Exhibit 10.1
ORDINARY SHARES PURCHASE AGREEMENT
ORDINARY SHARES PURCHASE
AGREEMENT (the “Agreement”), dated as of December 2, 2019 by and between INTEC PHARMA LTD., a company
organized and existing under the laws of the State of Israel, company number 513022780 (the “Company”), and
ASPIRE CAPITAL FUND, LLC, an Illinois limited liability company (the “Buyer”). Capitalized terms used
herein and not otherwise defined herein are defined in Section 10 hereof.
WHEREAS:
Subject to the terms and
conditions set forth in this Agreement, the Company wishes to sell to the Buyer, and the Buyer wishes to buy from the Company,
up to Ten Million Dollars ($10,000,000) of the Company’s ordinary shares, no par value per share (the “Ordinary
Shares”). The Ordinary Shares to be purchased hereunder are referred to herein as the “Purchase Shares.”
NOW THEREFORE, the
Company and the Buyer hereby agree as follows:
| 1. | PURCHASE OF ORDINARY SHARES. |
Subject to the terms and
conditions set forth in this Agreement, the Company has the right to sell to the Buyer, and the Buyer has the obligation to purchase
from the Company, Purchase Shares as follows:
(a) Commencement
of Purchases of Ordinary Shares. Any time after Commencement (as defined below), the purchase and sale of Purchase Shares hereunder
may occur from time to time upon written notices by the Company to the Buyer on the terms and conditions as set forth herein following
the satisfaction of the conditions (the “Commencement”) as set forth in Sections 6 and 7 below (the date of
satisfaction of such conditions, the “Commencement Date”).
(b) The
Company’s Right to Require Regular Purchases. Subject to the terms and conditions of this Agreement, on any given
Business Day after the Commencement Date, the Company shall have the right but not the obligation to direct the Buyer by its
delivery to the Buyer of a Purchase Notice from time to time, and the Buyer thereupon shall have the obligation, to buy the
number of Purchase Shares specified in such notice, up to Two Hundred Thousand (200,000) Purchase Shares, on such Business
Day (as long as such notice is delivered on or before 5:00 p.m. Eastern time on such Business Day) (each such purchase, a
“Regular Purchase”) at the Purchase Price on the Purchase Date; however, in no event shall the Purchase
Amount of a Regular Purchase exceed Five Hundred Thousand Dollars ($500,000) per Business Day, unless the Buyer and the
Company mutually agree otherwise. The Company and the Buyer may mutually agree to increase the number of Purchase Shares that
may be sold per Regular Purchase to as much as an additional 2,000,000 Purchase Shares per Business Day. The Company may
deliver additional Purchase Notices to the Buyer from time to time so long as the most recent purchase has been
completed. The share amounts in this Section 1(b) shall be appropriately adjusted for any reorganization, recapitalization,
non-cash dividend, share split, reverse share split or other similar transaction.
(c) VWAP
Purchases. Subject to the terms and conditions of this Agreement, in addition to purchases of Purchase Shares as described
in Section 1(b) above, the Company shall also have the right but not the obligation to direct the Buyer by the Company’s
delivery to the Buyer of a VWAP Purchase Notice from time to time as follows:
(i) with one Business Day’s
prior written notice (as long as such notice is delivered on or before 5:00 p.m. Eastern Time on the Business Day immediately preceding
the VWAP Purchase Date), and the Buyer thereupon shall have the obligation, to buy the VWAP Purchase Share Percentage of the trading
volume of the Ordinary Shares on the VWAP Purchase Date up to the VWAP Purchase Share Volume Maximum on the VWAP Purchase Date
(each such purchase, a “VWAP Purchase”) at the VWAP Purchase Price. The Company may only deliver a VWAP Purchase Notice
to the Buyer on or before 5:00 p.m. Eastern Time on a date on which the Company also submits a Purchase Notice for a Regular Purchase
of 200,000 Purchase Shares to the Buyer. Any single VWAP Purchase Notice shall be limited to no more than 250,000 Purchase Shares
in connection with such VWAP Purchase Notice. The VWAP Purchase Amount and the VWAP Purchase Price shall be determined at the end
of the VWAP Purchase Date and confirmed by the Buyer and approved by the Company. However, the VWAP Purchase Amount and the VWAP
Purchase Price shall be determined before the end of the VWAP Purchase Date at such time if during the VWAP Purchase Date either:
(1) the Sale Price falls below the VWAP Minimum Price Threshold or (2) the trading volume of Ordinary Shares on the Principal Market
exceeds the VWAP Purchase Share Volume Maximum during normal trading hours. In such circumstances if:
(A) the Sale Price falls below the
VWAP Minimum Price Threshold during the VWAP Purchase Date, (1) the VWAP Purchase Amount shall be calculated using the VWAP Purchase
Share Percentage of the aggregate Ordinary Shares traded on the Principal Market for such portion of the VWAP Purchase Date prior
to the time that the Sale Price fell below the VWAP Minimum Price Threshold and (2) the VWAP Purchase Price shall be calculated
using the volume weighted average price of all Ordinary Shares sold during such portion of the VWAP Purchase Date prior to the
time that the Sale Price fell below the VWAP Minimum Price Threshold.
OR
(B) the trading volume of Ordinary
Shares on the Principal Market exceeds the VWAP Purchase Share Volume Maximum on the VWAP Purchase Date before normal trading hours
end (meaning that the VWAP Purchase Share Estimate has been reached at a time before the end of normal trading hours), the VWAP
Purchase Amount and VWAP Purchase Price shall be calculated using the volume weighted average price of all Ordinary Shares sold
during such portion of the VWAP Purchase Date prior to the time that the trading volume of Ordinary Shares on the Principal Market
exceeds the VWAP Purchase Share Volume Maximum.
(ii) By no later than 5:00 p.m. Eastern Time
on any VWAP Purchase Date, the Buyer shall submit to the Company a written confirmation of the VWAP Purchase in form and substance
reasonably acceptable to the Company setting forth the VWAP Purchase Amount and the VWAP Purchase Price, i.e., the exact amount
of Ordinary Shares to be sold pursuant to such VWAP Purchase Notice and the exact price to be paid by the Buyer to the Company.
Upon approval by the Company of the VWAP Purchase Amount and the VWAP Purchase Price and receipt by the Company of full payment
of the Purchase Amount related to such VWAP Purchase, the Company shall promptly deliver notice to the transfer agent of the VWAP
Purchase, including instructions to promptly issue an amount of Ordinary Shares equal to the Purchase Shares to be purchased by
the Buyer in connection with such VWAP Purchase. The Company may deliver additional VWAP Purchase Notices to the Buyer from time
to time so long as there is not more than one outstanding purchase (either a Regular Purchase or VWAP Purchase) that is not then
fully completed, i.e. the Buyer has fully paid for and has received such Purchase Shares. The amounts in this Section 1(c) shall
be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other
similar transaction.
(d) Payment
for Purchase Shares. For each Regular Purchase, the Buyer shall pay to the Company an amount equal to the Purchase Amount as
full payment for such Purchase Shares via wire transfer of immediately available funds no later than one Business Day from receipt
of a valid Purchase Notice and prior to the issuance of any Purchase Shares related to the Regular Purchase. For each VWAP Purchase,
the Buyer shall pay to the Company an amount equal to the VWAP Purchase Amount as full payment for such Purchase Shares via wire
transfer of immediately available funds no later than one Business Day after the VWAP Purchase Date and prior to the issuance of
any Purchase Securities related to such VWAP Purchase. All payments made under this Agreement shall be made in lawful money of
the United States of America via wire transfer of immediately available funds to such account as the Company may from time to time
designate by written notice in accordance with the provisions of this Agreement. Whenever any amount expressed to be due by the
terms of this Agreement is due on any day that is not a Business Day, the same shall instead be due on the next succeeding day
that is a Business Day.
(e) Purchase
Price Floor. The Company and the Buyer shall not effect any sales under this Agreement on any Purchase Date where the Closing
Sale Price is less than the Floor Price. “Floor Price” means $0.25 per share of Ordinary Share, which shall
not be adjusted for any reorganization, recapitalization, non-cash dividend, share split, reverse share split or other similar
transaction.
(f) Records
of Purchases. The Buyer and the Company shall each maintain records showing the remaining Available Amount at any given time
and the dates and Purchase Amounts for each purchase, or shall use such other method reasonably satisfactory to the Buyer and the
Company to reconcile the remaining Available Amount.
(g) Taxes.
The Company shall pay any and all transfer, stamp or similar taxes that may be payable with respect to the issuance and delivery
of any Ordinary Shares to the Buyer made under this Agreement.
(h) Compliance
with Principal Market Rules. Notwithstanding anything in this Agreement to the contrary, and in addition to the limitations
set forth in Section 1(e), the total number of Ordinary Shares that may be issued under this Agreement, including the Commitment
Shares (as defined in Section 4(e) hereof), shall be limited to 7,000,394 Ordinary Shares (the “Exchange Cap”),
which equals 19.99% of the Company’s outstanding Ordinary Shares as of the date hereof, unless shareholder approval is obtained
to issue more than such 19.99%. The Exchange Cap shall be appropriately adjusted for any reorganization, recapitalization, non-cash
dividend, share split, reverse share split or other similar transaction. The foregoing limitation shall not apply if shareholder
approval has not been obtained and at any time the Exchange Cap is reached and at all times thereafter the average price paid for
all Ordinary Shares issued under this Agreement is equal to or greater than $0.48978 (the “Minimum Price”),
a price equal to the lower of (1) the Closing Sale Price immediately preceding the execution of this Agreement or (2) the arithmetic
average of the five (5) Closing Sale Prices for the Ordinary Shares immediately preceding the execution of this Agreement (in such
circumstance, for purposes of the Principal Market, the transaction contemplated hereby would not be “below market”
and the Exchange Cap would not apply). The Minimum Price shall be appropriately adjusted for any reorganization, recapitalization,
non-cash dividend, share split, reverse share split or other similar transaction. Notwithstanding the foregoing, the Company shall
not be required or permitted to issue, and the Buyer shall not be required to purchase, any Ordinary Shares under this Agreement
if such issuance would breach the Company’s obligations under the rules or regulations of the Principal Market or other applicable
law (including, without limitation the Israeli Companies Law – 1999, as amended – “Companies Law”).
The Company may, in its sole discretion, determine whether to obtain shareholder approval to issue more than 19.99% of its outstanding
Ordinary Shares hereunder if such issuance would require shareholder approval under the rules or regulations of the Principal Market
or the Companies Law.
(i) Beneficial
Ownership Limitation. The Company shall not issue, and the Buyer shall not purchase any Ordinary Shares under this Agreement,
if such shares proposed to be issued and sold, when aggregated with all other Ordinary Shares then owned beneficially (as calculated
pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”) and Rule 13d-3
promulgated thereunder) by the Buyer and its affiliates would result in the beneficial ownership by the Buyer and its affiliates
of more than 19.99% of the then issued and outstanding Ordinary Shares.
2. BUYER’S
REPRESENTATIONS AND WARRANTIES.
The Buyer represents and
warrants to the Company that as of the date hereof and as of the Commencement Date:
(a) Investment
Purpose. The Buyer is entering into this Agreement and acquiring the Commitment Shares and the Purchase Shares (the Purchase
Shares and the Commitment Shares are collectively referred to herein as the “Securities”), for its own account
for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof; provided
however, by making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other
specific term.
(b) Accredited
Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a)(3) of Regulation
D of the 1933 Act.
(c) [Intentionally
Omitted.]
(d) Information.
The Buyer has been furnished with all materials relating to the business, finances and operations of the Company and materials
relating to the offer and sale of the Securities that have been reasonably requested by the Buyer, including, without limitation,
the SEC Documents (as defined in Section 3(f) hereof). The Buyer understands that its investment in the Securities involves a high
degree of risk. The Buyer (i) is able to bear the economic risk of an investment in the Securities including a total loss, (ii)
has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the
proposed investment in the Securities and (iii) has had an opportunity to ask questions of and receive answers from the officers
of the Company concerning the financial condition and business of the Company and other matters related to an investment in the
Securities. Neither such inquiries nor any other due diligence investigations conducted by the Buyer or its representatives shall
modify, amend or affect the Buyer’s right to rely on the Company’s representations and warranties contained in Section
3 below. The Buyer has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment
decision with respect to its acquisition of the Securities.
(e) No
Governmental Review. The Buyer understands that no United States federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment
in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities.
(f) [Intentionally
Omitted.]
(g) Organization.
The Buyer is a limited liability company duly organized and validly existing in good standing under the laws of the jurisdiction
in which it is organized, and has the requisite organizational power and authority to own its properties and to carry on its business
as now being conducted.
(h) Validity;
Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Buyer and is a valid
and binding agreement of the Buyer enforceable against the Buyer in accordance with its terms, subject as to enforceability to
(i) general principles of equity and to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar
laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies and (ii) public policy
underlying any law, rule or regulation (including any federal or state securities law, rule or regulation) with regards to indemnification,
contribution or exculpation. The execution and delivery of the Transaction Documents (as defined in Section 3(b) hereof) by the
Buyer and the consummation by it of the transactions contemplated hereby and thereby do not conflict with the Buyer’s certificate
of organization or operating agreement or similar documents, and do not require further consent or authorization by the Buyer,
its managers or its members.
(i) Residency.
The Buyer is a resident of the State of Illinois.
(j) No
Prior Short Selling. The Buyer represents and warrants to the Company that at no time prior to the date of this Agreement has
any of the Buyer, its agents, representatives or affiliates engaged in or effected, in any manner whatsoever, directly or indirectly,
any (i) “short sale” (as such term is defined in Section 242.200 of Regulation SHO of the 1934 Act) of the Ordinary
Shares or (ii) hedging transaction, which establishes a net short position with respect to the Ordinary Shares.
3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.
The Company represents
and warrants to the Buyer that as of the date hereof and as of the Commencement Date:
(a) Organization
and Qualification. The Company and its “Subsidiaries” (which for purposes of this Agreement means any entity in
which the Company, directly or indirectly, owns more than 50% of the voting stock or capital stock or other similar equity interests)
are corporations or limited liability companies duly organized and validly existing in good standing under the laws of the jurisdiction
in which they are incorporated or organized (where such concept is recognized in the relevant jurisdiction), and have the requisite
corporate or organizational power and authority to own their properties and to carry on their business as now being conducted.
Each of the Company and its Subsidiaries is duly qualified as a foreign corporation or limited liability company to do business
and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it
makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing could not reasonably
be expected to have a Material Adverse Effect. As used in this Agreement, “Material Adverse Effect” means any material
adverse effect on any of: (i) the business, properties, assets, operations, results of operations or financial condition of the
Company and its Subsidiaries, if any, taken as a whole, or (ii) the authority or ability of the Company to perform its obligations
under the Transaction Documents. The Company has no material Subsidiaries except as set forth on Schedule 3(a).
(b) Authorization;
Enforcement; Validity. (i) The Company has the requisite corporate power and authority to enter into and perform its obligations
under this Agreement, the Registration Rights Agreement and each of the other agreements entered into by the parties on the Commencement
Date and attached hereto as exhibits to this Agreement (collectively, the “Transaction Documents”), and to issue
the Securities in accordance with the terms hereof and thereof, (ii) the execution and delivery of the Transaction Documents by
the Company and the consummation by it of the transactions contemplated hereby and thereby, including without limitation, the issuance
of the Commitment Shares and the reservation for issuance and the issuance of the Purchase Shares issuable under this Agreement,
have been duly authorized by the Company’s Board of Directors or duly authorized committee thereof, do not conflict with
the Company’s Articles of Association (as defined below), and do not require further consent or authorization by the Company,
its Board of Directors, except as set forth in this Agreement, or its shareholders (other than as contemplated by Section 1(h)
hereof), (iii) this Agreement has been, and each other Transaction Document shall be on the Commencement Date, duly executed and
delivered by the Company and (iv) this Agreement constitutes, and each other Transaction Document upon its execution on behalf
of the Company, shall constitute, the valid and binding obligations of the Company enforceable against the Company in accordance
with their terms, except as such enforceability may be limited by (y) general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of creditors’ rights
and remedies and (z) public policy underlying any law, rule or regulation (including any federal or state securities law, rule
or regulation) with regards to indemnification, contribution or exculpation. The Board of Directors of the Company or duly authorized
committee thereof has approved the resolutions (the “Signing Resolutions”) substantially in the form as set
forth as Exhibit B attached hereto to authorize this Agreement and the transactions contemplated hereby. The Signing Resolutions
are valid, in full force and effect and have not been modified or supplemented in any material respect. The Company has delivered
to the Buyer a true and correct copy of the Signing Resolutions as approved by the Board of Directors of the Company or an appropriate
Board committee.
(c) Capitalization.
As of the date hereof, the authorized share capital of the Company consists of 100,000,000 Ordinary Shares, no par value per share,
of which as of the date hereof, 35,029,479 shares are issued and outstanding, zero shares are held as treasury shares and 4,487,186
shares are reserved for future issuance pursuant to the Company’s equity incentive plans, of which approximately 201,054
shares remain available for future option grants or share awards. All of such outstanding shares have been, or upon issuance will
be, validly issued and are fully paid and non-assessable. Except as disclosed in Schedule 3(c), (i) none of the Company’s
securities are subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the
Company, (ii) there are no outstanding debt securities of the Company or any of its Subsidiaries, (iii) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or
rights convertible into, any securities of the Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional securities of the Company
or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, any securities of the Company or any of its Subsidiaries, (iv) there are
no material agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of
any of their securities under the 1933 Act (except the Registration Rights Agreement), (v) there are no outstanding securities
or instruments of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a
security of the Company or any of its Subsidiaries, (vi) there are no securities or instruments containing anti-dilution or similar
provisions that will be triggered by the issuance of the Securities as described in this Agreement and (vii) the Company does not
have any share appreciation rights or “phantom share” plans or agreements or any similar plan or agreement. The Company
has furnished or made available to the Buyer true and correct copies of the Company’s Articles of Association, as amended
and as in effect on the date hereof (the “Articles of Association”).
(d) Issuance
of Securities. The Commitment Shares have been duly authorized and, upon issuance in accordance with the terms hereof, the
Commitment Shares shall be (i) validly issued, fully paid and non-assessable and (ii) free from all taxes, liens and charges with
respect to the issuance thereof. Upon issuance and payment therefore in accordance with the terms and conditions of this Agreement,
the Purchase Shares shall be validly issued, fully paid and non-assessable and free from all taxes, liens and charges with respect
to the issue thereof, with the holders being entitled to all rights accorded to a holder of Ordinary Shares.
(e) No
Conflicts. Except as disclosed in Schedule 3(e), the execution, delivery and performance of the Transaction Documents
by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including,
without limitation, the reservation for issuance and issuance of the Purchase Shares) will not (i) result in a violation of
the Articles of Association or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time
or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation
of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or result, to
the Company’s knowledge, in a violation of any law, rule, regulation, order, judgment or decree (including federal
and state securities laws and regulations and the rules and regulations of the Principal Market applicable to the Company or
any of its Subsidiaries) or by which any property or asset of the Company or any of its Subsidiaries is bound or affected,
except in the case of conflicts, defaults, terminations, amendments, accelerations, cancellations and violations under clause
(ii), which could not reasonably be expected to result in a Material Adverse Effect. Except as disclosed in Schedule 3(e),
neither the Company nor its Subsidiaries is in violation of any term of or in default under its Articles of Association.
Except as disclosed in Schedule 3(e), neither the Company nor any of its Subsidiaries is in violation of any term of or is in
default under any material contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or
any statute, rule or regulation applicable to the Company or its Subsidiaries, except for possible violations, defaults,
terminations or amendments that would not reasonably be expected to have a Material Adverse Effect. The business of the
Company and its Subsidiaries is not being conducted, and shall not be conducted, in violation of any law, ordinance, or
regulation of any governmental entity, except for possible violations, the sanctions for which either individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect. Except as specifically contemplated by this
Agreement, reporting obligations under the 1934 Act, or as required under the 1933 Act or applicable state securities laws or
the filing of a Listing of Additional Shares Notification Form with the Principal Market and except with respect to the
consent of the Israeli Innovation Authority to be obtained in connection with the offering of the Ordinary Shares, to the
extent applicable, and the required filings with the Israeli Registrar of Companies, the Company is not required to obtain
any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or any
regulatory or self-regulatory agency in order for it to execute, deliver or perform any of its obligations under or
contemplated by the Transaction Documents in accordance with the terms hereof or thereof. Except as disclosed in Schedule
3(e) and for reporting obligations under the 1934 Act, all consents, authorizations, orders, filings and registrations which
the Company is required to obtain pursuant to the preceding sentence shall be obtained or effected on or prior to the
Commencement Date. Except as disclosed in Schedule 3(e), the Company is not subject to any notices or actions from or to the
Principal Market other than routine matters incident to listing on the Principal Market and not involving a violation of the
rules of the Principal Market. Except as disclosed in Schedule 3(e), to the Company’s knowledge, the Principal Market
has not commenced any delisting proceedings against the Company.
(f) SEC
Documents; Financial Statements. Except as disclosed in Schedule 3(f), since September 30, 2018, the Company has filed all
reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements
of the 1934 Act (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements
and schedules thereto and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”).
As of their respective dates (except as they have been correctly amended), the SEC Documents complied in all material respects
with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC (except as they may have been properly amended), contained
any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they were made, not misleading. As of their respective
dates (except as they have been properly amended), the financial statements of the Company included in the SEC Documents complied
as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC
with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as may be otherwise indicated in such financial statements or the
notes thereto or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed
or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments). Except as disclosed in Schedule 3(f) or routine correspondence, such as comment letters and notices
of effectiveness in connection with previously filed registration statements or periodic reports publicly available on EDGAR, to
the Company’s knowledge, the Company or any of its Subsidiaries are not on the date hereof the subject of any inquiry, investigation
or action by the SEC.
(g) Absence
of Certain Changes. Except as disclosed in Schedule 3(g), since September 30, 2019, there has been no material adverse change
in the business, properties, operations, financial condition or results of operations of the Company or its Subsidiaries taken
as a whole. For purposes of this Agreement, neither a decrease in cash or cash equivalents or in the market price of the Ordinary
Shares nor losses incurred in the ordinary course of the Company’s business shall be deemed or considered a material adverse
change. The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any
Bankruptcy Law nor does the Company or any of its Subsidiaries have any knowledge or reason to believe that its creditors intend
to initiate involuntary bankruptcy or insolvency proceedings. The Company is financially solvent and is generally able to pay its
debts as they become due.
(h) Absence
of Litigation. Except as disclosed in Schedule 3(h), to the Company’s knowledge, there is no action, suit, proceeding,
inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending
or, to the knowledge of the Company or any of its Subsidiaries, threatened against the Company, the Ordinary Shares or any of the
Company’s Subsidiaries or any of the Company’s or the Company’s Subsidiaries’ officers or directors in
their capacities as such, which could reasonably be expected to have a Material Adverse Effect (each, an “Action”).
A description of each such Action, if any, is set forth in Schedule 3(h).
(i) Acknowledgment
Regarding Buyer’s Status. The Company acknowledges and agrees that the Buyer is acting solely in the capacity of arm’s
length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby. The Company further
acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with
respect to the Transaction Documents and the transactions contemplated hereby and thereby and any advice given by the Buyer or
any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby and
thereby is merely incidental to the Buyer’s purchase of the Securities. The Company further represents to the Buyer that
the Company’s decision to enter into the Transaction Documents has been based solely on the independent evaluation by the
Company and its representatives and advisors.
(j) Intellectual
Property Rights. To the Company’s knowledge, the Company and its Subsidiaries own or possess adequate rights or licenses
to use all material trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights,
copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights
(collectively, “Intellectual Property”) necessary to conduct their respective businesses as now conducted, except
as set forth in Schedule 3(j) or to the extent that the failure to own, possess, license or otherwise hold adequate rights to use
Intellectual Property would not, individually or in the aggregate, have a Material Adverse Effect. Except as disclosed in Schedule
3(j), to the Company’s knowledge, none of the Company’s active and registered Intellectual Property have expired or
terminated, or, by the terms and conditions thereof, will expire or terminate within two years from the date of this Agreement,
except as would not reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries do not have any
knowledge of any infringement by the Company or its Subsidiaries of any Intellectual Property of others and, except as set forth
on Schedule 3(j), there is no claim, action or proceeding being made or brought against, or to the Company’s knowledge, being
threatened against, the Company or its Subsidiaries regarding Intellectual Property, which could reasonably be expected to have
a Material Adverse Effect.
(k) Environmental
Laws. To the Company’s knowledge, the Company and its Subsidiaries (i) are in material compliance with any and all
applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety or
the environment and with respect to hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”), (ii) have received all material permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective businesses and (iii) are in material compliance with all
terms and conditions of any such permit, license or approval, except where, in each of the three foregoing clauses, the
failure to so comply or receive such approvals could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
(l) Title.
The Company and its Subsidiaries have good and marketable title to all personal property owned by them that is material to the
business of the Company and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as
are described in Schedule 3(l) or such as do not materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and any of its Subsidiaries or could not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect. Any real property and facilities held under lease by the Company
and any of its Subsidiaries, to the Company’s knowledge, are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings
by the Company and its Subsidiaries.
(m) Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as management of the Company believes to be reasonable and customary in the businesses in which
the Company and its Subsidiaries are engaged. To the Company’s knowledge, since January 1, 2017, neither the Company
nor any such Subsidiary has been refused any insurance coverage sought or applied for and neither the Company nor any such
Subsidiary, to the Company’s knowledge, will be unable to renew its existing insurance coverage as and when such
coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost
that would not reasonably be expected to have a Material Adverse Effect.
(n) Regulatory
Permits. The Company and its Subsidiaries possess all material certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their respective businesses as currently conducted, except
when the failure to so possess such certificates, authorizations or permits could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any written notice
of proceedings relating to the revocation or modification of any such material certificate, authorization or permit.
(o) Tax
Status. The Company and each of its Subsidiaries has made or filed all federal and state income and all other material tax
returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company
and each of its Subsidiaries has set aside on its books reserves reasonably adequate for the payment of all unpaid and unreported
taxes or filed valid extensions) and has paid all taxes and other governmental assessments and charges that are material in amount,
shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and has set
aside on its books reserves reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such
returns, reports or declarations apply. To the Company’s knowledge, there are no unpaid taxes in any material amount claimed
to be due by the taxing authority of any jurisdiction.
(p) Transactions
With Affiliates. Except as set forth on Schedule 3(p), and other than (i) the grant or exercise of share options or any other
equity securities offered pursuant to duly adopted share or incentive compensation plans as disclosed on Schedule 3(c) and (ii)
employment agreements approved by the Board of Directors of the Company, none of the officers, directors or employees of the Company
is on the date hereof a party to any transaction with the Company or any of its Subsidiaries (other than for services as employees,
officers and directors and reimbursement for expenses incurred on behalf of the Company), including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any corporation,
partnership, trust or other entity in which any officer, director, or any such employee has a material interest or is an officer,
director, trustee or general partner.
(q) [Intentionally
omitted.]
(r) Registration
Statement. The Shelf Registration Statement (as defined in Section 4(a) hereof) has been declared effective by the SEC, and
no stop order has been issued or is pending or, to the knowledge of the Company, threatened by the SEC with respect thereto. As
of the date hereof, the Company has a dollar amount of securities registered and unsold under the Shelf Registration Statement,
which is not less than the sum of (i) the Available Amount and (ii) the market value of the Commitment Shares on the date hereof.
4. COVENANTS.
(a) Filing of Form
8-K and Prospectus Supplement. The Company agrees that it shall, within the time required under the 1934 Act, file a
Current Report on Form 8-K disclosing this Agreement and the transaction contemplated hereby. The Company shall file within
two (2) Business Days from the date hereof a prospectus supplement to the Company’s existing shelf registration
statement on Form S-3 (File No. 333-230016, the “Shelf Registration Statement”) covering the sale of the
Commitment Shares and Purchase Shares (the “Prospectus Supplement”) in accordance with the terms of the
Registration Rights Agreement between the Company and the Buyer, dated as of the date hereof (the “Registration
Rights Agreement”). The Company shall use its reasonable best efforts to keep the Shelf Registration
Statement and any New Registration Statement (as defined in the Registration Rights Agreement) effective pursuant to Rule 415
promulgated under the 1933 Act and available for sales of all Securities to the Buyer until such time as (i) it no longer
qualifies to make sales under the Shelf Registration Statement (which shall be understood to include the inability of the
Company to immediately register sales of Securities to the Buyer under the Shelf Registration Statement or any New
Registration Statement pursuant to General Instruction I.B.6 of Form S-3), (ii) the date on which all the Securities have
been sold under this Agreement and no Available Amount remains thereunder, or (iii) this Agreement has been terminated.
The Shelf Registration Statement (including any amendments or supplements thereto and prospectuses or prospectus
supplements, including the Prospectus Supplement, contained therein) shall not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein, in light of
the circumstances in which they were made, not misleading.
(b) Blue
Sky. The Company shall take such action, if any, as is reasonably necessary in order to obtain an exemption for or to qualify
(i) the initial sale of the Securities to the Buyer under this Agreement and (ii) any subsequent sale of the Securities by the
Buyer, in each case, under applicable securities or “Blue Sky” laws of the states of the United States in such states
as is reasonably requested by the Buyer from time to time, and shall provide evidence of any such action so taken to the Buyer
at its written request; provided, however, that the Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified
or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.
(c) Listing.
The Company shall promptly secure the listing of all of the Securities upon each national securities exchange and automated quotation
system that requires an application by the Company for listing, if any, upon which Ordinary Shares are then listed (subject to
official notice of issuance) and shall maintain such listing, so long as any other Ordinary Shares shall be so listed. The Company
shall use its reasonable best efforts to maintain the Ordinary Shares’ listing on the Principal Market in accordance with
the requirements of the Registration Rights Agreement. Neither the Company nor any of its Subsidiaries shall take any action that
would be reasonably expected to result in the delisting or suspension of the Ordinary Shares on the Principal Market, unless the
Ordinary Shares is immediately thereafter traded on the New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market,
the Nasdaq Global Market, or the Nasdaq Capital Market. The Company shall pay all fees and expenses in connection with satisfying
its obligations under this Section.
(d) Limitation
on Short Sales and Hedging Transactions. The Buyer agrees that beginning on the date of this Agreement and ending on the date
of termination of this Agreement as provided in Section 11(k), the Buyer and its agents, representatives and affiliates shall not
in any manner whatsoever enter into or effect, directly or indirectly, any (i) “short sale” (as such term is defined
in Section 242.200 of Regulation SHO of the 1934 Act) of the Ordinary Shares or (ii) hedging transaction, which establishes a net
short position with respect to the Ordinary Shares.
(e) Issuance
of Commitment Shares. In connection with the Commencement, the Company shall issue to the Buyer as consideration for the Buyer
entering into this Agreement 612,520 Ordinary Shares (the “Commitment Shares”). The Commitment Shares shall
be issued without any restrictive legend whatsoever or prior sale requirement.
(f) Due
Diligence. The Buyer shall have the right, from time to time as the Buyer may reasonably request, to perform reasonable due
diligence on the Company during normal business hours and subject to reasonable prior notice to the Company. The Company and its
officers and employees shall provide information and reasonably cooperate with the Buyer in connection with any reasonable request
by the Buyer related to the Buyer’s due diligence of the Company, including, but not limited to, any such request made by
the Buyer in connection with (i) the filing of the prospectus supplement described in Section 4(a) hereof and (ii) the Commencement;
provided, however, that at no time is the Company required to disclose material nonpublic information to the Buyer or breach any
obligation of confidentiality or non-disclosure to a third party or make any disclosure that could cause a waiver of attorney-client
privilege. Except as may be required by law, court order or governmental authority, each party hereto agrees not to disclose any
Confidential Information of the other party to any third party and shall not use the Confidential Information of such other party
for any purpose other than in connection with, or in furtherance of, the transactions contemplated hereby; provided, that to the
extent such disclosure is required by law, court order or governmental authority, the receiving party shall provide the disclosing
party with reasonable prior written notice of such disclosure and make a reasonable effort to assist the disclosing party in obtaining
a protective order preventing or limiting the disclosure and/or requiring that the Confidential Information so disclosed be used
only for the purposes for which the law, court order or governmental authority requires. Each party hereto acknowledges that the
Confidential Information shall remain the property of the disclosing party and agrees that it shall take all reasonable measures
to protect the secrecy of any Confidential Information disclosed by the other party.
(g) [Intentionally
omitted.]
| 5. | TRANSFER AGENT INSTRUCTIONS. |
All of the Purchase Shares
to be issued under this Agreement shall be issued without any restrictive legend unless the Buyer expressly consents otherwise.
The Company shall issue irrevocable instructions to the Transfer Agent, and any subsequent transfer agent, to issue Ordinary Shares
in the name of the Buyer for the Purchase Shares (the “Irrevocable Transfer Agent Instructions”). The Company
warrants to the Buyer that no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5,
will be given by the Company to the Transfer Agent with respect to the Purchase Shares and that the Commitment Shares and the Purchase
Shares shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement
and the Registration Rights Agreement.
| 6. | CONDITIONS TO THE COMPANY’S RIGHT TO COMMENCE
SALES OF ORDINARY SHARES UNDER THIS AGREEMENT. |
The right of the Company
hereunder to commence sales of the Purchase Shares is subject to the satisfaction of each of the following conditions on or before
the Commencement Date (the date that the Company may begin sales of Purchase Shares):
(a) The
Buyer shall have executed each of the Transaction Documents and delivered the same to the Company;
(b) The
representations and warranties of the Buyer shall be true and correct as of the Commencement Date as though made at that time (except
for representations and warranties that speak as of a specific date, which shall be true and correct in all material respects as
of such specific date) and the Buyer shall have performed, satisfied and complied in all material respects with the covenants and
agreements required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Commencement
Date; and
(c) The
Prospectus Supplement shall have been delivered to the Buyer and no stop order with respect to the registration statement covering
the sale of shares to the Buyer shall be pending or threatened by the SEC.
| 7. | CONDITIONS TO THE BUYER’S OBLIGATION TO MAKE PURCHASES
OF ORDINARY SHARES. |
The obligation of the Buyer
to buy Purchase Shares under this Agreement is subject to the satisfaction of each of the following conditions on or before the
Commencement Date (the date that the Company may begin sales of Purchase Shares) and once such conditions have been initially satisfied,
there shall not be any ongoing obligation to satisfy such conditions after the Commencement has occurred:
(a) The
Company shall have executed each of the Transaction Documents and delivered the same to the Buyer;
(b) [Intentionally
Omitted.];
(c) The
Ordinary Shares shall be authorized for quotation on the Principal Market, trading in the Ordinary Shares shall not have been within
the last 365 days suspended by the SEC or the Principal Market, other than a general halt in trading in the Ordinary Shares by
the Principal Market under halt codes indicating pending or released material news, and the Securities shall be approved for listing
upon the Principal Market;
(d) The
Buyer shall have received the opinion of the Company’s legal counsel dated as of the Commencement Date in customary form
and substance;
(e) The
representations and warranties of the Company shall be true and correct in all material respects (except to the extent that any
of such representations and warranties is already qualified as to materiality in Section 3 above, in which case, such representations
and warranties shall be true and correct without further qualification) as of the date of this Agreement and as of the Commencement
Date as though made at that time (except for representations and warranties that speak as of a specific date, which shall be true
and correct in all material respects as of such specific date) and the Company shall have performed, satisfied and complied in
all material respects with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied
or complied with by the Company at or prior to the Commencement Date. The Buyer shall have received a certificate, executed by
the CEO, President or CFO of the Company, dated as of the Commencement Date, to the foregoing effect in the form attached hereto
as Exhibit A;
(f) The
Board of Directors of the Company or a duly authorized committee thereof shall have adopted resolutions substantially in the form
attached hereto as Exhibit B which shall be in full force and effect without any amendment or supplement thereto as of the
Commencement Date;
(g) As
of the Commencement Date, the Company shall have reserved out of its authorized and unissued Ordinary Shares, solely for the purpose
of effecting future purchases of Purchase Shares hereunder, 7,000,394 Ordinary Shares;
(h) The
Irrevocable Transfer Agent Instructions, in form acceptable to the Buyer shall have been signed by the Company and the Buyer and
shall have been delivered to the Transfer Agent;
(i) [Intentionally
Omitted.];
(j) [Intentionally
Omitted.];
(k) The
Company shall have delivered to the Buyer an officer’s certificate executed by the Chief Financial Officer of the Company,
dated as of the Commencement Date, in the form attached hereto as Exhibit C;
(l) The
Shelf Registration Statement shall have been declared effective under the 1933 Act by the SEC and no stop order with respect thereto
shall be pending or threatened by the SEC. The Company shall have prepared and delivered to the Buyer a final and complete form
of prospectus supplement, dated and current as of the Commencement Date, to be used in connection with any issuances of any Commitment
Shares or any Purchase Shares to the Buyer, and to be filed by the Company within one (1) Business Day after the Commencement Date
pursuant to Rule 424(b). The Company shall have made all filings under all applicable federal and state securities laws necessary
to consummate the issuance of the Commitment Shares and the Purchase Shares pursuant to this Agreement in compliance with such
laws;
(m) No
Event of Default has occurred and is continuing, or any event which, after notice and/or lapse of time, would become an Event of
Default has occurred;
(n) [Intentionally
omitted.]; and
(o) The
Company shall have provided the Buyer with the information reasonably requested by the Buyer in connection with its due diligence
requests made prior to, or in connection with, the Commencement, in accordance with the terms of Section 4(f) hereof.
In consideration of the
Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities hereunder and in addition to all
of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect, indemnify and hold
harmless the Buyer and all of its affiliates, members, officers, directors, and employees, and any of the foregoing person’s
agents or other representatives (including, without limitation, those retained in connection with the transactions contemplated
by this Agreement) (collectively, the “Indemnitees”) from and against any and all third party actions, causes
of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective
of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable
attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result
of, or arising out of, or relating to (a) any misrepresentation or breach of any representation or warranty made by the Company
in the Transaction Documents or any other certificate, instrument or document contemplated hereby or thereby, (b) any breach of
any covenant, agreement or obligation of the Company contained in the Transaction Documents or any other certificate, instrument
or document contemplated hereby or thereby, or (c) any cause of action, suit or claim brought or made against such Indemnitee and
arising out of or resulting from the execution, delivery, performance or enforcement of the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, other than with respect to Indemnified Liabilities which directly
and primarily result from (A) a breach of any of the Buyer’s representations and warranties, covenants or agreements contained
in this Agreement, or (B) the gross negligence, bad faith or willful misconduct of the Buyer or any other Indemnitee. To the extent
that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution
to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law.
An “Event of Default”
shall be deemed to have occurred at any time as any of the following events occurs:
(a) during
any period in which the effectiveness of any registration statement is required to be maintained pursuant to the terms of the Registration
Rights Agreement, the effectiveness of such registration statement lapses for any reason (including, without limitation, the issuance
of a stop order) or is unavailable to the Company for the sale of all of the Registrable Securities (as defined in the Registration
Rights Agreement) to the Buyer in accordance with the terms of the Registration Rights Agreement, and such lapse or unavailability
continues for a period of ten (10) consecutive Business Days or for more than an aggregate of thirty (30) Business Days in any
365-day period, which is not in connection with a post-effective amendment to any such registration statement or the filing of
a new registration statement; provided, however, that in connection with any post-effective amendment to such registration statement
or filing of a new registration statement that is required to be declared effective by the SEC, such lapse or unavailability may
continue for a period of no more than thirty (30) consecutive Business Days, which such period shall be extended for an additional
thirty (30) Business Days if the Company receives a comment letter from the SEC in connection therewith;
(b) the
suspension from trading or failure of the Ordinary Shares to be listed on a Principal Market for a period of three (3) consecutive
Business Days;
(c) the
delisting of the Ordinary Shares from the Principal Market, and the Ordinary Shares is not immediately thereafter trading on the
New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market, or the Nasdaq Capital Market;
(d) the
failure for any reason by the Transfer Agent to issue Purchase Shares to the Buyer within five (5) Business Days after the applicable
Purchase Date that the Buyer is entitled to receive;
(e) the
Company’s breach of any representation or warranty (as of the dates made), covenant or other term or condition under any
Transaction Document if such breach could reasonably be expected to have a Material Adverse Effect and except, in the case of a
breach of a covenant which is reasonably curable, only if such breach continues uncured for a period of at least five (5) Business
Days;
(f) if
any Person commences a proceeding against the Company pursuant to or within the meaning of any Bankruptcy Law;
(g) if
the Company pursuant to or within the meaning of any Bankruptcy Law; (A) commences a voluntary case, (B) consents to the entry
of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially
all of its property, (D) makes a general assignment for the benefit of its creditors or (E) becomes insolvent;
(h) a
court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Company in
an involuntary case, (B) appoints a Custodian of the Company or for all or substantially all of its property, or (C) orders the
liquidation of the Company or any Subsidiary; or
(i) if
at any time after the Commencement Date, the Exchange Cap is reached unless and until shareholder approval has been obtained pursuant
to Section 1(h) hereof. The Exchange Cap shall be deemed to be reached at such time if, upon submission of a Purchase Notice or
VWAP Purchase Notice under this Agreement, the issuance of such Ordinary Shares would exceed the number of Ordinary Shares which
the Company may issue under this Agreement without breaching the Company’s obligations under the rules or regulations of
the Principal Market.
In addition to any other rights and remedies
under applicable law and this Agreement, including the Buyer termination rights under Section 11(k) hereof, so long as an Event
of Default has occurred and is continuing, or if any event which, after notice and/or lapse of time, would become an Event of Default,
has occurred and is continuing, or so long as the Closing Sale Price is below the Floor Price, the Company may not require and
the Buyer shall not be obligated to purchase any Ordinary Shares under this Agreement. If pursuant to or within the meaning of
any Bankruptcy Law, the Company commences a voluntary case or any Person commences a proceeding against the Company, a Custodian
is appointed for the Company or for all or substantially all of its property, or the Company makes a general assignment for the
benefit of its creditors, (any of which would be an Event of Default as described in Sections 9(f), 9(g) and 9(h) hereof) this
Agreement shall automatically terminate without any liability or payment to the Company without further action or notice by any
Person. No such termination of this Agreement under Section 11(k)(i) shall affect the Company’s or the Buyer’s obligations
under this Agreement with respect to pending purchases and the Company and the Buyer shall complete their respective obligations
with respect to any pending purchases under this Agreement.
| 10. | CERTAIN DEFINED TERMS. |
For purposes of this Agreement,
the following terms shall have the following meanings:
(a) “1933
Act” means the Securities Act of 1933, as amended.
(b) “Available
Amount” means initially Ten Million Dollars ($10,000,000) in the aggregate which amount shall be reduced by the Purchase
Amount each time the Buyer purchases Ordinary Shares pursuant to Section 1 hereof.
(c) “Bankruptcy
Law” means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.
(d) “Business
Day” means any day on which the Principal Market is open for trading during normal trading hours (i.e., 9:30 a.m. to
4:00 p.m. Eastern Time), including any day on which the Principal Market is open for trading for a period of time less than the
customary time.
(e) “Closing
Sale Price” means the last closing trade price for the Ordinary Shares on the Principal Market as reported by the Principal
Market.
(f) “Confidential
Information” means any information disclosed by either party to the other party, either directly or indirectly, in writing,
orally or by inspection of tangible objects (including, without limitation, documents, prototypes, samples, protocols, development
plans, commercialization plans, compounds, formulations, preclinical study and clinical trial results, plant and equipment), which
is designated as “Confidential,” “Proprietary” or some similar designation. Information communicated orally
shall be considered Confidential Information if such information is expressly identified as Confidential Information at the time
of such initial disclosure and confirmed in writing as being Confidential Information within ten (10) Business Days after the initial
disclosure. Confidential Information may also include information disclosed to a disclosing party by third parties. Confidential
Information shall not, however, include any information which (i) was publicly known and made generally available in the public
domain prior to the time of disclosure by the disclosing party; (ii) becomes publicly known and made generally available after
disclosure by the disclosing party to the receiving party through no action or inaction of the receiving party or its affiliates;
(iii) is already in the possession of the receiving party at the time of disclosure by the disclosing party as shown by the receiving
party’s files and records immediately prior to the time of disclosure; (iv) is obtained by the receiving party from a third
party without a breach of such third party’s obligations of confidentiality; or (v) is independently developed by the receiving
party without use of or reference to the disclosing party’s Confidential Information, as shown by documents and other competent
evidence in the receiving party’s possession.
(g) “Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
(h) “Maturity
Date” means the date that is thirty (30) months from the Commencement Date.
(i) “Person”
means an individual or entity including any limited liability company, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization and a government or any department or agency thereof.
(j) “Principal
Market” means the Nasdaq Capital Market; provided however, that in the event the Company’s Ordinary Shares is ever
listed or traded on the New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market,
or the Nasdaq Capital Market, then the “Principal Market” shall mean such other market or exchange on which the Company’s
Ordinary Shares is then listed or traded.
(k) “Purchase
Amount” means, with respect to any particular purchase made hereunder, the portion of the Available Amount to be purchased
by the Buyer pursuant to Section 1 hereof as set forth in a valid Purchase Notice or VWAP Purchase Notice which the Company delivers
to the Buyer.
(l) “Purchase
Date” means, with respect to any Regular Purchase made hereunder, the Business Day of receipt by the Buyer of a valid
Purchase Notice that the Buyer is to buy Purchase Shares pursuant to Section 1(b) hereof.
(m) “Purchase
Notice” shall mean an irrevocable written notice from the Company to the Buyer directing the Buyer to buy Purchase Shares
pursuant to Section 1(b) hereof as specified by the Company therein at the applicable Purchase Price on the Purchase Date.
(n)
“Purchase Price” means the lesser of (i) the lowest Sale Price of the Ordinary Shares on the Purchase Date or
(ii) the arithmetic average of the three (3) lowest Closing Sale Prices for the Ordinary Shares during the ten (10) consecutive
Business Days ending on the Business Day immediately preceding such Purchase Date (to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, share split, reverse share split or other similar transaction).
(o) “Sale
Price” means any trade price for the Ordinary Shares on the Principal Market during normal trading hours, as reported
by the Principal Market.
(p) “SEC”
means the U.S. Securities and Exchange Commission.
(q) “Transfer
Agent” means the transfer agent of the Company as set forth in Section 11(f) hereof or such other person who is then
serving as the transfer agent for the Company in respect of the Ordinary Shares.
(r) “VWAP
Minimum Price Threshold” means, with respect to any particular VWAP Purchase Notice, the Sale Price on the VWAP Purchase
Date equal to the greater of (i) 80% of the Closing Sale Price on the Business Day immediately preceding the VWAP Purchase Date
or (ii) such higher price as set forth by the Company in the VWAP Purchase Notice.
(s) “VWAP
Purchase Amount” means, with respect to any particular VWAP Purchase Notice, the portion of the Available Amount to be
purchased by the Buyer pursuant to Section 1(c) hereof pursuant to a valid VWAP Purchase Notice which requires the Buyer to buy
the VWAP Purchase Share Percentage of the aggregate shares traded on the Principal Market during normal trading hours on the VWAP
Purchase Date up to the VWAP Purchase Share Volume Maximum, subject to the VWAP Minimum Price Threshold.
(t) “VWAP
Purchase Date” means, with respect to any VWAP Purchase made hereunder, the Business Day following the receipt by the
Buyer of a valid VWAP Purchase Notice that the Buyer is to buy Purchase Shares pursuant to Section 1(c) hereof.
(u) “VWAP
Purchase Notice” shall mean an irrevocable written notice from the Company to the Buyer directing the Buyer to buy Purchase
Shares on the VWAP Purchase Date pursuant to Section 1(c) hereof as specified by the Company therein at the applicable VWAP Purchase
Price with the applicable VWAP Purchase Share Percentage specified therein.
(v) “VWAP
Purchase Share Percentage” means, with respect to any particular VWAP Purchase Notice pursuant to Section 1(c) hereof,
the percentage set forth in the VWAP Purchase Notice which the Buyer will be required to buy as a specified percentage of the aggregate
shares traded on the Principal Market during normal trading hours up to the VWAP Purchase Share Volume Maximum on the VWAP Purchase
Date subject to Section 1(c) hereof but in no event shall this percentage exceed thirty percent (30%) of such VWAP Purchase Date’s
share trading volume of the Ordinary Shares on the Principal Market during normal trading hours.
(w)
“VWAP Purchase Price” means the lesser of (i) the Closing Sale Price on the VWAP Purchase Date; or (ii) ninety-seven
percent (97%) of volume weighted average price for the Ordinary Shares traded on the Principal Market during normal trading hours
on (A) the VWAP Purchase Date if the aggregate shares traded on the Principal Market on the VWAP Purchase Date have not exceeded
the VWAP Purchase Share Volume Maximum and the Sale Price of Ordinary Shares has not fallen below the VWAP Minimum Price Threshold
(to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, share split, reverse share split or
other similar transaction), or (B) the portion of the VWAP Purchase Date until such time as the sooner to occur of (1) the time
at which the aggregate shares traded on the Principal Market has exceeded the VWAP Purchase Share Volume Maximum, or (2) the time
at which the Sale Price of Ordinary Shares falls below the VWAP Minimum Price Threshold (to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, share split, reverse share split or other similar transaction).
(x)
“VWAP Purchase Share Estimate” means the number of Ordinary Shares that the Company elects to set forth in a
VWAP Purchase Notice in connection with a VWAP Purchase pursuant to Section 1(c) hereof which is the maximum number of Ordinary
Shares that the Buyer may be obligated to buy in such VWAP Purchase but which shall not exceed 250,000 Ordinary Shares for any
one VWAP Purchase (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, share split, reverse
share split or other similar transaction).
(y)
“VWAP Purchase Share Volume Maximum” means a number of Ordinary Shares traded on the Principal Market during
normal trading hours on the VWAP Purchase Date equal to: (i) the VWAP Purchase Share Estimate, divided by (ii) the VWAP Purchase
Share Percentage (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, share split, reverse
share split or other similar transaction).
(a) Governing Law;
Jurisdiction; Jury Trial. The laws of the State of Israel shall govern all issues concerning the relative rights of
the Company and its shareholders. All other questions concerning the construction, validity, enforcement and interpretation
of this Agreement and the other Transaction Documents shall be governed by the internal laws of the State of Illinois,
without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Illinois or any
other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Illinois. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of
Chicago, for the adjudication of any dispute hereunder or under the other Transaction Documents or in connection herewith or
therewith, or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding
is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(b) Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile
or pdf (or other electronic reproduction) signature shall be considered due execution and shall be binding upon the signatory thereto
with the same force and effect as if the signature were an original, not a facsimile or PDF (or other electronic reproduction)
signature.
(c) Headings.
The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this
Agreement.
(d) Severability.
If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability
of any provision of this Agreement in any other jurisdiction.
(e) Entire
Agreement. This Agreement and the Registration Rights Agreement supersede all other prior oral or written agreements between
the Buyer, the Company, their affiliates and persons acting on their behalf with respect to the matters discussed herein, and this
Agreement, the other Transaction Documents and the instruments referenced herein contain the entire understanding of the parties
with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company
nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. Each of the Company and
the Buyer acknowledges and agrees that it has not relied on, in any manner whatsoever, any representations or statements, written
or oral, other than as expressly set forth in this Agreement.
(f) Notices.
Any notices, consents or other communications required or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile
(provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii)
upon receipt, when sent by electronic message (provided the recipient responds to the message and confirmation of both electronic
messages are kept on file by the sending party); or (iv) one (1) Business Day after timely deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:
If to the Company:
Intec Pharma Ltd.
12 Hartom Street
Har Hotzvim, Jerusalem 9777512
| Telephone: |
972-2-586-4657 |
| Facsimile: |
972-77-470-1797 |
| Attention: |
Nir Sassi |
| Email: |
nir@intecpharma.com |
With a copy (which shall not constitute notice) to:
McDermott Will & Emery LLP
340 Madison Avenue
New York, NY 10173
| Telephone: |
212-547-5352 |
| Facsimile: |
646-390-0820 |
| Attention: |
Gary Emmanuel |
| Email: |
gemmanuel@mwe.com |
If to the Buyer:
Aspire Capital Fund, LLC
155 North Wacker Drive, Suite 1600
Chicago, IL 60606
| Telephone: |
312-658-0400 |
| Facsimile: |
312-658-4005 |
| Attention: |
Steven G. Martin |
| Email: |
smartin@aspirecapital.com |
With a copy to (which shall not constitute delivery to the Buyer):
Morrison & Foerster LLP
2000 Pennsylvania Avenue, NW, Suite 6000
Washington, DC 20006
| Telephone: |
202-778-1611 |
| Facsimile: |
202-887-0763 |
| Attention: |
Martin P. Dunn, Esq. |
| |
Email: mdunn@mofo.com |
If to the Transfer Agent:
VStock Transfer, LLC
18 Lafayette Pl.
Woodmere, NY 11598
| Telephone: |
212-828-8436 |
| Facsimile: |
646-536-3179 |
| Email: |
info@vstocktransfer.com |
or at such other address and/or facsimile number
and/or to the attention of such other person as the recipient party has specified by written notice given to each other party at
least one (1) Business Day prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient
of such notice, consent or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, and recipient facsimile number, (C) electronically generated by the sender’s electronic mail containing
the time, date and recipient email address or (D) provided by a nationally recognized overnight delivery service, shall be rebuttable
evidence of receipt in accordance with clause (i), (ii), (iii) or (iv) above, respectively.
(g) Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and
assigns. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of
the Buyer, including by merger or consolidation; provided, however, that any transaction, whether by merger, reorganization, restructuring,
consolidation, financing or otherwise, whereby the Company remains the surviving entity immediately after such transaction shall
not be deemed a succession or assignment. The Buyer may not assign its rights or obligations under this Agreement.
(h) No
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.
(i) Publicity.
The Buyer shall have the right to approve before issuance any press release, SEC filing or any other public disclosure made by
or on behalf of the Company whatsoever with respect to, in any manner, the Buyer, its purchases hereunder or any aspect of this
Agreement or the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval
of the Buyer, to make any press release or other public disclosure (including any filings with the SEC) with respect to such transactions
as is required by applicable law and regulations so long as the Company and its counsel consult with the Buyer in connection with
any such press release or other public disclosure at least one (1) Business Day prior to its release; provided, however, that the
Company’s obligations pursuant to this Section 11(i) shall not apply if the material provisions of such press release, SEC
filing, or other public disclosure previously has been publicly disclosed by the Company in accordance with this Section 11(i).
The Buyer must be provided with a copy thereof at least one (1) Business Day prior to any release or use by the Company thereof.
(j) Further
Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.
(k) Termination.
This Agreement may be terminated only as follows:
(i) By
the Buyer any time an Event of Default exists without any liability or payment to the Company. However, if pursuant to or within
the meaning of any Bankruptcy Law, the Company commences a voluntary case or any Person commences a proceeding against the Company,
a Custodian is appointed for the Company or for all or substantially all of its property, or the Company makes a general assignment
for the benefit of its creditors, (any of which would be an Event of Default as described in Sections 9(f), 9(g) and 9(h) hereof)
this Agreement shall automatically terminate without any liability or payment to the Company without further action or notice by
any Person. No such termination of this Agreement under this Section 11(k)(i) shall affect the Company’s or the Buyer’s
obligations under this Agreement with respect to pending purchases and the Company and the Buyer shall complete their respective
obligations with respect to any pending purchases under this Agreement.
(ii) In
the event that the Commencement shall not have occurred the Company shall have the option to terminate this Agreement for any reason
or for no reason without any liability whatsoever of either party to the other party under this Agreement.
(iii) In
the event that the Commencement shall not have occurred within ten (10) Business Days of the date of this Agreement, due to the
failure to satisfy any of the conditions set forth in Sections 6 and 7 above with respect to the Commencement, either party shall
have the option to terminate this Agreement at the close of business on such date or thereafter without liability of either party
to any other party; provided, however, that the right to terminate this Agreement under this Section 11(k)(iii) shall not be available
to either party if such failure to satisfy any of the conditions set forth in Sections 6 and 7 is the result of a breach of this
Agreement by such party or the failure of any representation or warranty of such party included in this Agreement to be true and
correct in all material respects.
(iv)
At any time after the Commencement Date, the Company shall have the option to terminate this Agreement for any reason or for no
reason by delivering notice (a “Company Termination Notice”) to the Buyer electing to terminate this Agreement
without any liability whatsoever of either party to the other party under this Agreement. The Company Termination Notice shall
not be effective until one (1) Business Day after it has been received by the Buyer.
(v) This
Agreement shall automatically terminate on the date that the Company sells and the Buyer purchases the full Available Amount as
provided herein, without any action or notice on the part of any party and without any liability whatsoever of any party to any
other party under this Agreement.
(vi) If
by the Maturity Date for any reason or for no reason the full Available Amount under this Agreement has not been purchased as provided
for in Section 1 of this Agreement, this Agreement shall automatically terminate on the Maturity Date, without any action or notice
on the part of any party and without any liability whatsoever of any party to any other party under this Agreement.
Except as set forth in Sections 11(k)(i)
(in respect of an Event of Default under Sections 9(f), 9(g) and 9(h)), 11(k)(v) and 11(k)(vi), any termination of this Agreement
pursuant to this Section 11(k) shall be effected by written notice from the Company to the Buyer, or the Buyer to the Company,
as the case may be, setting forth the basis for the termination hereof. The representations and warranties of the Company and the
Buyer contained in Sections 2, 3 and 5 hereof, the indemnification provisions set forth in Section 8 hereof and the agreements
and covenants set forth in Sections 4(e) and 11, shall survive the Commencement and any termination of this Agreement. No termination
of this Agreement shall affect the Company’s or the Buyer’s rights or obligations (i) under the Registration Rights
Agreement which shall survive any such termination in accordance with its terms or (ii) under this Agreement with respect to pending
purchases and the Company and the Buyer shall complete their respective obligations with respect to any pending purchases under
this Agreement.
(l) No
Financial Advisor, Placement Agent, Broker or Finder. The Company represents and warrants to the Buyer that it has not engaged
any financial advisor, placement agent, broker or finder in connection with the transactions contemplated hereby. The Buyer represents
and warrants to the Company that it has not engaged any financial advisor, placement agent, broker or finder in connection with
the transactions contemplated hereby. Each party shall be responsible for the payment of any fees or commissions, if any, of any
financial advisor, placement agent, broker or finder engaged by such party relating to or arising out of the transactions contemplated
hereby. Each party shall pay, and hold the other party harmless against, any liability, loss or expense (including, without limitation,
attorneys’ fees and out of pocket expenses) arising in connection with any such claim.
(m) No
Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.
(n) Failure
or Indulgence Not Waiver. No failure or delay in the exercise of any power, right or privilege hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise
thereof or of any other right, power or privilege.
* * * * *
IN WITNESS WHEREOF,
the Buyer and the Company have caused this Ordinary Shares Purchase Agreement to be duly executed as of the date first written
above.
| |
THE
COMPANY: |
| |
|
|
| |
INTEC
PHARMA LTD. |
| |
|
|
| |
By: |
/s/
Nir Sassi |
| |
Name: |
Nir Sassi |
| |
Title: |
Chief FInancial
Officer |
| |
|
|
| |
BUYER: |
| |
|
|
| |
ASPIRE
CAPITAL FUND, LLC |
| |
BY: ASPIRE CAPITAL PARTNERS,
LLC |
| |
BY:
SGM HOLDINGS CORP. |
| |
|
|
| |
By: |
/s/
Steven G. Martin |
| |
Name: |
Steven G. Martin |
| |
Title: |
President |
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