitute and may not be used for the purpose of
an offer or invitation. No services relating to the securities,
including the receipt of applications and/or the allotment or
redemption of such shares, may be rendered within the United Arab
Emirates by the Company.
No offer or invitation to subscribe for securities is valid or
permitted in the Dubai International Financial Centre.
United
Kingdom
Neither the information in this document nor any other document
relating to the offer has been delivered for approval to the
Financial Services Authority in the United Kingdom and no
prospectus (within the meaning of section 85 of the Financial
Services and Markets Act 2000, as amended (“FSMA”)) has
been published or is intended to be published in respect of the
securities. This document is issued on a confidential basis to
“qualified investors” (within the meaning of section
86(7) of FSMA) in the United Kingdom, and the securities may not be
offered or sold in the United Kingdom by means of this document,
any accompanying letter or any other document, except in
circumstances which do not require the publication of a prospectus
pursuant to section 86(1) FSMA. This document should not be
distributed, published or reproduced, in whole or in part, nor may
its contents be disclosed by recipients to any other person in the
United Kingdom.
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Any invitation or inducement to engage in investment activity
(within the meaning of section 21 of FSMA) received in connection
with the issue or sale of the securities has only been communicated
or caused to be communicated and will only be communicated or
caused to be communicated in the United Kingdom in circumstances in
which section 21(1) of FSMA does not apply to us.
In the United Kingdom, this document is being distributed only to,
and is directed at, persons (i) who have professional experience in
matters relating to investments falling within Article 19(5)
(investment professionals) of the Financial Services and Markets
Act 2000 (Financial Promotions) Order 2005 (“FPO”),
(ii) who fall within the categories of persons referred to in
Article 49(2)(a) to (d) (high net worth companies, unincorporated
associations, etc.) of the FPO or (iii) to whom it may otherwise be
lawfully communicated (together “relevant persons”).
The investments to which this document relates are available only
to, and any invitation, offer or agreement to purchase will be
engaged in only with, relevant persons. Any person who is not a
relevant person should not act or rely on this document or any of
its contents.
Canada
The securities may be sold in Canada only to purchasers purchasing,
or deemed to be purchasing, as principal, that are accredited
investors, as defined in National Instrument 45-106 Prospectus
Exemptions or subsection 73.3(1) of the Securities Act (Ontario),
and are permitted clients, as defined in National Instrument 31-103
Registration Requirements, Exemptions and Ongoing Registrant
Obligations. Any resale of the securities must be made in
accordance with an exemption from, or in a transaction not subject
to, the prospectus requirements of applicable securities laws.
Securities legislation in certain provinces or territories of
Canada may provide a purchaser with remedies for rescission or
damages if this prospectus (including any amendment thereto)
contains a misrepresentation, provided that the remedies for
rescission or damages are exercised by the purchaser within the
time limit prescribed by the securities legislation of the
purchaser’s province or territory. The purchaser should refer
to any applicable provisions of the securities legislation of the
purchaser’s province or territory for particulars of these
rights or consult with a legal advisor. Pursuant to section 3A.3 of
National Instrument 33-105 Underwriting Conflicts (NI 33-105), the
underwriters are not required to comply with the disclosure
requirements of NI 33-105 regarding underwriter conflicts of
interest in connection with this offering.
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EXPERTS
The financial statements incorporated in this prospectus supplement
by reference to the Annual Report on Form 20-F for the year
December 31, 2016 have been so incorporated in reliance on the
report of Kost Forer Gabbay & Kasierer, a member of Ernst &
Young Global, an independent registered public accounting firm,
given on the authority of said firm as experts in auditing and
accounting.
LEGAL MATTERS
Certain matters concerning this offering will be passed upon for us
by Pearl Cohen Zedek Latzer Baratz, LLP, New York, New York. The
validity of the ordinary shares represented by ADSs being offered
by this prospectus supplement and other legal matters concerning
this offering relating to Israeli law will be passed upon for us by
Pearl Cohen Zedek Latzer Baratz, Tel Aviv, Israel. Certain matters
related to the offering will be passed upon for the underwriters by
Sichenzia Ross Ference Kesner LLP, New York, New York.
INCORPORATION OF CERTAIN
INFORMATION BY REFERENCE
The SEC allows us to incorporate by reference our publicly filed
reports into this prospectus supplement, which means that
information included in those reports is considered part of this
prospectus supplement. Information that we file with the SEC after
the date of this prospectus supplement will automatically update
and supersede the information contained in this prospectus
supplement. We incorporate by reference the following documents
filed with the SEC and any future filings made with the SEC under
sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”):
1)
Our
Annual Report on Form 20-F for the year ended December 31, 2016
filed on April 28, 2017; and
2)
Our
current reports on Form 6-K filed May 30, 2017 and August 31, 2017,
that include our unaudited financial statements for the period
ended March 31, 2017 and June 30, 2017, respectively.
3)
Our
current reports on Form 6-K filed on June 14, 2017, June 19, 2017,
July 3, 2017, July 20, 2017, August 17, 2017 and August 31,
2017.
We will furnish without charge to you, on written or oral request,
a copy of any or all of the above documents, other than exhibits to
such documents which are not specifically incorporated by reference
therein. You should direct any requests for documents to:
BiondVax Pharmaceuticals Ltd.
14 Einstein St.
Nes Ziona, Israel, 74036
Attention: Chief Financial Officer
Tel.: (+972) (8) 930-2529
e-mail: info@biondvax.com
The information relating to us contained in this prospectus
supplement is not comprehensive and should be read together with
the information contained in the incorporated documents.
Descriptions contained in the incorporated documents as to the
contents of any contract or other document may not contain all of
the information which is of interest to you. You should refer to
the copy of such contract or other document filed as an exhibit to
our filings.
WHERE YOU CAN FIND MORE
INFORMATION
We have filed with the SEC a registration statement on Form F-3
under the Securities Act of 1933, as amended (the “Securities
Act”), relating to this offering of securities. This
prospectus supplement does not contain all of the information
contained in the registration statement. The rules and regulations
of the SEC allow us to omit certain information from this
prospectus supplement that is included in the registration
statement. Statements made in this prospectus supplement concerning
the contents of any contract, agreement or other document are
summaries of all material information about the documents
summarized, but are not complete descriptions of all terms of these
documents. If we filed any of these documents as an exhibit to the
registration statement, you may read the document itself for a
complete description of its terms.
S-20
In addition, we file reports with, and furnish information to, the
SEC. You may read and copy the registration statement and any other
documents we have filed at the SEC, including any exhibits and
schedules, at the SEC’s public reference room at 100 F Street
N.E., Washington, D.C. 20549. You may call the SEC at
1-800-SEC-0330 for further information on this public reference
room. As a foreign private issuer, all documents which were filed
after November 13, 2014 on the SEC’s EDGAR system are
available for retrieval on the SEC’s website at
www.sec.gov
.
These SEC filings are also available to the public on the Israel
Securities Authority’s Magna website at
www.magna.isa.gov.il
and from commercial document retrieval services. We also generally
make available on our own web site (
www.biolinerx.com
)
our quarterly and year-end financial statements as well as other
information.
In addition, since our Ordinary Shares are traded on the TASE, in
the past we filed Hebrew language periodic and immediate reports
with, and furnished information to, the TASE and the Israel
Securities Authority, or the ISA, as required under Chapter Six of
the Israel Securities Law, 1968. On September 8, 2015, following
our shareholders and tradeable options holders approvals, we have
transitioned solely to U.S. reporting standards after listing the
ADSs and ADSs Warrants on the Nasdaq Capital Market, in accordance
with an applicable exemption under the Israel Securities Law.
Copies of our SEC filings and submissions are now submitted to the
ISA and the TASE. Such copies can be retrieved electronically
through the MAGNA distribution site of the ISA (
www.magna.isa.gov.il
)
and the TASE website (maya.tase.co.il).
We maintain a corporate website at
www.biondvax.com
.
Information contained on, or that can be accessed through, our
website does not constitute a part of this prospectus supplement.
We have included our website address in this prospectus supplement
solely as an inactive textual reference.
ENFORCEABILITY OF CIVIL
LIABILITIES
We are incorporated under the laws of the State of Israel. Service
of process upon us and upon our directors and officers and the
Israeli experts named in this registration statement, substantially
all of whom reside outside of the United States, may be difficult
to obtain within the United States. Furthermore, because
substantially all of our assets and substantially all of our
directors and officers are located outside the United States, any
judgment obtained in the United States against us or any of our
directors and officers may not be collectible within the United
States.
Subject to specified time limitations and legal procedures, Israeli
courts may enforce a United States judgment in a civil matter
which, subject to certain exceptions, is non-appealable, including
judgments based upon the civil liability provisions of the
Securities Act and the Exchange Act and including a monetary or
compensatory judgment in a non-civil matter, provided that among
other things:
•
the judgments are obtained after due process before a court of
competent jurisdiction, according to the laws of the state in which
the judgment is given and the rules of private international law
currently prevailing in Israel;
•
the prevailing law of the foreign state in which the judgments were
rendered allows for the enforcement of judgments of Israeli
courts;
•
adequate service of process has been effected and the defendant has
had a reasonable opportunity to be heard and to present his or her
evidence;
•
the judgments are not contrary to public policy of Israel, and the
enforcement of the civil liabilities set forth in the judgment is
not likely to impair the security or sovereignty of Israel;
•
the judgments were not obtained by fraud and do not conflict with
any other valid judgments in the same matter between the same
parties;
•
an action between the same parties in the same matter is not
pending in any Israeli court at the time the lawsuit is instituted
in the foreign court;
•
the judgment is not subject to any further appeal procedures;
and
•
the judgment is enforceable according to the laws of Israel and
according to the law of the foreign state in which the relief was
granted.
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Generally, an Israeli court will not enforce a foreign judgment if
the motion for enforcement was filed more than five years after the
date of its award in the United States, unless Israel and the
United States have agreed otherwise on a different period, or if an
Israeli court finds exceptional reasons justifying the delay.
If a foreign judgment is enforced by an Israeli court, it generally
will be payable in Israeli currency, which can then be converted
into non-Israeli currency and transferred out of Israel. The usual
practice in an action before an Israeli court to recover an amount
in a non-Israeli currency is for the Israeli court to issue a
judgment for the equivalent amount in Israeli currency at the rate
of exchange in force on the date of the judgment, but the judgment
debtor may make payment in foreign currency. Pending collection,
the amount of the judgment of an Israeli court stated in Israeli
currency ordinarily will be linked to the Israeli consumer price
index plus interest at the annual statutory rate set by Israeli
regulations prevailing at the time. Judgment creditors must bear
the risk of unfavorable exchange rates.
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________________________
PROSPECTUS
SUPPLEMENT
________________________
PROSPECTUS
$150,000,000
American
Depositary Shares Representing Ordinary Shares
Warrants to Purchase American Depositary Shares
Units
We may offer
from time to time, in one or more series:
•
American
Depositary Shares, or ADSs;
•
warrants to
purchase ADSs; and
•
units
consisting of two or more of these classes or series of
securities.
We may offer
these securities in amounts, at prices and on terms determined at
the time of offering. The specific plan of distribution for any
securities to be offered will be provided in a prospectus
supplement. If we use agents, underwriters or dealers to sell these
securities, a prospectus supplement will name them and describe
their compensation.
The specific
terms of any securities to be offered will be described in a
supplement to this prospectus. This prospectus may not be used to
sell securities unless accompanied by a prospectus supplement. The
prospectus supplement may also add, update or change information
contained in this prospectus. You should read this prospectus and
any prospectus supplement, together with additional information
described under the heading “Where You Can Find More
Information,” before you make an investment
decision.
Our ADSs and
the ADS warrants are currently traded on the NASDAQ Capital Market
under the symbol “BVXV” and “BVXVW”,
respectively. The last reported closing price of our ADSs and ADS
Warrants on the NASDAQ Capital Market on December 9, 2016, was
$3.74 and $0.375, respectively.
Our ordinary
shares are currently traded on the Tel Aviv Stock Exchange, or the
TASE, under the symbol “BVXV.” The last reported
closing price of our ordinary shares on the TASE on December 11,
2016, was NIS 0.346, or $0.09, per share (based on the exchange
rate reported by the Bank of Israel on December 9, 2016, which was
NIS 3.818 = $1.00).
The
aggregate market value of our outstanding voting and non-voting
common equity held by non-affiliates on December 9, 2016, as
calculated in accordance with General Instruction I.B.5. of Form
F-3, was approximately $11.2 million. We have not issued any
securities pursuant to Instruction I.B.5. of Form F-3 during the 12
calendar month period that ends on and includes the date
hereof.
Investing in
our securities involves a high degree of risk. See “Risk
Factors” contained in the applicable registration statement
or the documents we incorporate by reference in this prospectus to
read about factors you should consider before investing in our
securities.
Neither the
Securities and Exchange Commission, the Israeli Securities
Authority, nor any other state or foreign regulatory body has
approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the
contrary is a criminal offense.
The date of
this prospectus is December 15, 2016
TABLE OF
CONTENTS
|
About this prospectus
|
|
1
|
|
Where You Can Find More Information
|
|
2
|
|
Forward-Looking Statements
|
|
3
|
|
The company
|
|
4
|
|
Documents incorporated by reference
|
|
6
|
|
Risk Factors
|
|
7
|
|
Use of Proceeds
|
|
8
|
|
Exchange Rate Information
|
|
8
|
|
Price Range of our ADSs
|
|
9
|
|
Price Range of our Ordinary Shares
|
|
10
|
|
Description of Share Capital
|
|
11
|
|
Description of American Depositary
Shares
|
|
17
|
|
Description of Warrants
|
|
24
|
|
Description of Units
|
|
27
|
|
Taxation
|
|
28
|
|
Plan of Distribution
|
|
28
|
|
Experts
|
|
32
|
|
Legal Matters
|
|
32
|
|
Enforceability of Civil Liabilities
|
|
32
|
i
ABOUT THIS
PROSPECTUS
This prospectus is part of a registration statement on Form F-3
that we filed with the U.S. Securities and Exchange Commission, or
the SEC, using a “shelf” registration process. By using
a shelf registration statement, we may sell securities from time to
time and in one or more offerings up to a total dollar amount of
$150 million as described in this prospectus. Furthermore, in no
event will we sell securities with a value exceeding more than
one-third of our “public float” (the market value of
our ordinary shares and any other equity securities that we may
issue in the future that are held by non-affiliates) in any
12-calendar month period. Each time that we offer and sell
securities, we will provide a prospectus supplement to this
prospectus that contains specific information about the securities
being offered and sold and the specific terms of that offering. The
prospectus supplement may also add, update or change information
contained in this prospectus with respect to that offering. If
there is any inconsistency between the information in this
prospectus and the applicable prospectus supplement, you should
rely on the prospectus supplement. Before purchasing any
securities, you should carefully read both this prospectus and the
applicable prospectus supplement, together with the additional
information described under the heading “Where You Can Find
More Information”.
You should rely only on the information contained in or
incorporated by reference in this prospectus or any related
prospectus supplement. We have not authorized any other person to
provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it.
We will not make an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. You should
assume that the information appearing in this prospectus and the
applicable prospectus supplement to this prospectus is accurate
only as of the date on its respective cover, and that any
information incorporated by reference is accurate only as of the
date of the document incorporated by reference, unless we indicate
otherwise. Our business, financial condition, results of operations
and prospects may have changed since those dates.
Unless the context otherwise requires, all references to
“BiondVax”, “we”, “us”,
“our”, the “Company” and similar
designations refer to BiondVax Pharmaceuticals Ltd.
Market data and certain industry data and forecasts used throughout
this prospectus were obtained from sources we believe to be
reliable, including market research databases, publicly available
information, reports of governmental agencies and industry
publications and surveys. We have not sought the consent of the
sources to refer to the publicly available reports in this
prospectus.
1
WHERE YOU CAN FIND MORE
INFORMATION
We have filed with the SEC a registration statement on Form F-3
under the Securities Act relating to this offering of securities.
This prospectus does not contain all of the information contained
in the registration statement. The rules and regulations of the SEC
allow us to omit certain information from this prospectus that is
included in the registration statement. Statements made in this
prospectus concerning the contents of any contract, agreement or
other document are summaries of all material information about the
documents summarized, but are not complete descriptions of all
terms of these documents. If we filed any of these documents as an
exhibit to the registration statement, you may read the document
itself for a complete description of its terms.
You may read and copy the registration statement, including the
related exhibits and schedules, and any document we file with the
SEC without charge at the SEC’s public reference room at 100
F Street, N.E., Room 1580, Washington, DC 20549. You may also
obtain copies of the documents at prescribed rates by writing to
the Public Reference Section of the SEC at 100 F Street, N.E., Room
1580, Washington, DC 20549. Please call the SEC at 1-800-SEC-0330
for further information on the public reference room. The SEC also
maintains an Internet website that contains reports and other
information regarding issuers that file electronically with the
SEC. Our filings with the SEC are also available to the public
through the SEC’s website at
http://www.sec.gov
.
These SEC filings are also available to the public on the Israel
Securities Authority’s Magna website at
www.magna.isa.gov.il
.
In addition, since our ordinary shares are traded on the TASE, in
the past we filed Hebrew language periodic and immediate reports
with, and furnished information to, the TASE and the Israeli
Securities Authority, or the ISA, as required under Chapter Six of
the Israel Securities Law, 1968. Following the Company’s
listing of ADSs and ADS warrants on the NASDAQ Capital Market, and
following the approval of the shareholders and Tradable Options
(Series 3-5) holders of the Company on July 27, 2015, August 16,
2015, and September 7, 2015, the Company transitioned to U.S.
reporting standard. Copies of our SEC filings and submissions are
submitted to the ISA and the TASE. Such copies can be retrieved
electronically through the MAGNA distribution site of the ISA
(
www.magna.isa.gov.il
)
and the TASE website (
www.maya.tase.co.il
).
We maintain a corporate website at
www.biondvax.com
.
Information contained on, or that can be accessed through, our
website does not constitute a part of this prospectus. We have
included our website address in this prospectus solely as an
inactive textual reference.
2
FORWARD-LOOKING
STATEMENTS
This prospectus contains statements and information that involve
known and unknown risks, uncertainties and other factors that may
cause our actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. In some cases, you can identify forward-looking
statements by terms including “anticipates”,
“believes”, “could”,
“estimates”, “expects”,
“intends”, “may”, “plans”,
“potential”, “predicts”,
“projects”, “should”, “will”,
“would”, and similar expressions intended to identify
forward-looking statements. Forward looking statements reflect our
current views with respect to future events and are based on
assumptions and subject to risks and uncertainties. You should not
put undue reliance on any forward-looking statements.
Factors that could cause our actual results to differ materially
from those expressed or implied in such forward-looking statements
include, but are not limited to:
•
the initiation, timing, progress and results of our clinical
trials;
•
the clinical development, commercialization and market acceptance
of our product candidate;
•
our receipt of regulatory approvals for our product candidate, and
the timing of other regulatory filings and approvals;
•
our ability to obtain and maintain ongoing regulatory requirements,
even if our product candidate receives marketing approvals;
•
our ability to maintain and expand our intellectual property in
connection with our product candidate;
•
estimates of our expenses, future revenues, capital requirements
and our needs for additional financing.
3
THE COMPANY
We are a clinical stage biopharmaceutical company focused on
developing and, ultimately, commercializing immunomodulation
therapies for infectious diseases. Our current product candidate, a
universal influenza vaccine that we refer to as M-001, is a
synthetic peptide-based protein targeting both seasonal and
pandemic strains of the influenza virus. Unlike existing influenza
vaccines, which offer only strain specific seasonal protection or
pandemic prevention, M-001 is designed to provide long-lasting
protection against multiple existing and future influenza strains.
As a result, we believe that M-001 has the potential to become an
attractive alternative to existing influenza vaccines.
M-001 is based on research initially conducted at the Weizmann
Institute of Science in Israel, or the Weizmann Institute, over a
period of approximately 10 years prior to our inception in 2003. In
2003, we acquired from Yeda Research and Development Company Ltd.,
or Yeda, an affiliate of the Weizmann Institute, an exclusive
worldwide license for the development, manufacture, use, marketing,
sale, distribution and importation of products based, directly or
indirectly, on patents and patent applications filed pursuant to
the invention titled “Peptide Based Vaccine for
Influenza”, developed on the basis of the research conducted
by Professor Ruth Arnon and her team at the Weizmann Institute.
Since 2003, we have continued the research and development of M-001
under the supervision of our Chief Scientific Officer, Dr. Tamar
Ben-Yedidia and, at present, we own or license five families of
patents filed in a large number of jurisdictions, the latest of
which is expected to be in force until 2035.
According to a report by the U.S. Department of Health and Human
Services, Centers for Disease Control and Prevention, or the CDC,
annual seasonal influenza vaccines in the U.S. were found to be
effective in preventing the onset of the influenza virus in between
8% and 48% of healthy adults during the influenza seasons from 2004
to 2008 (depending on the particular season and the statistical
significance of the sample). In addition, studies conducted by
universities and hospitals in cooperation with the CDC from 2004
and until recently measured the effectiveness of the influenza
vaccine at preventing outpatient medical visits due to
laboratory-confirmed influenza. These studies estimated the
adjusted influenza vaccine effectiveness to be between 10% during
the 2004/2005 season and 60% during the 2010/2011 season, and only
19% effective during the 2014/2015 season. Most existing influenza
vaccines are formulated based on weakened or dead strains of the
influenza virus that are predicted to be the most common during the
then upcoming influenza season or that are predicted to be most
likely to cause a pandemic outbreak in the then upcoming influenza
season. Furthermore, as seasonal and pandemic influenza vaccines
are strain-specific, most existing vaccines only target those
specific strains and do not cope with the ever-changing nature of
the influenza virus. In addition, according to the Biomedical and
Advanced Research and Development Authority of the United States
Department of Health, or BARDA, which is responsible for the
advanced development and procurement of medical countermeasures for
pandemic influenza in the United States, the production cycle of
existing influenza vaccines is long (approximately 6 months),
considerably limiting the ability to timely immunize the
non-affected population in case of a pandemic outbreak.
M-001 is comprised of nine peptides that activate the entire immune
system (including both a humoral reaction, an immune reaction
causing the body to create antibodies against a pathogen or parts
thereof, and a cellular immune reaction, an immune reaction causing
the body to kill or assist in killing pathogens), to prevent the
spread of the influenza disease within the body and shorten the
duration of the illness. The selected peptides are from the HA, NP
and M1 proteins of both influenza Type A and Type B virus, and each
peptide comprises up to 22 amino-acids. These peptides are common
in the vast majority of influenza virus strains and are combined
into a single protein used in M-001.
M-001 is intended to be intramuscularly injected into the body.
Once administered, M-001 is designed to be recognized by white
blood cells in the body, causing both humoral and cellular immune
reactions. This process is expected to result in the creation of
new memory cells which, upon influenza infection, secrete
antibodies to fight the influenza virus.
We intend to seek regulatory approvals to market M-001 for the
following three indications: (i) as a standalone universal vaccine
suitable to be administered to the general population to provide
protection against seasonal and pandemic strains of influenza, that
we refer to as the Universal Standalone Indication; (ii) as a
seasonal influenza vaccine, or primer, to be administered to
patients over the age of 65 with additional age-related medical
conditions, or elderly with co-morbidities, in combination with the
existing seasonal vaccine to provide additional protection against
seasonal influenza virus strains, that we refer to as the Universal
Seasonal Primer for Elderly Indication;
4
and (iii) as a pre-pandemic influenza vaccine, or primer, suitable
to be administered to the general population in combination with
the existing pandemic vaccine, to provide additional protection
against pandemic strains of the influenza virus, that we refer to
as the Universal Pandemic Primer Indication.
To date, we have completed two Phase 1/2 clinical trials and three
Phase 2 clinical trials conducted in Israel pursuant to clinical
trial protocols approved by the Israeli Ministry of Health. These
clinical trials were designed for adults between the ages of 18 and
49 and 55 to 75, and included an aggregate of 479 participants.
Because our product candidate is a vaccine, we conducted our Phase
1/2 clinical trials on healthy participants to test both safety of
M-001 as our primary endpoint and the immunogenicity of M-001 as
our secondary endpoint. Results from our Phase 1/2 and Phase 2
clinical trials indicated that M-001 was well tolerated and safe
across all treatment groups within the trial population and that
M-001 was effective in causing an immune reaction in clinical trial
participants administered with M-001.
In June 2015 we received preliminary results from our Phase 2
clinical trial in Israel, which we refer to as BVX-006, indicating
M-001 was safe, well tolerated and induced humoral immune
responses, successfully meeting the primary safety and secondary
immunogenicity endpoints. In addition, in September 2015 we
initiated our BVX-007 clinical trial in Europe as part of our
membership in the UNISEC Consortium following the receipt of a
regulatory clearance from the relevant Hungarian Regulatory
Authority. The UNISEC Consortium is a consortium of three
University partners, five National Health Institutes and other
companies and organizations to work on promising recently developed
concepts for a universal influenza vaccine. BVX-007 includes the
administration of the H5N1 vaccine following the administration of
M-001 to our clinical trial participants. We entered into an
agreement with a supplier for the supply of H5N1 vaccine approved
by the relevant regulatory authority for the purpose of performing
BVX-007. On September 21, 2016, we announced that the last
participant in this clinical trial completed his final visit, and
on November 29, 2016, we announced positive preliminary safety
results. Although no regulatory authority has requested or
instructed that we perform these or any other additional
preclinical or clinical trials, we elected to conduct additional
Phase 2 clinical trials at this time (rather than proceed directly
to filing an IND application for Phase 3 clinical trials) in order
to further expand our data to provide greater support for any Phase
3 clinical trial of M-001 we may conduct in the future.
In June 2015, the FDA accepted our newly submitted IND application,
and we were informed by our regulatory advisors that the
“study may proceed”. We have submitted this IND in
order to comply with Biomedical Advanced Research and Development
Authority, or BARDA, for a grant application we had previously
submitted to BARDA. Following such IND acceptance, we intend to
participate in a Phase 2 clinical trial to be held in the U.S. by
the National Institute of Allergy and Infectious Diseases, or
NIAID. The purpose of the planned clinical trial is to assess the
ability of M-001 in humans to serve as a pandemic primer to the
H7N9 avian pandemic vaccine, and we expect NIAID will launch this
clinical trial during 2016-2017.
We intend, following the receipt of all requisite regulatory
approvals, to conduct Phase 3 clinical trials in the U.S., either
with one or more future collaborators, or, subject to available
funds, on our own, in support of FDA approval to market M-001 in
the U.S. While all of our preclinical and clinical trials to date
have been conducted outside the United States, considering the
FDA’s review and comments to this IND application, we believe
that the FDA will consider the results of our completed preclinical
and clinical trials in reviewing any future IND application. We
expect that phase 3 clinical trials will be planned for the
2017/2018 timeframe.
We do not currently have sufficient financial resources to conduct
Phase 3 clinical trials of M-001 on our own. Subject to the
completion of our current and planned Phase 2 clinical trials and
the approval of an IND application for Phase 3 clinical trials, we
intend to seek to establish collaborations with large multinational
pharmaceutical companies and/or national health authorities to
finance Phase 3 clinical trials of M-001. However, to the extent
that we have sufficient capital to do so (whether through sales of
debt or equity securities or otherwise), we may seek to conduct
Phase 3 clinical trials of M-001 for some or all of our indications
without such collaborations.
We were incorporated under the laws of the state of Israel in 2003
as a privately held company. In February 2007, we completed an
initial public offering of our ordinary shares on TASE and in May
2015 we completed an initial public offering of our ADSs and ADS
warrants on the NASDAQ Capital Market. Our principal executive
offices are located at 14 Einstein Street, Nes Ziona, Israel,
74036, and our telephone number is (+972) (8) 930-2529. Our agent
for service of process in the United States is Puglisi &
Associates, whose address is 850 Library Avenue, Suite 204, Newark,
Delaware, and whose telephone number is (302) 738-6680.
5
DOCUMENTS INCORPORATED
BY REFERENCE
The SEC allows us to incorporate by reference our publicly filed
reports into this prospectus, which means that information included
in those reports is considered part of this prospectus. Information
that we file with the SEC after the date that we file this
registration statement will automatically update and supersede the
information contained in this prospectus. We incorporate by
reference the following documents filed with the SEC and any future
filings made with the SEC under sections 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”):
(1)
Our
Annual Report on Form 20-F for the year ended December 31, 2015
filed on April 27, 2016; and
(2)
Our
current reports on Form 6-K filed May 31, 2016, August 18, 2016 and
November 28, 2016, that include our unaudited financial statements
for the period ended March 31, 2016, unaudited financial statements
for the period ended June 30, 2016 and unaudited financial
statements for the period ended September 30, 2016,
respectively.
(3)
Our
current reports on Form 6-K filed on August 18, 2016, September 1,
2016, September 8, 2016, September 12, 2016, September 20, 2016,
September 29, 2016 and October 11, 2016, that include our annual
general shareholders meeting proxy statement and proxy card, as
amended, position notice from our shareholders and response of our
board of directors to this position notice and results of this
general shareholders meeting.
(4)
Our
current reports on Form 6-K filed on September 9, 2016, October 11,
2016 and November 29, 2016.
We will furnish without charge to you, on written or oral request,
a copy of any or all of the above documents, other than exhibits to
such documents which are not specifically incorporated by reference
therein. You should direct any requests for documents to:
Biondvax Pharmaceuticals Ltd.
14 Einstein Street
Nes Ziona, Israel 74036
(+972) (8) 930-2529
(+972) (8) 930-2531 (facsimile)
The information relating to us contained in this prospectus is not
comprehensive and should be read together with the information
contained in the incorporated documents. Descriptions contained in
the incorporated documents as to the contents of any contract or
other document may not contain all of the information which is of
interest to you. You should refer to the copy of such contract or
other document filed as an exhibit to our filings.
6
RISK FACTORS
Investing in our securities involves significant risks. Before
making an investment decision, you should carefully consider the
risks described under “Risk Factors” in the applicable
prospectus supplement and under Item 3.D. — “Risk
Factors” in our most recent Annual Report on Form 20-F, or
any updates in our Reports on Form 6-K, together with all of the
other information appearing in this prospectus or incorporated by
reference into this prospectus and any applicable prospectus
supplement, in light of your particular investment objectives and
financial circumstances. The risks so described are not the only
risks facing us. Additional risks not presently known to us or that
we currently deem immaterial may also impair our business
operations. Our business, financial condition and results of
operations could be materially adversely affected by any of these
risks. The trading price of our securities could decline due to any
of these risks, and you may lose all or part of your investment.
The discussion of risks includes or refers to forward-looking
statements; you should read the explanation of the qualifications
and limitations on such forward-looking statements discussed
elsewhere in this prospectus.
7
USE OF
PROCEEDS
We intend to use the proceeds from the sale of securities for
working capital, operating expenses and other general corporate
purposes, unless otherwise indicated in an accompanying prospectus
supplement.
EXCHANGE RATE
INFORMATION
From the Company’s
inception through the date of this prospectus, our functional and
presentation currency was the New Israeli Shekel, or NIS. Our
foreign currency exposures give rise to market risk associated with
exchange rate movements of the NIS, our functional and reporting
currency, mainly against the U.S. dollar and the Euro.
To date, we entered into currency hedging transactions to decrease
the risk of financial exposure from fluctuations in the exchange
rates of our principal operating currencies. These measures,
however, may not adequately protect us from the material adverse
effects of such fluctuations.
The following table sets forth information regarding the exchange
rates of NIS per U.S. dollars for the periods indicated. Average
rates are calculated by using the daily representative rates as
reported by the Bank of Israel on the last day of each month during
the periods presented.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
4.0530
|
|
3.7610
|
|
3.8869
|
|
3.9020
|
|
2014
|
|
3.9940
|
|
3.4020
|
|
3.5774
|
|
3.8890
|
|
2013
|
|
3.7910
|
|
3.4710
|
|
3.6094
|
|
3.4710
|
|
2012
|
|
4.0840
|
|
3.7000
|
|
3.8580
|
|
3.7330
|
|
2011
|
|
3.8210
|
|
3.3630
|
|
3.5791
|
|
3.8210
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November 30, 2016
|
|
3.876
|
|
3.799
|
|
3.843
|
|
3.839
|
|
October 31, 2016
|
|
3.856
|
|
3.778
|
|
3.822
|
|
3.849
|
|
September 30, 2016
|
|
3.786
|
|
3.746
|
|
3.766
|
|
3.758
|
|
August 31, 2016
|
|
3.829
|
|
3.754
|
|
3.795
|
|
3.786
|
|
July 31, 2016
|
|
3.900
|
|
3.818
|
|
3.857
|
|
3.846
|
|
June 30, 2016
|
|
3.900
|
|
3.818
|
|
3.857
|
|
3.846
|
8
PRICE RANGE OF OUR ADSs
AND ADS WARRANTS
Our ADSs and ADS warrants are listed on the NASDAQ Capital Market
under the symbol “BVXV” and “BVXVW”,
respectively, since May 12, 2015.
The following tables set forth for the periods indicated the high
and low sales prices per ADS and ADS warrants as reported on the
NASDAQ Capital Market:
|
BVXV
|
|
|
|
|
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
2015
|
|
$
|
5.39
|
|
$
|
3.39
|
|
Quarterly:
|
|
|
|
|
|
|
|
Third Quarter 2016
|
|
$
|
3.94
|
|
$
|
3.31
|
|
Second Quarter 2016
|
|
$
|
4.02
|
|
$
|
3.30
|
|
First Quarter 2016
|
|
$
|
4.05
|
|
$
|
3.57
|
|
Fourth Quarter 2015
|
|
$
|
4.08
|
|
$
|
3.39
|
|
Third Quarter 2015
|
|
$
|
4.69
|
|
$
|
3.99
|
|
Second Quarter 2015 (from May 12,
2015)
|
|
$
|
5.39
|
|
$
|
3.49
|
|
Most
Recent Six Months:
|
|
|
|
|
|
|
|
November 2016
|
|
$
|
3.90
|
|
$
|
3.25
|
|
October 2016
|
|
$
|
3.94
|
|
$
|
3.66
|
|
September 2016
|
|
$
|
3.94
|
|
$
|
3.60
|
|
August 2016
|
|
$
|
3.88
|
|
$
|
3.31
|
|
July 2016
|
|
$
|
3.67
|
|
$
|
3.31
|
|
June 2016
|
|
$
|
3.90
|
|
$
|
3.30
|
|
BVXVW
|
|
|
|
|
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
2015
|
|
$
|
1.37
|
|
$
|
0.71
|
|
Quarterly:
|
|
|
|
|
|
|
|
Third Quarter 2016
|
|
$
|
0.70
|
|
$
|
0.37
|
|
Second Quarter 2016
|
|
$
|
0.80
|
|
$
|
0.40
|
|
First Quarter 2016
|
|
$
|
0.99
|
|
$
|
0.40
|
|
Fourth Quarter 2015
|
|
$
|
0.98
|
|
$
|
0.71
|
|
Third Quarter 2015
|
|
$
|
0.99
|
|
$
|
0.70
|
|
Second Quarter 2015 (from May 12,
2015)
|
|
$
|
1.37
|
|
$
|
0.96
|
|
Most
Recent Six Months:
|
|
|
|
|
|
|
|
November 2016
|
|
$
|
0.47
|
|
$
|
0.37
|
|
October 2016
|
|
$
|
0.60
|
|
$
|
0.38
|
|
September 2016
|
|
$
|
0.70
|
|
$
|
0.41
|
|
August 2016
|
|
$
|
0.50
|
|
$
|
0.37
|
|
July 2016
|
|
$
|
0.60
|
|
$
|
0.40
|
|
June 2016
|
|
$
|
0.60
|
|
$
|
0.60
|
On December 9, 2016, the last reported sale price of our ADS and
the ADS warrants on the NASDAQ Capital Market was $3.74 and $0.375,
respectively.
9
PRICE RANGE OF OUR
ORDINARY SHARES
Our ordinary shares have been trading on the TASE under the symbol
“BNDX” since June 18, 2007 and under the symbol
“BVXV” since May 18, 2015. No trading market currently
exists for our ordinary shares in the United States.
The following table sets forth, for the periods indicated, the
reported high and low closing sale prices of our ordinary shares on
the TASE in NIS and convenient translation to U.S. dollars.
|
|
|
|
|
|
|
|
|
|
|
Price Per Ordinary Share
(1)
|
|
|
|
|
|
|
|
|
|
|
|
Annual:
|
|
|
|
|
|
|
|
|
|
2015
|
|
0.769
|
|
0.330
|
|
0.205
|
|
0.088
|
|
2014
|
|
0.796
|
|
0.575
|
|
0.212
|
|
0.153
|
|
2013
|
|
1.052
|
|
0.597
|
|
0.280
|
|
0.159
|
|
2012
|
|
1.712
|
|
0.736
|
|
0.456
|
|
0.196
|
|
2011
|
|
3.139
|
|
1.37
|
|
0.835
|
|
0.365
|
|
2010
|
|
4.005
|
|
2.026
|
|
1.066
|
|
0.539
|
|
2009
|
|
7.700
|
|
0.280
|
|
2.049
|
|
0.075
|
|
Quarterly:
|
|
|
|
|
|
|
|
|
|
Third Quarter 2016
|
|
0.369
|
|
0.325
|
|
0.098
|
|
0.086
|
|
Second Quarter 2016
|
|
0.389
|
|
0.326
|
|
0.104
|
|
0.087
|
|
First Quarter 2016
|
|
0.389
|
|
0.338
|
|
0.104
|
|
0.090
|
|
Fourth Quarter 2015
|
|
0.405
|
|
0.351
|
|
0.108
|
|
0.093
|
|
Third Quarter 2015
|
|
0.462
|
|
0.330
|
|
0.123
|
|
0.088
|
|
Second Quarter 2015
|
|
0.728
|
|
0.420
|
|
0.194
|
|
0.112
|
|
First Quarter 2015
|
|
0.769
|
|
0.623
|
|
0.205
|
|
0.166
|
|
Fourth Quarter 2014
|
|
0.759
|
|
0.595
|
|
0.202
|
|
0.158
|
|
Third Quarter 2014
|
|
0.788
|
|
0.594
|
|
0.210
|
|
0.158
|
|
Second Quarter 2014
|
|
0.790
|
|
0.690
|
|
0.210
|
|
0.184
|
|
First Quarter 2014
|
|
0.796
|
|
0.575
|
|
0.212
|
|
0.153
|
|
Fourth Quarter 2013
|
|
0.817
|
|
0.601
|
|
0.217
|
|
0.160
|
|
Third Quarter 2013
|
|
0.822
|
|
0.638
|
|
0.219
|
|
0.170
|
|
Second Quarter 2013
|
|
0.751
|
|
0.597
|
|
0.200
|
|
0.159
|
|
First Quarter 2013
|
|
1.052
|
|
0.668
|
|
0.280
|
|
0.178
|
|
Fourth Quarter 2012
|
|
1.225
|
|
0.794
|
|
0.326
|
|
0.211
|
|
Third Quarter 2012
|
|
0.944
|
|
0.736
|
|
0.251
|
|
0.196
|
|
Most
Recent Six Months:
|
|
|
|
|
|
|
|
|
|
November 2016
|
|
0.367
|
|
0.329
|
|
0.098
|
|
0.088
|
|
October 2016
|
|
0.373
|
|
0.362
|
|
0.099
|
|
0.096
|
|
September 2016
|
|
0.366
|
|
0.351
|
|
0.097
|
|
0.093
|
|
August 2016
|
|
0.369
|
|
0.325
|
|
0.098
|
|
0.086
|
|
July 2016
|
|
0.343
|
|
0.327
|
|
0.091
|
|
0.087
|
|
June 2016
|
|
0.361
|
|
0.326
|
|
0.096
|
|
0.087
|
On December 11, 2016, the last reported sale price of our ordinary
shares on the TASE was NIS 0.346 per share, or $0.09 per share
(based on the exchange rate reported by the Bank of Israel for such
date). On December 9, 2016, the exchange rate of the NIS to the
dollar was $1.00= NIS 3.818 as reported by the Bank of Israel. As
of December 12, 2016, there were two shareholders of record of our
ordinary shares. The number of record holders is not representative
of the number of beneficial holders of our ordinary shares.
10
DESCRIPTION OF SHARE
CAPITAL
The following description of our share capital and provisions of
our Articles of Association are summarized and do not purport to be
complete.
Ordinary
Shares
As of December 12, 2016, our authorized share capital consists of
391,000,000 ordinary shares, par value NIS 0.0000001 per share. As
of December 12, 2016, there are 135,097,367 ordinary shares issued
and outstanding (including those represented by ADSs). All of our
outstanding ordinary shares are validly issued, fully paid and
non-assessable. Our ordinary shares are not redeemable and do not
have any preemptive rights.
Pursuant to Israeli securities laws, a company whose shares are
traded on the TASE may not have more than one class of shares for a
period of one year following its registration, after which it is
permitted to issue preferred shares (which shall bear a dividend
preference and shall not have any voting rights), and all
outstanding shares must be validly issued and fully paid.
Tradable
Options
As of December 12, 2016, we had the following tradeable options
outstanding (the dollar exercise prices are based on the exchange
rate reported by the Bank of Israel on December 9, 2016, which is
NIS 3.818=$1.00):
•
series 4 options to purchase up to 5,685,000 ordinary shares at an
exercise price of NIS 1.50 (or $0.39) per share. These options
shall expire on February 28, 2017.
•
series 5 options to purchase up to 6,302,000 ordinary shares at an
exercise price of NIS 1.50 (or $0.39) per share. These options
shall expire on October 30, 2017.
Options
We maintained the 2005 Plan, which was adopted by our board of
directors in July 2005 and expired in July 2015. To date, an
aggregate amount of 15,282,503 options to purchase 15,282,503
ordinary shares were granted. Of such outstanding options, options
to purchase 5,568,501ordinary shares were vested as of December 8,
2016 with a weighted average exercise price of NIS 0.76 ($0.20) per
share, and will expire 10 years from the date of grant, during the
years 2016 – 2025. The 2005 Plan has expired. As of the date
of this prospectus, we did not adopt a new option plan.
Articles of
Association
The following are summaries of material provisions of our articles
of association and the Companies Law insofar as they relate to the
material terms of our ordinary shares.
Registration Number, Purposes and Objects of the Company
Our number with the Israeli Register of Companies is 513436105. Our
purpose is set forth in Section 4 of our articles of association
and includes every lawful purpose in the field of
Bio-Technology.
Voting Rights
Holders of our ordinary shares have one vote for each ordinary
share held on all matters submitted to a vote of shareholders at a
shareholder meeting. Shareholders may vote at shareholder meetings
either in person, by proxy or by written ballot. Israeli law does
not allow public companies to adopt shareholder resolutions by
means of written consent in lieu of a shareholder meeting. The
board of directors shall determine and provide a record date for
each shareholders meeting and all shareholders at such record date
may vote. Unless stipulated differently in the Companies Law or in
the articles of association, all shareholders’ resolutions
shall be approved by a simple majority vote. Except as otherwise
disclosed herein, an amendment to our articles of association
requires the prior approval of the holders of at least 75% of our
shares, represented and voting at a general meeting. Generally, a
resolution for the voluntary winding up of the company requires the
approval of holders of 75% of the voting rights represented at the
meeting, in person, by proxy or by written ballot and voting on the
resolution.
11
Transfer of Shares
Our ordinary shares that are fully paid for are issued in
registered form and may be freely transferred under our articles of
association, unless the transfer is restricted or prohibited by
applicable law or the rules of a stock exchange on which the shares
are traded. The ownership or voting of our ordinary shares by
non-residents of Israel is not restricted in any way by our
articles of association or Israeli law, except for ownership by
nationals of some countries that are, or have been, in a state of
war with Israel.
The Powers of the Directors, Election of Directors
Our board of directors shall direct the Company’s policy and
shall supervise the performance of the Company’s Chief
Executive Officer. Pursuant to the Companies Law and our articles
of association, our board of directors may exercise all powers and
take all actions that are not required under law or under our
articles of association to be exercised or taken by our
shareholders, including the power to borrow money for company
purposes.
Under our articles of association, our board of directors must
consist of at least three and not more than nine directors,
including at least two external directors required to be appointed
under the Israeli Companies Law, 1999. Our board of directors
currently consists of nine members, including our non-executive
Chairman of the board of directors. Other than our two external
directors, for whom special election requirements apply under the
Israeli Companies Law, as detailed below, our directors may be
divided into three classes with staggered three-year terms. Class
I, Class II and Class III shall each consist of two or three
directors, constituting our entire board of directors (other than
the external directors). On February 12, 2015, our annual general
shareholders meeting approved the staggering and extension the term
of our board members in accordance with the Company’s
articles of association and divided the members of our board of
directors among the three classes, so that the term of office of
only one class of directors will expire in each upcoming annual
shareholders meeting. From the date of such annual general meeting
during which we divide the members of our board of directors among
the three classes, each year the term of office of only one class
of directors will expire, commencing with term of office of the
Class III directors which will expire one year after such annual
general meeting, followed by the term of office of the Class II
directors and by the term of office of the Class I directors which
will expire two years and three years after such annual general
meeting, respectively. Thereafter, at each annual general meeting
of our shareholders, the election or re-election of directors
following the expiration of the term of office of the directors of
that class of directors will be for a term of office that expires
on the third annual general meeting following such election or
re-election. Each director will hold office until the annual
general meeting of our shareholders for the year in which his or
her term expires, unless they are removed by a vote of 75% of the
voting power of our board of directors and a vote of 75% of the
voting power of our shareholders at a general meeting of our
shareholders, or upon the occurrence of certain events, in
accordance with the Israeli Companies Law and our articles of
association.
In addition, our Articles of Association allow our Board of
Directors to appoint directors to fill vacancies on the Board of
Directors to serve until the next general meeting. External
directors are elected for an initial term or three years and may be
removed from office pursuant to the terms of the Israeli Companies
Law.
Amendment of share capital
Our articles of association enable us to increase or reduce our
share capital. Any such changes are subject to the provisions of
the Companies Law and must be approved by a resolution duly passed
by our shareholders at a general or special meeting by voting on
such change in the capital. In addition, transactions that have the
effect of reducing capital, such as the declaration and payment of
dividends in the absence of sufficient retained earnings and
profits and an issuance of shares for less than their nominal
value, require a resolution of our board of directors and court
approval.
Dividends
Under Israeli law, we may declare and pay dividends only if, upon
the determination of our board of directors, there is no reasonable
concern that the distribution will prevent us from being able to
meet the terms of our existing and foreseeable obligations as they
become due. Under the Companies Law, the distribution amount is
further limited to the greater of retained earnings or earnings
generated over the two most recent years legally available for
distribution according to our then last reviewed or audited
financial statements, provided that the date of the financial
statements is not more than six months prior to the date of
distribution. In the event that we do not have retained
12
earnings or earnings generated over the two most recent years
legally available for distribution, we may seek the approval of the
court in order to distribute a dividend. The court may approve our
request if it is determines that there is no reasonable concern
that the payment of a dividend will prevent us from satisfying our
existing and foreseeable obligations as they become due.
In the event of our liquidation, after satisfaction of liabilities
to creditors, our assets will be distributed to the holders of our
ordinary shares in proportion to their shareholdings. This right,
as well as the right to receive dividends, may be affected by the
grant of preferential dividend or distribution rights to the
holders of a class of shares with preferential rights that may be
authorized in the future.
Shareholder Meetings
Under Israeli law, we are required to hold an annual general
meeting of our shareholders once every calendar year and in any
event no later than 15 months after the date of the previous annual
general meeting. All meetings other than the annual general meeting
of shareholders are referred to as special meetings. Our board of
directors may call special meetings whenever it sees fit, at such
time and place, within or outside of Israel, as it may determine.
In addition, the Companies Law and our articles of association
provide that our board of directors is required to convene a
special meeting upon the written request of (i) any two of our
directors or one quarter of the directors then in office; or (ii)
one or more shareholders holding, in the aggregate either (a) 5% of
our issued share capital and 1% of our outstanding voting power, or
(b) 5% of our outstanding voting power.
Subject to the provisions of the Companies Law and the regulations
promulgated thereunder, shareholders entitled to participate and
vote at general meetings are the shareholders of record on a date
to be decided by the board of directors. Furthermore, the Companies
Law and our articles of association require that resolutions
regarding the following matters must be passed at a general meeting
of our shareholders:
•
amendments to our articles of association;
•
appointment or termination of our auditors;
•
appointment of directors and appointment and dismissal of external
directors;
•
approval of acts and transactions requiring general meeting
approval pursuant to the Companies Law;
•
approval of compensation policy for directors and office
holders
•
director compensation, indemnification and change of the principal
executive officer;
•
increases or reductions of our authorized share capital;
•
a merger;
•
the exercise of our board of directors’ powers by a general
meeting, if our board of directors is unable to exercise its powers
and the exercise of any of its powers is required for our proper
management; and
•
authorizing the chairman of the board of directors or his relative
to act as the company’s chief executive officer or act with
such authority; or authorize the company’s chief executive
officer or his relative to act as the chairman of the board of
directors or act with such authority.
The Companies Law requires that a notice of any annual or special
shareholders meeting be provided at least 21 days prior to the
meeting and if the agenda of the meeting includes the appointment
or removal of directors, the approval of transactions with office
holders or interested or related parties, or an approval of a
merger, notice must be provided at least 35 days prior to the
meeting.
Quorum
The quorum required for our general meetings of shareholders
consists of one or more shareholders present in person, by proxy or
by other voting instrument in accordance with the Companies Law who
hold or represent, in the aggregate, at least 10% of the total
outstanding voting rights, within half an hour from the appointed
time.
13
A meeting adjourned for lack of a quorum is adjourned to the same
day in the following week at the same time and place or on a later
date if so specified in the summons or notice of the meeting. At
the reconvened meeting, any number of our shareholders present in
person or by proxy shall constitute a lawful quorum.
Resolutions
Our articles of association provide that all resolutions of our
shareholders require a simple majority vote, unless otherwise
required by applicable law or by another provision of the articles
of association.
Israeli law provides that a shareholder of a public company may
vote in a meeting and in a class meeting by means of a written
ballot in which the shareholder indicates how he or she votes on
resolutions relating to the following matters:
•
an appointment or removal of directors;
•
an approval of transactions with office holders or interested or
related parties, that require shareholder approval;
•
an approval of a merger;
•
authorizing the chairman of the board of directors or his relative
to act as the company’s chief executive officer or act with
such authority; or authorize the company’s chief executive
officer or his relative to act as the chairman of the board of
directors or act with such authority;
•
any other matter that is determined in the articles of association
to be voted on by way of a written ballot. Our articles of
association do not stipulate any additional matters; and
•
other matters which may be prescribed by Israel’s Minister of
Justice.
The provision allowing the vote by written ballot does not apply
where the voting power of the controlling shareholder is sufficient
to determine the vote.
On June 17, 2015, the Israeli Securities Authority, or ISA,
launched an electronic voting system and, as of this date,
shareholders may vote in a meeting or in a class meeting by using
this electronic voting system (in addition to other existing
methods of voting).
The Companies Law provides that a shareholder, in exercising his or
her rights and performing his or her obligations toward the company
and its other shareholders, must act in good faith and in a
customary manner, and avoid abusing his or her power. This is
required when voting at general meetings on matters such as changes
to the articles of association, increasing the company’s
registered capital, mergers and approval of certain interested or
related party transactions. A shareholder also has a general duty
to refrain from depriving any other shareholder of its rights as a
shareholder. In addition, any controlling shareholder, any
shareholder who knows that its vote can determine the outcome of a
shareholder vote and any shareholder who, under such
company’s articles of association, can appoint or prevent the
appointment of an office holder or other power towards the company,
is required to act with fairness towards the company. The Companies
Law does not describe the substance of this duty except that the
remedies generally available upon a breach of contract will also
apply to a breach of the duty to act with fairness, and, to the
best of our knowledge, there is no binding case law that addresses
this subject directly.
Access to Corporate Records
Under the Companies Law, all shareholders of a company generally
have the right to review minutes of the company’s general
meetings, its shareholders register and principal shareholders
register, articles of association, financial statements and any
document it is required by law to file publicly with the Israeli
Companies Registrar and the ISA. Any of our shareholders may
request to review any document in our possession that relates to
any action or transaction with a related party, interested party or
office holder that requires shareholder approval under the
Companies Law. We may deny a request to review a document if we
determine that the request was not made in good faith, that the
document contains a commercial secret or a patent or that the
document’s disclosure may otherwise prejudice our
interests.
14
Acquisitions under Israeli Law
Full Tender
Offer
A person wishing to acquire shares of a public Israeli company and
who would as a result hold over 90% of the target company’s
issued and outstanding share capital is required by the Companies
Law to make a tender offer to all of the company’s
shareholders for the purchase of all of the issued and outstanding
shares of the company. A person wishing to acquire shares of a
public Israeli company and who would as a result hold over 90% of
the issued and outstanding share capital of a certain class of
shares is required to make a tender offer to all of the
shareholders who hold shares of the same class for the purchase of
all of the issued and outstanding shares of the same class. If the
shareholders who do not accept the offer hold less than 5% of the
issued and outstanding share capital of the company or of the
applicable class, all of the shares that the acquirer offered to
purchase will be transferred to the acquirer by operation of law
(provided that a majority of the offerees that do not have a
personal interest in such tender offer shall have approved the
tender offer except that if the total votes to reject the tender
offer represent less than 2% of the company’s issued and
outstanding share capital, in the aggregate, approval by a majority
of the offerees that do not have a personal interest in such tender
offer is not required to complete the tender offer). However, a
shareholder that had its shares so transferred may petition the
court within six months from the date of acceptance of the full
tender offer, whether or not such shareholder agreed to the tender
or not, to determine whether the tender offer was for less than
fair value and whether the fair value should be paid as determined
by the court unless the acquirer stipulated in the tender offer
that a shareholder that accepts the offer may not seek appraisal
rights, so long as prior to the acceptance of the full tender
offer, the acquirer and the company disclosed the information
required by law in connection with the full tender offer. If the
shareholders who did not accept the tender offer hold 5% or more of
the issued and outstanding share capital of the company or of the
applicable class, the acquirer may not acquire shares of the
company that will increase its holdings to more than 90% of the
company’s issued and outstanding share capital or of the
applicable class from shareholders who accepted the tender
offer.
Special Tender
Offer
The Companies Law provides that an acquisition of shares of a
public Israeli company must be made by means of a special tender
offer if as a result of the acquisition the purchaser would become
a holder of 25% or more of the voting rights in the company, unless
one of the exemptions in the Companies Law is met. This rule does
not apply if there is already another holder of at least 25% of the
voting rights in the company. Similarly, the Companies Law provides
that an acquisition of shares in a public company must be made by
means of a tender offer if as a result of the acquisition the
purchaser would become a holder of 50% or more of the voting rights
in the company, if there is no other shareholder of the company who
holds 50% or more of the voting rights in the company, unless one
of the exemptions in the Companies Law is met.
A special tender offer must be extended to all shareholders of a
company, but the offeror is not required to purchase shares
representing more than 5% of the voting power attached to the
company’s outstanding shares, regardless of how many shares
are tendered by shareholders. A special tender offer may be
consummated only if (i) at least 5% of the voting power attached to
the company’s outstanding shares will be acquired by the
offeror and (ii) the number of shares tendered in the offer exceeds
the number of shares whose holders objected to the offer.
If a special tender offer is accepted, then the purchaser or any
person or entity controlling it or under common control with the
purchaser or such controlling person or entity may not make a
subsequent tender offer for the purchase of shares of the target
company and may not enter into a merger with the target company for
a period of one year from the date of the offer, unless the
purchaser or such person or entity undertook to effect such an
offer or merger in the initial special tender offer.
Merger
The Companies Law permits merger transactions if approved by each
party’s board of directors and, unless certain requirements
described under the Companies Law are met, a majority of each
party’s shares voted on the proposed merger at a
shareholders’ meeting called with at least 35 days’
prior notice.
For purposes of the shareholder vote, unless a court rules
otherwise, the merger will not be deemed approved if a majority of
the shares represented at the shareholders meeting that are held by
parties other than the other party to the merger, or by any person
who holds 25% or more of the outstanding shares or the right to
appoint 25% or
15
more of the directors of the other party, vote against the merger.
If the transaction would have been approved but for the separate
approval of each class or the exclusion of the votes of certain
shareholders as provided above, a court may still approve the
merger upon the request of holders of at least 25% of the voting
rights of a company, if the court holds that the merger is fair and
reasonable, taking into account the value of the parties to the
merger and the consideration offered to the shareholders.
Upon the request of a creditor of either party to the proposed
merger, the court may delay or prevent the merger if it concludes
that there exists a reasonable concern that, as a result of the
merger, the surviving company will be unable to satisfy the
obligations of any of the parties to the merger, and may further
give instructions to secure the rights of creditors.
In addition, a merger may not be completed unless at least 50 days
have passed from the date that a proposal for approval of the
merger was filed by each party with the Israeli Registrar of
Companies and 30 days have passed from the date the merger was
approved by the shareholders of each party.
Antitakeover
Measures
The Companies Law allows us to create and issue shares having
rights different from those attached to our ordinary shares,
including shares providing certain preferred rights, distributions
or other matters and shares having preemptive rights. As of the
date of this prospectus, we do not have any authorized or issued
shares other than our ordinary shares. In the future, if we do
create and issue a class of shares other than ordinary shares, such
class of shares, depending on the specific rights that may be
attached to them, may delay or prevent a takeover or otherwise
prevent our shareholders from realizing a potential premium over
the market value of their ordinary shares. The authorization of a
new class of shares will require an amendment to our articles of
association which requires the prior approval of the holders of at
least 75% of our shares at a general meeting. In addition, the
rules and regulations of the TASE also limit the terms permitted
with respect to a new class of shares and prohibit any such new
class of shares from having voting rights. Shareholders voting in
such meeting will be subject to the restrictions provided in the
Companies Law as described above.
16
DESCRIPTION OF AMERICAN
DEPOSITARY SHARES
American Depositary
Shares
The Bank of New York Mellon, as depositary, registered and
delivered American Depositary Shares, also referred to as ADSs.
Each ADS represents forty (40) ordinary shares (or a right to
receive forty (40) ordinary shares) deposited with the principal
Tel Aviv office of either of Bank Leumi or Bank Hapoalim, as
custodian for the depositary. Each ADS also represents any other
securities, cash or other property which may be held by the
depositary. The depositary’s office at which the ADSs are
administered is located at 101 Barclay Street, New York, New York
10286. The Bank of New York Mellon’s principal executive
office is located at One Wall Street, New York, New York 10286.
You may hold ADSs either (A) directly (i) by having an American
Depositary Receipt, also referred to as an ADR, which is a
certificate evidencing a specific number of ADSs, registered in
your name, or (ii) by having ADSs registered in your name in the
Direct Registration System, or DRS, or (B) indirectly by holding a
security entitlement in ADSs through your broker or other financial
institution. If you hold ADSs directly, you are a registered ADS
holder, also referred to as an ADS holder. This description assumes
you are an ADS holder. If you hold the ADSs indirectly, you must
rely on the procedures of your broker or other financial
institution to assert the rights of ADS holders described in this
section. You should consult with your broker or financial
institution to find out what those procedures are.
The DRS is a system administered by The Depository Trust Company,
or DTC, under which the depositary may register the ownership of
uncertificated ADSs, which ownership is confirmed by periodic
statements sent by the depositary to the registered holders of
uncertificated ADSs.
As an ADS holder, we will not treat you as one of our shareholders
and you will not have shareholder rights. Israeli law governs
shareholder rights. The depositary will be the holder of the
ordinary shares underlying your ADSs. As a registered holder of
ADSs, you will have ADS holder rights. A deposit agreement among
us, the depositary, ADS holders and all other persons indirectly or
beneficially holding ADSs sets out ADS holder rights as well as the
rights and obligations of the depositary. New York law governs the
deposit agreement and the ADSs.
The following is a summary of the material provisions of the
deposit agreement.
Dividends and Other
Distributions
How will you receive dividends and other distributions on the
shares?
The depositary has agreed to pay to ADS holders the cash dividends
or other distributions it or the custodian receives on ordinary
shares or other deposited securities, after deducting its fees and
expenses. You will receive these distributions in proportion to the
number of ordinary shares your ADSs represent.
Cash
. The
depositary will convert any cash dividend or other cash
distribution we pay on the ordinary shares into U.S. dollars, if it
can do so on a reasonable basis and can transfer the U.S. dollars
to the United States. If that is not possible or if any government
approval is needed and cannot be obtained, the deposit agreement
allows the depositary to distribute the foreign currency only to
those ADS holders to whom it is possible to do so. It will hold the
foreign currency it cannot convert for the account of the ADS
holders who have not been paid. It will not invest the foreign
currency and it will not be liable for any interest.
Before making a distribution, the depositary will deduct any
withholding taxes, or other required governmental charges. The
depositary will distribute only whole U.S. dollars and cents and
will round fractional cents to the nearest whole cent. If the
exchange rates fluctuate during a time when the depositary cannot
convert the foreign currency, you may lose some or all of the value
of the distribution.
17
Shares
. The
depositary may distribute additional ADSs representing any ordinary
shares we distribute as a dividend or free distribution. The
depositary will only distribute whole ADSs. It may sell ordinary
shares which would require it to deliver a fraction of an ADS and
distribute the net proceeds in the same way as it does with cash.
If the depositary does not distribute additional ADSs, the
outstanding ADSs will also represent the new shares. The depositary
may sell a portion of the distributed ordinary shares sufficient to
pay its fees and expenses in connection with that distribution.
Rights to purchase
additional shares
.
If we
offer holders of our securities any rights to subscribe for
additional ordinary shares or any other rights, the depositary may
make these rights available to ADS holders. If the depositary
decides it is not legal and practical to make the rights available
but that it is practical to sell the rights, the depositary will
use reasonable efforts to sell the rights and distribute the
proceeds in the same way as it does with cash. The depositary will
allow rights that are not distributed or sold to lapse.
In that case, you
will receive no value for them.
If the depositary makes rights available to ADS holders, it will
exercise the rights and purchase the ordinary shares on your
behalf. The depositary will then deposit the ordinary shares and
deliver ADSs to the persons entitled to them. It will only exercise
rights if you pay the exercise price and any other charges the
rights require you to pay.
U.S. securities laws may restrict transfers and cancellation of the
ADSs represented by ordinary shares purchased upon exercise of
rights. For example, you may not be able to trade these ADSs freely
in the United States. In this case, the depositary may deliver
restricted depositary shares that have the same terms as the ADSs
described in this section except for changes needed to put the
necessary restrictions in place.
Other Distributions
.
The
depositary will send to ADS holders anything else we distribute on
deposited securities by any means it thinks is legal, fair and
practical. If it cannot make the distribution in that way, the
depositary will have a choice. It may decide to sell what we
distributed and distribute the net proceeds, in the same way as it
does with cash. Or, it may decide to hold what we distributed, in
which case ADSs will also represent the newly distributed property.
However, the depositary is not required to distribute any
securities (other than ADSs) to ADS holders unless it receives
reasonably satisfactory evidence from us that it is legal to make
that distribution. The depositary may sell a portion of the
distributed securities or property sufficient to pay its fees and
expenses in connection with that distribution.
The depositary is not responsible if it decides that it is unlawful
or impractical to make a distribution available to any ADS holders.
We have no obligation to register ADSs, shares, rights or other
securities under the Securities Act. We also have no obligation to
take any other action to permit the distribution of ADSs, shares,
rights or anything else to ADS holders.
This means that you
may not receive the distributions we make on our ordinary shares or
any value for them if it is illegal or impractical for us to make
them available to you
.
Deposit, Withdrawal and
Cancellation
How are ADSs issued?
The depositary will deliver ADSs if you or your broker deposits
ordinary shares or evidence of rights to receive ordinary shares
with the custodian. Upon payment of its fees and expenses and of
any taxes or charges, such as stamp taxes or stock transfer taxes
or fees, the depositary will register the appropriate number of
ADSs in the names you request and will deliver the ADSs to or upon
the order of the person or persons that made the deposit.
How can ADS holders withdraw the deposited securities?
You may surrender your ADSs at the depositary’s office. Upon
payment of its fees and expenses and of any taxes or charges, such
as stamp taxes or stock transfer taxes or fees, the depositary will
deliver the ordinary shares and any other deposited securities
underlying the ADSs to the ADS holder or a person the ADS holder
designates at the office of the custodian. Or, at your request,
risk and expense, the depositary will deliver the deposited
securities at its office, if feasible.
18
How do ADS holders interchange between certificated ADSs and
uncertificated ADSs?
You may surrender your ADR to the depositary for the purpose of
exchanging your ADR for uncertificated ADSs. The depositary will
cancel that ADR and will send to the ADS holder a statement
confirming that the ADS holder is the registered holder of
uncertificated ADSs. Alternatively, upon receipt by the depositary
of a proper instruction from a registered holder of uncertificated
ADSs requesting the exchange of uncertificated ADSs for
certificated ADSs, the depositary will execute and deliver to the
ADS holder an ADR evidencing those ADSs.
Voting Rights
How do you vote?
ADS holders may instruct the depositary how to vote the number of
deposited ordinary shares their ADSs represent.
Otherwise, you
won’t be able to exercise your right to vote unless you
withdraw the shares. However, you may not know about the meeting
sufficiently in advance to withdraw the shares.
The depositary will notify ADS holders of shareholders’
meetings and arrange to deliver our voting materials to them if we
ask it to. Those materials will describe the matters to be voted on
and explain how ADS holders may instruct the depositary how to
vote. For instructions to be valid, they must reach the depositary
by a date set by the depositary.
The depositary will try, as far as practical, subject to the laws
of Israel and of our articles of association or similar documents,
to vote or to have its agents vote the ordinary shares or other
deposited securities as instructed by ADS holders. The depositary
will only vote or attempt to vote as instructed or as described in
the following sentence. If we ask the depositary to solicit your
instructions at least 30 days before the meeting date but the
depositary does not receive voting instructions from you by the
specified date, it will consider you to have authorized and
directed it to give a discretionary proxy to a person designated by
us to vote the number of deposited securities represented by your
ADSs. The depositary will give a discretionary proxy in those
circumstances to vote on all questions at to be voted upon unless
we notify the depositary that:
•
we do not wish to receive a discretionary proxy;
•
there is substantial shareholder opposition to the particular
question; or
•
the particular question would have an adverse impact on our
shareholders.
We are required to notify the depositary if one of the conditions
specified above exists.
We cannot assure you that you will receive the voting materials in
time to ensure that you can instruct the depositary to vote your
shares. In addition, the depositary and its agents are not
responsible for failing to carry out voting instructions or for the
manner of carrying out voting instructions.
This means that
you may not be able to exercise your right to vote and there may be
nothing you can do if your ordinary shares are not voted as you
requested.
In order to give you a reasonable opportunity to instruct the
Depositary as to the exercise of voting rights relating to
Deposited Securities, if we request the Depositary to act, we agree
to give the Depositary notice of any such meeting and details
concerning the matters to be voted upon at least 30 days in advance
of the meeting date.
19
Fees and
Expenses
|
Persons depositing or withdrawing ordinary
shares or ADS holders must pay
:
|
|
For
:
|
|
$5.00 (or less) per 100 ADSs (or portion of 100
ADSs)
|
|
Issuance of ADSs, including issuances resulting
from a distribution of ordinary shares or rights or other property
Cancellation of ADSs for the purpose of withdrawal, including if
the deposit agreement terminates
|
|
|
|
|
|
$.05 (or less) per ADS
|
|
Any cash distribution to ADS holders
|
|
|
|
|
|
A fee equivalent to the fee that would be
payable if securities distributed to you had been ordinary shares
and the ordinary shares had been deposited for issuance of
ADSs
|
|
Distribution of securities distributed to
holders of deposited securities which are distributed by the
depositary to ADS holders
|
|
|
|
|
|
$.05 (or less) per ADS per calendar
year
|
|
Depositary services
|
|
|
|
|
|
Registration or transfer fees
|
|
Transfer and registration of ordinary shares on
our share register to or from the name of the depositary or its
agent when you deposit or withdraw ordinary shares
|
|
|
|
|
|
Expenses of the depositary
|
|
Cable, telex and facsimile transmissions (when
expressly provided in the deposit agreement) converting foreign
currency to U.S. dollars
|
|
|
|
|
|
Taxes and other governmental charges the
depositary or the custodian has to pay on any ADSs or ordinary
shares underlying ADSs, such as stock transfer taxes, stamp duty or
withholding taxes
|
|
As necessary
|
|
|
|
|
|
Any charges incurred by the depositary or its
agents for servicing the deposited securities
|
|
As necessary
|
The depositary collects its fees for delivery and surrender of ADSs
directly from investors depositing ordinary shares or surrendering
ADSs for the purpose of withdrawal or from intermediaries acting
for them. The depositary collects fees for making distributions to
investors by deducting those fees from the amounts distributed or
by selling a portion of distributable property to pay the fees. The
depositary may collect its annual fee for depositary services by
deduction from cash distributions or by directly billing investors
or by charging the book-entry system accounts of participants
acting for them. The depositary may collect any of its fees by
deduction from any cash distribution payable to ADS holders that
are obligated to pay those fees. The depositary may generally
refuse to provide fee-attracting services until its fees for those
services are paid.
From time to time, the depositary may make payments to us to
reimburse and/or share revenue from the fees collected from ADS
holders, or waive fees and expenses for services provided,
generally relating to costs and expenses arising out of
establishment and maintenance of the ADS program. In performing its
duties under the deposit agreement, the depositary may use brokers,
dealers or other service providers that are affiliates of the
depositary and that may earn or share fees or commissions.
Payment of
Taxes
You will be responsible for any taxes or other governmental charges
payable on your ADSs or on the deposited securities represented by
any of your ADSs. The depositary may refuse to register any
transfer of your ADSs or allow you to withdraw the deposited
securities represented by your ADSs until such taxes or other
charges are paid. It may apply payments owed to you or sell
deposited securities represented by your American Depositary Shares
to pay any taxes owed and you will remain liable for any
deficiency. If the depositary sells deposited securities, it will,
if appropriate, reduce the number of ADSs to reflect the sale and
pay to ADS holders any proceeds, or send to ADS holders any
property, remaining after it has paid the taxes.
20
Reclassifications,
Recapitalizations and Mergers
|
If we:
|
|
Then:
|
|
• Change the nominal or par value of
our shares
• Reclassify, split up or consolidate
any of the deposited securities
|
|
The cash, ordinary shares or other securities
received by the depositary will become deposited securities. Each
ADS will automatically represent its equal share of the new
deposited securities.
|
|
• Distribute securities on the
ordinary shares that are not distributed to you
• Recapitalize, reorganize, merge,
liquidate, sell all or substantially all of our assets, or take any
similar action
|
|
The depositary may distribute new ADSs
representing the new deposited securities or ask you to surrender
your outstanding ADRs in exchange for new ADRs identifying the new
deposited securities.
|
Amendment and
Termination
How may the deposit agreement be amended?
We may agree with the depositary to amend the deposit agreement and
the ADSs without your consent for any reason. If an amendment adds
or increases fees or charges, except for taxes and other
governmental charges or expenses of the depositary for registration
fees, facsimile costs, delivery charges or similar items, or
prejudices a substantial right of ADS holders, it will not become
effective for outstanding ADSs until 30 days after the depositary
notifies ADS holders of the amendment.
At the time an
amendment becomes effective, you are considered, by continuing to
hold your ADSs, to agree to the amendment and to be bound by the
ADRs and the deposit agreement as amended
.
How may the deposit agreement be terminated?
The depositary will terminate the deposit agreement at our
direction by mailing notice of termination to the ADS holders at
least 30 days prior to the date fixed in such notice for such
termination. The depositary may also terminate the deposit
agreement by mailing notice of termination to us and the ADS
holders if 60 days have passed from the date on which the
depositary told us it wants to resign but a successor depositary
has not been appointed and accepted its appointment.
After termination, the depositary and its agents will do the
following under the deposit agreement but nothing else: collect
distributions on the deposited securities, sell rights and other
property, and deliver ordinary shares and other deposited
securities upon cancellation of ADSs. Four months after
termination, the depositary may sell any remaining deposited
securities by public or private sale. After that, the depositary
will hold the money it received on the sale, as well as any other
cash it is holding under the deposit agreement for the pro rata
benefit of the ADS holders that have not surrendered their ADSs. It
will not invest the money and has no liability for interest. The
depositary’s only obligations will be to account for the
money and other cash. After termination our only obligations will
be to indemnify the depositary and to pay fees and expenses of the
depositary that we agreed to pay.
Limitations on
Obligations and Liability
Limits on our Obligations and the Obligations of the Depositary;
Limits on Liability to Holders of ADSs
The deposit agreement expressly limits our obligations and the
obligations of the depositary. It also limits our liability and the
liability of the depositary. We and the depositary:
•
are only obligated to take the actions specifically set forth in
the deposit agreement without negligence or bad faith;
•
are not liable if we are or it is prevented or delayed by law or
circumstances beyond our or its control from performing our or its
obligations under the deposit agreement;
•
are not liable if we or it exercise discretion permitted under the
deposit agreement;
•
are not liable for the inability of any holder of ADSs to benefit
from any distribution on deposited securities that is not made
available to holders of ADSs under the terms of the deposit
agreement, or for any special, consequential or punitive damages
for any breach of the terms of the deposit agreement;
21
•
have no obligation to become involved in a lawsuit or other
proceeding related to the ADSs or the deposit agreement on your
behalf or on behalf of any other person;
•
are not liable for the acts or
omissions of any securities depository, clearing agency or
settlement system; and
•
may rely upon any documents we believe or it believe in good faith
to be genuine and to have been signed or presented by the proper
person.
In the deposit agreement, we and the depositary agree to indemnify
each other under certain circumstances.
Requirements for
Depositary Actions
Before the depositary will deliver or register a transfer of ADSs,
make a distribution on ADSs, or permit withdrawal of shares, the
depositary may require:
•
payment of stock transfer or other taxes or other governmental
charges and transfer or registration fees charged by third parties
for the transfer of any ordinary shares or other deposited
securities;
•
satisfactory proof of the identity and genuineness of any signature
or other information it deems necessary; and
•
compliance with regulations it may establish, from time to time,
consistent with the deposit agreement, including presentation of
transfer documents.
The depositary may refuse to deliver ADSs or register transfers of
ADSs when the transfer books of the depositary or our transfer
books are closed or at any time if the depositary or we think it
advisable to do so.
Your Right to Receive
the Ordinary Shares Underlying your ADSs
ADS holders have the right to cancel their ADSs and withdraw the
underlying ordinary shares at any time except:
•
when temporary delays arise because: (i) the depositary has closed
its transfer books or we have closed our transfer books;
(ii) the transfer of ordinary shares is blocked to permit voting at
a shareholders’ meeting; or (iii) we are paying a
dividend
on our shares;
•
when you owe money to pay fees, taxes and similar charges; or
•
when it is necessary to prohibit withdrawals in order to comply
with any laws or governmental regulations that apply to
ADSs or to the withdrawal of ordinary shares or other deposited
securities.
This right of withdrawal may not be limited by any other provision
of the deposit agreement.
Pre-release of
ADSs
The deposit agreement permits the depositary to deliver ADSs before
deposit of the underlying shares. This is called a pre-release of
the ADSs. The depositary may also deliver ordinary shares upon
cancellation of pre-released ADSs (even if the ADSs are canceled
before the pre-release transaction has been closed out). A
pre-release is closed out as soon as the underlying ordinary shares
are delivered to the depositary. The depositary may receive ADSs
instead of ordinary shares to close out a pre-release. The
depositary may pre-release ADSs only under the following
conditions: (1) before or at the time of the pre-release, the
person to whom the pre-release is being made represents to the
depositary in writing that it or its customer owns the ordinary
shares or ADSs to be deposited; (2) the pre-release is fully
collateralized with cash or other collateral that the depositary
considers appropriate; and (3) the depositary must be able to close
out the pre-release on not more than five business days’
notice. In addition,
22
the depositary will limit the number of ADSs that may be
outstanding at any time as a result of pre-release, although the
depositary may disregard the limit from time to time if it thinks
it is appropriate to do so.
Direct Registration
System
In the deposit agreement, all parties to the deposit agreement
acknowledge that DRS and the Profile Modification System, or
Profile, will apply to uncertificated ADSs upon acceptance thereof
to DRS by DTC. DRS is the system administered by DTC under which
the depositary may register the ownership of uncertificated ADSs,
which ownership will be confirmed by periodic statements sent by
the depositary to the registered holders of uncertificated ADSs.
Profile is a required feature of DRS that allows a DTC participant,
claiming to act on behalf of a registered holder of ADSs, to direct
the depositary to register a transfer of those ADSs to DTC or its
nominee and to deliver those ADSs to the DTC account of that DTC
participant without receipt by the depositary of prior
authorization from the ADS holder to register that transfer.
In connection with and in accordance with the arrangements and
procedures relating to DRS/Profile, the parties to the deposit
agreement understand that the depositary will not determine whether
the DTC participant that is claiming to be acting on behalf of an
ADS holder in requesting registration of transfer and delivery
described in the paragraph above has the actual authority to act on
behalf of the ADS holder (notwithstanding any requirements under
the Uniform Commercial Code). In the deposit agreement, the parties
agree that the depositary’s reliance on and compliance with
instructions received by the depositary through the DRS/Profile
System and in accordance with the deposit agreement will not
constitute negligence or bad faith on the part of the
depositary.
Shareholder
communications; inspection of register of holders of
ADSs
The depositary will make available for your inspection at its
office all communications that it receives from us as a holder of
deposited securities that we make generally available to holders of
deposited securities. The depositary will send you copies of those
communications if we ask it to. You have a right to inspect the
register of holders of ADSs, but not for the purpose of contacting
those holders about a matter unrelated to our business or the
ADSs.
23
DESCRIPTION OF
WARRANTS
We may issue warrants for the purchase of our ADSs. We may issue
warrants independently of or together with ordinary shares
(including ordinary shares represented by ADSs) offered by any
prospectus supplement, and we may attach the warrants to, or issue
them separately from, ordinary shares (including ordinary shares
represented by ADSs). Each series of warrants will be issued under
a separate warrant agreement to be entered into between us and a
bank or trust company, as warrant agent, all as set forth in the
prospectus supplement relating to the particular issue of offered
warrants. The warrant agent will act solely as our agent in
connection with the warrant certificates relating to the warrants
and will not assume any obligation or relationship of agency or
trust with any holders of warrant certificates or beneficial owners
of warrants. The following summaries of certain provisions of the
warrant agreements and warrants do not purport to be complete and
are subject to, and are qualified in their entirety by reference
to, all the provisions of the warrant agreement and the warrant
certificates relating to each series of warrants which we will file
with the SEC and incorporate by reference as an exhibit to the
registration statement of which this prospectus is a part at or
prior to the time of the issuance of any series of warrants.
General
The applicable prospectus supplement will describe the terms of the
warrants, including as applicable:
•
the offering price;
•
the aggregate number or amount of underlying securities purchasable
upon exercise of the warrants and the exercise price;
•
the number of warrants being offered;
•
the date, if any, after which the warrants and the underlying
securities will be transferable separately;
•
the date on which the right to exercise the warrants will commence,
and the date on which the right will expire (the “Expiration
Date”);
•
the number of warrants outstanding, if any;
•
any material Israeli and/or U.S. federal income tax
consequences;
•
the terms, if any, on which we may accelerate the date by which the
warrants must be exercised; and
•
any other terms of the warrants, including terms, procedures and
limitations relating to the exchange and exercise of the
warrants.
Warrants will be offered and exercisable for US dollars only and
will be in registered form only.
Holders of warrants will be able to exchange warrant certificates
for new warrant certificates of different denominations, present
warrants for registration of transfer, and exercise warrants at the
corporate trust office of the warrant agent or any other office
indicated in the applicable prospectus supplement. Prior to the
exercise of any warrants, holders of the warrants to purchase
ordinary shares will not have any rights of holders of ordinary
shares, including the right to receive payments of dividends, if
any, or to exercise any applicable right to vote.
Certain Risk
Considerations
Any warrants we issue will involve a degree of risk, including
risks arising from fluctuations in the price of the underlying
ordinary shares or debt securities and general risks applicable to
the securities market (or markets) on which the underlying
securities trade, as applicable. Prospective purchasers of the
warrants will need to recognize that the warrants may expire
worthless and, thus, purchasers should be prepared to sustain a
total loss of the purchase price of their warrants. This risk
reflects the nature of a warrant as an asset which, other factors
held constant, tends to decline in value over time and which may,
depending on the price of the underlying securities, become
worthless when it expires. The trading price of a warrant at any
time is expected to increase if the price of or, if applicable,
dividend rate on, the underlying securities increases. Conversely,
the trading price of a warrant is expected to decrease as the time
remaining to expiration of the warrant decreases and as the price
of or, if applicable, dividend rate on, the underlying securities,
decreases. Assuming all other factors are held constant, the more a
warrant is
24
“out-of-the-money” (i.e., the more the exercise price
exceeds the price of the underlying securities and the shorter its
remaining term to expiration), the greater the risk that a
purchaser of the warrant will lose all or part of his or her
investment. If the price of the underlying securities does not rise
before the warrant expires to an extent sufficient to cover a
purchaser’s cost of the warrant, the purchaser will lose all
or part of his or her investment in the warrant upon
expiration.
In addition, prospective purchasers of the warrants should be
experienced with respect to options and option transactions, should
understand the risks associated with options and should reach an
investment decision only after careful consideration, with their
financial advisers, of the suitability of the warrants in light of
their particular financial circumstances and the information
discussed in this prospectus and, if applicable, the prospectus
supplement. Before purchasing, exercising or selling any warrants,
prospective purchasers and holders of warrants should carefully
consider, among other things:
•
the trading price of the warrants;
•
the price of the underlying securities at that time;
•
the time remaining to expiration; and
•
any related transaction costs.
Some of the factors referred to above are in turn influenced by
various political, economic and other factors that can affect the
trading price of the underlying securities and should be carefully
considered prior to making any investment decisions.
Purchasers of the warrants should further consider that the initial
offering price of the warrants may be in excess of the price that a
purchaser of options might pay for a comparable option in a
private, less liquid transaction. In addition, it is not possible
to predict the price at which the warrants will trade in the
secondary market or whether any such market will be liquid. We may,
but will not be obligated to, file an application to list any
warrants on a United States national securities exchange. To the
extent that any warrants are exercised, the number of warrants
outstanding will decrease, which may result in a lessening of the
liquidity of the warrants. Finally, the warrants will constitute
our direct, unconditional and unsecured obligations, and as such
will be subject to any changes in our perceived
creditworthiness.
Exercise of
Warrants
Each holder of a warrant will be entitled to purchase that number
or amount of underlying securities, at the exercise price, as will
in each case be described in the prospectus supplement relating to
the offered warrants. After the close of business on the Expiration
Date (which may be extended by us), unexercised warrants will
become void.
Holders may exercise warrants by delivering to the warrant agent
payment as provided in the applicable prospectus supplement of the
amount required to purchase the underlying securities purchasable
upon exercise, together with the information set forth on the
reverse side of the warrant certificate. Warrants will be deemed to
have been exercised upon receipt of payment of the exercise price,
subject to the receipt within five business days of the warrant
certificate evidencing the exercised warrants. Upon receipt of
payment and the warrant certificate properly completed and duly
executed at the corporate trust office of the warrant agent or any
other office indicated in the applicable prospectus supplement, we
will, as soon as practicable, issue and deliver the underlying
securities purchasable upon such exercise. If fewer than all of the
warrants represented by a warrant certificate are exercised, we
will issue a new warrant certificate for the remaining amount of
warrants.
Amendments and
Supplements to Warrant Agreements
We may amend or supplement the warrant agreement without the
consent of the holders of the warrants issued under the agreement
to effect changes that are not inconsistent with the provisions of
the warrants and that do not adversely affect the interests of the
holders.
25
Outstanding
warrants
As of December 12, 2016, there were 2,038,000 ADS warrants issued
to public investors in our initial public offering and 95,500 ADS
warrants issued to the representative of the underwriters in
connection with our initial public offering in May 2015, both
pursuant to a prospectus dated May 13, 2015. The ADS warrants were
exercisable at an exercise price of $6.25 per ADS, subject to
adjustments as described in item 12D of our Annual Report on Form
20-F filed on April 27, 2016.
26
DESCRIPTION OF
UNITS
We may issue securities in units, a combination of ADSs and
warrants to purchase our ADS. If we issue units, the prospectus
supplement relating to the units will contain the information
described above with regard to each of the securities that is a
component of the units. In addition, the prospectus supplement
relating to units will describe the terms of any units we issue,
including as applicable:
•
the date, if any, on and after which the units may be transferable
separately;
•
whether we will apply to have the units traded on a securities
exchange or securities quotation system;
•
any material Israeli and/or U.S. federal income tax consequences;
and
•
how, for Israeli and/or U.S. federal income tax purposes, the
purchase price paid for the units is to be allocated among the
component securities.
27
TAXATION
The material Israeli and U.S. federal income tax consequences
relating to the purchase, ownership and disposition of any of the
securities offered by this prospectus will be set forth in the
prospectus supplement offering those securities.
PLAN OF
DISTRIBUTION
We may sell the securities offered under this prospectus in one or
more of the following ways (or in any combination) from time to
time:
•
to or through one or more underwriters or dealers;
•
in short or long transactions;
•
directly to investors; or
•
through agents.
If underwriters or dealers are used in the sale, the securities
will be acquired by the underwriters or dealers for their own
account and may be resold from time to time in one or more
transactions, including:
•
in privately negotiated transactions;
•
in one or more transactions at a fixed price or prices, which may
be changed from time to time;
•
in “at the market offerings,” within the meaning of
Rule 415(a)(4) of the Securities Act, to or through a market maker
or into an existing trading market, on an exchange or
otherwise;
•
at prices related to those prevailing market prices; or
•
at negotiated prices.
As applicable, we and our respective underwriters, dealers or
agents, reserve the right to accept or reject all or part of any
proposed purchase of the securities. We will set forth in a
prospectus supplement the terms and offering of securities by us,
including:
•
the names of any underwriters, dealers or agents;
•
any agency fees or underwriting discounts or commissions and other
items constituting agents’ or underwriters’
compensation;
•
any discounts or concessions allowed or reallowed or paid to
dealers;
•
details regarding over-allotment options under which underwriters
may purchase additional securities from us, if any;
•
the purchase price of the securities being offered and the proceeds
we will receive from the sale;
•
the public offering price; and
•
the securities exchanges on which such securities may be listed, if
any.
Underwriters, Agents and
Dealers
If underwriters are used in the sale of our securities, the
securities will be acquired by the underwriters for their own
account and may be resold from time to time in one or more
transactions described above. The securities may be offered to the
public either through underwriting syndicates represented by
managing underwriters or directly by underwriters. Generally, the
underwriters’ obligations to purchase the securities will be
subject to conditions precedent and the underwriters will be
obligated to purchase all of the securities if they purchase any of
the securities. We may use underwriters with which we have a
material relationship and will describe in the prospectus
supplement, naming the underwriter, the nature of any such
relationship.
28
We may sell the securities through agents from time to time. When
we sell securities through agents, the prospectus supplement will
name any agent involved in the offer or sale of securities and any
commissions we pay to them. Generally, any agent will be acting on
a best efforts basis for the period of its appointment.
We may authorize underwriters, dealers or agents to solicit offers
by certain purchasers to purchase our securities from us at the
public offering price set forth in the prospectus supplement
pursuant to delayed delivery contracts providing for payment and
delivery on a specified date in the future. The contracts will be
subject only to those conditions set forth in the prospectus
supplement, and the prospectus supplement will set forth any
commissions we pay for solicitation of these contracts.
Underwriters, dealers and agents may contract for or otherwise be
entitled to indemnification by us against certain civil
liabilities, including liabilities under the Securities Act or to
contribution with respect to payments made by the underwriters,
dealers or agents, under agreements between us and the
underwriters, dealers and agents.
We may grant underwriters who participate in the distribution of
our securities an option to purchase additional securities to cover
over-allotments, if any, in connection with the distribution.
Underwriters, dealers or agents may receive compensation in the
form of discounts, concessions or commissions from us or our
purchasers, as their agents in connection with the sale of our
securities. These underwriters, dealers or agents may be considered
to be underwriters under the Securities Act. As a result,
discounts, commissions or profits on resale received by the
underwriters, dealers or agents may be treated as underwriting
discounts and commissions. The prospectus supplement for any
securities offered by us will identify any such underwriter, dealer
or agent and describe any compensation received by them from us.
Any public offering price and any discounts or concessions allowed
or re-allowed or paid to dealers may be changed from time to
time.
Any underwriter may engage in over-allotment transactions,
stabilizing transactions, short-covering transactions and penalty
bids in accordance with Regulation M under the Exchange Act.
Over-allotment involves sales in excess of the offering size, which
create a short position. Stabilizing transactions permit bids to
purchase the underlying security so long as the stabilizing bids do
not exceed a specified maximum. Short-covering transactions involve
purchases of our securities in the open market after the
distribution is completed to cover short positions. Penalty bids
permit the underwriters to reclaim a selling concession from a
dealer when the securities originally sold by the dealer are
purchased in a transaction to cover short positions. Those
activities may cause the price of the securities to be higher than
it would otherwise be. If commenced, the underwriters may
discontinue any of the activities at any time. We make no
representation or prediction as to the direction or magnitude of
any effect these transactions may have on the price of our
securities. For a description of these activities, see the
information under the heading “Underwriting” in the
applicable prospectus supplement.
Underwriters, broker-dealers or agents who may become involved in
the sale of our securities may engage in transactions with and
perform other services for us for which they receive
compensation.
In compliance with guidelines of the Financial Industry Regulatory
Authority, or FINRA, the maximum commission or discount to be
received by any FINRA member or independent broker dealer may not
exceed 8% of the aggregate amount of the securities offered
pursuant to this prospectus and any applicable prospectus
supplement.
Stabilization
Activities
In connection with an offering through underwriters, an underwriter
may, to the extent permitted by applicable rules and regulations,
purchase and sell securities in the open market. These
transactions, to the extent permitted by applicable rules and
regulations, may include short sales, stabilizing transactions and
purchases to cover positions created by short sales. Short sales
involve the sale by the underwriters of a greater number of
securities than they are required to purchase in the offering.
“Covered” short sales are sales made in an amount not
greater than the underwriters’ option to purchase additional
securities from us in the offering, if any. If the underwriters
have an over-allotment option to purchase additional securities
from us, the underwriters may consider, among other things, the
price of securities available for purchase in the open market as
compared to the price at which they may purchase securities through
the over-allotment option. “Naked” short sales, which
may be prohibited or restricted by applicable rules and
regulations, are any sales in excess of such option or where the
underwriters do not have an over-allotment option. The underwriters
must close out any naked short position by purchasing securities in
the open market. A naked short position is more likely to be
created if the underwriters are concerned that there may be
29
downward pressure on the price of the securities in the open market
after pricing that could adversely affect investors who purchase in
the offering.
Accordingly, to cover these short sales positions or to otherwise
stabilize or maintain the price of the securities, the underwriters
may bid for or purchase securities in the open market and may
impose penalty bids. If penalty bids are imposed, selling
concessions allowed to syndicate members or other broker-dealers
participating in the offering are reclaimed if securities
previously distributed in the offering are repurchased, whether in
connection with stabilization transactions or otherwise. The effect
of these transactions may be to stabilize or maintain the market
price of the securities at a level above that which might otherwise
prevail in the open market. The imposition of a penalty bid may
also affect the price of the securities to the extent that it
discourages resale of the securities. The magnitude or effect of
any stabilization or other transactions is uncertain.
Direct Sales
We may also sell securities directly to one or more purchasers
without using underwriters or agents. In this case, no agents,
underwriters or dealers would be involved. We may sell securities
upon the exercise of rights that we may issue to our shareholders.
We may also sell securities directly to institutional investors or
others who may be deemed to be underwriters within the meaning of
the Securities Act with respect to any sale of those
securities.
Trading
Market
It is possible that one or more underwriters may make a market in a
class or series of securities, but the underwriters will not be
obligated to do so and may discontinue any market making at any
time without notice. We cannot give any assurance as to the
liquidity of the trading market for any of the securities.
30
EXPENSES
We are paying all of the expenses of the registration of our
securities under the Securities Act, including, to the extent
applicable, registration and filing fees, printing and duplication
expenses, administrative expenses, accounting fees and the legal
fees of our counsel. We estimate these expenses to be approximately
$110,000 which at the present time include the following categories
of expenses:
|
SEC registration fee
|
|
$
|
17,385
|
|
Legal fees and expenses
|
|
$
|
29,250
|
|
Accounting fees and expenses
|
|
$
|
15,000
|
|
Miscellaneous expenses
|
|
$
|
48,500
|
|
Total
|
|
$
|
110,135
|
31
EXPERTS
The consolidated financial statements incorporated in this
prospectus by reference to the Annual Report on Form 20-F for the
year December 31, 2015 have been so incorporated in reliance on the
report of Ko
st Forer Gabbay & Ka
sierer, a
member of Ernst& Young Global, an independent registered public
accounting firm, given on the authority of said firm as experts in
auditing and accounting.
LEGAL MATTERS
Pearl Cohen Zedek Latzer Baratz, Tel Aviv, has passed upon certain
legal matters regarding the securities offered hereby under Israeli
Law, and Pearl Cohen Zedek Latzer Baratz, LLP, New York, has passed
upon certain legal matters regarding the securities offered hereby
under U.S. law.
ENFORCEABILITY OF CIVIL
LIABILITIES
We are incorporated under the laws of the state of Israel. Service
of process upon us and upon our directors and officers and the
Israeli experts named in this registration statement, substantially
all of whom reside outside of the United States, may be difficult
to obtain within the United States. Furthermore, because
substantially all of our assets and substantially all of our
directors and officers are located outside the United States, any
judgment obtained in the United States against us or any of our
directors and officers may not be collectible within the United
States.
We have been informed by our
legal counsel in Israel, Pearl Cohen Zedek Latzer Baratz, that it
may be difficult to assert U.S. securities law claims in original
actions instituted in Israel. Israeli courts may refuse to hear a
claim based on a violation of U.S. securities laws because Israel
is not the most appropriate forum to bring such a claim. In
addition, even if an Israeli court agrees to hear a claim, it may
determine that Israeli law and not U.S. law is applicable to the
claim. If U.S. law is found to be applicable, the content of
applicable U.S. law must be proved as a fact which can be a
time-consuming and costly process. Certain matters of procedure
will also be governed by Israeli law.
Subject to specified time limitations and legal procedures, Israeli
courts may enforce a United States judgment in a civil matter
which, subject to certain exceptions, is non-appealable, including
judgments based upon the civil liability provisions of the
Securities Act and the Exchange Act and including a monetary or
compensatory judgment in a non-civil matter, provided that among
other things:
•
the judgments are obtained after due process before a court of
competent jurisdiction, according to the laws of the state in which
the judgment is given and the rules of private international law
currently prevailing in Israel;
•
the prevailing law of the foreign state in which the judgments were
rendered allows for the enforcement of judgments of Israeli
courts;
•
adequate service of process has been effected and the defendant has
had a reasonable opportunity to be heard and to present his or her
evidence;
•
the judgments are not contrary to public policy of Israel, and the
enforcement of the civil liabilities set forth in the judgment is
not likely to impair the security or sovereignty of Israel;
•
the judgments were not obtained by fraud and do not conflict with
any other valid judgments in the same matter between the same
parties;
•
an action between the same parties in the same matter is not
pending in any Israeli court at the time the lawsuit is instituted
in the foreign court;
•
the judgment is not subject to any further appeal procedures;
and
•
the judgment is enforceable according to the laws of Israel and
according to the law of the foreign state in which the relief was
granted.
Generally, an Israeli court will not enforce a foreign judgment if
the motion for enforcement was filed more than five years after the
date of its award in the United States, unless Israel and the
United States have agreed otherwise on a different period, or if an
Israeli court finds exceptional reasons justifying the delay.
32
If a foreign judgment is enforced by an Israeli court, it generally
will be payable in Israeli currency, which can then be converted
into non-Israeli currency and transferred out of Israel. The usual
practice in an action before an Israeli court to recover an amount
in a non-Israeli currency is for the Israeli court to issue a
judgment for the equivalent amount in Israeli currency at the rate
of exchange in force on the date of the judgment, but the judgment
debtor may make payment in foreign currency. Pending collection,
the amount of the judgment of an Israeli court stated in Israeli
currency ordinarily will be linked to the Israeli consumer price
index plus interest at the annual statutory rate set by Israeli
regulations prevailing at the time. Judgment creditors must bear
the risk of unfavorable exchange rates.
33