2,409,092 Common Shares Underlying the Warrants and the Placement Agent Warrants

We are offering (i) 2,272,728 common shares, no par value per share, and (ii) warrants (the “Warrants”) to purchase up to 2,272,728 common shares at a combined purchase price of $0.88 per common share and associated Warrant directly to certain institutional investors pursuant to this prospectus supplement and the accompanying prospectus. The Warrants have an exercise price of $0.76 per share, are exercisable immediately upon issuance and expire five years following the date of issuance. This prospectus supplement also relates to the offering of 136,364 Placement Agent Warrants (as such term is defined below) and 2,409,092 common shares issuable upon exercise of the Warrants and the Placement Agent Warrants.

Our common shares are traded on the Nasdaq Capital Market (“Nasdaq”) under the symbol “VBIV.” On April 8, 2024, the last reported sale price of our common shares on Nasdaq was $0.921 per share.

There is no established public trading market for the Warrants and we do not expect a market to develop. In addition, we do not intend to list the Warrants on Nasdaq, or any other national securities exchange or any other nationally recognized trading system.

Investing in our securities involves a high degree of risk. See “Risk Factors” section beginning on page S-3 of this prospectus supplement and page 4 of the accompanying prospectus, and in our Annual Report on Form 10-K and our other reports filed with the Securities and Exchange Commission, which are incorporated into this prospectus supplement and the accompanying prospectus by reference, for a discussion of information that should be considered in connection with an investment in our securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.

(1) We will pay the Placement Agent (as defined below) a cash fee equal to 7.5% of the aggregate gross proceeds of this offering. In addition, we will pay the Placement Agent $50,000 for non-accountable expenses and $15,950 for clearing fees. In addition, we agreed to issue to the Placement Agent or its designees, warrants to purchase up to 136,364 common shares at an exercise price of $1.10 per share (the “Placement Agent Warrants”). See “Plan of Distribution” on page S-15 of this prospectus supplement for more information regarding the Placement Agent’s compensation.

(2) The amount of the offering proceeds to us presented in this table does not give effect to the sale or exercise, if any, of the Warrants or the Placement Agent Warrants.

We have engaged H.C. Wainwright & Co., LLC (the “Placement Agent”) to act as our exclusive placement agent in connection with this offering. The Placement Agent is not purchasing or selling any of the securities we are offering, and the Placement Agent is not required to arrange the purchase or sale of any specific number of securities or dollar amount, but it has agreed to use its reasonable best efforts to arrange for the sale of all of the securities. There is no required minimum number of securities that must be sold as a condition to completion of this offering, and there are no arrangements to place the funds in an escrow, trust, or similar account.

We expect to deliver the common shares and the Warrants on or about April 11, 2024, subject to satisfaction of customary closing conditions.

No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus supplement or the accompanying prospectus. You must not rely on any unauthorized information or representations. This prospectus supplement and the accompanying prospectus are an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus supplement and the accompanying prospectus is current only as of their respective dates.

This prospectus supplement and the accompanying prospectus are part of a registration statement that we filed with the U.S. Securities and Exchange Commission (the “SEC”) utilizing a “shelf” registration process. This document is in two parts. The first part is this prospectus supplement, which describes the specific terms of this offering and also adds to and updates information contained in the accompanying prospectus and the documents incorporated by reference herein. The second part, the accompanying prospectus, provides more general information. Generally, when we refer to this prospectus, we are referring to both parts of this document combined. To the extent there is a conflict between the information contained in this prospectus supplement and the information contained in the accompanying prospectus or any document incorporated by reference therein filed prior to the date of this prospectus supplement, you should rely on the information in this 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 the accompanying prospectus—the statement in the document having the later date modifies or supersedes the earlier statement.

We further note that the representations, warranties, and covenants made by us in any agreement that is filed as an exhibit to any document that is incorporated by reference herein were made solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties or covenants were accurate only as of the date when made. Accordingly, such representations, warranties, and covenants should not be relied on as accurately representing the current state of our affairs.

You should rely only on the information contained in this prospectus supplement, the accompanying prospectus, any free writing prospectus or document incorporated by reference herein. We have not, and the Placement Agent has not, authorized anyone to provide you with different or additional information. The information contained in this prospectus supplement, the accompanying prospectus, any free writing prospectus or document incorporated by reference herein or therein is accurate only as of the respective dates thereof, regardless of the time of delivery of this prospectus supplement and the accompanying prospectus or of any sale of our securities. Our business, financial condition, results of operations and prospects may have changed since those dates. It is important for you to read and consider all information contained in this prospectus supplement and the accompanying prospectus, including the documents incorporated by reference herein and therein, in making your investment decision. You should also read and consider the information in the documents to which we have referred you in the sections entitled “Where You Can Find More Information” and “Incorporation of Certain Information By Reference” in this prospectus supplement and in the accompanying prospectus, respectively.

We are offering to sell, and seeking offers to buy, our securities only in jurisdictions where offers and sales are permitted. The distribution of this prospectus supplement and the accompanying prospectus and the offering of our securities in certain jurisdictions may be restricted by law. Persons outside the United States who come into possession of this prospectus supplement and the accompanying prospectus must inform themselves about, and observe any restrictions relating to, the offering of the securities and the distribution of this prospectus supplement and the accompanying prospectus outside the United States. This prospectus supplement and the accompanying prospectus do not constitute, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy, any securities offered by this prospectus supplement and the accompanying prospectus by any person in any jurisdiction in which it is unlawful for such person to make such an offer or solicitation.

This prospectus supplement, the accompanying prospectus, and the information incorporated herein and therein by reference includes trademarks, service marks and trade names owned by us or other companies. All trademarks, service marks and trade names included or incorporated by reference into this prospectus supplement or the accompanying prospectus are the property of their respective owners.

All references in this prospectus supplement and the accompanying prospectus to “VBI,” the “Company,” “we,” “us,” “our,” or similar references refer to VBI Vaccines Inc., a company incorporated under the laws of British Columbia, Canada, and its subsidiaries taken as a whole, except where the context otherwise requires or as otherwise indicated. References in this prospectus to “$” are to United States dollars, and Canadian dollars are indicated by the symbol “C$”.

This prospectus supplement and the accompanying prospectus and the information incorporated by reference herein and therein contain “forward-looking statements,” which include information relating to future events, future financial performance, strategies, expectations, competitive environment, and regulation. Words such as “may,” “will,” “should,” “could,” “would,” “hopes,” “projects,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements should not be read as a guarantee of future performance or results and will probably not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or our management’s good faith belief as of that time with respect to future events, and are subject to numerous factors, risks and uncertainties that could cause actual performance, the outcome of events, timing, or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

● the timing of, and our ability to, obtain and maintain regulatory approvals for our clinical trials, products, and pipeline candidates;

● our ability to achieve and sustain commercial success of PreHevbrio in the United States and Canada and PreHevbri in Europe;

● the timing and results of our ongoing and planned clinical trials for products and pipeline candidates;

● the amount of funds we require for our prophylactic and therapeutic pipeline candidates;

● the potential benefits of strategic partnership agreements and our ability to enter into strategic partnership arrangements;

● our ability to manufacture, or to have manufactured, our 3-antigen hepatitis B vaccine and our pipeline candidates, at commercially viable scales to the standards and requirements of regulatory agencies;

● the impact of the COVID-19 endemic and its effects on our clinical studies, research programs, manufacturing, business plan, regulatory review including site inspections, and the global economy;

● our ability to effectively execute and deliver our plans related to commercialization, marketing, manufacturing capabilities and strategy;

● our ability to retain and maintain a good relationship with our current employees, and our ability to competitively attract new employees with relevant experience and expertise;

● the suitability and adequacy of our office, manufacturing, and research facilities and our ability to secure term extensions or expansions of leased space;

● the ability of our vendors and suppliers to manufacture and deliver materials in a timely manner that meet regulatory agency and our standards and requirements to meet planned timelines and milestones;

● any disruption in the operations of our Rehovot, Israel manufacturing facility where we manufacture all of our clinical and commercial supplies of our 3-antigen hepatitis B vaccine and clinical supplies of our hepatitis B immunotherapeutic, VBI-2601;

● our compliance with all laws, rules, and regulations applicable to our business and products;

● emerging competition and rapidly advancing technology in our industry that may outpace our technology;

● customer demand for our 3-antigen hepatitis B vaccine and pipeline candidates;

● the impact of competitive or alternative products, technologies, and pricing;

● general economic conditions and events and the impact they may have on us and our potential customers;

● our ability to obtain adequate financing in the future on reasonable terms, as and when we need it;

● our ability to implement network systems and controls that are effective at preventing cyber-attacks, malware intrusions, malicious viruses, and ransomware threats;

● our ability to secure and maintain protection over our intellectual property;

● our ability to maintain our existing licenses with licensors of intellectual property, or obtain new licenses for intellectual property;

● changes to legal and regulatory processes for biosimilar approval and marketing that could reduce the duration of market exclusivity for our products;

● our ability to regain and maintain compliance with Nasdaq’s listing standards; and

You should review carefully the section entitled “Risk Factors” beginning on page S-3 of this prospectus supplement, on page 4 of the accompanying prospectus and under similar headings in the documents incorporated by reference into this prospectus supplement for a discussion of these and other risks that relate to our business and investing in our securities. The forward-looking statements contained or incorporated by reference in this prospectus supplement, the accompanying prospectus and under similar headings in the documents incorporated by reference into this prospectus supplement are expressly qualified in their entirety by this cautionary statement. We do not undertake any obligation to publicly update any forward-looking statement to reflect events or circumstances after the date on which any such statement is made or to reflect the occurrence of unanticipated events.

PROSPECTUS SUPPLEMENT SUMMARY

This summary highlights selected information about us, this offering and information appearing elsewhere in this prospectus supplement, in the accompanying prospectus and in the documents incorporated by reference herein and therein. This summary is not complete and does not contain all the information you should consider before investing in our securities pursuant to this prospectus supplement and the accompanying prospectus. Before making an investment decision, to fully understand this offering and its consequences to you, you should carefully read this entire prospectus supplement and the accompanying prospectus, including “Risk Factors,” the financial statements, and related notes, and the other information incorporated by reference herein and therein.

Company Overview

We are a commercial-stage biopharmaceutical company driven by immunology in the pursuit of prevention and treatment of disease. Through its innovative approach to virus-like particles (“VLPs”), including a proprietary enveloped VLP (“eVLP”) platform technology and a proprietary mRNA-launched eVLP (“MLE”) platform technology, VBI develops vaccine candidates that mimic the natural presentation of viruses, designed to elicit the innate power of the human immune system. VBI is committed to targeting and overcoming significant infectious diseases, including hepatitis B (“HBV”), COVID-19 and coronaviruses, and cytomegalovirus (“CMV”), as well as aggressive cancers including glioblastoma (“GBM”). VBI is headquartered in Cambridge, Massachusetts, with research operations in Ottawa, Canada, and a research and manufacturing site in Rehovot, Israel.

Nasdaq Minimum Bid Price Requirement

On November 1, 2023, we received a letter from the Listing Qualifications Department of Nasdaq indicating that, based upon the closing bid price of our common shares for the 30 consecutive business day period between September 19, 2023 through October 31, 2023, we did not meet the minimum bid price of $1.00 per share required for continued listing on Nasdaq pursuant to Nasdaq Listing Rule 5550(a)(2). The letter also indicated that we will be provided with a compliance period of 180 calendar days, or until April 29, 2024 (the “Compliance Period”), in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A).

In order to regain compliance with Nasdaq’s minimum bid price requirement, our common shares must maintain a minimum closing bid price of $1.00 for a minimum of ten consecutive business days during the Compliance Period. In the event that we do not regain compliance by the end of the Compliance Period, we may be eligible for additional time to regain compliance. To qualify, we will be required to meet the continued listing requirement for the market value of our publicly held shares and all other initial listing standards for Nasdaq, with the exception of the bid price requirement, and will need to provide written notice of our intention to cure the deficiency during the second compliance period, by effecting a reverse stock split if necessary. If we meet these requirements, we may be granted an additional 180 calendar days to regain compliance. We have not regained compliance as of the date of this prospectus supplement, and if we fail to regain compliance during the Compliance Period or any subsequent grace period granted by Nasdaq, our common shares will be subject to delisting by Nasdaq, which could seriously decrease or eliminate the value of an investment in our common shares and result in significantly increased uncertainty as to the Company’s ability to raise additional capital.

Preliminary Estimated Financial Results as of December 31, 2023

Based on the information and data currently available, as of December 31, 2023, we had approximately $23.7 million of cash.

The preliminary estimate above represents the most current information available to our management and does not present all necessary information for an understanding of our financial condition as of December 31, 2023. This is a preliminary estimate which should not be regarded as a representation by us or our management as to our actual financial condition as of December 31, 2023. Additional information and disclosures would be required for a more complete understanding of our financial position and results of operations as of December 31, 2023.

Our final results may vary from the information herein. Prospective investors should not place undue reliance on these estimates, and this information should not be viewed as a substitute for our full interim or annual financial statements prepared in accordance with U.S. Generally Accepted Accounting Principles. Further, these results are not necessarily indicative of the results to be expected for the remainder of the year or any future period. See the sections titled “Risk Factors,” and “Special Note Regarding Forward-Looking Statements,” in the prospectus supplement, the accompanying prospectus, and under similar headings in the documents incorporated by reference into this prospectus supplement for additional information regarding factors that could affect our results in future periods.

The preliminary financial data as of December 31, 2023, included in this document has been prepared by, and are the responsibility of, management. EisnerAmper LLP, our independent registered public accounting firm, has not audited such preliminary data as of December 31, 2023.

Corporate Information

Our principal office is located at 160 Second Street, Floor 3, Cambridge, Massachusetts 02142. Our telephone number at our headquarters is (617) 830-3031. Additional information about us is available on our website at www.vbivaccines.com. The information contained on, or that may be obtained from our website is not, and shall not be deemed to be, a part of this prospectus supplement. For a description of our business, financial condition, results of operations and other important information regarding us, we refer you to our filings with the SEC incorporated by reference in this prospectus supplement. For instructions on how to find copies of these documents, see “Where You Can Find More Information.”

THE OFFERING

Common shares offered by us		2,272,728 common shares, and up to 2,409,092 common shares issuable upon exercise of the Warrants and the Placement Agent Warrants.

Warrants offered by us		Warrants to purchase up to an aggregate of 2,272,728 common shares at an exercise price of $0.76 per share. Each common share is being sold together with a Warrant to purchase one common share and will be immediately exercisable on the date of issuance. The Warrants will expire five years following the date of issuance. There is no established trading market for the Warrants on Nasdaq or any other securities exchange or nationally recognized trading system, and we do not expect a trading market to develop. See “Description of Securities We Are Offering” on page S-13 of this prospectus supplement.

		The common shares and the accompanying Warrants can only be purchased together in this offering but will be issued separately and will be immediately separable upon issuance. This offering also relates to the offering of the common shares issuable upon exercise of the Warrants.

Placement agent warrants issued by us		We will also issue Placement Agent Warrants to purchase up to 136,364 common shares (representing 6.0% of the common shares sold in this offering) to the Placement Agent (or its designees) as part of the compensation payable to the Placement Agent in connection with this offering. The exercise price per share will be $1.10 (representing 125% of the offering price per common share and accompanying Warrant sold in this offering). See “Description of Securities We Are Offering” on page S-13 of this prospectus supplement.

Common shares to be outstanding immediately after this offering⁽¹⁾		28,306,025 common shares (as more fully described in the notes following this table), assuming no exercise of the Warrants and the Placement Agent Warrants.

Use of Proceeds		We currently intend to use the net proceeds from this offering for working capital and general corporate purposes. See “Use of Proceeds” on page S-11 of this prospectus supplement.

Risk Factors		Investing in our securities involves a high degree of risk. You should read the “Risk Factors” section beginning on page S-3 of this prospectus supplement and page 4 of the accompanying prospectus and in the documents incorporated by reference in this prospectus supplement for a discussion of factors to consider before deciding to invest in our securities.

The Nasdaq Capital Market symbol		“VBIV.” There is no established public trading market for the Warrants and we do not expect a market to develop. We do not intend to list the Warrants on Nasdaq, or any other national securities exchange or any other nationally recognized trading system.

⁽¹⁾The number of common shares to be outstanding immediately after this offering is based on 26,033,297 common shares outstanding as of April 9, 2024, and excludes as of such date:

	●	14,467,566 common shares issuable upon the exercise of warrants outstanding with a weighted average exercise price of $29.20 per share;
	●	1,639,873 common shares issuable upon the exercise of options outstanding with a weighted average exercise price of $31.21 per share;
	●	205,396 common shares issuable upon the conversion of certain outstanding debt pursuant our Loan Agreement (as defined herein), at a weighted average conversion price of $34.14 per share; and
	●	913,922 common shares reserved for future issuance under our 2016 VBI Equity Incentive Plan (the “2016 Plan”).

Except as otherwise indicated, the information in this prospectus supplement, including the number of common shares that will be outstanding after this offering assumes no exercise of the Warrants offered in this offering, or the Placement Agent Warrants to be issued to the Placement Agent or its designees as compensation in connection with this offering.

An investment in our securities involves a high degree of risk. Before deciding whether to invest in our securities, you should consider carefully the risks described below, together with other information in this prospectus supplement, the accompanying prospectus, the information and documents incorporated by reference. You should also consider the risks, uncertainties and assumptions discussed under the heading “Risk Factors” included in our most recent annual report on Form 10-K and the subsequent quarterly reports on Form 10-Q and other reports that we file with the SEC which are on file with the SEC and are incorporated herein by reference, and which may be amended, supplemented or superseded from time to time by other reports we file with the SEC in the future. If any of these risks actually occurs, our business, financial condition, results of operations or cash flow could be seriously harmed. This could cause the trading price of our common shares to decline, resulting in a loss of all or part of your investment. The risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties not presently known to us, or that we currently see as immaterial, may also harm our business. Please also read carefully the section above entitled “Special Note Regarding Forward-Looking Statements.”

Our financial statements have been prepared on a going concern basis; we must raise additional capital to fund our operations in order to continue as a going concern.

In its report dated March 13, 2023, EisnerAmper LLP, our independent registered public accounting firm, expressed substantial doubt about our ability to continue as a going concern as we have suffered recurring losses from operations and have insufficient liquidity to fund our future operations. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. The consolidated financial statements for the year ended December 31, 2022, do not include any adjustments that might result if we are unable to continue as a going concern and, therefore, be required to realize our assets and discharge our liabilities other than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their investment. As of September 30, 2023, we had $35.5 million of cash and as of December 31, 2023, we had approximately $23.7 million of cash, based on preliminary estimated financial results. In order to have sufficient cash and cash equivalents to fund our operations in the future, we will need to raise additional equity or debt capital and cannot provide any assurance that we will be successful in doing so. If we are unable to obtain additional financing, we may be required to pursue a reorganization proceeding, including under applicable bankruptcy or insolvency laws. Holders of our common shares will likely not receive any value or payments in a restructuring or similar scenario. In the event we pursue bankruptcy protection, we will be subject to the risks and uncertainties associated with such proceedings. There can be no guarantees that if we seek bankruptcy protection, we will emerge from bankruptcy protection as a going concern or that holders of our common shares will receive any recovery from any bankruptcy proceedings. See “Prospectus Supplement Summary – Preliminary Estimated Financial Results as of December 31, 2023”.

We have incurred significant losses since inception and anticipate that we will incur continued losses for the foreseeable future.

We have incurred significant net losses and negative operating cash flows since inception. We incurred net losses of approximately $113.3 million for the year ended December 31, 2022. As of December 31, 2023, we had approximately $23.7 million of cash, based on preliminary estimated financial results. Our income generating activities have been from sales of PreHevbrio in the U.S., PreHevbri in Europe, and Sci-B-Vac in Israel, which have generated a limited number of sales to-date, fees from research and development services, and revenue from partnership collaborations. We expect to incur significant operating losses for the next several years as we support the continued commercialization activities of our 3-antigen HBV vaccine, advance other pipeline candidates into and through clinical development, including our GBM vaccine immunotherapeutic candidate, prophylactic coronavirus vaccine program candidates, and CMV candidate, complete clinical trials, and seek regulatory approval. Because of the numerous risks and uncertainties associated with developing and commercializing pharmaceutical products, as well as those related to our expectations for our collaboration and license agreements with Brii Biosciences Limited (“Brii Bio”), we are unable to predict the extent of any future losses or guarantee when, or if, our company will become profitable or cash flow positive. If we never achieve profitability or positive cash flows, or achieve either later than we anticipate, you may lose some or all of your investment in us.

We will need additional financing to continue our operations. If we are unable to obtain additional financing on acceptable terms, we may have to curtail or cease our development plans and operations.

Our revenue generating activities include product sales and research and development services pursuant to fee for service agreements, collaboration agreements, and certain governmental research and development grants. However, our revenues have not been significant to date. Our long-term success and ability to continue as a going concern is dependent upon obtaining sufficient capital to fund the research and development of our products, to bring about their successful commercial release, if approved, to generate revenue, and, ultimately, to attain profitable operations or alternatively advance the products and technology to such a point that an acquirer would find attractive. We face substantial demand on our cash resources to fund operations and our growth plans in the future.

To date, we have been able to obtain financing; however, there is no assurance that financing will be available in the future, or if it is, that it will be available at terms acceptable to us. Additional financings may be effected through debt financing and/or the issuance of equity securities, there being no assurance that any type of financing on terms acceptable to us will be available or otherwise occur. Debt financing must be repaid regardless of whether we generate revenues or cash flows from operations and may be secured by substantially all of our assets. Any equity financing or debt financing that requires the issuance of equity securities or securities convertible into equity securities would cause the percentage ownership of our shareholders to be diluted, which dilution may be substantial. Also, any additional equity securities issued may have rights, preferences, or privileges senior to those of existing shareholders. Furthermore, if we issue additional securities, whether equity or debt, or if investors believe we may issue additional securities, the market price of our common shares could decline. If such financing is not available when required or is not available on acceptable terms, we may be required to reduce or eliminate certain pipeline candidates and development activities, and it may ultimately require us to suspend or cease operations, which could cause investors to lose the entire amount of their investment.

The reduction in our internal workforce, our intention to sell the manufacturing facility in Rehovot, Israel, and other cost reductions we are undertaking to reduce our operating expenses could disrupt our business.

On April 4, 2023, we announced organizational changes including our intention to reduce our internal workforce and other expenses by 30-35%, activity which began in April 2023 and was completed by the end of September 2023. The headcount reduction and other actions to reduce our operating costs may result in unintended consequences and costs, such as the loss of institutional knowledge and expertise, attrition beyond the intended number of employees seeking alternative employment, decreased morale among our remaining employees, and the risk that we may not achieve the anticipated benefits of the reduction in force. Our workforce reductions could also harm our ability to attract and retain qualified management and personnel who are critical to our business. In addition, our former employees may initiate lawsuits related to their termination. The reduction in internal workforce could also make it difficult for us to pursue, or prevent us from pursuing, new opportunities and initiatives.

Any of the foregoing may be disruptive to our operations. If we are unable to realize the anticipated benefits from the reduction in internal workforce, or if we experience significant unintended adverse consequences from the reduction in internal workforce, our business, financial condition, and results of operations may be materially adversely affected.

Our credit facility contains certain customary covenants as well as financial and non-financial covenants, and instances of non-compliance may lead to the declaration of an event of default, which could accelerate our repayment obligations, increase the interest rate under the credit facility, and lead to the foreclosure on substantially all of our assets, among others.

The Loan and Guaranty Agreement dated as of May 22, 2020, as amended by the first amendment, dated as of May 17, 2021 (the “First Amendment”), that second amendment, dated as of September 14, 2022 (the “Second Amendment”), that third amendment, dated as of July 5, 2023 (the “Third Amendment”), and that fourth amendment, dated February 13, 2024 (the “Fourth Amendment”) and as such agreement may be amended from time to time in the future (collectively, the “Loan Agreement”) with K2 HealthVentures LLC (“K2HV”) and any other lenders party thereto from time to time, contains customary covenants as well as financial and non-financial covenants.

Pursuant to the Fourth Amendment, K2HV has agreed to the forbearance of the Loan Agreement to the earlier of (i) December 31, 2024, (ii) the date the side letter, dated as of February 13, 2024, by and between us and Brii Bio (the “Side Letter”) ceases to be in full force and effect prior to the completion of the Essential Activities and (iii) the date in which certain essential and additional priority activities (the “Essential Activities”) to transfer manufacturing responsibility for clinical supply and commercial supply of VBI-2601 and PreHevbri for the certain territories as set forth in the Side Letter are complete (the “Forbearance Expiration Date”) from exercising their remedies with respect to the occurrence of Events of Default (as defined in the Loan Agreement),subject to certain exceptions. We have also agreed, to remove the minimum net revenue covenant and, following the Forbearance Expiration Date, to add to a financial covenant requiring us to maintain a minimum cash amount equal to our obligations under the Loan Agreement at all times.

We have in the past not been in compliance with certain covenants in the Loan Agreement and had sought forbearance, and there is no assurance that we will be able to comply with covenants in the Loan Agreement in the future, or obtain from K2HV any extensions or waivers of instances of non-compliance or forbearance on our repayment obligations. Failure to comply with such covenants, or to obtain extensions, waivers, or forbearance for any instances of non-compliance or ability to make repayments, may constitute event of defaults under the Loan Agreement. Upon the occurrence and during the continuance of an event of default, subject to certain exceptions, K2HV is entitled to declare all obligations under the Loan Agreement immediately due and payable and to stop advancing money or extending credit to us under the Loan Agreement. Additionally, upon the occurrence and during the continuance of an event of default, the applicable interest rate under the Loan Agreement will be increased by 5.00% per annum. The principal amount of the term loan as of December 31, 2023, was $50.0 million ($55.7 million including the exit fees). As of December 31, 2023, we were required under applicable accounting rules to reclassify the outstanding principal amount of the Loan Agreement, as amended, as a current liability rather than a long-term liability due to the failure to meet the minimum Net Revenue covenant for the measurement periods ended September 30, 2023, and December 31, 2023. The reclassification of the indebtedness as a current liability has resulted in negative net working capital as of December 31, 2023. If the maturity of our indebtedness is accelerated, we may not have sufficient funds available for repayment, or we may not have the ability to borrow or obtain sufficient funds to replace the accelerated indebtedness on terms acceptable to us, or at all. Our failure to repay our indebtedness may result in K2HV foreclosing on all or a portion of our assets and force us to curtail or cease our operations.

In the event of a default, K2HV would have a prior right to substantially all of our assets to the exclusion of our general creditors. In such event, our assets would first be used to repay in full all indebtedness and other obligations secured by K2HV, resulting in all or a portion of our assets being unavailable to satisfy the claims of any unsecured indebtedness. Only after satisfying the claims of any unsecured creditors would any amount be available for our equity holders. These events of default include, among other things, our failure to pay any amounts due under the Loan Agreement, as amended by the First Amendment, the Second Amendment, the Third Amendment, and the Fourth Amendment, or any of the other loan documents, a breach of certain covenants under the Loan Agreement, our insolvency, a material adverse effect occurring, subject to certain exceptions.

Additionally, K2HV, pursuant to the Loan Agreement, as amended by the First Amendment and the Second Amendment, has a security interest in substantially all of our assets. Pursuant to the Third Amendment, K2HV also has a security interest in all of our respective right, title and interest in substantially all of our intellectual property. Pursuant to the Fourth Amendment, effective at all times after the Forbearance Expiration Date, we have agreed to maintain at all times unrestricted cash and cash equivalents in collateral accounts subject to a perfected security interest in favor of the applicable Secured Party (as defined in the Loan Agreement), in an amount not less than the aggregate amount of outstanding obligations. As a result, if we default under our obligations or do not have adequate unrestricted cash and cash equivalents after the Forbearance Expiration Date to hold in such collateral accounts, K2HV could foreclose on its security interests and liquidate some or all of these assets, which would harm our business, financial condition and results of operations.

The pledge of these assets and intellectual property and other restrictions may limit our flexibility in raising capital for other purposes. Because substantially all of our assets are pledged under the credit facility, our ability to incur additional secured indebtedness or to sell or dispose of assets to raise capital may be impaired, which could have an adverse effect on our financial flexibility.

If we are unable to close the transactions contemplated by various agreements entered into with Brii Bio in February 2024, our obligations due under the Loan Agreement may not be reduced, which will adversely affect our liquidity position, financial condition and business operations.

Pursuant to the purchase agreement by and among us, Variation Biotechnologies Inc., a Canadian federal corporation and our wholly-owned subsidiary (“VBI Cda”) and Brii Bio, dated as of February 13, 2024, subject to achievement of certain activities, in consideration for the sale, transfer, conveyance and assignment to Brii Bio of substantially all of the intellectual property related to VBI-2601 owned by us and VBI Cda, we received a secured promissory note in with an initial principal amount of $2.5 million, which shall be increased by $7.5 million, up to total principal amount of $10 million (the “Note”), upon our obtaining the applicable consents under the Amended and Restated Ferring License Agreement. Additionally, pursuant to the Side Letter, upon completion of the Essential Activities, the principal amount of the Note may be further increased to up to $18 million in principal amount. The entry by VBI Cda and Brii Bio into that certain license agreement (the “Brii License Agreement”), pursuant to which VBI Cda will grant Brii Bio an exclusive license to the GBM program (VBI-1901) for development and commercialization in the Asia Pacific region (excluding Japan), for a secured promissory note in the principal amount of $5 million, and the closing of the transactions pursuant to the purchase agreement (the “Rehovot Purchase Agreement”), dated as of February 13, 2024, by and between us, SciVac Ltd., a wholly-owned subsidiary of Brii Bio to be formed in Israel (“Brii Israel”) prior to the closing of the transactions contemplated by the Rehovot Purchase Agreement, and joined as a party to the agreement prior to the closing as the purchaser, and Brii Biosciences, Inc, a Delaware corporation, pursuant to which, upon achievement of certain activities and closing of the transactions contemplated by the Rehovot Purchase Agreement, subject to the terms and conditions therein, SciVac will sell to Brii Israel certain assets, including SciVac and its affiliates’ interest and rights in certain leases with respect to the vaccine manufacturing facility in Israel for consideration of $10 million, are subject to the terms and conditions therein and our completion of the Essential Activities. There can be no assurances that we will be able to obtain the applicable consents under the Brii License Agreement or that we complete any or all of the Essential Activities pursuant to the Side Letter. If we are unable to obtain the applicable consents under the Brii License Agreement or complete the Essential Activities, the amount of consideration we may receive from the completion of the transactions contemplated by various agreements with Brii Bio may be reduced, and as such our obligations due under the Loan Agreement would be correspondingly increased, which will in turn affect our liquidity position, financial condition, business and results of operation.

After the Forbearance Expiration Date, we will additionally be obligated to maintain a minimum cash amount in collateral accounts for the benefit of the secured parties equal to our obligations due under the Loan Amendment at all times. If the Loan Agreement is not reduced by the full potential aggregate consideration we may receive from completion of the transactions contemplated by various agreements entered into with Brii Bio in February 2024, we will be required to maintain a greater amount of cash in such collateral accounts, which may in turn reduce our capital available to fund our business, operations, and research and development of our products, among others, and have an adverse effect on our liquidity position. There can be no assurance that additional financing we will need to maintain the minimum cash amount will be available to us in the future, or if it is, that it will be available at terms acceptable to us, or that the issuance of any equity securities or securities convertible into equity securities in such financing would not cause the percentage ownership of our shareholders to be diluted, among others.

We have significant operations located in Israel and, therefore, our results may be adversely affected by political, economic, and military instability in Israel.

Our subsidiary’s operations are located in Rehovot, Israel. Accordingly, political, economic, and military conditions in Israel may directly affect our business. Since the establishment of the State of Israel in 1948, a number of armed conflicts have taken place between Israel and its neighboring countries. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its trading partners could adversely affect our business and results of operations. Pursuant to the Rehovot Purchase Agreement, subject to the achievement of certain activities, SciVac will sell to Brii Israel certain assets including SciVac and its affiliates’ interest and rights in and to certain assets and leases with respect to a vaccine manufacturing facility in Israel, for an aggregate purchase price of $10 million, which is then required to be paid to K2HV pursuant to the terms of the Fourth Amendment. The closing of the transactions pursuant to the Rehovot Purchase Agreement, subject to the terms and conditions therein, may affect, delay or hinder completion of the Essential Activities, a condition to closing, and affect the closing of the transaction which will not occur prior to June 30, 2024.

Any armed conflicts, war, terrorist activities, or political instability in the region and the consequences thereof, such as shipping disruptions in the Red Sea, which have caused shipping delays and other supply chain issues, and additional added costs for imported goods, could adversely affect business conditions and could harm our results of operations and could make it more difficult for us to raise capital. Parties with whom we do business have sometimes declined to travel to Israel during periods of heightened unrest or tension, forcing us to make alternative arrangements, when necessary, in order to meet our business partners face to face. In addition, the political and security situation in Israel may result in parties with whom we have agreements involving performance in Israel claiming that they are not obligated to perform their commitments under those agreements pursuant to force majeure provisions in such agreements.

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. Following the attack, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organization commenced in parallel to their continued rocket and terror attacks. Moreover, the clash between Israel and Hezbollah in Lebanon, may escalate in the future into a greater regional conflict. These situations may potentially escalate in the future to more violent events which may affect Israel and us. Any armed conflicts, war, terrorist activities, or political instability in the region could adversely affect business conditions and could harm our results of operations and could make it more difficult for us to raise capital.

It is currently not possible to predict the duration or severity of the ongoing war or its effects on our business, operations, and financial conditions. The ongoing war is rapidly evolving and developing, and could disrupt our business and operations, interrupt our sources and availability of supply and hamper our ability to raise additional funds or sell our securities, among others. As a result of reduced transport in and out of Israel due to the ongoing war, we have experienced delays in shipping supplies and materials in and out of Israel, and while there have been temporary delays to date, there may be additional disruption in transport in the future. We currently do not have any active study sites in Israel. The ongoing war has not, however, materially affected our customers, manufacturing, research and development, supply chain, and manufacturing commercialization activities. However, there can be no assurances that further unforeseen events will not have a material adverse effect on us or our operations in the future.

Many Israeli citizens are obligated to perform several days, and in some cases more, of annual military reserve duty until they reach the age of 40 (or older, for reservists who are officers or who have certain special training) and, in the event of a military conflict, may be called to active duty. As of the date of this prospectus supplement, we currently have about 93 employees who are located in and/or reside in Israel, including one member of our senior management. Shelter-in-place and work-from-home measures, government-imposed restrictions on movement and travel and other precautions taken to address the ongoing war have and may again temporarily disrupt our management and employees’ ability to effectively perform their daily tasks. Additionally, three employees located in Israel are responsible for global operations, including manufacturing, regulatory, and quality control. The operations of our subsidiary in Israel could be disrupted by such call-ups, which may include the call-up of our employees or the employees of our Israeli business partners. As many Israeli citizens are subject to military service should the Israel Defense Force deem it necessary, it is possible there will be further military reserve duty call-ups in the future, which may cause disruptions and delays in our operations.

Commercial insurance does not cover losses that may occur as a result of an event associated with the security situation in the Middle East. Although the Israeli government is currently committed to covering the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure that this government coverage will be maintained, or if maintained, will be sufficient to compensate us fully for damages incurred. Any losses or damages incurred by us could have a material adverse effect on our business.

The price of our common shares has been, and may continue to be, volatile. This may affect the ability of our investors to sell their shares, and the value of an investment in our common shares may decline.

During the 12-month period ended April 9, 2024, our common shares traded as high as $5.82 per share and as low as $0.45 per share. The market prices of our common shares may continue to be volatile and could fluctuate widely in response to various factors, many of which are beyond our control, including the following:

Furthermore, the stock market in general and the market for biotechnology companies, in particular, have from time-to-time experienced extreme price and volume fluctuations that are unrelated or disproportionate to the operating performance of the affected companies. A continuation or worsening of the levels of market disruption and volatility seen in the recent past could have an adverse effect on our ability to access capital, on our business, results of operations and financial condition, and on the market price of our common shares.

Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common shares.

On November 1, 2023, we received a letter from the Listing Qualifications Department of Nasdaq indicating that, based upon the closing bid price of our common shares for the 30 consecutive business day period between September 19, 2023 through October 31, 2023, we did not meet the minimum bid price of $1.00 per share required for continued listing on Nasdaq pursuant to Nasdaq Listing Rule 5550(a)(2). The letter also indicated that we will be provided with the Compliance Period, in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A).

In order to regain compliance with Nasdaq’s minimum bid price requirement, our common shares must maintain a minimum closing bid price of $1.00 for a minimum of ten consecutive business days during the Compliance Period. In the event that we do not regain compliance by the end of the Compliance Period, we may be eligible for additional time to regain compliance. To qualify, we will be required to meet the continued listing requirement for the market value of our publicly held shares and all other initial listing standards for Nasdaq, with the exception of the bid price requirement, and will need to provide written notice of our intention to cure the deficiency during the second compliance period, by effecting a reverse stock split if necessary. If we meet these requirements, we may be granted an additional 180 calendar days to regain compliance. However, if it appears to Nasdaq that we will be unable to cure the deficiency, or if we are not otherwise eligible for the additional cure period, Nasdaq will provide notice that our common shares will be subject to delisting. We have not regained compliance as of the date of this prospectus supplement.

If we fail to regain compliance during the Compliance Period or any subsequent grace period granted by Nasdaq, our common shares will be subject to delisting by Nasdaq. We would then be permitted to appeal any delisting determination to a Nasdaq Hearings Panel. Our common shares would remain listed on Nasdaq pending the panel’s decision after the hearing. If we do not appeal the delisting determination, or do not succeed in such an appeal, we may list our common shares on an over-the-counter exchange. Any delisting could seriously decrease or eliminate the value of an investment in our common shares and result in significantly increased uncertainty as to the Company’s ability to raise additional capital.

To resolve the noncompliance, we may consider available options including a reverse share split, which may not result in a permanent increase in the market price of our shares, which is dependent on many factors, including general economic, market and industry conditions and other factors detailed from time to time in the reports we file with the SEC. It is not uncommon for the market price of a company’s shares to decline in the period following a reverse share split. For example, we did not meet the minimum bid price for the period between May 18, 2022 to June 30, 2022, and we effected a 1-for-30 reverse stock split of our common shares in April 2023 (the “Reverse Stock Split”) with the primary intent of increasing the price of our common shares immediately following the Reverse Stock Split to regain compliance with the minimum bid price requirement, and regained compliance in April 2023. It cannot be assured that any future reverse stock split will result in any sustained proportionate increase in the market price of our common shares, which is dependent upon many factors, including the business and financial performance of the company, general market conditions, and prospects for future success, which are unrelated to the number of shares of our common shares outstanding. It is not uncommon for the market price of a company’s common shares to decline in the period following a reverse stock split.

Although we expect to take actions intended to restore our compliance with the listing requirements, we can provide no assurance that any action taken by us would be successful, or that any such action would stabilize the market price or improve the liquidity of our shares. Should a delisting occur, an investor would likely find it significantly more difficult to dispose of, or to obtain accurate quotations as to the value of our shares, and our ability to raise future capital through the sale of our shares could be severely limited.

We will have broad discretion in the use of the net proceeds from this offering and may allocate the net proceeds from this offering in ways that you and other shareholders may not approve.

Our management will have broad discretion in the use of the net proceeds, including for any of the purposes described in the section entitled “Use of Proceeds,” and could spend the proceeds in ways that do not improve our results of operations or enhance the value of our common shares. You will not have the opportunity as part of your investment decision to assess whether the net proceeds are being used appropriately. Because of the number and variability of factors that will determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently intended use. The failure of our management to use these funds effectively could have a material adverse effect on our business and cause the market price of our common shares to decline. Pending their ultimate use, we may choose to invest the net proceeds in short-term, investment-grade, interest-bearing instruments. These investments may not yield a favorable return to our shareholders.

You will experience immediate and substantial dilution in the book value per common share you purchase.

The effective price per common share being offered in this offering exceeds the net tangible book value per share of our common shares. Therefore, if you purchase securities in this offering, your interest will be diluted to the extent of the difference between the effective price per common share you pay and the pro forma as adjusted net tangible book value per common share. Based on the effective offering price of $0.88 per common share, you will experience immediate dilution of $1.39 per share, representing the difference between the effective offering price per common share offered in this offering and our pro forma as adjusted net tangible book value per share as of September 30, 2023, after giving effect to the Pro Forma Adjustments (as defined herein), this offering, and after deducting the placement agent fees and estimated offering expenses payable by us. The future exercise of outstanding options and warrants will result in further dilution of your investment. See the section entitled “Dilution” below for a more detailed discussion of the dilution you will incur if you purchase common shares in this offering.

You may experience significant dilution as a result of future financings and the exercise of outstanding options or warrants.

In order to raise additional capital, we may in the future offer additional common shares or other securities convertible into or exchangeable for our common shares, including offerings pursuant to the accompanying prospectus. We cannot assure you that we will be able to sell shares or other securities in any other offering at a price per share that is equal to or greater than the price per share paid by investors in this offering, and investors purchasing shares or other securities in the future could have rights superior to existing shareholders. The price per share at which we sell additional common shares or other securities convertible into or exchangeable for our common shares in future transactions may be higher or lower than the price per share in this offering.

Common shares eligible for future sale may cause the price of our common shares to decline.

From time to time, certain of our shareholders may be eligible to sell all or some of their restricted common shares by means of ordinary brokerage transactions in the open market pursuant to Rule 144, promulgated under the Securities Act of 1933, as amended, subject to certain limitations. In general, pursuant to Rule 144, non-affiliate shareholders may sell freely after six months, subject only to the current public information requirement (which disappears after one year). Of the 23,918,983 common shares outstanding as of December 31, 2023, approximately 95.43% common shares are held by “non-affiliates,” all of which are currently freely tradable either because those were issued in a registered offering or pursuant to Rule 144.

Any substantial sale of our common shares pursuant to Rule 144 or pursuant to any resale prospectus may have a material adverse effect on the market price of our common shares.

We plan to reinvest all of our earnings, to the extent we have earnings, in order to market our products and to cover operating costs and to otherwise become and remain competitive. We do not plan to pay any cash dividends with respect to our securities in the foreseeable future. We cannot assure you that we would, at any time, generate sufficient surplus cash that would be available for distribution to the holders of our common shares as a dividend. In addition, our Loan Agreement with K2HV prohibits us from declaring or paying cash dividends or making distributions on any class of our capital stock. We currently intend to retain earnings, if any, for reinvestment in our business. Therefore, holders of our common shares should not expect to receive cash dividends on our common shares.

If we sell additional equity or debt securities to fund our operations, it may impose restrictions on our business.

In order to raise additional funds to support our operations, we may sell additional equity or debt securities, which may impose restrictive covenants that adversely impact our business. The incurrence of indebtedness would result in increased fixed payment obligations and could also result in restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. If we are unable to expand our operations or otherwise capitalize on our business opportunities due to such restrictions, our business, financial condition and results of operations could be materially adversely affected.

There is no public market for the Warrants being offered in this offering.

There is no established public trading market for the Warrants being offered in this offering, and we do not expect a market to develop. In addition, we do not intend to apply to list the Warrants on any securities exchange or nationally recognized trading system, including on Nasdaq. Without an active market, the liquidity of the Warrants will be limited.

Holders of the Warrants purchased in this offering will have no rights as common shareholders until such holders exercise their Warrants and acquire our common shares.

Until holders of the Warrants acquire common shares upon exercise of such warrants, holders of the Warrants will have no rights with respect to the common shares underlying such Warrants. Upon exercise of the Warrants, the holders will be entitled to exercise the rights of a common shareholder only as to matters for which the record date occurs after the exercise date.

The Warrants being offered by us in this offering have an exercise price of $0.76 per share, subject to certain adjustments, and expire five years from the date of issuance, after which date any unexercised Warrants will expire and have no further value. In the event that the market price of our common shares does not exceed the exercise price of the Warrants during the period when they are exercisable, the Warrants may not have any value.

We may not receive any additional funds upon the exercise of the Warrants being offered.

The Warrants may never be exercised, and in certain limited circumstances, the Warrants may be exercised by way of a cashless exercise, meaning that the holder may not pay a cash purchase price upon exercise, but instead would receive upon such exercise the net number of common shares determined according to the formula set forth in the Warrants. Accordingly, we may not receive any additional funds upon the cashless exercise of the Warrants or if the Warrants altogether are not exercised at all.

Although we expect that we will not be classified as a passive foreign investment company (“PFIC”) in 2024, there can be no assurance that we will not be classified as a PFIC in 2024 or any subsequent year, which would result in adverse U.S. federal income tax consequences to U.S. Holders of our common shares.

A non-U.S. corporation, such as us, would be classified as a PFIC for U.S. federal income tax purposes for any taxable year if either (i) 75% or more of its gross income is passive income, or (ii) 50% or more of the value of its assets (based on an average of the values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income. We do not expect to be a PFIC for the 2024 taxable year. However, the fair market value of our assets may be determined in large part by the market price of our common shares, which is likely to fluctuate, and the composition of our income and assets will be affected by how, and how quickly, we spend any cash that is raised in any financing transaction. No assurance can be provided that we will not be classified as a PFIC for the 2024 taxable year or any future taxable year. If we are a PFIC in any year, U.S. Holders (as defined in “Certain United States Income Tax Considerations” below) will be subject to certain adverse U.S. federal income tax consequences. Prospective U.S. Holders should consult their tax advisors regarding our PFIC status.

We have not declared or paid any cash or other dividends on our capital stock since January 1, 2015, and we do not expect to declare or pay any cash or other dividends in the foreseeable future. In addition, our Loan Agreement with K2HV prohibits us from declaring or paying cash dividends or making distributions on any class of our capital stock.

We estimate that the net proceeds from this offering will be approximately $1.7 million, assuming no exercise of the Warrants being issued in this offering, and after deducting placement agent fees and estimated offering expenses payable by us in connection with this offering.

We currently intend to use the net proceeds from this offering for working capital and general corporate purposes. We do not currently have more specific plans or commitments with respect to the net proceeds from this offering and, accordingly, are unable to quantify the allocation of such proceeds among the various potential issues.

Investors are cautioned, however, that expenditures may vary substantially from these uses. Investors will be relying on the judgment of our management, who will have broad discretion regarding the application of the proceeds of this offering. We may find it necessary or advisable to use portions of the proceeds from this offering and for other purposes. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development, the status of and results from clinical trials, the timing of regulatory submissions, the outcome of regulatory review, the amount of cash generated by our operations, the amount of competition we face and other operational factors, as well as any collaborations that we may enter into with third parties for our product candidates, and any unforeseen cash needs.

Pending other uses, we may choose to invest the proceeds to us in short-term, investment grade, interest-bearing bank accounts or securities. We cannot predict whether the proceeds invested will yield a favorable, or any, return.

If you invest in our securities, your interest will be diluted immediately to the extent of the difference between the effective price per share you pay in this offering and the pro forma as adjusted net tangible book value per share of our common shares after this offering. Our net tangible book value (deficit) as of September 30, 2023, was approximately $(17,838,000), or $(0.76) per share. Net tangible book value per share is determined by dividing our total tangible assets, less total liabilities, by the number of common shares outstanding as of September 30, 2023.

After giving effect to the sale and issuance of 2,694,077 common shares pursuant to our Open Market Sale Agreement with Jefferies LLC, as sales agent, dated August 26, 2022, for an aggregate net proceeds of $1,755,118, subsequent to September 30, 2023 (collectively, the “Pro Forma Adjustments”), our pro forma net tangible book value as of September 30, 2023, would have been approximately $(16,083,000), or approximately $(0.62) per share.

After giving further effect to this offering, which includes the issuance and sale of 2,272,728 common shares and accompanying Warrants to purchase up to 2,272,728 common shares, assuming no exercise of the Warrants offered in this offering, and after deducting placement agent fees and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value (deficit) as of September 30, 2023, would have been approximately $(14,334,000), or approximately $(0.51) per share. This represents an immediate increase in pro forma as adjusted net tangible book value of $0.26 per share to our existing shareholders, and an immediate dilution of $1.39 per share to new investors in this offering, as illustrated by the following table:

The discussion and table above are based on 23,339,220 common shares outstanding as of September 30, 2023, and excludes the following potentially dilutive securities as of that date:

Except as otherwise indicated, all information in this prospectus supplement assumes (i) no exercise or conversion, of the outstanding options, debt or warrants described above and does not give effect to any subsequent repricing of warrants; and (ii) no exercise of the Warrants offered and sold in this offering and the Placement Agent Warrants to be issued to the Placement Agent or its designees as compensation in connection with this offering.

To the extent that any of these outstanding options, debt or warrants are exercised or converted at prices per share below the effective offering price per share in this offering or we issue additional shares under our equity incentive plans at prices below the effective offering price per share in this offering, you may experience further dilution. In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent that we raise additional capital by issuing equity or convertible debt securities, your ownership will be further diluted.

We are offering 2,272,728 common shares and Warrants to purchase 2,272,728 common shares. We are also registering the common shares issuable from time to time upon exercise of the Warrants offered hereby.

We are offering common shares in this offering. See “Description of Capital Stock–Description of Common Shares” in the accompanying prospectus for more information regarding our common shares.

The following is a summary of the material terms and provisions of the Warrants that are being offered hereby. This summary is subject to and qualified in its entirety by the form of the Warrant, which has been provided to the investor in this offering and which will be filed with the SEC as an exhibit to a Current Report on Form 8-K in connection with this offering and incorporated by reference into the registration statement of which this prospectus supplement and the accompanying prospectus form a part. Prospective investors should carefully review the terms and provisions of the form of Warrant for a complete description of the terms and conditions of the Warrants.

The Warrants will have an exercise price of $0.76 per share. The Warrants are exercisable immediately upon and will expire five years following the date of issuance. The exercise price and number of common shares issuable upon exercise are subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting our common shares. The Warrants will be issued in certificated form only.

The Warrants will be exercisable, at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment in full for the number of common shares purchased upon such exercise (except in the case of a cashless exercise as discussed below). A holder (together with its affiliates) may not exercise any portion of such holder’s Warrants to the extent that the holder would own more than 4.99% (or 9.99%, at the holder’s election) of our outstanding common shares immediately after exercise, except that upon notice from the holder to us, the holder may decrease or increase the limitation of ownership of outstanding stock after exercising the holder’s Warrants up to 9.99% of the number of common shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrants, provided that any increase in such limitation shall not be effective until 61 days’ following notice to us.

If, at the time a holder exercises its Warrants, a registration statement registering the issuance of the common shares underlying the Warrants under the Securities Act, is not then effective or available for the issuance of such shares, then in lieu of making the cash payment otherwise contemplated to be made to us upon such exercise in payment of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either in whole or in part) the net number of common shares determined according to a formula set forth in the Warrant.

A Warrant may be transferred at the option of the holder upon surrender of the Warrant to us together with the appropriate instruments of transfer.

No fractional common shares will be issued upon the exercise of the Warrants. Rather, we will pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the exercise price.

There is no established trading market for the Warrants, and we do not expect a market to develop. We do not intend to apply for a listing for the Warrants on any securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the Warrants will be limited.

Except as otherwise provided in the Warrants or by virtue of the holders’ ownership of common shares, the holders of Warrants do not have the rights or privileges of holders of our common shares, including any voting rights, until such Warrant holders exercise their Warrants.

In the event of a fundamental transaction, as described in the Warrants and generally including any reorganization, recapitalization or reclassification of our common shares, the sale, transfer or other disposition of all or substantially all of our assets, our consolidation or merger with or into another person, the acquisition of 50% or more of our outstanding common shares, or any person or group becoming the beneficial owner of 50% or more of the voting power represented by our outstanding common shares, the holders of the Warrants will be entitled to receive upon exercise of the Warrants for each share of common shares that would have been issuable upon such exercise immediately prior to the occurrence of such fundamental transaction, at the option of the Holder, the number of our common shares or the common shares of the successor or acquiring corporation, if it is the surviving corporation, and any additional consideration receivable as a result of such fundamental transaction by a holder of the number of common shares for which the Warrant is exercisable immediately prior to such fundamental transaction. Notwithstanding the foregoing, in the event of a fundamental transaction, the holders of the Warrants have the right to require us or a successor entity to redeem the Warrants for cash in the amount of the Black-Scholes Value (as defined in the Warrants) of the unexercised portion of the Warrants concurrently with or within 30 days following the consummation of a fundamental transaction. However, in the event of a fundamental transaction which is not in our control, including a fundamental transaction not approved by our board of directors, the holders of the Warrants will only be entitled to receive from us or our successor entity, as of the date of consummation of such fundamental transaction the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of the Warrants, whether that consideration is in the form of cash, stock or any combination of cash and stock, or whether the holders of our common shares are given the choice to receive alternative forms of consideration in connection with the fundamental transaction.

The following is a summary of the material terms and provisions of the Placement Agent Warrants that are being offered hereby. This summary is subject to and qualified in its entirety by the form of the Placement Agent Warrant, which will be filed with the SEC as an exhibit to a Current Report on Form 8-K in connection with this offering and incorporated by reference into the registration statement of which this prospectus supplement and the accompanying prospectus form a part. Prospective investors should carefully review the terms and provisions of the form of Placement Agent Warrant for a complete description of the terms and conditions of the Placement Agent Warrants.

The Placement Agent Warrants are substantially similar to the Warrants, except that they will have an exercise price of $1.10 per share, which represents 125% of the offering price per share and accompanying Warrant sold in this offering and will expire five years from the commencement of sales in this offering.

Pursuant to an engagement agreement, dated as of February 26, 2024 (the “Engagement Agreement”), we have engaged the Placement Agent to act as our exclusive placement agent, on a reasonable best-efforts basis, in connection with this offering. The terms of this offering are subject to market conditions and negotiations between us, the Placement Agent, and prospective investors. The Engagement Agreement does not give rise to any commitment by the Placement Agent to purchase any of the securities, and the Placement Agent will have no authority to bind us by virtue of the Engagement Agreement. The Placement Agent is not purchasing the securities offered by us in this offering and is not required to sell any specific number or dollar amount of securities but will assist us in this offering on a reasonable best-efforts basis. Further, the Placement Agent does not guarantee that it will be able to raise new capital in any prospective offering. The Placement Agent has no commitment to buy any of the securities offered pursuant to this prospectus supplement and accompanying prospectus and we may not sell the entire amount of the common shares and Warrants offered pursuant to this prospectus supplement and accompanying prospectus.

We have entered into a securities purchase agreement directly with the investors in connection with this offering, and we will only sell to investors who have entered into the securities purchase agreement.

We expect to deliver the common shares and the Warrants being offered pursuant to this prospectus supplement and the accompanying prospectus on or about April 11, 2024, subject to satisfaction of customary closing conditions.

We have agreed to pay the Placement Agent a cash fee equal to 7.5% of the aggregate gross proceeds of this offering. The following table shows the per share and accompanying Warrant and total placement agent fees payable to the Placement Agent by us in connection with this offering.

We will also pay the Placement Agent $50,000 for non-accountable expenses and $15,950 for clearing expenses. We estimate the total offering expenses of this offering payable by us, excluding the placement agent fees and expenses, will be approximately $35,000.

In addition, we have agreed to issue to the Placement Agent or its designees the Placement Agent Warrants to purchase up to an aggregate of 136,364 common shares (which represents 6.0% of the aggregate number of common shares sold in this offering), at an exercise price of $1.10 per share (representing 125% of the offering price per common share and accompanying Warrant sold in this offering). The Placement Agent Warrants are exercisable immediately upon issuance and will expire five years from the commencement of sales in this offering.

Except as provided above, the Placement Agent Warrants will have substantially the same terms as the Warrants issued to the investor in this offering. The summary of certain terms and provisions of the Placement Agent Warrants is not complete and is subject to, and qualified in its entirety by, the provisions of the form of Placement Agent Warrant of which will be filed as an exhibit to our Current Report on Form 8-K and which will be incorporated by reference herein.

We have granted the Placement Agent, subject to certain exceptions, a right of first refusal for a period of twelve (12) months following the consummation of this offering to act as our sole book-running manager, sole underwriter or sole placement agent for any further capital raising transactions undertaken by us or any of our subsidiaries.

We have also agreed to pay the Placement Agent a tail fee equal to the cash and warrant compensation in this offering, if any investor, who was “wall-crossed” or contacted by the Placement Agent during the term of its engagement, provides us with capital in any public or private offering or other financing or capital raising transaction during the 12-month period following expiration or termination of our engagement of the Placement Agent.

Under the terms of the securities purchase agreement, from the date of such agreements until thirty (30) days after the closing of this offering, neither we nor any subsidiary shall (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any common shares or common share equivalents, or (ii) file any registration statement or prospectus, or any amendment or supplement thereto, subject to certain exceptions.

We have also agreed, subject to certain exceptions, until two (2) years after the closing of this offering, not to (i) issue or sell any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional common shares either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices of or quotations for the common shares at any time after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to our business or the market for our common shares, or (ii) enter into, or effect a transaction under, any agreement, including, but not limited to, an equity line of credit or an “at-the-market” facility, subject certain exceptions.

The Placement Agent may be deemed to be an underwriter within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended (the “Securities Act”), and any commissions received by it and any profit realized on the resale of the securities sold by it while acting as principal might be deemed to be underwriting discounts or commissions under the Securities Act. As an underwriter, the Placement Agent would be required to comply with the requirements of the Securities Act and the Exchange Act of 1934, as amended (the “Exchange Act”), including, without limitation, Rule 10b-5 and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of our securities by the Placement Agent acting as principal. Under these rules and regulations, the Placement Agent (i) may not engage in any stabilization activity in connection with our securities and (ii) may not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other than as permitted under the Exchange Act, until it has completed its participation in the distribution.

We have agreed to indemnify the Placement Agent against liabilities relating to the offering arising under the Securities Act and the Exchange Act, liabilities arising from breaches of some or all of the representations and warranties contained in the Engagement Agreement, and to contribute to payments that the Placement Agent may be required to make for these liabilities.

The Placement Agent and its affiliates may engage in investment banking transactions and other commercial dealings in the ordinary course of business with us or our affiliates and receive customary fees and commissions for these transactions.

In addition, in the ordinary course of their business activities, the Placement Agent and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) for their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments of ours or our affiliates. The Placement Agent and its affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.

A prospectus in electronic format may be made available on a website maintained by the Placement Agent and the Placement Agent may distribute prospectuses electronically. Other than the prospectus in electronic format, the information on these websites is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the Placement Agent and should not be relied upon by investors.

The section discusses the material U.S. federal income tax consequences of purchasing, owning and disposing of our common shares or Warrants by a U.S. Holder that acquires the common shares or Warrants pursuant to this offering and holds such common shares or Warrants as capital assets. This summary is of a general nature only, is not exhaustive of all possible U.S. federal income tax considerations and is not intended to be, nor should it be construed to be, legal or tax advice to any particular U.S. Holder (as defined below) U.S. Holders should consult their own tax advisors with respect to their particular circumstances. For purposes of this summary, “U.S. Holder” means a beneficial holder of our common shares or Warrants that is for U.S. federal income tax purposes:

● a corporation or other entity classified as a corporation for U.S. federal income tax purposes created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

● an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or

● a trust, if (a) a court within the United States is able to exercise primary supervision over the administration of such trust and one or more “United States persons” (within the meaning of the Code, as defined below) have the authority to control all substantial decisions of the trust, or (b) a valid election is in effect to be treated as a United States person for U.S. federal income tax purposes.

If a partnership or other entity or arrangement classified as a partnership for U.S. federal income tax purposes holds our common shares or Warrants, the U.S. federal income tax treatment of a partner generally will depend on the status of the partner and the activities of the partnership. This section does not address the tax consequences to such a partnership or any partner in such a partnership for U.S. federal income tax purposes. Such a partner should consult its own tax advisor as to the tax consequences of the partnership purchasing, owning, and disposing of our common shares or Warrants.

This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), U.S. Treasury regulations promulgated thereunder, IRS rulings, and judicial decisions in effect as of the date of this prospectus supplement. All of these are subject to change, possibly with retroactive effect, or different interpretations. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive basis. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary.

This summary does not purport to be a complete analysis of all potential U.S. federal income tax effects and does not address all aspects of U.S. federal income taxation that may be relevant to particular U.S. Holders in light of their specific circumstances (for example, U.S. Holders subject to the alternative minimum tax) or to U.S. Holders that are subject to special rules under U.S. federal income tax law, including:

● retirement plans, individual plans, individual retirement accounts, and tax-deferred accounts;

● persons holding our common shares or Warrants as part of a hedging or conversion transaction straddle or other integrated or risk reduction transaction;

● persons who or that are, or may become, subject to the expatriation provisions of the Code;

●controlled foreign corporations, passive foreign investment companies, and shareholders of such corporations;

● pass-through entities, including partnerships, entities, and arrangements classified as partnerships for U.S. federal income tax purposes, and beneficial owners of pass-through entities;

● persons subject to the alternative minimum tax or the corporate minimum tax;

● direct, indirect, or constructive owners of 10% or more of the total combined voting power of all classes of our voting stock.

This summary also does not discuss any aspect of state, local or foreign law, or estate or gift tax law as applicable to U.S. Holders or any holders of our common shares or Warrants that are not U.S. Holders.

PROSPECTIVE U.S. INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH REGARD TO THE APPLICATION OF THE TAX CONSEQUENCES DESCRIBED BELOW TO THEIR PARTICULAR SITUATIONS AS WELL AS THE APPLICATION OF ANY STATE, LOCAL, FOREIGN OR OTHER TAX LAWS, INCLUDING GIFT AND ESTATE TAX LAWS.

For U.S. federal income tax purposes, the purchase of our common shares and Warrants in this offering by U.S. Holders should be treated for U.S. federal income tax purposes as a “unit” consisting of one common share and its associated Warrant. Each U.S. Holder must allocate its purchase price of such unit between each common share and its associated Warrant, as applicable based on their respective relative fair market values of each at the time of issuance. This allocation of the purchase price will establish the U.S. Holder’s initial tax basis for U.S. federal income tax purposes for each common share and its associated Warrant.

Any disposition of a unit should be treated for U.S. federal income tax purposes as a disposition of the common share and the Warrant comprising the unit, and the amount realized on the disposition should be allocated between the common share and the Warrant based on their respective relative fair market values (as determined by each such unitholder on all the relevant facts and circumstances) at the time of disposition. The separation of common shares and Warrants comprising the units should not be a taxable event for U.S. federal income tax purposes.

The foregoing treatment of the common shares and Warrants and a U.S. Holder’s purchase price allocation are not binding on the IRS or the courts. Because there are no authorities that directly address instruments that are similar to the units, no assurance can be given that the IRS or the courts will agree with the characterization described above or the discussion below. Accordingly, each prospective investor is urged to consult its own tax advisors regarding the tax consequences of an investment in a unit (including alternative characterizations of such unit). The remainder of this discussion assumes that the characterization of the units described above is respected for U.S. federal income tax purposes.

Subject to the PFIC rules discussed below, any distributions paid by the Company out of current or accumulated earnings and profits (as determined for U.S. federal income tax purposes), before reduction for any Canadian withholding tax paid with respect thereto, will generally be taxable to a U.S. Holder as foreign source dividend income, and, other than a corporate 10% shareholder, will not be eligible for the dividends received deduction generally allowed to corporations. The dividend will be taxable to a U.S. Holder when such holder receives the dividend, actually or constructively. Distributions in excess of current and accumulated earnings and profits will be treated as a non-taxable return of capital to the extent of the U.S. Holder’s adjusted tax basis in our common shares and thereafter as capital gain. The Company may not, however, maintain the calculations of its earnings and profits in accordance with U.S. federal income tax principles. Therefore, U.S. Holders should assume (unless advised to the contrary) that any distribution from the Company will be treated for US federal income tax purposes as a dividend. Prospective purchasers should consult their own tax advisors with respect to the appropriate U.S. federal income tax treatment of any distribution received from the Company. The Company does not expect to pay dividends with respect to its common shares.

Dividends paid to non-corporate U.S. Holders by the Company in a taxable year in which it is treated as a PFIC, or in the immediately following taxable year, will not be eligible for the preferential rate normally applicable to qualified dividend income. In all other taxable years, dividends paid by the Company should be taxable to a non-corporate U.S. Holder at the preferential rate applicable qualified dividend income, provided that certain conditions are satisfied. The Company does not expect to be classified as a PFIC for the 2023 taxable year or the 2024 taxable year. However, no assurance can be provided that the Company will not in fact be classified as a PFIC for the 2023 taxable year or any subsequent taxable year and, therefore, no assurance can be provided that a U.S. Holder will be able to claim a reduced rate for dividends paid in 2023 or any subsequent taxable year (if any). See “Taxation of U.S. Holders of Our Common Shares or Warrants — Passive Foreign Investment Company Considerations” below.

Under current law, payments of dividends by the Company to non-Canadian investors (including U.S. Holders) are generally subject to Canadian withholding tax at a rate of 25%. The rate of withholding tax applicable to U.S. Holders that are eligible for benefits under the Canada-United States Tax Convention (the “Convention”) is reduced to a rate of 15% unless the U.S. Holder is a company which owns 10% of our voting shares in which case the withholding rate is reduced to a rate of 5%. This reduced rate of withholding will not apply if the dividends received by a U.S. Holder are effectively connected with a permanent establishment of the U.S. Holder in Canada. For U.S. federal income tax purposes, U.S. Holders will be treated as having received the amount of Canadian taxes withheld by the Company, and as then having paid over the withheld taxes to the Canadian taxing authorities. As a result of this rule, the amount of dividend income included in gross income for U.S. federal income tax purposes by a U.S. Holder with respect to a payment of dividends may be greater than the amount of cash actually received by the U.S. Holder from the Company with respect to the payment.

Subject to certain limitations, a U.S. Holder will generally be entitled to a credit or a deduction against its U.S. federal income tax liability for Canadian income taxes withheld by the Company. For purposes of the foreign tax credit limitation, dividends paid by the Company generally will constitute foreign source income in the “passive category income” basket. The foreign tax credit rules are complex and prospective purchasers should consult their tax advisors concerning the availability of the foreign tax credit in their particular circumstances.

The terms of the Warrants may allow for changes in the exercise price of the Warrants under certain circumstances. A change in exercise price of a common warrant that allows holders to receive more common shares on exercise may increase a holder’s proportionate interest in our earnings and profits or assets. In that case, such holder may be treated as though it received a taxable distribution in the form of our common shares. A taxable constructive stock distribution would generally result, for example, if the exercise price is adjusted to compensate holders for distributions of cash or property to our stockholders.

Not all changes in the exercise price that result in a holder’s receiving more common shares on exercise, however, would be considered as increasing a holder’s proportionate interest in our earnings and profits or assets. For instance, a change in exercise price could simply prevent the dilution of a holder’s interest upon a stock split or other change in capital structure. Changes of this type, if made pursuant to a bona fide reasonable adjustment formula, are not treated as constructive stock distributions for these purposes. Conversely, if an event occurs that dilutes a holder’s interest and the exercise price is not adjusted, the resulting increase in the proportionate interests of our shareholders could be treated as a taxable stock distribution to our shareholders.

Any taxable constructive stock distributions resulting from a change to, or a failure to change, the exercise price of the Warrants that is treated as a distribution of common shares would be treated for U.S. federal income tax purposes in the same manner as distributions on our common shares paid in cash or other property, resulting in a taxable dividend to the recipient to the extent of our current or accumulated earnings and profits (with the recipient’s tax basis in its common shares or Warrants, as applicable, being increased by the amount of such dividend), and with any excess treated as a return of capital or as capital gain. U.S. Holders should consult their own tax advisors regarding whether any taxable constructive stock dividend would be eligible for tax rates applicable to long-term capital gains or the dividends-received deduction described under “—Distributions,” as the requisite applicable holding period requirements might not be considered to be satisfied.

Subject to the PFIC rules discussed below, upon a sale, exchange, or other taxable disposition of our common shares, a U.S. Holder generally will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference, if any, between the amount realized on the sale, exchange, or other taxable disposition and the U.S. Holder’s adjusted tax basis in its common shares.

This capital gain or loss will be long-term capital gain or loss if the U.S. Holder’s holding period in its common shares exceeds one year. The deductibility of capital losses is subject to limitations. Any gain or loss will generally be sourced to the United States for U.S. foreign tax credit purposes.

Sale, Exchange, Redemption, Expiration, or Other Taxable Disposition of a Warrant

Upon a sale, exchange, redemption, expiration, or other taxable disposition of a Warrant, a U.S. Holder generally will recognize capital gain or loss in an amount equal to the difference between the amount realized (if any) on the disposition and such U.S. Holder’s tax basis in the Warrant. The amount realized will include the amount of any cash and the fair market value of any other property received in exchange for the Warrant. The U.S. Holder’s tax basis in the Warrant generally will equal the amount the holder paid for the Warrant. Gain or loss will be long-term capital gain or loss if the U.S. Holder has held the Warrant for more than one year. Long-term capital gains of non-corporate U.S. Holders are generally taxed at preferential rates. The deductibility of capital losses is subject to certain limitations.

Except as discussed below with respect to the cashless exercise of a Warrant, a U.S. Holder generally will not recognize taxable gain or loss on the acquisition of common shares upon exercise of a Warrant for cash. The U.S. Holder’s tax basis in the share of our common shares received upon exercise of the Warrant generally will be an amount equal to the sum of the U.S. Holder’s initial investment in the Warrant (i.e., the portion of the U.S. Holder’s purchase price for units that is allocated to the Warrant, as described above under “— Allocation of Purchase Price”) and the exercise price. It is unclear whether the U.S. Holder’s holding period for the common shares received upon exercise of the Warrants will begin on the date following the date of exercise or on the date of exercise of the Warrants; in either case, the holding period will not include the period during which the U.S. Holder held the Warrants.

The U.S. federal income tax consequences of a cashless exercise of a Warrant are not clear. A cashless exercise may be tax-free, either because the exercise is not a realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-free situation, a U.S. Holder’s basis in the common shares received would equal the holder’s basis in the Warrants exercised therefor. If the cashless exercise were treated as not being a realization event, it is unclear whether a U.S. Holder’s holding period in the common shares would be treated as commencing on the date following the date of exercise or on the date of exercise of the Warrants; in either case, the holding period would not include the period during which the U.S. Holder held the Warrants. If the cashless exercise were treated as a recapitalization, the holding period of the common shares would include the holding period of the Warrants exercised therefore.

It is possible that a cashless exercise could be treated in part as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. Holder could be deemed to have surrendered Warrants equal to the number of common shares having a value equal to the exercise price for the total number of Warrants to be exercised. The U.S. Holder would recognize capital gain or loss in an amount equal to the difference between the fair market value of the common shares received in respect of the Warrants deemed surrendered and the U.S. Holder’s tax basis in the Warrants deemed surrendered. In this case, a U.S. Holder’s tax basis in the common shares received would equal the sum of the fair market value of the common shares received in respect of the Warrants deemed surrendered and the U.S. Holder’s tax basis in the Warrants exercised. Alternatively, it is possible that a cashless exercise could be treated as a fully taxable exchange of the Warrants for common shares, in which case the U.S. Holder would generally recognize taxable gain to the extent the fair market value of the common shares exceeds the U.S. Holder’s basis in its Warrants exchanged therefor. It is unclear whether a U.S. Holder’s holding period for the common shares would commence on the date following the date of exercise or on the date of exercise of the Warrant; in either case, the holding period would not include the period during which the U.S. Holder held the Warrant.

Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise, including when a U.S. Holder’s holding period would commence with respect to the common shares received, there can be no assurance which, if any, of the alternative tax consequences and holding periods described above would be adopted by the IRS or a court of law. Accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of a cashless exercise of a Warrant.

Special U.S. tax rules apply to U.S. Holders of our common shares or Warrants if we are a passive foreign investment company, or “PFIC”. A foreign corporation will be classified as a PFIC for any taxable year in which, after taking into account the income and assets of the corporation and certain subsidiaries pursuant to applicable “look-through rules,” either (i) at least 75% of its gross income is passive income (the “PFIC income test”) or (ii) at least 50% of the average value of its assets is attributable to assets which produce passive income or are held for the production of passive income (the “PFIC asset test”). Passive income generally includes dividends, interest, rents and royalties (other than certain rents and royalties derived in the active conduct of a trade or business), annuities, and gains from assets that produce passive income. If a non-U.S. corporation owns at least 25% by value of the stock of another corporation, the non-U.S. corporation is treated for purposes of the PFIC income or asset tests as receiving directly its proportionate share of the other corporation’s income and as owning its proportionate share of the assets of the other corporation.

We do not expect to be a PFIC for the 2023 taxable year. However, the fair market value of the Company’s assets may be determined in large part by the market price of our common shares, which is likely to fluctuate, and the composition of the Company’s income and assets will be affected by how, and how quickly, the Company spends any cash that is raised in any financing transaction. No assurance can be provided that the Company will not be classified as a PFIC for the 2023 taxable year or any future taxable year. Prospective purchasers should consult their tax advisors regarding the Company’s PFIC status.

If a U.S. Holder holds common shares or Warrants during any taxable year when the Company is a PFIC, such U.S. Holder that does not make the QEF election or the mark-to-market election described below will generally be subject to adverse rules with respect to (i) any “excess distributions” (generally, any distributions received by the U.S. Holder on our common shares in a taxable year that are greater than 125% of the average annual distributions received by the U.S. Holder in the three preceding taxable years or, if shorter, the U.S. Holder’s holding period for our common shares or Warrants) and (ii) any gain realized on the sale or other disposition of the common shares or Warrants. For this purpose, you will be treated as holding common shares acquired through the exercise of a Warrant for the period during which the Warrant was held. Generally, our common shares or Warrants will be shares in a PFIC with respect to a U.S. Holder if we are a PFIC during any time of such U.S. Holder’s holding period, unless the U.S. shareholder makes a deemed sale election or a mark-to-market election, or makes a QEF election with respect to the first taxable year for which we are a PFIC.

Under these adverse rules (a) the excess distribution or gain will be allocated ratably over the U.S. Holder’s holding period, (b) the amount allocated to the current taxable year and any taxable year prior to the first taxable year in which the Company is classified as a PFIC will be taxed as ordinary income, and (c) the amount allocated to each of the other taxable years during which the Company was classified as a PFIC will be subject to tax at the highest rate of tax in effect for the applicable category of taxpayer for that year and an interest charge will be imposed with respect to the resulting tax attributable to each such other taxable year. A U.S. Holder that is not a corporation will be required to treat any such interest paid as “personal interest”, which is not deductible.

U.S. Holders can avoid the adverse rules described above in part by making a mark-to-market election with respect to our common shares, provided that our common shares are “marketable”. Our common shares will be marketable if they are “regularly traded” on a “qualified exchange” or other market within the meaning of applicable U.S. Treasury regulations. For this purpose, our common shares generally should be considered to be regularly traded during any calendar year during which they are traded, other than in de minimis quantities, on at least 15 days during each calendar quarter. Our common shares are currently listed on Nasdaq, which constitutes a qualified exchange; however, there can be no assurance that our common shares will be treated as regularly traded on a qualified exchange for purposes of the mark-to-market election. If our common shares are not regularly traded on Nasdaq or are delisted from Nasdaq and not traded on another qualified exchange for the requisite time period described above, the mark-to-market election will not be available.

A U.S. Holder that makes a mark-to-market election must include in gross income, as ordinary income, for each taxable year an amount equal to the excess, if any, of the fair market value of the U.S. Holder’s common shares at the close of the taxable year over the U.S. Holder’s adjusted tax basis in our common shares. An electing U.S. Holder may also claim an ordinary loss deduction for the excess, if any, of the U.S. Holder’s adjusted tax basis in its common shares over the fair market value of its common shares at the close of the taxable year, but this deduction is allowable only to the extent of any net mark-to-market gains previously included in income. A U.S. Holder that makes a mark-to-market election generally will adjust such U.S. Holder’s tax basis in its common shares to reflect the amount included in gross income or allowed as a deduction because of such mark-to-market election. Gains from an actual sale or other disposition of our common shares will be treated as ordinary income, and any losses incurred on a sale or other disposition of our common shares will be treated as ordinary losses to the extent of any net mark-to-market gains previously included in income. The mark-to-market election will not be available for warrants.

If the Company is classified as a PFIC for any taxable year in which a U.S. Holder owns our common shares but before a mark-to-market election is made, the adverse PFIC rules described above will apply to any mark-to-market gain recognized in the year the election is made. Otherwise, a mark-to-market election will be effective for the taxable year for which the election is made and all subsequent taxable years. The election cannot be revoked without the consent of the IRS or unless our common shares cease to be marketable, in which case the election is automatically terminated.

If the Company were to be classified as a PFIC, a U.S. Holder of our common shares or Warrants will generally be treated as owning stock owned by the Company in any direct or indirect subsidiaries that are also PFICs (a “PFIC Subsidiary”) and will be subject to similar adverse rules with respect to distributions to the Company by, and dispositions by the Company of, the stock of such subsidiaries. A mark-to-market election is not permitted for the shares of any subsidiary of the Company that is also classified as a PFIC. Prospective purchasers should consult their tax advisors regarding the availability of, and procedure for making, a mark-to-market election.

A U.S. Holder can also avoid the interest charge and the other adverse PFIC consequences described above if we are a PFIC by making a Qualified Electing Fund (“QEF”) election to be taxed currently on its share of our undistributed income. If we are classified as a PFIC, we may satisfy the record keeping requirements that apply to a QEF and supply requesting U.S. Holders with the information that such U.S. Holders are required to report under the QEF rules with respect to the Company and any PFIC Subsidiary. However, there can be no assurance that the Company will satisfy the record keeping requirement or provide the information required to be reported by U.S. Holders.

A U.S. Holder that makes a timely and effective QEF election with respect to the first tax year in its holding period of our common shares for which we are a PFIC generally will not be subject to the adverse PFIC consequences described above with respect to its common shares. Rather, a U.S. Holder that makes a timely and effective QEF election will be subject to U.S. federal income tax on such U.S. Holder’s pro rata share of (a) the Company’s net capital gain, which will be taxed as long-term capital gain to such U.S. Holder, and (b) the Company’s ordinary earnings, which will be taxed as ordinary income to such U.S. Holder, in each case regardless of which such amounts are actually distributed to the U.S. Holder by the Company. Generally, “net capital gain” is the excess of (a) net long-term capital gain over (b) net short-term capital loss, and “ordinary earnings” are the excess of (a) “earnings and profits” over (b) net capital gain. A U.S. Holder that makes a timely and effective QEF election with respect to the Company generally (a) may receive a tax-free distribution from the Company to the extent that such distribution represents “earnings and profits” that were previously included in income by the U.S. Holder because of such QEF election and (b) will adjust such U.S. Holder’s tax basis in its common shares to reflect the amount included in income or allowed as a tax-free distribution because of such QEF election. In addition, a U.S. Holder that makes a QEF election generally will recognize capital gain or loss on the sale or other taxable disposition of our common shares.

The QEF election is made on a shareholder-by-shareholder basis. Once made, a QEF election will apply to the tax year for which the QEF election is made and to all subsequent tax years, unless the QEF election is invalidated or terminated or the IRS consents to revocation of the QEF election. In addition, if a U.S. Holder makes a QEF election, the QEF election will remain in effect (although it will not be applicable) during those tax years in which the Company is not a PFIC.

A QEF election made with respect to the Company will not apply to any PFIC Subsidiary; a separate QEF election must be made for each PFIC Subsidiary (in which case the treatment described above will apply to each such PFIC Subsidiary). If a U.S. Holder makes a timely and effective QEF election with respect to a PFIC Subsidiary, it will be required in each taxable year to include in gross income its pro rata share of the ordinary earnings and net capital gain of such PFIC Subsidiary, regardless of whether it actually receives a distribution of such income.

If the Company is classified as a PFIC and later ceases to be so classified, a U.S. Holder may make an election (a “deemed sale election”) to be treated for U.S. federal income tax purposes as having sold its common shares on the last day of the taxable year of the Company during which it is a PFIC. A U.S. Holder that makes a deemed sale election will then cease to be treated as owning stock in a PFIC by reason of ownership of our common shares in the Company. However, gain recognized as a result of making the deemed sale election will be subject to the adverse rules described above and loss will not be recognized as a result of a deemed sale election.

In addition, if the Company were to be classified as a PFIC, U.S. Holders will generally be required to file an annual information return with the IRS (also on IRS Form 8621, which PFIC shareholders are required to file with their U.S. federal income tax or information returns) relating to their ownership of our common shares. This filing requirement is in addition to the preexisting reporting requirements described above that apply to a U.S. Holder’s interest in a PFIC (which this requirement does not affect).

Prospective purchasers should consult their tax advisors regarding the potential application of the PFIC regime and any reporting obligations to which they may be subject under that regime.

A Medicare contribution tax of 3.8% is imposed on a portion or all of the net investment income of certain individuals with a modified adjusted gross income of over $200,000 (or $250,000 in the case of joint filers or $125,000 in the case of married individuals filing separately) and on the undistributed net investment income of certain estates and trusts. “Net investment income” generally includes income from any dividends paid with respect to our common shares and net gain from the sale, exchange, or other taxable disposition of our common shares, reduced by any deductions properly allocable to such income or net gain. U.S. Holders are urged to consult their tax advisors regarding the applicability of this tax to their income and gains in respect of an investment in our common shares.

Payments made within the United States, or by a U.S. payor or U.S. middleman, of dividends on, and proceeds arising from sales or other dispositions of our common shares or Warrants, generally will be reported to the IRS and to the U.S. Holder as required under applicable regulations. Backup withholding tax may apply to these payments if the U.S. Holder fails to timely provide in the appropriate manner an accurate taxpayer identification number or otherwise fails to comply with, or establish an exemption from, such backup withholding tax requirements. Certain U.S. Holders are not subject to the information reporting or backup withholding tax requirements described herein. U.S. Holders should consult their tax advisors as to their qualification for exemption from backup withholding tax and the procedure for establishing an exemption.

Backup withholding tax is not an additional tax. U.S. Holders generally will be allowed a refund or credit against their U.S. federal income tax liability for amounts withheld, provided the required information is timely furnished to the IRS. Certain U.S. Holders may be required to file Form 5471 reporting transfers of cash or other property to the Company and information relating to the U.S. Holder and the Company. In addition, certain U.S. Holders are required to report information on IRS Form 8938 with respect to their investments in certain “foreign financial assets,” which includes an investment in our common shares or Warrants. Substantial penalties may be imposed upon a U.S. Holder that fails to comply. U.S. Holders should consult their tax advisors regarding the information reporting obligations that may arise from their acquisition, ownership or disposition of our common shares or Warrants.

The following is a summary, as of today’s date, of the principal Canadian federal income tax considerations under the Income Tax Act (Canada) and the regulations thereunder, as amended (“Tax Act”) that generally apply to an investor who acquires, as beneficial owner, a common share and accompanying Warrant pursuant to this prospectus supplement and who, for the purposes of the Tax Act and at all relevant times, (i) is not, and is not deemed to be, a resident of Canada, (ii) deals at arm’s length with us and the underwriters, (iii) is not affiliated with us or the underwriters, (iv) acquires and holds the common shares and Warrants, and will hold the common shares acquired on the exercise of the Warrants (the “warrant shares”), as capital property, and (v) does not and will not use or hold, and is not and will not be deemed to use or hold, the common shares, Warrants, or warrant shares in the course of carrying on a business in Canada (a “Holder”). For purposes of this summary, references to “shares” shall include common shares and warrant shares unless otherwise indicated. Special rules, which are not discussed in this summary, may apply to a Holder that is an insurer that carries on business in Canada and elsewhere. Such Holders should consult their own tax advisors.

Generally, the shares and Warrants will be considered to be capital property to a Holder provided that the Holder does not use the shares or Warrants in the course of carrying on a business of trading or dealing in securities and such Holder has not acquired them in one or more transactions considered to be an adventure or concern in the nature of trade, all within the meaning of the Tax Act.

This summary is based upon the current provisions of the Tax Act, the Convention and the current published administrative policies and assessing practices of the Canada Revenue Agency (the “CRA”). This summary takes into account all specific proposals to amend the Tax Act and its regulations publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the “Tax Proposals”) and assumes that the Tax Proposals will be enacted in the form proposed, although no assurance can be given that the Tax Proposals will be enacted in their current form or at all. This summary does not otherwise take into account any changes in law or in the administrative policies or assessing practices of the CRA, whether by legislative, governmental or judicial decision or action, nor does it take into account or consider any provincial, territorial or foreign income tax considerations, which considerations may differ significantly from the Canadian federal income tax considerations discussed in this summary.

This summary is of a general nature only, is not exhaustive of all possible Canadian federal income tax considerations and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Holder. Holders should consult their own tax advisors with respect to their particular circumstances.

For purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of the shares and Warrants, including dividends, adjusted cost base and proceeds of disposition, must be expressed in Canadian dollars using the rate of exchange quoted by the Bank of Canada on the day the amount first arose, or such other rate of exchange as is acceptable to the CRA.

Holders will be required to allocate the total purchase price of a common share and accompanying Warrant between the common share and the Warrants on a reasonable basis to determine the respective costs of each to such Holder for purposes of the Tax Act. A Holder’s adjusted cost base of the common share acquired pursuant to this prospectus supplement will be determined by averaging the cost allocated to such common share with the adjusted cost base to the Holder of all common shares (if any) of the Company owned by the Holder as capital property immediately prior to such acquisition. Holders should consult their own tax advisors in this regard.

The exercise of a Warrant to acquire a warrant share will be deemed not to constitute a disposition of property for purposes of the Tax Act. As a result, no gain or loss will be realized by a Holder upon the exercise of a Warrant to acquire a warrant share. When a Warrant is exercised, the Holder’s cost of the warrant share acquired thereby will be equal to the aggregate of the Holder’s adjusted cost base of such Warrant and the exercise price paid for the warrant share. The Holder’s adjusted cost base of the warrant share so acquired will be determined by averaging the cost of the warrant share with the adjusted cost base to the Holder of all common shares (if any) of the Company owned by the Holder as capital property immediately prior to the exercise of the Warrant.

The expiry of an unexercised warrant generally will result in a capital loss to the Holder equal to the adjusted cost base of the Warrant to the Holder immediately before its expiry. Such capital loss will not be recognized under the Tax Act unless the Warrant constitutes “taxable Canadian property” to the Holder (see discussion below under the heading “Dispositions of Shares and Warrants”)

Dividends paid or credited or deemed to be paid or credited by us to a Holder on the shares are subject to Canadian withholding tax at the rate of 25% on the gross amount of the dividend unless such rate is reduced by the terms of the Convention or another applicable tax treaty between Canada and the Holder’s country of residence. The rate of withholding tax on dividends paid or credited to a Holder who is resident in the United States for purposes of the Convention, is fully entitled to benefits under the Convention, and is the beneficial owner of the dividend is generally limited to 15% of the gross amount of the dividend (or 5% in the case of such a Holder that is a company beneficially owning at least 10% of our voting shares). Holders should consult their own tax advisors regarding the application of the Convention (or any other applicable tax treaty) to dividends based on their particular circumstances.

A Holder generally will not be subject to tax under the Tax Act in respect of a capital gain realized on the disposition or deemed disposition of the shares or Warrants, nor will capital losses arising therefrom be recognized under the Tax Act, unless the shares or Warrants constitute “taxable Canadian property” to the Holder for purposes of the Tax Act, and the gain is not exempt from tax pursuant to the terms of the Convention (or any other applicable tax treaty).

Provided our shares are listed on a “designated stock exchange”, as defined in the Tax Act (which currently includes Nasdaq), at the time of disposition, the shares or Warrants generally will not constitute taxable Canadian property of a Holder at that time, unless at any time during the 60-month period immediately preceding the disposition the following two conditions are met concurrently:

Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, our shares or Warrants could be deemed to be “taxable Canadian property” to a Holder. Holders whose shares or Warrants may be taxable Canadian property should consult their own tax advisors.

Certain legal matters, including the validity of the Warrants offered by this prospectus supplement, will be passed upon for us by Haynes and Boone, LLP, New York, New York. The validity of the common shares offered by this prospectus supplement will be passed upon for us by Stikeman Elliott LLP, Toronto, Ontario.

The consolidated balance sheets of VBI Vaccines Inc. and subsidiaries as of December 31, 2022 and 2021, and the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the years then ended, have been audited by EisnerAmper LLP, independent registered public accounting firm, as stated in their report which is incorporated herein by reference, which report includes an explanatory paragraph about the existence of substantial doubt concerning our ability to continue as a going concern. Such financial statements have been incorporated herein by reference in reliance on the report of such firm given upon their authority as experts in accounting and auditing.

We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith file annual, quarterly, and current reports, proxy statements, and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the SEC’s website is www.sec.gov.

We make available free of charge on or through our website at http://www.vbivaccines.com, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, amendments to those reports, and other information that we file or furnish pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with or otherwise furnish it to the SEC.

We have filed with the SEC a registration statement under the Securities Act of 1933, as amended, relating to the offering of these securities. The registration statement, including the attached exhibits, contains additional relevant information about us and the securities. This prospectus supplement does not contain all of the information set forth in the registration statement. You can obtain a copy of the registration statement, at prescribed rates, from the SEC for free at www.sec.gov. The registration statement and the documents referred to below under “Incorporation of Certain Information By Reference” are also available on our website, http://www.vbivaccines.com.

We have not incorporated by reference into this prospectus supplement the information on our website, and you should not consider it to be a part of this prospectus supplement.

The SEC allows us to “incorporate by reference” the information we have filed with it, which means that we can disclose important information to you by referring you to those documents. The information we incorporate by reference is an important part of this prospectus supplement, and later information that we file with the SEC automatically update and supersede this information. We incorporate by reference the documents listed below and any future documents (excluding information furnished pursuant to Items 2.02 and 7.01 of Form 8-K) we file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, subsequent to the date of this prospectus supplement and prior to the termination or completion of the offering:

Any statement contained in this prospectus supplement or in a document incorporated or deemed to be incorporated by reference into this prospectus supplement will be deemed to be modified or superseded for purposes of this prospectus supplement to the extent that a statement contained in this prospectus supplement or any other subsequently filed document that is deemed to be incorporated by reference into this prospectus supplement modifies or supersedes the statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.

You may request, orally or in writing, a copy of any or all of the documents incorporated herein by reference (excluding any exhibits to those documents, unless we have specifically incorporated that exhibit by reference herein). These documents will be provided to you at no cost, by contacting:

You may also access the documents incorporated by reference in this prospectus supplement through our website at http://www.vbivaccines.com. Except as set forth above, no information available on or through our website shall be deemed to be incorporated in this prospectus supplement, the accompanying prospectus, or the registration statement of which it forms a part.

We may offer and sell from time to time, in one or more series or issuances and on terms that we will determine at the time of the offering, any combination of the securities described in this prospectus, up to an aggregate amount of $300,000,000.

This prospectus may also be used by the selling shareholders named in this prospectus to offer and resell from time to time up to 3,012,363 common shares, which are comprised of (i) 705,000 common shares issued or issuable upon exercise of the warrants issued in April 2020 (the “National Warrants”) to National Securities Corporation (“National”) or its designees, (ii) 937,500 common shares (the “Restated K2 Warrant Shares”) issuable upon the exercise of the warrant amended and restated in May 2021 (the “Restated K2 Warrant” and together with the National Warrants, the “Warrants”) to K2 HealthVentures (“K2HV”), and (iii) 1,369,863 common shares (the “K2 Term Loan Shares,” and together with the Restated K2 Warrant Shares, the “K2 Shares”) issuable upon conversion of the Term Loans (as defined herein) due June 1, 2024, as further described in this prospectus.

The Warrants and the Term Loans were issued in reliance upon the exemption from the registration requirements in Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Regulation D (Rule 506) under the Securities Act. We are registering the offer and resale of the K2 Shares to satisfy a provision in a loan and guaranty agreement, dated as of May 22, 2020, by and among us, Variation Biotechnologies, Inc., each of the guarantors signatory thereto, K2HV and Ankura Trust Company, LLC (the “Loan Agreement”).

We will not receive any of the proceeds from the sale of our common shares by the selling shareholders. Any common shares subject to resale hereunder will have been issued by us and acquired by the selling shareholders prior to any resale of such shares pursuant to this prospectus.

We will provide specific terms of any offering by us in a supplement to this prospectus or in an issuer free writing prospectus. Any prospectus supplement or issuer free writing prospectus may also add, update, or change information contained in this prospectus. You should carefully read this prospectus and any applicable prospectus supplement or issuer free writing prospectus as well as the documents incorporated or deemed to be incorporated by reference in this prospectus before you purchase any of the securities offered hereby.

We may offer and sell these securities in the same offering or in separate offerings; to or through underwriters, dealers, and agents; or directly to purchasers. The names of any underwriters, dealers, or agents involved in the sale of our securities, their compensation and any over-allotment options held by them will be described in the applicable prospectus supplement. The selling shareholders named in this prospectus, or their donees, pledgees, transferees or other successors-in-interest, may offer or resell the shares from time to time through public or private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices. The selling shareholders will bear all commissions and discounts, if any, attributable to the sale of shares, and all selling and other expenses incurred by the selling shareholders. We will bear all costs, expenses and fees in connection with the registration of the shares. For additional information on the methods of sale that may be used by us or the selling shareholders, see “Plan of Distribution” beginning on page 16 of this prospectus.

Our common shares are listed on The Nasdaq Capital Market under the symbol “VBIV”. On August 25, 2022, the last reported sale price of our common shares as reported by The Nasdaq Capital Market was $1.01 per share. We recommend that you obtain current market quotations for our common shares prior to making an investment decision. We will provide information in any applicable prospectus supplement regarding any listing of securities other than our common shares on any securities exchange.

You should carefully read this prospectus, any prospectus supplement relating to any specific offering of securities, and all information incorporated by reference herein and therein.

Investing in our securities involves a high degree of risk. These risks are discussed in this prospectus under “Risk Factors” beginning on page 4 and in the documents incorporated by reference into this prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission (the “SEC”) using a “shelf” registration process. Under this shelf process, we may, from time to time, sell any combination of the securities described in this prospectus in one or more offerings up to a total amount of $300,000,000. In addition, the selling shareholders named in this prospectus may resell, from time to time, in one or more offerings, the common shares offered by this prospectus.

This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering; however, the selling shareholders may sell securities using this prospectus. The prospectus supplement may also add to, update or change information contained in the prospectus and, accordingly, to the extent inconsistent, information in this prospectus is superseded by the information in the prospectus supplement. The prospectus supplement to be attached to the front of this prospectus may describe, as applicable: the terms of the securities offered; the public offering price; the price paid for the securities; net proceeds; and the other specific terms related to the offering of the securities.

Information about the selling shareholders may change over time. When the selling shareholders sell our common shares under this prospectus, we will, if necessary and required by law, provide a prospectus supplement that will contain specific information about the terms of that offering.

Any prospectus supplement may also add to, update or change information contained in the prospectus and, accordingly, to the extent inconsistent, information in this prospectus is superseded by the information in the prospectus supplement.

You should only rely on the information contained or incorporated by reference in this prospectus and any prospectus supplement or issuer free writing prospectus relating to a particular offering. No person has been authorized to give any information or make any representations in connection with this offering other than those contained or incorporated by reference in this prospectus, any accompanying prospectus supplement and any related issuer free writing prospectus in connection with the offering described herein and therein, and, if given or made, such information or representations must not be relied upon as having been authorized by us or the selling shareholders. Neither this prospectus nor any prospectus supplement nor any related issuer free writing prospectus shall constitute an offer to sell or a solicitation of an offer to buy offered securities in any jurisdiction in which it is unlawful for such person to make such an offering or solicitation. This prospectus does not contain all of the information included in the registration statement. For a more complete understanding of the offering of the securities, you should refer to the registration statement, including its exhibits.

You should read the entire prospectus and any prospectus supplement and any related issuer free writing prospectus, as well as the documents incorporated by reference into this prospectus or any prospectus supplement or any related issuer free writing prospectus, before making an investment decision. Neither the delivery of this prospectus or any prospectus supplement or any issuer free writing prospectus nor any sale made hereunder shall under any circumstances imply that the information contained or incorporated by reference herein or in any prospectus supplement or issuer free writing prospectus is correct as of any date subsequent to the date hereof or of such prospectus supplement or issuer free writing prospectus, as applicable. You should assume that the information appearing in this prospectus, any prospectus supplement or any document incorporated by reference is accurate only as of the date of the applicable documents, regardless of the time of delivery of this prospectus or any sale of securities. Our business, financial condition, results of operations and prospects may have changed since that date.

In this prospectus, unless the context otherwise requires, references to the terms “VBI,” “we,” “us,” “our” and the “Company” refer to VBI Vaccines Inc. and its subsidiaries.

Unless indicated otherwise, all references to the U.S. Dollar, Dollar or $ are to the United States Dollar, the legal currency of the United States of America. We may also refer to the Canadian Dollar or CAD, which is the legal currency of Canada.

This prospectus and the information incorporated by reference in this prospectus and any prospectus supplement contain “forward-looking statements,” which include information relating to future events, future financial performance, strategies, expectations, competitive environment and regulation. Words such as “approximates,” “believes,” “hopes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “would,” “should,” “could,” “will,” “may,” or other similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and will probably not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or our management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

● the timing of, and our ability to, obtain and maintain regulatory approvals for our clinical trials, products, and pipeline candidates;

● our ability to achieve and sustain commercial success of PreHevbrio in the U.S and PreHevbri in Europe;

● the timing and results of our ongoing and planned clinical trials for products and pipeline candidates;

● the amount of funds we require for our prophylactic and therapeutic pipeline candidates;

● the potential benefits of strategic partnership agreements and our ability to enter into strategic partnership arrangements;

● our ability to manufacture, or to have manufactured, our 3-antigen hepatitis B vaccine and our pipeline candidates, at a commercially viable scale to the standards and requirements of regulatory agencies;

● the impact of the ongoing COVID-19 pandemic on our clinical studies, research programs, manufacturing, business plan, regulatory review including site inspections, and the global economy;