|
|
Filed
Pursuant to Rule 424(b)(2)
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Registration
File No. 333-225745
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PROSPECTUS
THERAPIX
BIOSCIENCES LTD.
$50,000,000
American
Depositary Shares Representing Ordinary Shares
Ordinary
Shares
Debt
Securities
Rights
Warrants
Units
We
may offer and sell from time to time in one or more offerings our American Depositary Shares, or ADSs, ordinary shares, debt securities,
rights, warrants and units comprising any combination of these securities having an aggregate offering price up to $50,000,000.
Each
time we sell securities pursuant to this prospectus, we will provide in a supplement to this prospectus the price and any other
material terms of any such offering and the securities offered. Any prospectus supplement may also add, update or change information
contained in the prospectus. You should read this prospectus and any applicable prospectus supplement, as well as the documents
incorporated by reference or deemed incorporated by reference into this prospectus, carefully before you invest in any securities.
Our
American Depositary Shares, or ADSs, each representing forty (40) ordinary shares, evidenced by American Depositary Receipts,
are traded on the Nasdaq Capital Market under the symbol “TRPX”. On July 13, 2018, the last reported sale price of
our ADSs was $3.17 per share. As of July 13, 2018, the aggregate market value of our outstanding ordinary shares held by non-affiliates
was approximately $16,436,550, based on 139,885,534 ordinary shares outstanding, of which 2,912,549 shares were held by non-affiliates,
and a per ordinary share price of $0.1175 based on the closing sale price of our ADSs on June 13, 2018. We have not sold any securities
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
of this prospectus.
AN
INVESTMENT IN OUR SECURITIES INVOLVES RISKS. SEE THE
SECTION
ENTITLED “RISK FACTORS” BEGINNING ON PAGE 4.
Neither
the Securities and Exchange Commission nor any state or other securities commission has
approved
or disapproved of these securities or determined if this prospectus is truthful
or
complete. Any representation to the contrary is a criminal offense.
This
prospectus may not be used to consummate sales of securities unless it is accompanied by a prospectus supplement.
The date of this
prospectus is July 20, 2018
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the SEC, using a
“shelf” registration process. Under this shelf registration process, we may from time to time sell ADSs, ordinary
shares, debt securities, rights, warrants or units comprising any combination of these securities, in one or more offerings up
to a total dollar amount of $50,000,000. We have provided to you in this prospectus a general description of the securities we
may offer. Each time we sell securities, we will, to the extent required by law, provide a prospectus supplement that will contain
specific information about the terms of the offering. We may also add, update or change in any accompanying prospectus supplement
or any free writing prospectus we may authorize to be delivered to you any of the information contained in this prospectus. To
the extent there is a conflict between the information contained in this prospectus and the prospectus supplement, you should
rely on the information in the prospectus supplement, provided that if any statement in one of these documents is inconsistent
with a statement in another document having a later date—for example, a document incorporated by reference in this prospectus
or any prospectus supplement—the statement in the document having the later date modifies or supersedes the earlier statement.
This prospectus, together with any accompanying prospectus supplement and any free writing prospectus we may authorize to be delivered
to you, includes all material information relating to the offering of our securities.
As
permitted by the rules and regulations of the SEC, the registration statement, of which this prospectus forms a part, includes
additional information not contained in this prospectus. You may read the registration statement and the other reports we file
with the SEC at the SEC’s web site or at the SEC’s offices described below under the heading “Where You Can
Find Additional Information.”
Unless
the context otherwise requires, references to “we,” “our,” “us,” the “Company”
or “Therapix” in this prospectus mean Therapix Biosciences Ltd.
We
report under International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board,
or the IASB. None of the financial statements were prepared in accordance with generally accepted accounting principles in the
United States.
You
should rely only on the information contained or incorporated by reference in this prospectus, any accompanying prospectus supplement
or any “free writing prospectus” we may authorize to be delivered to you. We have not authorized anyone to provide
you with different information. If anyone provides you with different or inconsistent information, you should not rely on it.
You should assume that the information appearing in this prospectus, any prospectus supplement and the documents incorporated
by reference herein and therein are accurate only as of their respective dates. Our business, financial condition, results of
operations and prospects may have changed since those dates.
Neither
this prospectus nor any accompanying prospectus supplement shall constitute an offer or solicitation by anyone in any jurisdiction
in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified
to do so or to anyone to whom it is unlawful to make such offer or solicitation.
PROSPECTUS
SUMMARY
This
summary highlights only some of the information included or incorporated by reference in this prospectus. You should carefully
read this prospectus together with the additional information about us described in the sections entitled “Incorporation
of Certain Information by Reference” and “Where You Can Find Additional Information” before purchasing our securities.
Therapix
Biosciences Ltd.
Overview
We
are a specialty clinical-stage pharmaceutical company led by an experienced team of senior executives and scientists, focused
on creating and enhancing a portfolio of technologies and assets based on cannabinoid pharmaceuticals. With this focus, we have
initiated two internal drug development programs based on repurposing an FDA approved synthetic cannabinoid (dronabinol): Joint
Pharma developing THX-110 targeted to the treatment of TS and BrainBright Pharma developing THX-130 targeted to the high value
and under-served market of MCIs.
We
intend to seek FDA approval for the commercialization of our drug candidates through the Section 505(b)(2) regulatory pathway
under the Federal Food, Drug, and Cosmetic Act of 1938, as amended, or the FDC Act. The FDA’s 505(b)(2) regulatory pathway
permits the filing of a new drug application, or NDA, where at least some of the information required for approval comes from
studies that were not conducted by or for the applicant, and for which the applicant has not received a right of reference. See
“—Clinical Strategy and Preclinical Results.” This approach could expedite the development program for our product
candidates by potentially decreasing the amount of clinical data that we would need to generate in order to obtain FDA approval.
In addition, with respect to our Joint Pharma program, we intend to pursue orphan drug designation in the United States. In June
2016, we submitted a request for orphan drug designation to the FDA for THX-110 for the treatment of TS. In a letter dated September
29, 2016, the FDA informed us that our request could not be granted at such time, and is being held in abeyance until and subject
to us providing additional information pertaining to the overall prevalence of TS in both children and adults, and further clinical
data to support our scientific rationale for our request for orphan drug designation within 12 months. In September 2017, we responded
to such FDA letter within the designated time frame, and provided the FDA with our articulated and reasoned responses including
documentation and clinical data that supports it. On December 26, 2017, we received the FDA’s response to our response.
The FDA accepted that there is adequate scientific rationale for the treatment of TS with THX-110 mainly through the preliminary
results of ongoing clinical trials, suggesting that THX-110 may provide benefit in treating TS. However, the FDA stated that it
was unable to grant our request and indicated that we did not provide adequate prevalence estimates, and any evidence to support
our statement that only moderate to severe Tourette’s patients would require pharmacological treatment. We further responded
in January 2018 by providing the requested information. We are currently waiting for the FDA’s response. There is no assurance
that we will successfully obtain orphan drug designation for TS, although we believe that we can provide adequate data to address
all issues raised by the FDA.
Joint
Pharma
Our
Joint Pharma program is dedicated to developing a cannabinoid-based drug for the treatment of TS, which is an inherited neuropsychiatric
disorder usually onset in childhood. TS is characterized by multiple physical (motor) tics and at least one vocal (phonic) tic.
Although TS and other tic disorders were once thought to be very rare, it has become increasingly apparent that they are not that
uncommon conditions. While epidemiological study results may vary, according to the U.S. Centers for Disease Control and Prevention,
or the CDC, as of 2012, one out of every 360 U.S. children (about 138,000) aged six to 17 years had been diagnosed with TS in
the United States. To date, only three drugs have been approved by the FDA to treat TS, most of which are limited to treating
only a narrow range of TS symptoms (mainly tics). Additionally, the usefulness of these drugs is also limited, since they are
associated with severe side effects that have resulted in the need for a “black box” warning. In many cases “off-label”
use of prescription medications not approved for the indication are associated with unwanted severe side effects that, in our
opinion, are also detrimental. Therefore, we believe there continues to be a great need for more effective, safer medications
targeted at treating tics as well as other features of TS.
We
believe our proprietary THX-110 drug candidate takes a unique approach to the treatment of TS. THX-110 is a combination drug candidate
based on two components: (1) dronabinol, the active ingredient in an FDA approved synthetic analog of tetrahydrocannabinol, or
THC, which is the psychoactive molecule in the cannabis plant, and (2) palmitoylethanolamide, or PEA, which is an endogenous fatty
acid amide that belongs to the class of nuclear factor agonists, which are proteins that regulate the expression of genes. We
believe that the combination of THC and PEA may induce a reaction known as the “entourage effect.”
The
basic tenet of the entourage effect is that cannabinoids work together, or possess synergy, and affect the body in a mechanism
similar to the body’s own cannabinoid system, which is a group of molecules and receptors in the brain that mediates the
psychoactive effects of cannabis. This entourage effect may account for the pharmacological actions of PEA. Based on an activity
enhancement of other physiological compounds, PEA may indirectly stimulate the cannabinoid receptors by potentiating their affinity
for a receptor or by inhibiting their metabolic degradation, and by doing so, may increase the uptake of cannabinoid compounds,
such as THC. Thus, we believe that the presence of the PEA molecule likely increases the efficacy of orally administered THC,
while reducing the required dosage and decreasing associated deleterious adverse events.
We
have completed the preclinical phase of development of THX-110 and recently initiated a proof of concept, or POC, Phase IIa clinical
trial in the United States. In addition, we expect to initiate a Phase IIb clinical trial in Europe in the third quarter of 2018.
BrainBright
Pharma
Our
BrainBright Pharma program takes a unique approach to developing a treatment for MCI. MCI refers to the transitional state between
the cognitive changes of normal aging and very early dementia. Signs of MCI have also been observed with respect to sports-related
brain injuries. It can involve problems with memory, language, thinking and judgment that are greater than normal changes related
to age. According to the Mayo Clinic Study of Aging published in 2008, the prevalence of MCI increases with age, at a rate of
10% in those aged 70-79 years and 25% in those aged 80-89 years. There is no FDA approved treatment for MCI. As MCI is believed
to represent an early state of Alzheimer’s, several Alzheimer’s treatments have been proposed for MCI. However, Alzheimer’s
treatments are not currently widely recommended by the medical community for the routine treatment of MCI and have not been shown
to delay or prevent the progression of MCI.
Our
proprietary THX-130 drug candidate is based on an ultra-low dose of FDA approved dronabinol. While the safety and efficacy of
drug delivery methods are solely FDA determinations, we believe that both sublingual and nasal administration of dronabinol present
several advantages over alternative administration routes, such as oral administration, and may enhance the bioavailability, or
the rate and extent of the drug when it reaches the site of action, of an ultra-low dose dronabinol. Sublingual administration
has certain advantages over oral administration. For example, it is often faster and it ensures that the substance will risk degradation
only by salivary enzymes before entering the bloodstream, whereas orally administered drugs must survive passage through the hostile
environment of the gastrointestinal tract, which risks degrading them, either by stomach acid or bile, or by the many enzymes
therein. Furthermore, after absorption from the gastrointestinal tract, such drugs must pass to the liver, where they may be extensively
altered; this is known as the first pass effect of drug metabolism.
We
have preclinical data that suggests that using an ultra-low dose of dronabinol may improve cognitive abilities. We intend to conduct
a Phase I clinical trial to document the pharmacokinetic parameters of THX-130 and to evaluate drug safety. During the first half
of 2018 we expect to initiate a pre-clinical trial to evaluate safety, and efficacy of THX-130 in rat model of Traumatic Brain
Injury (TBI) associated MCI with cognitive impairment. In addition, we may conduct further preclinical studies in parallel to
our clinical plans as part of the development of our innovative pipeline and for registration purposes.
With
respect to both our Joint Pharma and BrainBright Pharma programs, we intend to pursue a section 505(b)(2) regulatory path, which
may expedite the development of these programs by potentially decreasing the amount of clinical data that we would need to generate
in order to obtain FDA approval. We believe that the key benefits of this strategy include a relatively low scientific-technological
risk (compared to the risk of developing drugs based on new molecular entities) combined with relatively low costs and fast time
to market. If the FDA does not allow us to pursue the Section 505(b)(2) regulatory pathway as anticipated, we may need to conduct
additional clinical trials, provide additional data and information and meet additional standards for regulatory approval. If
this were to occur, the time and financial resources required to obtain FDA approval, and complications and risks associated with
FDA approval, would substantially increase.
Other
indications
Cannabis
and cannabinoids have great therapeutic potential and have been used for years for medicinal purposes. For example, cannabis and
cannabinoids are being used to improve the quality of life of patients with numerous and diverse indications (oncological patients,
chronic pain conditions, etc.). We believe that the novel approaches and unique mechanism of action of our proprietary technology
platforms, including our drug delivery systems and unique combination and specific dosages, may be expanded to treat additional
diseases and unmet medical needs.
In
January 2017, we announced that we intend to initiate an additional program in the area of antimicrobial therapies. Our objective
is to use our entourage technology in association with THC to increase the efficacy of existing antibiotic drugs especially in
antibiotic-resistant bacteria strains. The resistance to antimicrobials has become a global hazard. We believe that there is an
urgent need for the development of novel antimicrobial agents. THC has been shown to have a wide range of important biological
activities, including potential antibacterial activity. We are currently in the midst of our pre-clinical research stage for determining
an effective dosage of our proprietary formulation.
In
October 2017, we signed an agreement with Assuta Medical Center to conduct a Phase IIa, sponsor-initiated trial for the treatment
of Obstructive Sleep Apnea (OSA) THX-110. The study commenced durring the second quarter of 2018.
In
December 2017, we contracted with, Comprehensive Research Institute (“CRI”) for the assessment of our proprietary
combinational therapy THX-110 in patients suffering from chronic low back pain for whom existing medicines do not provide adequate
relief. we expect to commence a Phase IIa clinical trial in the fourth quarter of 2018.
In
November 2017, we executed a non-exclusive material transfer agreement with Yissum, the technology transfer company of The Hebrew
University of Jerusalem, for two synthetic cannabinoids synthesized by Raphael Mechoulam, Ph.D.. we initiated a preliminary preclinical
study during the fourth quarter of 2017 to evaluate the opioid-sparing effect of these compounds in a rat model of acute and chronic
pain. The follow-up in vivo study started during the second quarter of 2018, and will further evaluate the dosage regiment of
the active ingredients, as well as their optimal therapeutic ratio.
In
November 2017, we entered into an agreement with Dalhousie University to conduct a pre-clinical study with the goal of testing
the effect of THX-130 on cognitive and neurological state as well as mortality in a model of repeated mild traumatic brain injury
In
the future, we may consider expanding our pipeline to include these additional indications.
Corporate
Information
Our
legal and commercial name is Therapix Biosciences Ltd. We were incorporated in the State of Israel on August 23, 2004, and are
subject to the Israeli Companies Law, 5759-1999, as amended, or the Companies Law. In December 26, 2005, we became a public company
in Israel and our shares were listed for trade on the TASE. Our ordinary shares are currently traded on the TASE under the symbol
THXBY. Our ADSs representing our ordinary shares currently trade in the United States on the Nasdaq Capital Market under the symbol
“TRPX”.
Our
registered office and principal place of business is located at 4 Ariel Sharon Street, HaShahar Tower, 16th Floor, Givatayim 5320047,
Israel. Our telephone number in Israel is: +972-3-6167055.
Our
website address is http://therapixbio.com. The information contained on our website or available through our website is not incorporated
by reference into and should not be considered a part of this annual report on Form 20-F, and the reference to our website in
this annual report on Form 20-F is an inactive textual reference only.
RISK
FACTORS
Investing
in our ordinary shares involves risks. Please carefully consider the risk factors described below and in our periodic reports
filed with the SEC, including those set forth under the caption “Item 3. Key Information - D. Risk Factors” in our
most recently filed annual report on Form 20-F, which is incorporated by reference in this prospectus. Before making an investment
decision, you should carefully consider these risks as well as other information we include or incorporate by reference in this
prospectus. You should be able to bear a complete loss of your investment.
NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains, and any accompanying prospectus supplement will contain, forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of
1934, as amended, or the Exchange Act, and the Private Securities Litigation Reform Act of 1995. Also, documents that we incorporate
by reference into this prospectus, including documents that we subsequently file with the SEC, will contain forward-looking statements.
Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to historical
matters. You can generally identify forward-looking statements as statements containing the words “may,” “will,”
“could,” “should,” “expect,” “anticipate” “objective,” “goal,”
“intend,” “estimate,” “believe,” “project,” “plan,” “assume”
or other similar expressions, or negatives of those expressions, although not all forward-looking statements contain these identifying
words. All statements contained or incorporated by reference in this prospectus and any prospectus supplement regarding our future
strategy, future operations, projected financial position, proposed products, anticipated collaborations, estimated future revenues,
projected costs, future prospects, the future of our industry and results that might be obtained by pursuing management’s
current plans and objectives are forward-looking statements.
You
should not place undue reliance on our forward-looking statements because the matters they describe are subject to certain risks,
uncertainties and assumptions, including in many cases decisions or actions by third parties, that are difficult to predict. Our
forward-looking statements are based on the information currently available to us and speak only as of the date on the cover of
this prospectus, the date of any prospectus supplement, or, in the case of forward-looking statements incorporated by reference,
the date of the filing that includes the statement. Over time, our actual results, performance or achievements may differ from
those expressed or implied by our forward-looking statements, and such difference might be significant and materially adverse
to our security holders. We undertake no obligation to update publicly any forward-looking statements, whether as a result of
new information, future events or otherwise.
We
have identified some of the important factors that could cause future events to differ from our current expectations and they
are described in this prospectus and supplements to this prospectus under the caption “Risk Factors,” as well as in
our most recent Annual Report on Form 20-F, including without limitation under the captions “Risk Factors” and “Operating
and Financial Review and Prospects,” and in other documents that we may file with the SEC, all of which you should review
carefully. Please consider our forward-looking statements in light of those risks as you read this prospectus and any prospectus
supplement.
OFFER
STATISTICS AND EXPECTED TIMETABLE
We
may sell from time to time pursuant to this prospectus (as may be detailed in prospectus supplements) an indeterminate number
of securities as shall have a maximum aggregate offering price of $50,000,000. The actual number of securities and price of the
securities that we will offer pursuant hereto will depend on a number of factors that may be relevant as of the time of offer
(see “Plan of Distribution” below).
CAPITALIZATION
The
table below sets forth our capitalization as of December 31, 2017:
|
(in thousands)
|
|
(in thousands of USD)
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
9,195
|
|
|
Total assets
|
|
|
9,566
|
|
|
Total liabilities
|
|
|
1,177
|
|
|
|
|
|
|
|
|
Shareholders’ equity:
|
|
|
|
|
|
Share capital
|
|
|
3,812
|
|
|
Share premium
|
|
|
36,612
|
|
|
Transactions with non-controlling interests
|
|
|
261
|
|
|
Reserve for share-based payment transactions
|
|
|
5,311
|
|
|
Foreign currency translation reserve
|
|
|
782
|
|
|
Accumulated loss
|
|
|
(38,389
|
)
|
|
Total equity
|
|
|
8,389
|
|
*
Calculated using the exchange rate reported by the Bank of Israel for December 31, 2017 at the rate of one U.S. dollar per NIS
3.467.
PRICE
RANGE OF OUR ADSs AND ORDINARY SHARES
Our
ordinary shares have been trading on the TASE under the symbol “THXBY” since December 26, 2005. Our ADSs commenced
trading on the OTC Markets on October 6, 2014 under the symbol “THXBY”. On March 22, 2017, our ADSs, each of which
represents forty (40) of our ordinary shares, commenced trading on the Nasdaq Capital Market under the symbol “TRPX.”
On
July 13, 2018, the last reported sales price of the ADSs on Nasdaq was $3.17 per ADS. As of July 13, 2018, there was one shareholder
of record of the ADSs. The number of record holders is not representative of the number of beneficial holders of the ADSs. The
following table sets forth, for the periods indicated, the reported high and low closing sale prices of our ADSs on the Nasdaq
Capital Market, OTCQX and OTCQB, as applicable, in U.S. dollars.
|
|
|
U.S.$ Price Per ADS
|
|
|
|
|
High
|
|
|
Low
|
|
|
Annual:
|
|
|
|
|
|
|
|
2017
|
|
|
10.95
|
|
|
|
4.26
|
|
|
2016
|
|
|
8.02
|
|
|
|
7.80
|
|
|
2015
|
|
|
7.80
|
|
|
|
4.30
|
|
|
2014 (from October 6, 2014)
|
|
|
6.00
|
|
|
|
4.30
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly:
|
|
|
|
|
|
|
|
|
|
Third Quarter 2018 (through July 13, 2018)
|
|
|
4.00
|
|
|
|
3.17
|
|
|
Second Quarter 2018
|
|
|
7.76
|
|
|
|
3.84
|
|
|
First Quarter 2018
|
|
|
6.01
|
|
|
|
5.08
|
|
|
Fourth Quarter 2017
|
|
|
7.59
|
|
|
|
4.26
|
|
|
Third Quarter 2017
|
|
|
6.27
|
|
|
|
5.01
|
|
|
Second Quarter 2017
|
|
|
7.74
|
|
|
|
5.20
|
|
|
First Quarter 2017
|
|
|
10.95
|
|
|
|
6.3
|
|
|
Fourth Quarter 2016
|
|
|
8.02
|
|
|
|
8.02
|
|
|
Third Quarter 2016
|
|
|
8.02
|
|
|
|
8.02
|
|
|
Second Quarter 2016
|
|
|
8.02
|
|
|
|
7.80
|
|
|
First Quarter 2016
|
|
|
7.80
|
|
|
|
7.80
|
|
|
|
|
|
|
|
|
|
|
|
|
Most Recent Six Months:
|
|
|
|
|
|
|
|
|
|
June 2018
|
|
|
4.70
|
|
|
|
3.86
|
|
|
May 2018
|
|
|
4.70
|
|
|
|
3.84
|
|
|
April 2018
|
|
|
7.76
|
|
|
|
4.17
|
|
|
March 2018
|
|
|
6.01
|
|
|
|
5.64
|
|
|
February 2018
|
|
|
6.31
|
|
|
|
5.25
|
|
|
January 2018
|
|
|
6.21
|
|
|
|
5.08
|
|
|
December 2017
|
|
|
7.59
|
|
|
|
5.34
|
|
The
following table sets forth, for the periods indicated, the reported high and low closing prices of our ordinary shares on the
TASE in NIS and U.S. dollars. U.S. dollar per ordinary share amounts are calculated using the U.S. dollar representative rate
of exchange on the date to which the high or low market price is applicable, as reported by the Bank of Israel.
|
|
|
NIS Price Per
Ordinary Share
|
|
|
U.S.$ Price Per
Ordinary Share
|
|
|
|
|
High
|
|
|
Low
|
|
|
High
|
|
|
Low
|
|
|
Annual:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
0.88
|
|
|
|
0.40
|
|
|
|
0.25
|
|
|
|
0.11
|
|
|
2016
|
|
|
1.04
|
|
|
|
0.62
|
|
|
|
0.26
|
|
|
|
0.16
|
|
|
2015
|
|
|
0.99
|
|
|
|
0.37
|
|
|
|
0.26
|
|
|
|
0.09
|
|
|
2014
|
|
|
1.13
|
|
|
|
0.38
|
|
|
|
0.33
|
|
|
|
0.10
|
|
|
2013
|
|
|
1.77
|
|
|
|
0.55
|
|
|
|
0.49
|
|
|
|
0.15
|
|
|
2012
|
|
|
14.21
|
|
|
|
1.31
|
|
|
|
3.70
|
|
|
|
0.35
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter (through July 15, 2018)
|
|
|
0.36
|
|
|
|
0.30
|
|
|
|
0.10
|
|
|
|
0.08
|
|
|
Second Quarter 2018
|
|
|
0.43
|
|
|
|
0.36
|
|
|
|
0.12
|
|
|
|
0.10
|
|
|
First Quarter 2018
|
|
|
0.55
|
|
|
|
0.48
|
|
|
|
0.15
|
|
|
|
0.13
|
|
|
Fourth Quarter 2017
|
|
|
0.49
|
|
|
|
0.45
|
|
|
|
0.25
|
|
|
|
0.12
|
|
|
Third Quarter 2017
|
|
|
0.55
|
|
|
|
0.50
|
|
|
|
0.15
|
|
|
|
0.14
|
|
|
Second Quarter 2017
|
|
|
0.73
|
|
|
|
0.54
|
|
|
|
0.20
|
|
|
|
0.15
|
|
|
First Quarter 2017
|
|
|
0.84
|
|
|
|
0.69
|
|
|
|
0.23
|
|
|
|
0.19
|
|
|
Fourth Quarter 2016
|
|
|
0.83
|
|
|
|
0.62
|
|
|
|
0.21
|
|
|
|
0.16
|
|
|
Third Quarter 2016
|
|
|
0.93
|
|
|
|
0.77
|
|
|
|
0.24
|
|
|
|
0.21
|
|
|
Second Quarter 2016
|
|
|
1.01
|
|
|
|
0.82
|
|
|
|
0.27
|
|
|
|
0.21
|
|
|
First Quarter 2016
|
|
|
1.04
|
|
|
|
0.85
|
|
|
|
0.26
|
|
|
|
0.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Most Recent Six Months:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 2018
|
|
|
0.43
|
|
|
|
0.36
|
|
|
|
0.12
|
|
|
|
0.10
|
|
|
May 2018
|
|
|
0.41
|
|
|
|
0.35
|
|
|
|
0.11
|
|
|
|
0.98
|
|
|
April 2018
|
|
|
0.65
|
|
|
|
0.38
|
|
|
|
0.18
|
|
|
|
0.10
|
|
|
March 2018
|
|
|
0.52
|
|
|
|
0.48
|
|
|
|
0.15
|
|
|
|
0.14
|
|
|
February 2018
|
|
|
0.50
|
|
|
|
0.48
|
|
|
|
0.14
|
|
|
|
0.14
|
|
|
January 2018
|
|
|
0.55
|
|
|
|
0.53
|
|
|
|
0.16
|
|
|
|
0.15
|
|
|
December 2017
|
|
|
0.48
|
|
|
|
0.47
|
|
|
|
0.14
|
|
|
|
0.13
|
|
On
July 15, 2018, the last reported sales price of our ordinary shares on the TASE was NIS 0.30 per share, or $0.08 per share (based
on the exchange rate reported by the Bank of Israel for such date). On July 15, 2018, the exchange rate of the NIS to the dollar
was $1.00 = NIS 3.6410, as reported by the Bank of Israel. As of July 15, 2018, there were four holders 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 Nominees Company Ltd. As of June 13, 2018, there were no record holders of our ordinary shares in the
United States. We will be voluntarily delisting our ordinary shares from the TASE on August 9, 2018.
Dividend
Policy
To
date, we have not declared or paid cash dividends on any of our shares, and we have no current intention of paying any cash dividends
in the near future.
The
Companies Law also restricts our ability to declare and pay dividends. We can only distribute dividends from profits (as defined
in the Companies Law), if, in the discretion of our board of directors, there is no reasonable concern that the dividend distribution
will prevent us from meeting our existing and contingent obligations as they come due.
REASONS
FOR THE OFFER AND
USE OF PROCEEDS
We
cannot assure you that we will receive any proceeds in connection with securities offered pursuant to this prospectus. Unless
otherwise indicated in the applicable prospectus supplement, we intend to use any net proceeds from the sale of securities under
this prospectus for our operations and for other general corporate purposes, which may include repayment or refinancing of indebtedness
or other corporate borrowings, working capital, intellectual property protection and enforcement, capital expenditures, investments,
acquisitions or collaborations, research and development and product development. We may set forth additional information on the
use of proceeds from the sale of securities we offer under this prospectus in a prospectus supplement relating to the specific
offering. We have not determined the amount of net proceeds to be used specifically for the foregoing purposes. As a result, our
management will have broad discretion in the allocation of the net proceeds. Pending use of the net proceeds, we would expect
to invest any proceeds in a variety of capital preservation instruments, including short-term, investment-grade, interest-bearing
instruments.
DESCRIPTION
OF SECURITIES
The
descriptions of the securities contained in this prospectus, together with the applicable prospectus supplements, summarize the
material terms and provisions of the various types of securities that we may offer. We will describe in the applicable prospectus
supplement relating to any securities the particular terms of the securities offered by that prospectus supplement. If we so indicate
in the applicable prospectus supplement, the terms of the securities may differ from the terms we have summarized below.
We
may sell from time to time, in one or more offerings, ADSs, ordinary shares, debt securities, rights, warrants to purchase ordinary
shares and units comprising any combination of these securities.
In
this prospectus, we refer to the ADSs, ordinary shares, debt securities, rights, warrants and units that may be offered by us
collectively as “securities.” The total dollar amount of all securities that we may issue under this prospectus will
not exceed $50,000,000.
This
prospectus may not be used to consummate a sale of securities unless it is accompanied by a prospectus supplement.
DESCRIPTION
OF AMERICAN DEPOSITARY SHARES
The
Bank of New York Mellon, as depositary, will register and deliver ADSs. Each ADS will represent forty (40) shares (or a right
to receive forty (40) shares) deposited with the principal Tel Aviv office of Bank HaPoalim, as custodian for the depositary.
Each ADS will also represent any other securities, cash or other property which may be held by the depositary. The depositary’s
office at which the ADSs will be administered is located at 101 Barclay Street, New York, New York 10286. The Bank of New York
Mellon’s principal executive office is located at 225 Liberty Street, New York, New York 10286.
You
may hold ADSs either (A) directly (i) by having 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 (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
Direct Registration System, also referred to as DRS, is a system administered by The Depository Trust Company, also referred to
DTC, under which the depositary may register the ownership of uncertificated ADSs, which ownership is confirmed by statements
sent by the depositary to the registered holders of uncertificated ADSs.
As
an ADS holder, we will not treat you as one of our shareholders and you will not have shareholder rights. Israeli law governs
shareholder rights. The depositary will be the holder of the shares underlying your ADSs. As a registered holder of ADSs, you
will have ADS holder rights. 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.
Our
articles of association contain a provision that gives the authority to our Board of Directors (instead of our officers or shareholders
at a general meeting, for example)
to refer an action to arbitration. However, such arbitration provision is not mandatory
and it does not prevent ADS holders or ordinary shareholders from pursuing claims under the United States federal securities laws.
The
following is a summary of the material provisions of the deposit agreement. For more complete information, you should read the
entire deposit agreement and the form of ADR.
Dividends
and Other Distributions
How
will you receive dividends and other distributions on the shares?
The
depositary has agreed to pay to ADS holders the cash dividends or other distributions it or the custodian receives on shares or
other deposited securities, after deducting its fees and expenses. You will receive these distributions in proportion to the number
of shares your ADSs represent.
Cash
.
The
depositary will convert any cash dividend or other cash distribution we pay on the shares into U.S. dollars, if it can do so on
a reasonable basis and can transfer the U.S. dollars to the United States. If that is not possible or if any government approval
is needed and cannot be obtained, the deposit agreement allows the depositary to distribute the foreign currency only to those
ADS holders to whom it is possible to do so. It will hold the foreign currency it cannot convert for the account of the ADS holders
who have not been paid. It will not invest the foreign currency and it will not be liable for any interest.
Before
making a distribution, any withholding taxes, or other governmental charges that must be paid will be deducted. See “Taxation”.
It will distribute only whole U.S. dollars and cents and will round fractional cents to the nearest whole cent.
If the exchange
rates fluctuate during a time when the depositary cannot convert the foreign currency, you may lose some or all of the value of
the distribution.
Shares
.
The
depositary may distribute additional ADSs representing any shares we distribute as a dividend or free distribution. The depositary
will only distribute whole ADSs. It will sell shares which would require it to deliver a fraction of an ADS (or ADSs representing
those shares) and distribute the net proceeds in the same way as it does with cash. If the depositary does not distribute additional
ADSs, the outstanding ADSs will also represent the new shares. The depositary may sell a portion of the distributed shares sufficient
to pay its fees and expenses in connection with that distribution (or ADSs representing those shares).
Rights
to purchase additional shares
.
If
we offer holders of our securities any rights to subscribe for additional shares or any other rights, the depositary may make
these rights available to ADS holders. If the depositary decides it is not legal and practical to make the rights available but
that it is practical to sell the rights, the depositary will use reasonable efforts to sell the rights and distribute the proceeds
in the same way as it does with cash. The depositary will allow rights that are not distributed or sold to lapse.
In that case,
you will receive no value for them.
If
the depositary makes rights available to ADS holders, it will exercise the rights and purchase the shares on your behalf. The
depositary will then deposit the shares and deliver ADSs to the persons entitled to them. It will only exercise rights if you
pay it the exercise price and any other charges the rights require you to pay.
U.S.
securities laws may restrict transfers and cancellation of the ADSs represented by shares purchased upon exercise of rights. For
example, you may not be able to 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 has a choice. It may decide to sell what we distributed
and distribute the net proceeds, in the same way as it does with cash. Or, it may decide to hold what we distributed, in which
case ADSs will also represent the newly distributed property. However, the depositary is not required to distribute any securities
(other than ADSs) to ADS holders unless it receives satisfactory evidence from us that it is legal to make that distribution.
The depositary may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection
with that distribution.
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 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 shares or evidence of rights to receive shares with the custodian.
Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, the depositary
will register the appropriate number of ADSs in the names you request and will deliver the ADSs to or upon the order of the person
or persons that made the deposit.
How
can ADS holders withdraw the deposited securities?
You
may surrender your ADSs at the depositary’s office. Upon payment of its fees and expenses and of any taxes or charges, such
as stamp taxes or stock transfer taxes or fees, the depositary will deliver the shares and any other deposited securities underlying
the ADSs to the ADS holder or a person the ADS holder designates at the office of the custodian. Or, at your request, risk and
expense, the depositary will deliver the deposited securities at its office, if feasible.
How
do ADS holders interchange between certificated ADSs and uncertificated ADSs?
You
may surrender your ADR to the depositary for the purpose of exchanging your ADR for uncertificated ADSs. The depositary will cancel
that ADR and will send to the ADS holder a statement confirming that the ADS holder is the registered holder of uncertificated
ADSs. Alternatively, upon receipt by the depositary of a proper instruction from a registered holder of uncertificated ADSs requesting
the exchange of uncertificated ADSs for certificated ADSs, the depositary will execute and deliver to the ADS holder an ADR evidencing
those ADSs.
Voting
Rights
How
do you vote?
ADS
holders may instruct the depositary how to vote the number of deposited 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 enough 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 much 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 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 asked 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 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.
Fees
and Expenses
|
Persons
depositing or withdrawing 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 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 shares and the 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 shares on our share register to or from the name of the depositary
or its agent when you deposit or withdraw 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 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 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 us for costs and expenses generally arising out of establishment
and maintenance of the ADS program, waive fees and expenses for services provided to us by the depositary or share revenue from
the fees collected from ADS holders. In performing its duties under the deposit agreement, the depositary may use brokers, dealers,
foreign currency dealers or other service providers that are owned by or affiliated with the depositary and that may earn or share
fees, spreads or commissions.
The
depositary may convert currency itself or through any of its affiliates and, in those cases, acts as principal for its own account
and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation,
transaction spreads, that it will retain for its own account. The revenue is based on, among other things, the difference between
the exchange rate assigned to the currency conversion made under the deposit agreement and the rate that the depositary or its
affiliate receives when buying or selling foreign currency for its own account. The depositary makes no representation that the
exchange rate used or obtained in any currency conversion under the deposit agreement will be the most favorable rate that could
be obtained at the time or that the method by which that rate will be determined will be the most favorable to ADS holders, subject
to the depositary’s obligations under the deposit agreement. The methodology used to determine exchange rates used in currency
conversions is available upon request.
Payment
of Taxes
You
will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities represented
by any of your ADSs. The depositary may refuse to register any transfer of your ADSs or allow you to withdraw the deposited securities
represented by your ADSs until such taxes or other charges are paid. It may apply payments owed to you or sell deposited securities
represented by your ADSs to pay any taxes owed and you will remain liable for any deficiency. If the depositary sells deposited
securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to ADS holders any proceeds, or send
to ADS holders any property, remaining after it has paid the taxes.
Reclassifications,
Recapitalizations and Mergers
|
If
we:
|
|
Then:
|
|
|
|
|
|
●
|
Change
the nominal or par value of our shares
|
|
The
cash, shares or other securities received by the depositary will become deposited securities. Each ADS will automatically
represent its equal share of the new deposited securities.
|
|
|
Reclassify,
split up or consolidate any of the deposited securities
|
|
|
|
●
|
Distribute
securities on the shares that are not distributed to you
|
|
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.
|
|
●
|
Recapitalize,
reorganize, merge, liquidate, sell all or substantially all of our assets, or take any similar action
|
|
Amendment
and Termination
How
may the deposit agreement be amended?
We
may agree with the depositary to amend the deposit agreement and the ADRs without your consent for any reason. If an amendment
adds or increases fees or charges, except for taxes and other governmental charges or expenses of the depositary for registration
fees, facsimile costs, delivery charges or similar items, or prejudices a substantial right of ADS holders, it will not become
effective for outstanding ADSs until 30 days after the depositary notifies ADS holders of the amendment.
At the time an amendment
becomes effective, you are considered, by continuing to hold your ADSs, to agree to the amendment and to be bound by the ADRs
and the deposit agreement as amended
.
How
may the deposit agreement be terminated?
The
depositary will terminate the deposit agreement at our direction by mailing notice of termination to the ADS holders then outstanding
at least 30 days prior to the date fixed in such notice for such termination. The depositary may also terminate the deposit agreement
by mailing notice of termination to us and the ADS holders if 60 days have passed since the depositary told us it wants to resign
but a successor depositary has not been appointed and accepted its appointment.
After
termination, the depositary and its agents will do the following under the deposit agreement but nothing else: collect distributions
on the deposited securities, sell rights and other property, and deliver shares and other deposited securities upon cancellation
of ADSs. Four months after termination, the depositary may sell any remaining deposited securities by public or private sale.
After that, the depositary will hold the money it received on the sale, as well as any other cash it is holding under the deposit
agreement for the
pro rata
benefit of the ADS holders that have not surrendered their ADSs. It will not invest the money
and has no liability for interest. The depositary’s only obligations will be to account for the money and other cash. After
termination our only obligations will be to indemnify the depositary and to pay fees and expenses of the depositary that we agreed
to pay.
Limitations
on Obligations and Liability
Limits
on our Obligations and the Obligations of the Depositary; Limits on Liability to 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 control from performing our or its obligations
under the deposit agreement;
|
|
|
|
|
|
|
●
|
are
not liable if we or it exercises 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;
|
|
|
|
|
|
|
●
|
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 believes 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 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 Shares Underlying your ADSs
ADS
holders have the right to cancel their ADSs and withdraw the underlying shares at any time except:
|
|
●
|
when
temporary delays arise because: (1) the depositary has closed its transfer books or we have closed our transfer books; (2)
the transfer of shares is blocked to permit voting at a shareholders’ meeting; or (3) we are paying a dividend on our
shares;
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when
you owe money to pay fees, taxes and similar charges; or
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when
it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or
to the withdrawal of shares or other deposited securities.
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This
right of withdrawal may not be limited by any other provision of the deposit agreement.
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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 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 shares are delivered to
the depositary. The depositary may receive ADSs instead of shares to close out a pre-release. The depositary may pre-release ADSs
only under the following conditions: (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 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, 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 the DRS and Profile Modification System, or Profile,
will apply to uncertificated ADSs upon acceptance thereof to DRS by DTC. DRS is the system administered by DTC under which the
depositary may register the ownership of uncertificated ADSs, which ownership will be confirmed by 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.
DESCRIPTION
OF ORDINARY SHARES
As
of July 13, 2018, our authorized share capital consisted of 300,000,000 ordinary shares, NIS 0.1 par value per share, of which
139,885,534 shares were issued and outstanding as of such date. All of our outstanding ordinary shares have been validly issued,
are fully paid and non-assessable. Our ordinary shares are not redeemable and are not subject to any preemptive right.
On
January 12, 2014, we effected a reverse split of our share capital, in which every ten ordinary shares were converted to one ordinary
share. All descriptions of our share capital in this prospectus reflect such reverse split.
In
the last three years, we have issued an aggregate of approximately 121.5 million ordinary shares in several private placements,
options exercises and public offerings for aggregate net proceeds of NIS 60.5 million (approximately $16.4 million).
In
addition to ordinary shares, in the last three years, we have issued warrants to purchase an aggregate of 37,867,223 ordinary
shares with exercise prices ranging from NIS 0.50 (approximately $0.12) to NIS 1.90 (approximately $0.55) per share, out of which
26,776,256 warrants were exercised and 11,090,967 have expired. In addition, we have granted options to purchase an aggregate
of 24,839,278 ordinary shares with exercise prices ranging from NIS 0.50 (approximately $0.13) to NIS 1.061 (approximately $0.28)
per share, out of which 41,666 options were exercised and 4,214,779 have expired.
Purposes
and Objects of the Company
Our
purpose is set forth in Section 2 of our articles of association and includes every lawful purpose.
The
Powers of the Directors
Our
Board of Directors shall direct our policy and shall supervise the performance of our Chief Executive Officer and his actions.
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 the Companies Law or our articles of association to be exercised or taken by our shareholders, including
the power to borrow money for Company purposes.
Rights
Attached to Shares
Our
ordinary shares shall confer upon the holders thereof:
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equal
right to attend and to vote at all of our general meetings, whether regular or special, with each ordinary share entitling
the holder thereof, which attend the meeting and participate at the voting, either in person or by a proxy or by a written
ballot, to one vote;
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equal
right to participate in distribution of dividends, if any, whether payable in cash or in bonus shares, in distribution of
assets or in any other distribution, on a per share pro rata basis; and
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equal
right to participate, upon our dissolution, in the distribution of our assets legally available for distribution, on a per
share pro rata basis.
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All
ordinary shares have identical voting and other rights in all respects.
Dividend
and Liquidation Rights and Bonus Shares
We
may declare a dividend to be paid to the holders of our ordinary shares in proportion to their respective shareholdings. Under
the Companies Law, dividend distributions are determined by the Board of Directors and do not require the approval of the shareholders
of a company unless the company’s articles of association provide otherwise. Our articles of association do not require
shareholder approval of a dividend distribution and/or issuance of bonus shares and provide that our Board of Directors may, on
its sole discretion, determine dividend distributions and/or issuance of bonus shares. We have never declared or paid any cash
dividends and do not presently plan to pay cash dividends in the foreseeable future.
Pursuant
to the Companies Law, the distribution amount is limited to the greater of retained earnings or earnings generated over the previous
two years, 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 the distribution, or we may otherwise distribute dividends that do not meet such
criteria only with court approval. In each case, we are only permitted to distribute a dividend if our Board of Directors and
the court, if applicable, determines that there is no reasonable concern that payment of the 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.
There
are currently no Israeli currency control restrictions on remittances of dividends on our ordinary shares, proceeds from the sale
of the shares or interest or other payments to non-residents of Israel, except for shareholders who are subjects of countries
that are, or have been, in a state of war with Israel.
Access
to Corporate Records
Under
the Companies Law, shareholders are provided access to: minutes of our general meetings; our shareholders register and principal
shareholders register, articles of association and financial statements; and any document that we are required by law to file
publicly with the Israeli Companies Registrar or the ISA. In addition, shareholders may request to be provided with any document
related to an action or transaction requiring shareholder approval under the related party transaction provisions of the Companies
Law. We may deny this request if we believe it has not been made in good faith or if such denial is necessary to protect our interest
or protect a trade secret or patent.
Transfer
of Shares
Our
fully paid ordinary shares are issued in registered form and may be freely transferred under our articles of association, unless
the transfer is restricted or prohibited by another instrument, applicable law, or the rules of a stock exchange on which the
shares are listed for trade. 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 the laws of the State of Israel, except for ownership by nationals of some countries that
are, or have been, in a state of war with Israel.
Election
of Directors
Our
ordinary shares do not have cumulative voting rights for the election of directors. As a result, the holders of a majority of
the voting power represented at a shareholders meeting have the power to elect all of our directors, subject to the special approval
requirements for external directors described under “Management — External Directors.” Pursuant to our articles
of association, our directors are elected at an annual general meeting and/or a special meeting of our shareholders and serve
on the Board of Directors until the next annual general meeting (except for external directors) or until they resign or until
they cease to act as board members pursuant to the provisions of our articles of association or any applicable law, upon the earlier.
Pursuant to our articles of association, other than the external directors, for whom special election requirements apply under
the Companies Law, the vote required to appoint a director is a simple majority vote of holders of our voting shares, participating
and voting at the relevant meeting. A director whose tenure has ended may be reelected. In addition, our articles of association
allow our Board of Directors to appoint directors to fill vacancies or as an addition to the Board of Directors (subject to the
maximum number of directors) to serve until the next general meeting where directors are elected or earlier if required by our
articles of association or applicable law, upon the earlier. External directors are elected for an initial term of three years
and may be removed from office pursuant to the terms of the Companies Law. See “Management—Board Practices—External
Directors.”
Annual
and Special Meetings
Under
the Companies Law, we are required to hold an annual general meeting of our shareholders once every calendar year, at such time
and place which shall be determined by our Board of Directors, that must be no later than 15 months after the date of the previous
annual general meeting. All meetings other than the annual general meeting of shareholders are referred to as special general
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, and upon the written request of: (a) any two of our directors or such number of directors equal to
one quarter of the directors present at such a meeting; and/or (b) one or more shareholders holding, in the aggregate, either
(a) 5% or more of our outstanding issued shares and 1% of our outstanding voting power or (b) 5% of our outstanding voting power.
One or more shareholders, holding 1% or more of the outstanding voting power, may ask the board to add an item to the agenda of
a prospective meeting, if the proposal merits discussion at the general meeting.
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, which may be between four
and 40 days prior to the date of the meeting. Furthermore, the Companies Law requires that resolutions regarding the following
matters must be passed at a general meeting of our shareholders:
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amendments
to our articles of association;
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the
exercise of our Board of Director’s powers if our Board of Directors is unable to exercise its powers and the exercise
of any of its powers is required for our proper management;
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appointment
or termination of our auditors;
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appointment
of directors, including external directors;
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approval
of acts and transactions requiring general meeting approval (namely certain related party transactions) pursuant to the provisions
of the Companies Law and any other applicable law;
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increases
or reductions of our authorized share capital; and
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a
merger (as such term is defined in the Companies Law).
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Notices
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 certain matters prescribed under the Companies Law and the regulations promulgated thereafter,
among others, 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 publications of such meeting.
Under
the regulations of the Companies Law, certain exemptions and reliefs with respect to the manner of announcing the convening of
the general meeting of shareholders are granted to companies whose securities are traded outside of Israel. We may use these exemptions
and reliefs after this offering.
Under
our articles of association, shareholders are not permitted to take action via written consent in lieu of a meeting.
Quorum
As
permitted under the Companies Law, and our articles of association, the quorum required for our general meetings consists of at
least three shareholders present in person, by proxy or written ballot, who hold or represent between them at least thirty percent
of the total outstanding voting rights (instead of 33 1/3% of the issued share capital required under the Nasdaq Listing Rules).
If within half an hour of the time appointed for the general meeting a quorum is not present, the general meeting shall stand
adjourned the same day of the following week, at the same hour and in the same place, or to such other date, time and place as
prescribed in the notice to the shareholders and in such adjourned meeting, if no quorum is present within half an hour of the
time arranged, any number of shareholders participating in the meeting, shall constitute a quorum.
If
a general meeting was summoned following the request of a shareholder, then a quorum required in an adjourned general meeting,
shall consist of at least one or more shareholders, which holds and represents at least 5% of the company’s issued and outstanding
share capital and at least 1% of the company voting rights, or one or more shareholder, which holds at least 5% of the Company’s
voting rights.
Adoption
of Resolutions
Our
articles of association provide that all resolutions of our shareholders require a simple majority vote, unless otherwise required
under the Companies Law or our articles of association. A shareholder may vote in a general meeting in person, by proxy or by
a written ballot. Under the Companies Law, each of (i) the approval of an extraordinary transaction with a controlling shareholder,
(ii) the terms of employment or other engagement of the controlling shareholder of the company or such controlling shareholder’s
relative (even if not extraordinary) requires, the approval described above under “Management — Approval of Related
Party Transactions Under Israeli Law — Disclosure of Personal Interests of Controlling Shareholders,” and (iii) the
approval of certain compensation-related matters require the approval described above under “-Board Committees-Compensation
Committee.” Under our articles of association, the alteration of the rights, privileges, preferences, or obligations of
any class of our shares requires a simple majority vote of the class so affected (or such other percentage of the relevant class
that may be set forth in the governing documents relevant to such class), in addition to the ordinary majority vote of all classes
of shares voting together as a single class at a shareholder meeting. An exception to the simple majority vote requirement is
a resolution for the voluntary winding up, or an approval of a scheme of arrangement or reorganization, of the company pursuant
to Section 350 of the Companies Law, which requires the approval of holders of 75% of the voting rights represented at the meeting,
in person, by proxy, or by voting deed and voting on the resolution. In addition, the general meeting of our shareholders can
decide to alter our articles of association, which decision requires - in addition to any other majority requirement and except
as expressly provided otherwise on our articles of association - a simple majority vote of the shareholders attending such general
meeting (without counting abstentions).
Changing
Rights Attached to Shares
Unless
otherwise provided by the terms of the shares and subject to any applicable law, in order to change the rights attached to any
class of shares, such change must be adopted at a general meeting of the affected class or by a written consent of all the shareholders
of the affected class.
The
enlargement of an existing class of shares or the issuance of additional shares thereof, shall not be deemed to modify the rights
attached to the previously issued shares of such class or of any other class, unless otherwise provided by the terms of the shares.
Registration
Rights
None
of our shareholders is entitled to registration rights.
Provisions
Restricting Change in Control of Our Company - Acquisitions under Israeli Law
Merger
The
Companies Law includes provisions that allow a merger transaction and requires that each company that is a party to the merger
have the transaction approved by its Board of Directors and a vote of the majority of its shares (unless certain requirements
described under the Companies Law are met) and, in the case of the target company, a majority vote of each class of its shares,
voted on the proposed merger at a shareholders meeting.
For
purposes of the shareholder vote of each party, unless a court rules otherwise, the merger will not be deemed approved if shares
representing a majority of the voting power present at the shareholders meeting and which are not held by the other party to the
merger (or by any person who holds 25% or more of the voting power or the right to appoint 25% or more of the directors of the
other party) vote against the merger. If, however, the merger involves a merger with a company’s own controlling shareholder
or if the controlling shareholder has a personal interest in the merger, then the merger is instead subject to the same special
majority approval that governs all extraordinary transactions with controlling shareholders (as described under “Management
— Approval of Related Party Transactions Under Israeli Law — Disclosure of Personal Interests of a Controlling Shareholder”).
If
the transaction would have been approved by the shareholders of a merging company 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 of the target company.
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 (1) 50 days have passed from the time that the requisite proposals for approval of the merger
were filed with the Israeli Registrar of Companies by each merging company and (2) 30 days have passed since the merger was approved
by the shareholders of each merging company.
Special
Tender Offer
The
Companies Law also provides that an acquisition of shares in a public company must be made by means of a special tender offer
if as a result of the acquisition (i) the purchaser would become a 25% or greater shareholder of the company, unless there is
already another 25% or greater shareholder of the company or (ii) the purchaser would become a more than 45% shareholder of the
company, unless there is already a shareholder holding more than 45% of the company, subject to certain exceptions. These requirements
do not apply if, in general, the acquisition (i) was made in a private placement that received shareholder approval, (ii) was
from a 25% or greater shareholder of the company which resulted in the acquirer becoming a 25% or greater shareholder of the company,
or (iii) was from a shareholder holding more than 45% of the company’s issued and outstanding share capital which resulted
in the acquirer becoming a holder of more than 45% of the company’s issued and outstanding share capital.
A
special tender offer must be extended to all shareholders, but the offeror is not required to purchase more than 5% of the company’s
outstanding shares, regardless of how many shares are tendered by shareholders. In general, the tender offer may be consummated
only if (i) at least 5% of 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 (excluding the purchaser, controlling shareholders,
holders of 25% or more of the voting rights in the company or any person having a personal interest in the acceptance of the tender
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.
If
a tender offer is not accepted in accordance with the requirements set forth above, the acquirer may not acquire shares (either
alone or together with others) that will increase its holdings to 25% or more or above 45% (as may be the case) of the company’s
issued and outstanding share capital or of the applicable class and such shares shall not bestow upon such acquirer any rights
and shall become treasury shares for as long as the acquirer holds said shares. In addition, if a shareholder’s holding
in a company increases to 25% or greater of the company’s issued and outstanding share capital or above 45% of the company’s
issued and outstanding share capital, among others, as a result of the company’s shares becoming treasury shares following
a distribution event, then such excess shares shall not bestow upon their holder any voting rights for as long as the holder holds
said excess shares. These rules shall apply with respect to the offering under this prospectus (i.e., prior to the listing of
our ADSs on the Nasdaq).
Full
Tender Offer
A
person wishing to acquire shares of an Israeli public company and who would as a result hold (either alone or together with others)
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 (either alone or together with others)
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 relevant class for the purchase of all of the issued and outstanding shares of that 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, and more than half of the shareholders who do not have a personal interest in the offer accept the offer,
all of the shares that the acquirer offered to purchase will be transferred to the acquirer by operation of law. However, a tender
offer will also be accepted if the shareholders who do not accept the offer hold less than 2% of the issued and outstanding share
capital of the company or of the applicable class of shares.
Upon
a successful completion of such a full tender offer, any shareholder that was an offeree in such tender offer, whether such shareholder
accepted the tender offer or not, may, within six months from the date of acceptance of the tender offer, petition an Israeli
court to determine whether the tender offer was for less than fair value and that the fair value should be paid as determined
by the court. However, under certain conditions, the offeror may include in the terms of the tender offer that an offeree who
accepted the offer will not be entitled to petition the Israeli court as described above.
If
a tender offer is not accepted in accordance with the requirements set forth above, the acquirer may not acquire shares from shareholders
who accepted the tender offer that will increase its holdings to more than 90% of the company’s issued and outstanding share
capital or of the applicable class.
If
a tender offer is not accepted in accordance with the requirements set forth above, the acquirer may not acquire shares (either
alone or together with others) that will increase its holdings to more than 90% of the company’s issued and outstanding
share capital or of the applicable class and such shares shall not bestow upon such acquirer any rights and shall become treasury
shares for as long as the acquirer holds said shares.
Anti-Takeover
Provisions under Israeli Law
For
as long as our securities are traded on the TASE, the Securities Law does not allow us, to create and issue shares having rights
different from those attached to our ordinary shares, including shares providing certain preferred rights with respect to voting,
distributions, or other matters and shares having preemptive rights. The authorization and designation of a class of preferred
shares will require an amendment to our articles of association, which requires the prior approval of the holders of a majority
of the voting power attaching to our issued and outstanding shares at a general meeting. The convening of the meeting, the shareholders
entitled to participate and the majority vote required to be obtained at such a meeting will be subject to the requirements set
forth in the Companies Law as described above in “Description of Share Capital” and “Management.”
Lastly,
Israeli tax law treats some acquisitions, such as stock-for-stock exchanges between an Israeli company and a foreign company,
less favorably than U.S. tax laws. For example, Israeli tax law may, under certain circumstances, subject a shareholder who exchanges
his ordinary shares for shares in another corporation to taxation prior to the sale of the shares received in such stock-for-stock
swap.
Changes
in Our 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 meeting. In addition, transactions
that have the effect of reducing capital, such as the declaration and payment of dividends in the absence of sufficient retained
earnings or profits, require the approval of both our Board of Directors and an Israeli court.
The
general meeting may, by a simple majority vote of the shareholders attending the general meeting:
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increase
our registered share capital by the creation of new shares from the existing class or a new class, as determined by the general
meeting;
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cancel
any registered share capital which have not been taken or agreed to be taken by any person;
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consolidate
and divide all or any of our share capital into shares of larger nominal value than our existing shares;
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subdivide
our existing shares or any of them, our share capital or any of it, into shares of smaller nominal value than is fixed;
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reduce
our share capital subject to approval required by the Companies Law; and
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modify,
cancel, convert, extend, add to or otherwise modify the rights, privileges, advantages, limitations and instructions related
or unrelated to the Company’s shares at the time.
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DESCRIPTION
OF DEBT SECURITIES
The
following description, together with the additional information we include in any applicable prospectus supplement, summarizes
the material terms and provisions of the debt securities that we may offer under this prospectus. While the terms we have summarized
below will apply generally to any future debt securities we may offer, we will describe the particular terms of any debt securities
that we may offer in more detail in the applicable prospectus supplement. If we so indicate in a prospectus supplement, the terms
of any debt securities we offer under that prospectus supplement may differ from the terms we describe below.
We
will issue senior notes under a senior indenture that we will enter into with a trustee to be named in the senior indenture. We
will issue subordinated notes under a subordinated indenture that we will enter into with a trustee to be named in the subordinated
indenture. We have filed forms of these documents as exhibits to the registration statement, of which this prospectus forms a
part. We will describe changes to the indentures in connection with an offering of debt securities in a prospectus supplement.
We use the term “indentures” to refer to both the senior indenture and the subordinated indenture. The indentures
will be qualified under the Trust Indenture Act of 1939, or the Trust Indenture Act. We use the term “trustee” to
refer to either the trustee under the senior indenture or the trustee under the subordinated indenture, as applicable.
The
following summaries of material provisions of senior notes, subordinated notes and the indentures are subject to, and qualified
in their entirety by reference to, the provisions of the indenture applicable to a particular series of debt securities. Except
as we may otherwise indicate, the terms of the senior indenture and the subordinated indenture are identical.
General
If
we decide to issue any senior notes or subordinated notes pursuant to this prospectus, we will describe in a prospectus supplement
the terms of the series of notes, including the following:
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the
title of the notes;
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any
limit on the amount that may be issued;
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whether
or not we will issue the series of notes in global form, the terms and who the depository will be;
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the
annual interest rate, which may be fixed or variable, or the method for determining the rate and the date interest will begin
to accrue, the dates interest will be payable and the regular record dates for interest payment dates or the method for determining
such dates;
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If
the notes are guaranteed the name of the guarantor and a brief outline of the contract of guarantee;
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whether
or not the notes will be secured or unsecured, and the terms of any secured debt;
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whether
or not the notes will be senior or subordinated;
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the
terms of the subordination of any series of subordinated debt;
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the
terms on which the notes may be convertible into or exchangeable for ordinary shares or other securities of ours, including
provisions as to whether conversion or exchange is mandatory, at the option of the holder or at our option and provisions
pursuant to which the number of ordinary shares or other securities of ours that the holders of the series of debt securities
receive would be subject to adjustment;
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the
place where payments will be payable and the currency in which the debt is payable;
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our
right, if any, to defer payment of interest and the maximum length of any such deferral period;
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the
date, if any, after which, and the price at which, we may, at our option, redeem the series of notes pursuant to any optional
redemption provisions ;
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the
date, if any, on which, and the price at which we are obligated, pursuant to any mandatory sinking fund provisions or otherwise,
to redeem, or at the holder’s option to purchase, any series of notes which are not convertible into or exchangeable
for our securities;
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whether
the indenture will restrict our ability to pay dividends, or will require us to maintain any asset ratios or reserves;
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whether
we will be restricted from incurring any additional indebtedness;
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a
discussion of any material or special U.S. federal income tax considerations;
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the
denominations in which we will issue the series of notes, if other than denominations of $1,000 and any integral multiple
thereof;
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the
definition and consequences of events of default under the indentures; and
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any
other specific terms, preferences, rights or limitations of, or restrictions on, the debt securities.
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Subordination
of Subordinated Notes
Subordinated
notes will be unsecured and will be subordinate and junior in priority of payment to certain indebtedness to which we may be subject
to the extent described in a prospectus supplement. The subordinated indenture does not limit the amount of subordinated notes
that we may issue. It also does not limit us from issuing any other secured or unsecured debt.
Form,
Exchange and Transfer
We
will issue the notes of each series only in fully registered form without coupons and, unless we otherwise specify in the applicable
prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indentures provide that we may issue
notes of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or on behalf
of, The Depository Trust Company, New York, New York, or DTC, or another depository named by us and identified in a prospectus
supplement with respect to that series.
At
the option of the holder, subject to the terms of the indentures and the limitations applicable to global securities described
in the applicable prospectus supplement, the holder of the notes of any series can exchange the notes for other notes of the same
series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject
to the terms of the indentures and the limitations applicable to global securities set forth in the applicable prospectus supplement,
holders of the notes may present the notes for exchange or for registration of transfer, duly endorsed or with the form of transfer
endorsed thereon duly executed if so required by us or the security registrar, at the office of the security registrar or at the
office of any transfer agent designated by us for this purpose. Unless otherwise provided in the notes that the holder presents
for transfer or exchange, we will not require any payment for any registration of transfer or exchange, but we may require payment
of any taxes or other governmental charges.
We
will name in the applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar,
that we initially designate for any notes. We may at any time designate additional transfer agents or rescind the designation
of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required
to maintain a transfer agent in each place of payment for the notes of each series.
If
we elect to redeem the notes of any series, we will not be required to:
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reissue,
register the transfer of, or exchange any notes of that series during a period beginning at the opening of business 15 days
before the day of mailing of a notice of redemption of any notes that may be selected for redemption and ending at the close
of business on the day of the mailing; or
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register
the transfer of or exchange any notes so selected for redemption, in whole or in part, except the unredeemed portion of any
notes we are redeeming in part.
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Consolidation,
Merger or Sale
The
indentures do not contain any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise
dispose of all or substantially all of our assets. However, any successor to or acquirer of such assets must assume all of our
obligations under the indentures or the notes, as appropriate.
Events
of Default Under the Indentures
The
following are events of default under the indentures with respect to any series of notes that we may issue:
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if
we fail to pay interest when due and our failure continues for 90 days and the time for payment has not been extended or deferred;
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if
we fail to pay the principal, or premium, if any, when due and the time for payment has not been extended or delayed;
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if
we fail to observe or perform any other covenant contained in the notes or the indentures, other than a covenant specifically
relating to another series of notes, and our failure continues for 90 days after we receive notice from the trustee or holders
of at least 25% in aggregate principal amount of the outstanding notes of the applicable series; and
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if
we experience specified events of bankruptcy, insolvency or reorganization.
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If
an event of default with respect to notes of any series occurs and is continuing, the trustee or the holders of at least 25% in
aggregate principal amount of the outstanding notes of that series, by notice to us in writing, and to the trustee if notice is
given by such holders, may declare the unpaid principal of, or premium, if any, on and accrued interest, if any, on the notes
due and payable immediately.
The
holders of a majority in principal amount of the outstanding notes of an affected series may waive any default or event of default
with respect to the series and its consequences, except uncured defaults or events of default regarding payment of principal,
or premium, if any, or interest, unless we have cured the default or event of default in accordance with the indenture. Any waiver
shall cure the default or event of default.
Subject
to the terms of the indentures, if an event of default under an indenture shall occur and be continuing, the trustee will be under
no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of
the applicable series of notes, unless such holders have offered the trustee reasonable indemnity. In such event, the holders
of a majority in principal amount of the outstanding notes of any series will have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee,
with respect to the notes of that series, provided that:
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the
direction so given by the holder is not in conflict with any law or the applicable indenture; and
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subject
to its duties under the Trust Indenture Act, the trustee need not take any action that might involve it in personal liability
or might be unduly prejudicial to the holders not involved in the proceeding.
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A
holder of the notes of any series will only have the right to institute a proceeding under the indentures or to appoint a receiver
or trustee, or to seek other remedies, if:
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the
holder has given written notice to the trustee of a continuing event of default with respect to that series;
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the
holders of at least 25% in aggregate principal amount of the outstanding notes of that series have made written request, and
such holders have offered reasonable indemnity to the trustee to institute the proceeding as trustee; and
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the
trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount
of the outstanding notes of that series other conflicting directions within 60 days after the notice, request and offer.
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These
limitations do not apply to a suit instituted by a holder of notes if we default in the payment of the principal of, or the premium,
if any, or interest on, the notes.
We
will periodically file statements with the trustee regarding our compliance with specified covenants in the indentures.
Discharge
Each
indenture provides that we can elect, under specified circumstances, to be discharged from our obligations with respect to one
or more series of debt securities, except for obligations to:
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register
the transfer or exchange of debt securities of the series;
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replace
stolen, lost or mutilated debt securities of the series;
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maintain
paying agencies;
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hold
monies for payment in trust;
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compensate
and indemnify the trustee; and
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appoint
any successor trustee.
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In
order to exercise our rights to be discharged, we must deposit with the trustee money or government obligations sufficient to
pay all the principal of, any premium, if any, and interest on, the debt securities of the series on the dates payments are due.
Modification
of Indenture; Waiver
We
and the trustee may change an indenture without the consent of any holders with respect to specific matters, including:
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to
fix any ambiguity, defect or inconsistency in the indenture; or
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to
change anything that does not materially adversely affect the interests of any holder of notes or any series.
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In
addition, under the indentures, we and the trustee may change the rights of holders of a series of notes with the written consent
of the holders of at least a majority in aggregate principal amount of the outstanding notes of each series that is affected.
However, we and the trustee may only make the following changes with the consent of each holder of any outstanding notes affected:
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extending
the fixed maturity of the series of notes;
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reducing
the principal amount, the rate of interest or any premium payable upon the redemption of any notes; or
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reducing
the minimum percentage of notes, the holders of which are required to consent to any amendment.
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Information
Concerning the Trustee
The
trustee, other than during the occurrence and continuance of an event of default under an indenture, undertakes to perform only
those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the trustee
must use the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs.
Subject to this provision, the trustee is under no obligation to exercise any of the powers given to it by the indentures at the
request of any holder of notes unless it is offered reasonable security and indemnity against the costs, expenses and liabilities
that it might incur.
Payment
and Paying Agents
Unless
we otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any notes on any interest
payment date to the person in whose name the notes, or one or more predecessor securities, are registered at the close of business
on the regular record date for the interest payment.
We
will pay principal of and any premium and interest on the notes of a particular series at the office of the paying agents designated
by us, except that unless we otherwise indicate in the applicable prospectus supplement, we will make interest payments by check
which we will mail to the holder. Unless we otherwise indicate in a prospectus supplement, we will designate the corporate trust
office of the trustee as our sole paying agent for payments with respect to notes of each series. We will name in the applicable
prospectus supplement any other paying agents that we initially designate for the notes of a particular series. We will maintain
a paying agent in each place of payment for the notes of a particular series.
All
money we pay to a paying agent or the trustee for the payment of the principal of or any premium or interest on any notes which
remains unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid
to us, and the holder of the security thereafter may look only to us for payment thereof.
DESCRIPTION
OF RIGHTS
General
We
may issue rights to purchase any of our securities or any combination thereof. Rights may be issued independently or together
with any other offered security and may or may not be transferable by the person purchasing or receiving the rights. In connection
with any rights offering to our shareholders, we may enter into a standby underwriting arrangement with one or more underwriters
pursuant to which such underwriters will purchase any offered securities remaining unsubscribed for after such rights offering.
We may also appoint a rights agent that may act solely as our agent in connection with the rights that are sold. Any such agent
will not assume any obligation or relationship of agency or trust with any of the holders of the rights. In connection with a
rights offering to our shareholders, we will distribute certificates evidencing the rights and a prospectus supplement to our
shareholders on the record date that we set for receiving rights in such rights offering.
The
applicable prospectus supplement will describe the following terms of rights in respect of which this prospectus is being delivered:
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the
title of such rights;
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the
securities for which such rights are exercisable;
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the
exercise price for such rights;
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the
number of such rights issued with respect to each ordinary share;
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the
extent to which such rights are transferable;
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if
applicable, a discussion of the material Israeli and U.S. income tax considerations applicable to the issuance or exercise
of such rights;
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the
date on which the right to exercise such rights shall commence, and the date on which such rights shall expire (subject to
any extension);
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the
extent to which such rights include an over-subscription privilege with respect to unsubscribed securities;
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if
applicable, the material terms of any standby underwriting or other purchase arrangement, or any agency agreement, that we
may enter into in connection with the rights offering; and
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any
other terms of such rights, including terms, procedures and limitations relating to the exchange and exercise of such rights.
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Exercise
of Rights
Each
right will entitle the holder of the right to purchase for cash such securities or any combination thereof at such exercise price
as shall in each case be set forth in, or be determinable as set forth in, the prospectus supplement relating to the rights offered
thereby. Rights may be exercised at any time up to the close of business on the expiration date for such rights set forth in the
prospectus supplement. After the close of business on the expiration date, all unexercised rights will become void.
Rights
may be exercised as set forth in the prospectus supplement relating to the rights offered thereby. Upon receipt of payment and
the rights certificate properly completed and duly executed at the corporate trust office of the rights agent or any other office
indicated in the prospectus supplement, we will forward, as soon as practicable, the securities purchasable upon such exercise.
We may determine to offer any unsubscribed offered securities directly to persons other than shareholders, to or through agents,
underwriters or dealers or through a combination of such methods, including pursuant to standby underwriting arrangements, as
set forth in the applicable prospectus supplement.
DESCRIPTION
OF WARRANTS
We
may issue warrants for the purchase of 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). Any series of warrants may be issued under a separate warrant
agreement, which may be entered into between us and a warrant agent specified in a prospectus supplement. Any such warrant agent
will act solely as our agent in connection with the warrants of such series and will not assume any obligation or relationship
of agency or trust with any of the holders of the warrants. We will set forth further terms of the warrants and any applicable
warrant agreements in the applicable prospectus supplement relating to the issuance of any warrants, including, where applicable,
the following:
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the
title of the warrants;
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the
aggregate number of the warrants;
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the
number of ADSs or ordinary shares purchasable upon exercise of the warrants;
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the
designation and terms of the securities, if any, with which the warrants are issued and the number of the warrants issued
with each such offered security;
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the
date, if any, on and after which the warrants and the related securities will be separately transferable;
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the
price at which, and form of consideration for which, each security purchasable upon exercise of the warrants may be purchased;
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the
date on which the right to exercise the warrants will commence and the date on which the right will expire;
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the
minimum or maximum amount of the warrants which may be exercised at any one time;
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any
circumstances that will cause the warrants to be deemed to be automatically exercised; and
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any
other material terms of the warrants.
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DESCRIPTION
OF UNITS
As
specified in the applicable prospectus supplement, we may issue units consisting of our ADSs, ordinary shares, debt securities,
rights, warrants or any combination of such securities. The applicable prospectus supplement will describe:
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the
terms of the units and of the ADSs, ordinary shares, debt securities, rights and/or warrants comprising the units, including
whether and under what circumstances the securities comprising the units may be traded separately;
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a
description of the terms of any unit agreement governing the units or any arrangement with an agent that may act on our behalf
in connection with the unit offering; and
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a
description of the provisions for the payment, settlement, transfer or exchange of the units.
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PLAN
OF DISTRIBUTION
We
may sell the offered securities on a negotiated or competitive bid basis to or through underwriters or dealers. We may also sell
the securities directly to corporate partners in various programs of the Company, institutional investors or other purchasers
or through agents. We will identify any underwriter, dealer, or agent involved in the offer and sale of the securities, and any
applicable commissions, discounts and other terms constituting compensation to such underwriters, dealers or agents, in a prospectus
supplement.
We
may distribute our securities from time to time in one or more transactions:
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at
a fixed price or prices, which may be changed;
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at
market prices prevailing at the time of sale;
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at
prices related to such prevailing market prices; or
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Only
underwriters named in the prospectus supplement are underwriters of our securities offered by the prospectus supplement.
If
underwriters are used in the sale of our securities, such securities will be acquired by the underwriters for their own account
and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. Unless stated otherwise in a prospectus supplement, the obligation
of any underwriters to purchase our securities will be subject to certain conditions and the underwriters will be obligated to
purchase all of the applicable securities if any are purchased. If a dealer is used in a sale, we may sell our securities to the
dealer as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer
at the time of resale. In effecting sales, dealers engaged by us may arrange for other dealers to participate in the resales.
We
or our agents may solicit offers to purchase securities from time to time. Unless stated otherwise in a prospectus supplement,
any agent will be acting on a best efforts basis for the period of its appointment. In addition, we may enter into derivative,
sale or forward sale transactions with third parties, or sell securities not covered by this prospectus to third parties in privately
negotiated transactions. If the applicable prospectus supplement indicates, in connection with such transaction, the third parties
may, pursuant to this prospectus and the applicable prospectus supplement, sell securities covered by this prospectus and the
applicable prospectus supplement. If so, the third party may use securities borrowed from us or others to settle such sales and
may use securities received from us or others to close out any related short positions. We may also loan or pledge securities
covered by this prospectus and the applicable prospectus supplement to third parties, who may sell the loaned securities or, in
the event of default in the case of a pledge, sell the pledged securities pursuant to this prospectus and the applicable prospectus
supplement. The third party in such transactions will be an underwriter and will be identified in the applicable prospectus supplement
or a in a post-effective amendment.
In
connection with the sale of our securities, underwriters or agents may receive compensation (in the form of discounts, concessions
or commissions) from us or from purchasers of securities for whom they may act as agents. Underwriters may sell securities to
or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters
and/or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the
distribution of our securities may be deemed to be “underwriters” as that term is defined in the Securities Act, and
any discounts or commissions received by them from us and any profits on the resale of the shares by them may be deemed to be
underwriting discounts and commissions under the Securities Act. Compensation as to a particular underwriter, dealer or agent
might be in excess of customary commissions and will be in amounts to be negotiated in connection with transactions involving
our securities. We will identify any such underwriter or agent, and we will describe any such compensation paid, in the related
prospectus supplement. Maximum compensation to any underwriters, dealers or agents will not exceed any applicable FINRA limitations.
Underwriters,
dealers and agents may be entitled, under agreements with us, to indemnification against and contribution toward certain civil
liabilities, including liabilities under the Securities Act.
If
stated in a prospectus supplement, we will authorize agents and underwriters to solicit offers by certain specified institutions
or other persons to purchase our securities at the public offering price set forth in the prospectus supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specific date in the future. Institutions with whom such contracts
may be made include commercial savings banks, insurance companies, pension funds, investment companies, educational and charitable
institutions, and other institutions, but shall in all cases be subject to our approval. Such contracts will be subject only to
those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth the commission payable for
solicitation of such contracts. The obligations of any purchase under any such contract will be subject to the condition that
the purchase of the securities shall not be prohibited at the time of delivery under the laws of Israel and of the jurisdiction
to which the purchaser is subject. The underwriters and other agents will not have any responsibility in respect of the validity
or performance of such contracts.
If
underwriters or dealers are used in the sale, until the distribution of our securities is completed, SEC rules may limit the ability
of any such underwriters and selling group members to bid for and purchase the securities. As an exception to these rules, representatives
of any underwriters are permitted to engage in certain transactions that stabilize the price of the securities. Such transactions
may consist of bids or purchases for the purpose of pegging, fixing or maintaining the price of the securities. If the underwriters
create a short position in the securities in connection with the offering (in other words, if they sell more shares than are set
forth on the cover page of the prospectus supplement), the representatives of the underwriters may reduce that short position
by purchasing securities in the open market. The representatives of the underwriters also may elect to reduce any short position
by exercising all or part of any over-allotment option we may grant to the underwriters, as described in the prospectus supplement.
In addition, the representatives of the underwriters may impose a penalty bid on certain underwriters and selling group members.
This means that if the representatives purchase securities in the open market to reduce the underwriters’ short position
or to stabilize the price of our securities, they may reclaim the amount of the selling concession from the underwriters and selling
group members who sold those securities as part of the offering. In general, purchases of a security for the purpose of stabilizing
or to reduce a short position could cause the price of the security to be higher than it might be in the absence of such purchases.
The imposition of a penalty bid might also have the effect of causing the price of the securities to be higher than it would otherwise
be. If commenced, the representatives of the underwriters may discontinue any of the transactions at any time. These transactions
may be effected on any exchange on which our securities are traded, in the over-the-counter market, or otherwise.
Certain
of the underwriters or agents and their associates may engage in transactions with and perform services for us or our affiliates
in the ordinary course of their respective businesses.
LEGAL
MATTERS
Certain
legal matters concerning this offering under U.S. federal securities law will be passed upon for us by Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C., New York, New York. Certain legal matters governed by Israeli law will be passed upon for us by Horn
& Co. – Law Offices, Tel Aviv, Israel.
EXPERTS
The
consolidated financial statements of Therapix Biosciences Ltd. appearing in Therapix Biosciences Ltd. Report on Form 20-F as filed
with the SEC on April 30, 2018, have been audited by Kost Forer Gabbay & Kasierer (a Member of Ernst & Young Global),
independent registered public accounting firm, as set forth in their report thereon, included therein, and incorporated herein
by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on
the authority of such firm as experts in accounting and auditing.
EXPENSES
The
following are the estimated expenses related to the filing of the registration statement of which this prospectus forms a part,
all of which will be paid by us. In addition, we anticipate incurring additional expenses in the future in connection with the
offering of our securities pursuant to this prospectus. Any such additional expenses will be disclosed in a prospectus supplement.
|
SEC registration fee
|
|
$
|
6,225
|
|
|
FINRA review
|
|
|
*
|
|
|
Legal fees and expenses*
|
|
|
20,000
|
|
|
Accounting fees and expenses*
|
|
|
20,000
|
|
|
Miscellaneous*
|
|
|
3,775
|
|
|
Total*
|
|
$
|
50,000
|
|
*
Estimated
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
SEC allows us to “incorporate by reference” the information we file with it, which means that we can disclose important
information to you by referring you to those documents. The information incorporated by reference is considered to be part of
this prospectus and information we file later with the SEC will automatically update and supersede this information. The documents
we are incorporating by reference as of their respective dates of filing are:
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Annual
Report on Form 20-F for the year ended December 31, 2017, filed on April 30, 2018 (File No. 001-38041);
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Our
Reports on Form 6-K filed on January 16, 2018, March 20, 2018, April 9, 2018, April 20, 2018, April 27, 2018, May 4, 2018,
May 9, 2018, May 17, 2018, June 6, 2018 and June 14, 2018; and
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●
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the
description of our ordinary shares contained in our Form 8-A filed on March 21, 2017 (File No. 001-38041).
|
All
subsequent annual reports on Form 20-F, Form 40-F or Form 10-K filed by us, all subsequent filings on Forms 10-Q and 8-K filed
by us, and all subsequent reports on Form 6-K filed by us that are identified by us as being incorporated by reference shall be
deemed to be incorporated by reference into this prospectus and deemed to be a part hereof after the date of this prospectus but
before the termination of the offering by this prospectus.
Any
statement contained in a document incorporated by reference herein shall be deemed to be modified or superseded for all purposes
to the extent that a statement contained in this prospectus, or in any other subsequently filed document which is also incorporated
or deemed to be incorporated by reference, modifies or supersedes such statement. Any statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You
may request, orally or in writing, a copy of these documents, which will be provided to you at no cost, by contacting:
Therapix
Biosciences Ltd.
4
Ariel Sharon Street
HaShahar
Tower, 16th Floor
Givatayim
5320047, Israel
Tel:
+972-3-6167055
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
This
prospectus is part of a registration statement on Form F-3 that we filed with the SEC relating to the securities offered by this
prospectus, which includes additional information. You should refer to the registration statement and its exhibits for additional
information. Whenever we make reference in this prospectus to any of our contracts, agreements or other documents, the references
are not necessarily complete and you should refer to the exhibits attached to the registration statement for copies of the actual
contract, agreements or other document.
We
are subject to the informational requirements of the Exchange Act applicable to foreign private issuers. We, as a “foreign
private issuer,” are exempt from the rules under the Exchange Act prescribing certain disclosure and procedural requirements
for proxy solicitations, and our officers, directors and principal shareholders are exempt from the reporting and “short-swing”
profit recovery provisions contained in Section 16 of the Exchange Act, with respect to their purchases and sales of shares. In
addition, we are not required to file annual, quarterly and current reports and financial statements with the SEC as frequently
or as promptly as U.S. companies whose securities are registered under the Exchange Act.
You
may read and copy any materials we file or furnish with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E.,
Washington, D.C. 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., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the operation
of the Public Reference Room. You can review our SEC filings and the registration statement by accessing the SEC’s internet
site at
http://www.sec.gov
.
In
addition, because our ordinary shares are traded on the TASE, we have filed Hebrew language periodic and immediate reports with,
and furnish information to, the TASE and the ISA, as required under Chapter Six of the Israel Securities Law. Copies of our filings
with the ISA 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 http://therapixbio.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.
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 prospectus, substantially all of whom reside outside 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, Horn & Co. Law Offices, 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. There is little binding case law in Israel addressing these matters.
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:
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the
judgment is 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;
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the
judgment is final and is not subject to any right of appeal;
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the
prevailing law of the foreign state in which the judgment was rendered allows for the enforcement of judgments of Israeli
courts
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adequate
service of process has been effected and the defendant has had a reasonable opportunity to be heard and to present his or
her evidence;
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the
liabilities under the judgment are enforceable according to the laws of the State of Israel and the judgment and the enforcement
of the civil liabilities set forth in the judgment is not contrary to the law or public policy in Israel nor likely to impair
the security or sovereignty of Israel;
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the
judgment was not obtained by fraud and does not conflict with any other valid judgments in the same matter between the same
parties;
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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; and;
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the
judgment is enforceable according to the law of the foreign state in which the relief was granted.
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An
Israeli court will not declare a foreign civil judgment enforceable if:
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the
judgment was given in a state whose laws do not provide for the enforcement of judgments of Israeli courts (subject to exceptional
cases);
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the
enforcement of the judgment is likely to prejudice the sovereignty or security of the State of Israel;
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the
judgment was obtained by fraud;
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the
possibility given to the defendant to bring its arguments and evidence before the court was not reasonable in the opinion
of the Israeli court;
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the
judgment was rendered by a court not competent to render it according to the laws of private international law as they apply
in Israel;
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the
judgment is contradictory to another judgment that was given in the same matter between the same parties and that is still
valid; or
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at
the time the action was brought in the foreign court, a lawsuit in the same matter and between the same parties was pending
before a court or tribunal in Israel.
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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.
INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling
persons, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.
32
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