UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934
For the month of January 2025 (Report No. 2)
Commission File Number: 001-41502
WEARABLE
DEVICES Ltd.
(Translation of registrant’s name into English)
5 Ha-Tnufa Street
Yokne-am Illit, Israel 2066736
(Address of principal executive offices)
Indicate by check mark whether the registrant files
or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒
Form 40-F ☐
CONTENTS
On January 28, 2025, Wearable
Devices Ltd. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) with
a single institutional investor (the “Purchaser”) for the offer, issuance and sale (the “Offering”) of: (i) 345,000
of the Company’s ordinary shares, no par value per share (the “Ordinary Shares”), at an offering price of $1.00 per
share; (ii) pre-funded warrants to acquire up to 2,155,000 Ordinary Shares (the “Pre-Funded Warrants”) at an offering price
of $0.9999 per Pre-Funded Warrant; and (iii) warrants to acquire up to 2,500,000 Ordinary Shares (the “Warrants”) at an exercise
price of $1.00 per Ordinary Share, for aggregate gross proceeds of approximately $2,500,000, before deducting placement agent fees and
other offering expenses. The Ordinary Shares, the Pre-Funded Warrants and the Warrants issued in the Offering are sometimes collectively
referred to as the “Securities.” The Warrants are exercisable beginning on the original issuance date and will expire five
years from the date of issuance. The closing of the Offering is expected to take place on or about January 30, 2025, subject to the satisfaction
of the customary closing conditions.
The Pre-Funded Warrants were
sold to the Purchaser, whose purchase of Ordinary Shares in the offering would otherwise have resulted in the Purchaser, together with
its affiliates and certain related parties, beneficially owning more than 4.99% (or 9.99%, at the election of Purchaser) of the outstanding
share capital of the Company following the consummation of the Offering. Each Pre-Funded Warrant represents the right to purchase one
Ordinary Share at an exercise price of $0.0001 per share. The Pre-Funded Warrants are exercisable immediately and may be exercised at
any time until the Pre-Funded Warrants are exercised in full (subject to the beneficial ownership limitation described above).
The Purchase Agreement contains
customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the
Company, other obligations of the parties, and termination provisions. Additionally, each of the directors and executive officers of the
Company entered into a lock-up agreement, pursuant to which they agreed not to sell or transfer any of the Company securities which they
hold, subject to certain customary exceptions, during the thirty (30)-day period following the closing of the Offering.
In addition, the Company agreed
that for a period of forty-five (45) days from the closing date of the offering, it will not: (i) issue, enter into any agreement to issue
or announce the issuance or proposed issuance of any Ordinary Shares or equivalent securities; or (ii) file any registration statement
or amendment or supplement thereto (other than on Form S-8 or in connection with the registration for resale of the ordinary shares underlying
warrants issued in the concurrent private placement, as described below). In addition, the Company agreed that it will not conduct any
sales of Ordinary Shares or equivalent securities involving a variable rate transaction (as defined in the Purchase Agreement) for a period
of one-hundred and eighty (180) days, subject to certain exception as described in the Purchase Agreement.
In connection with the offering,
the Company and the Purchaser agreed to amend an Ordinary Shares Purchase Warrant initially issued to the Purchaser on November 26, 2024
(the “November 2024 Warrant”) to purchase 822,000 Ordinary Shares of the Company to update the exercise price of the November
2024 Warrant to $1.00 per Ordinary Share and to extend the termination date of the November 2024 Warrant to January 30, 2030.
On January 28, 2025, the Company
entered into a Placement Agency Agreement (the “Placement Agency Agreement”) with A.G.P./Alliance Global Partners (“A.G.P.”
or the “Placement Agent”), pursuant to which the Company engaged A.G.P. as the exclusive placement agent in connection with
the offering. The Placement Agent agreed to use its reasonable best efforts to arrange for the sale of the Securities. In addition, under
the Placement Agency Agreement the Company agreed to pay the Placement Agent a placement agent fee in cash equal to seven percent (7.0%)
and a management fee equal to one percent (1.0%) of the aggregate gross proceeds raised from the sale. The Company agreed to reimburse
the Placement Agent at closing for legal and other expenses incurred by them in connection with the offering in an amount not to exceed
$50,000.
The Ordinary Shares, the Pre-Funded
Warrants, the Warrants, and the ordinary shares issuable upon the exercise of the Pre-Funded Warrants and the Warrants were offered and
sold by the Company pursuant to the Company’s Registration Statement on Form F-1, as amended (File No. 333-284023), filed by
the Company with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the
“Securities Act”), which was declared effective on January 28, 2025.
The
foregoing summaries of the Placement Agency Agreement, the Purchase Agreement, the Ordinary Warrants, the Pre-Funded Warrants and the
amendment to the November 2024 Warrant do not purport to be complete and are subject to, and qualified in their entirety by, such documents
filed as Exhibits 10.1, 10.2, 4.1, 4.2 and 4.3, respectively, hereto and incorporated by reference herein. A copy of the press release
related to the Offering entitled “Wearable Devices Ltd. Announces Pricing of $2.50 Million Public Offering” is furnished as
Exhibit 99.1 hereto and is incorporated by reference herein.
This Report of Foreign Private
Issuer on Form 6-K (this “Form 6-K”) shall not constitute an offer to sell any securities or a solicitation of an offer to
buy any securities, nor shall there be any sale of any securities in any state or jurisdiction in which such an offer, solicitation or
sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
This Form 6-K is incorporated
by reference into the registration statements on Form S-8 (File Nos. 333-269869, 333-274343 and 333-284010) and on Form F-3 (File No.
333-274841) of the Company, filed with the Securities and Exchange Commission, to be a part thereof from the date on which this Form
6-K is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.
Forward-Looking Statements:
This Form 6-K contains forward-looking
statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and
other Federal securities laws. For example, the Company is using forward-looking statements when it discusses the closing of the offering.
All statements other than statements of historical facts included in this Form 6-K are forward-looking statements. Forward-looking statements
are neither historical facts nor assurances of future performance. Instead, they are based only on the Company’s current beliefs,
expectations and assumptions regarding the future of its business, future plans and strategies, projections, anticipated events and trends,
the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties,
risks and changes in circumstances that are difficult to predict and many of which are outside of the Company’s control. For example,
we are using forward-looking statements when we discuss the expected closing date of the Offering, the use of proceeds, and the satisfaction
of customary closing conditions. The Company’s actual results and financial condition may differ materially from those indicated
in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could
cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include among
others, the following: the trading of our ordinary shares or warrants and the development of a liquid trading market; our ability to successfully
market our products and services; the acceptance of our products and services by customers; our continued ability to pay operating costs
and ability to meet demand for our products and services; the amount and nature of competition from other security and telecom products
and services; the effects of changes in the cybersecurity and telecom markets; our ability to successfully develop new products and services;
our success establishing and maintaining collaborative, strategic alliance agreements, licensing and supplier arrangements; our ability
to comply with applicable regulations; and other risks and uncertainties described in the Company’s annual report on Form 20-F for
the year ended December 31, 2023, filed with the Commission on March 15, 2024, and the Company’s other filings with the Commission,
including the registration statement on Form F-1, as amended (File No. 333-284023). The Company undertakes no obligation to publicly update
any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future
developments or otherwise.
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
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Wearable Devices Ltd. |
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| Date: January 30, 2025 |
By: |
/s/ Asher Dahan |
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Asher Dahan |
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Chief Executive Officer |
Exhibit 4.1
FORM
OF ORDINARY SHARES PURCHASE WARRANT
Wearable
Devices Ltd.
| Warrant Shares: [●] |
Issue Date: [●], 2025 |
THIS ORDINARY SHARES PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, [●] or [his][her][its] assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after
the date hereof (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City time) on [●], 20301
(the “Termination Date”) but not thereafter, to subscribe for and purchase from Wearable Devices Ltd., a company organized
under the laws of Israel (the “Company”), up to [●] ordinary shares, no par value per share (the “Ordinary
Shares”) (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one Ordinary Share
under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section 1. Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(the “Purchase Agreement”), dated January [●], 2025, by and among the Company and each purchaser signatory thereto.
Section 2. Exercise.
a) Exercise of Warrant.
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy or PDF copy submitted
by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto as (the “Notice of Exercise”).
Within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined
in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the unpaid portion of the aggregate Exercise
Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United
States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise.
No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of
any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised
in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date
on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion
of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable
hereunder in an amount equal to the applicable number of Warrant Shares. The Holder and the Company shall maintain records showing the
number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within
one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that,
by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant
Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
For the avoidance of doubt, there is no circumstance
that would require the Company to net cash settle the Warrants.
| 1 | Five years after the Issue Date. |
b) Exercise Price.
The exercise price under this Warrant shall be $[●] per Ordinary Share, subject to adjustment hereunder (the “Exercise Price”).
c) Cashless Exercise.
Notwithstanding anything to the contrary set forth herein, if at the time of exercise hereof there is no effective registration statement
registering, or the prospectus contained therein is not available for the issuance of, the Warrant Shares to the Holder, then the Holder
may exercise this Warrant, in whole or in part, by means of a “cashless exercise” in which the Holder shall be entitled to
receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as applicable: (i) the
VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both
executed and delivered pursuant to Section 2(a) above on a day that is not a Trading Day, or (2) both executed and
delivered pursuant to Section 2(a) above on a Trading Day prior to the opening of “regular trading hours” (as defined
in Rule 600(b)(77) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the VWAP
on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular
trading hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close
of “regular trading hours” on a Trading Day) pursuant to Section 2(a) above, or (iii) the VWAP on
the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both
executed and delivered pursuant to Section 2(a) above after the close of “regular trading hours” on such Trading Day;
(B) = the Exercise Price, as adjusted
hereunder; and
(X) = the number of Warrant Shares that
would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash
exercise rather than a cashless exercise.
If Warrant Shares are issued in such a cashless
exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take
on the registered characteristics, if any, of the Warrants being exercised. The Company agrees not to take any position contrary to this
Section 2(c).
“Bid Price”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed
or quoted on a Trading Market, the bid price of an Ordinary Share for the time in question (or the nearest preceding date) on the Trading
Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New
York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of
the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not
then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets”
published by OTC Markets Group Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of an Ordinary Share as determined by an independent
appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to
the Company, the fees and expenses of which shall be paid by the Company.
“Trading Day”
means any day on which the Trading Market is open for trading, including any day on which the Trading Market is open for trading for a
period of time less than the customary time.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed
or quoted on a Trading Market, the daily volume weighted average price of the Ordinary Shares for such date (or the nearest preceding
date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary
Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink
Sheets” published by OTC Markets Group Inc. (or a similar organization or agency succeeding to its functions of reporting prices),
the most recent bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of an Ordinary Share as determined
by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably
acceptable to the Company, the fees and expenses of which shall be paid by the Company.
d) Mechanics of Exercise.
i. Delivery of Warrant Shares
Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted to the Holder by crediting the
account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or
Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an
effective registration statement permitting the issuance of the Warrant Shares to, or resale of, the Warrant Shares by the Holder or
(B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery of the Warrant Shares, registered in
the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder
is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the
earliest of (i) one (1) Trading Day after the delivery to the Company of the Notice of Exercise, (ii) one (1) Trading Day after
delivery of the aggregate Exercise Price to the Company, and (iii) the number of Trading Days comprising the Standard Settlement
Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery
Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the
holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery
of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is
received within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period
following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares
subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder in cash, as liquidated
damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Ordinary Shares
on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third (3rd) Trading
Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent and registrar (which may be the Transfer
Agent) that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein,
“Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the
Company’s primary Trading Market with respect to the Ordinary Shares as in effect on the date of delivery of the Notice of
Exercise. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York
City time) on the Initial Exercise Date, which may be delivered at any time after the time of execution of the Purchase Agreement,
the Company agrees to deliver, or cause to be delivered, the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City
time) on the Initial Exercise Date and the Initial Exercise Date shall be the Warrant Share Delivery Date for purposes hereunder,
provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Warrant
Share Delivery Date.
ii. Delivery of New Warrants Upon
Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this
Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant certificate evidencing the rights
of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant certificate shall in all other
respects be identical with this Warrant.
iii. Rescission Rights. If the
Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share
Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation for Buy-In on Failure
to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause
the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to
an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in
an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Ordinary Shares to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including
brokerage commissions, if any) for the Ordinary Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant
Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the
sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of
the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed
rescinded) or deliver to the Holder the number of Ordinary Shares that would have been issued had the Company timely complied with its
exercise and delivery obligations hereunder. For example, if the Holder purchases Ordinary Shares having a total purchase price of $11,000
to cover a Buy-In with respect to an attempted exercise of Warrants with an aggregate sale price giving rise to such purchase obligation
of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder
shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect
to the Company’s failure to timely deliver Ordinary Shares upon exercise of the Warrant as required pursuant to the terms hereof.
v. No Fractional Shares or Scrip.
No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of
a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a
cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to
the next whole Ordinary Share.
vi. Charges, Taxes and
Expenses. The issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder;
provided, however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant
when surrendered for exercise shall be accompanied by the Assignment Form attached hereto as Exhibit B duly executed
by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer
tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and
all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for
same-day electronic delivery of the Warrant Shares.
vii. Closing of Books. The Company
will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms
hereof.
e) Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with (i) the Holder’s Affiliates, (ii)
any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates, and (iii) any other Persons
whose beneficial ownership of the Ordinary Shares would or could be aggregated with the Holder’s for the purposes of Section
13(d) of the Exchange Act (such Persons, “Attribution Parties”)), would beneficially own in excess of the
Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Ordinary Shares
beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Warrant Shares with respect
to which such determination is being made, but shall exclude the number of the Warrant Shares which would be issuable upon (i)
exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or
Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the
Company (including, without limitation, any other Ordinary Share Equivalents) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties.
Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the
Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange
Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the
limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other
securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is
exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the
Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the
Beneficial Ownership Limitation (as defined herein), and the Company shall have no obligation to verify or confirm the accuracy of
such determination and shall have no liability for exercises of the Warrant that are not in compliance with the Beneficial Ownership
Limitation, except to the extent the Holder relies on the number of outstanding Ordinary Shares that was provided by the Company. In
addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder and the Company shall have no obligation to verify or confirm the
accuracy of such determination and shall have no liability for exercises of the Warrant that are not in compliance with the
Beneficial Ownership Limitation, except to the extent the Holder relies on the number of outstanding Ordinary Shares that was
provided by the Company. For purposes of this Section 2(e), in determining the number of outstanding Ordinary Shares, a Holder may
rely on the number of outstanding Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report
filed with the Securities and Exchange Commission (the “Commission”), as the case may be, (B) a more recent
public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number
of Ordinary Shares outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm
orally and in writing to the Holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary
Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant,
by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding Ordinary Shares was
reported. The “Beneficial Ownership Limitation” shall be 24.99% or 4.99% (or, upon election by a Holder prior to
the issuance of any Warrants, 9.99%) of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of
Warrant Shares. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of
this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Ordinary Shares
outstanding immediately after giving effect to the issuance of Warrant Shares upon exercise of this Warrant held by the Holder and
the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be
effective until the 61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and
implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any
portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make
changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this
paragraph shall apply to a successor holder of this Warrant. In addition to the above, the Holder will not hold at any time Ordinary
Shares (whether issued at the Closing, or issued as Warrant Shares or purchased or otherwise obtained) that would cause the
Holder and its Affiliates’ holdings together with the holdings of any Person acting as a group together with such Holder
and/or its Affiliate to represent 25% or more of the total voting rights in the Company, unless in compliance with the special
tender offer rules as provided in sections 328-335 of the Israeli Companies Law 5759-1999 and guidance of the Israel Securities
Authority. If the Warrant is unexercisable as a result of the Holder’s Beneficial Ownership Limitation, no alternate
consideration is owing to the Holder.
Section 3. Certain Adjustments.
a) Share Dividends and
Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes a distribution
on its Ordinary Shares or any other equity or equity equivalent securities payable in Ordinary Shares (which, for avoidance of doubt,
shall not include any Warrant Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding Ordinary Shares
into a larger number of shares, (iii) combines (including by way of reverse share split) outstanding Ordinary Shares into a smaller number
of shares or (iv) issues by reclassification of Ordinary Shares any shares of capital stock of the Company, then in each case the Exercise
Price shall be multiplied by a fraction of which the numerator shall be the number of Ordinary Shares (excluding treasury shares, if any)
outstanding immediately before such event and of which the denominator shall be the number of Ordinary Shares outstanding immediately
after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate
Exercise Price of this Warrant remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately
after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination or re-classification.
b) [RESERVED]
c) Subsequent Rights
Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any
Ordinary Shares Equivalents or rights to purchase Ordinary Shares, warrants, securities or other property pro rata to the record
holders of any class of Ordinary Shares (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder
had held the number of Ordinary Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on
exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is
taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record
holders of Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the
extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial
Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial
ownership of such Ordinary Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be
held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the
Beneficial Ownership Limitation).
d) Pro Rata Distributions.
During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets
(or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, Ordinary Shares or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance
of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the
Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon complete exercise of this
Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately
before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders
of Ordinary Shares are to be determined for the participation in such Distribution (provided, however, to the extent that the Holder’s
right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder
shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Ordinary Shares as a result
of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
e) Fundamental Transaction.
(i) If, at any time
while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger
or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary), directly or indirectly, effects
any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of the Company’s
assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which holders of Ordinary Shares are permitted to sell, tender
or exchange their shares for other securities, cash or property and has been accepted by the holders of more than 50% of the
outstanding Ordinary Shares or more than 50% of the voting power of the share equity of the Company, (iv) the Company, directly or
indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of Ordinary Shares
or any compulsory share exchange pursuant to which the Ordinary Shares are effectively converted into or exchanged for other
securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or
share purchase agreement or other business combination (including, without limitation, a reorganization or recapitalization that
requires the approval of the shareholders of the Company, spin-off, merger or scheme of arrangement) with another Person or group of
Persons whereby such other Person or group acquires more than 50% of the outstanding Ordinary Shares or more than 50% of the voting
power of the share equity of the Company (each a “Fundamental Transaction”), then, upon any subsequent exercise
of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise
immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation
in Section 2(e) on the exercise of this Warrant), the number of Ordinary Shares of the successor or acquiring corporation or of
the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of Ordinary Shares for which this Warrant is
exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise
of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Ordinary Share in
such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable
manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Ordinary Shares are
given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given
the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental
Transaction. provided, however, that, if the Fundamental Transaction is not within the Company’s control, including not
approved by the Board of Directors, the Holder shall only be entitled to receive from the Company or any Successor Entity the same
type or form of consideration (and in the same proportion), at the value of the unexercised portion of this Warrant, that is being
offered and paid to the holders of Ordinary Shares in connection with the Fundamental Transaction, whether that consideration be in
the form of cash, stock or any combination thereof, or whether the holders of Ordinary Shares are given the choice to receive from
among alternative forms of consideration in connection with the Fundamental Transaction; provided, further, that if holders of
Ordinary Shares are not offered or paid any consideration in such Fundamental Transaction, such holders will be deemed to have
received Ordinary Shares of the Successor Entity (which Successor Entity may be the Company following such Fundamental Transaction)
in such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is
not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this
Warrant and the other Transaction Documents. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall be
added to the term “Company” under this Warrant (so that from and after the occurrence or consummation of such
Fundamental Transaction, each and every provision of this Warrant and the other Transaction Documents referring to the
“Company” shall refer instead to each of the Company and the Successor Entity or Successor Entities, jointly and
severally), and the Successor Entity or Successor Entities, jointly and severally with the Company, may exercise every right and
power of the Company prior thereto and the Successor Entity or Successor Entities shall assume all of the obligations of the Company
prior thereto under this Warrant and the other Transaction Documents with the same effect as if the Company and such Successor
Entity or Successor Entities, jointly and severally, had been named as the Company herein.
(ii) Redemption
Right. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction, the Company or any Successor Entity
(as defined below) shall, at the Holder’s option, exercisable at any time concurrently with, or within 30 days after, the
consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental
Transaction), redeem this Warrant from the Holder (in accordance with Section 312 of the Israeli Companies Law, 5759-1999) by paying
to the Holder an amount of cash equal to the Black Scholes Value (as defined below) of the remaining unexercised portion of this
Warrant on the date of the consummation of such Fundamental Transaction; provided, however, that, if the Fundamental Transaction is
not within the Company’s control, including not approved by the Company’s Board of Directors, Holder shall only be
entitled to receive from the Company or any Successor Entity the same type or form of consideration (and in the same proportion), at
the Black Scholes Value of the unexercised portion of this Warrant, that is being offered and paid to the holders of Ordinary Shares
of the Company in connection with the Fundamental Transaction, whether that consideration be in the form of cash, shares or any
combination thereof, or whether the holders of Ordinary Shares are given the choice to receive from among alternative forms of
consideration in connection with the Fundamental Transaction; provided, further, that if holders of Ordinary Shares of the Company
are not offered or paid any consideration in such Fundamental Transaction, such holders of Ordinary Shares will be deemed to have
received share equity of the Successor Entity (which Entity may be the Company following such Fundamental Transaction) in such
Fundamental Transaction. “Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg determined as of the day of consummation of the applicable
Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate
for a period equal to the time between the date of the public announcement of the applicable Fundamental Transaction and the
Termination Date, (B) an expected volatility equal to the volatility for the remaining exercise period as obtained from the HVT
function on Bloomberg (determined utilizing a 252 day annualization factor) as of the Trading Day immediately following the
consummation of the applicable contemplated Fundamental Transaction, (C) the underlying price per share used in such calculation
shall be the VWAP for the 30 days prior to the Trading Day immediately preceding the consummation of the applicable contemplated
Fundamental Transaction and (D) a remaining option time equal to the time between the date of the public announcement of the
applicable Fundamental Transaction and the Termination Date and (E) cost of borrow for the Company’s shares at the exercise
date. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds (or such other
consideration) within the later of (i) five Business Days of the Holder’s election and (ii) the date of consummation of the
Fundamental Transaction.
f) Calculations. All
calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding as of a given date shall be the sum of the number
of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.
g) Notice to Holder.
i. Adjustment to Exercise Price.
Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder
by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant
Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice to Allow Exercise by
Holder. If (A) the Company declares a dividend (or any other distribution in whatever form) on the Ordinary Shares, (B) the
Company declares a special nonrecurring cash dividend on or a redemption of the Ordinary Shares, (C) the Company authorizes the
granting to all holders of the Ordinary Shares rights or warrants to subscribe for or purchase any shares of capital stock of any
class or of any rights, (D) the approval of any shareholders of the Company is required in connection with any Fundamental
Transaction, or (E) the Company authorizes the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the
Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile
number or email address as it shall appear upon the Warrant Register of the Company, at least five (5) calendar days prior to the
applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the
holders of the Ordinary Shares of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be
determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to
become effective or close, and the date as of which it is expected that holders of the Ordinary Shares of record shall be entitled
to exchange their Ordinary Shares for securities, cash or other property deliverable upon such reclassification, consolidation,
merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery
thereof shall not affect the validity of the corporate action required to be specified in such notice and provided, further that no
notice shall be required if the information is disseminated in a press release or document filed with the Commission within such
time period. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information
regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to
a Report on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such
notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
(h) Voluntary Adjustment
By Company. Subject to the rules and regulations of the Trading Market and requirements of any applicable law, the Company may at
any time during the term of this Warrant, subject to the consent of the Holder, reduce the then current Exercise Price to any amount and
for any period of time deemed appropriate by the board of directors of the Company
Section 4. Transfer of
Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all
rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this
Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially
in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable
upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant
or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant
to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this
Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.
b) New Warrants. This
Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with
a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney.
Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall
execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such
notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and shall be identical
with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c) Warrant Register.
The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the
absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual
notice to the contrary.
(d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of
this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under
applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current
public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the
Holder or transferee of this Warrant, as the case may be, comply with the provisions of Section 5.7 of the Purchase
Agreement.
(e) Representation by the
Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise hereof,
will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling
such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to
sales registered or exempted under the Securities Act.
Section 5. Miscellaneous.
a) Currency. All dollar
amounts referred to in this Warrant are in United States Dollars (“U.S. Dollars”). All amounts owing under this Warrant
shall be paid in U.S. Dollars. All amounts denominated in other currencies shall be converted in the U.S. Dollar equivalent amount in
accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency
to be converted into U.S. Dollars pursuant to this Warrant, the U.S. Dollar exchange rate as published in the Wall Street Journal (NY
edition) on the relevant date of calculation.
b) No Rights as Shareholder
Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as
a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section
3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 2(c) or
to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net
cash settle an exercise of this Warrant.
c) Loss, Theft, Destruction
or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the
loss, theft, destruction or mutilation of this Warrant or any share certificate relating to the Warrant Shares, and in case of loss, theft
or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting
of any bond), and upon surrender and cancellation of such Warrant or share certificate, if mutilated, the Company will make and deliver
a new Warrant or share certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or share certificate.
d) Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein
shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading Day.
e) Authorized Shares.
The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Ordinary Shares
a sufficient number of shares to provide for the issuance of the Warrant Shares underlying this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary
Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be
necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or
of any requirements of the Trading Market upon which the Ordinary Shares may be listed. The Company covenants that all Warrant Shares
underlying this Warrant, which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except and to the extent as
waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles of incorporation
or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith
assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights
of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not
increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in
par value (it is being clarified that the foregoing shall not prevent the Company from effecting a reverse share split in order to satisfy
listing requirements), (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain
all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable
the Company to perform its obligations under this Warrant.
Before taking any action which
would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company
shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or
bodies having jurisdiction thereof.
f) Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with
the provisions of the Purchase Agreement.
g) Restrictions. The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize
cashless exercise, will have restrictions upon resale imposed by state and federal securities laws, and in such case, the Holder, by the
acceptance hereof, represents and warrants that the Holder will acquire such Warrant Shares issuable upon such exercise for its own account
and not with a view to or for distributing or reselling Warrant Shares or any part thereof in violation of the Securities Act or any applicable
state securities law.
h) Nonwaiver and Expenses.
No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right
or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company
willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company
shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable
attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto
or in otherwise enforcing any of its rights, powers or remedies hereunder.
i) Notices. Any notice,
request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance
with the notice provisions of the Purchase Agreement.
j) Limitation of Liability.
No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no
enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of
any Ordinary Share or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
k) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the
defense in any action for specific performance that a remedy at law would be adequate.
l) Successors and Assigns.
Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and
be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions
of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder
or holder of Warrant Shares.
m) Amendment and Waiver.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
n) Severability. Wherever
possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if
any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
o) Headings. The headings
used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company
has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
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Wearable Devices Ltd. |
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By: |
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Name: |
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Title: |
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EXHIBIT
A
NOTICE OF EXERCISE
TO: Wearable Devices Ltd.
| (1) | The undersigned hereby elects to purchase ________ Warrant
Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the
exercise price in full, together with all applicable transfer taxes, if any. |
| (2) | Payment shall take the form of (check applicable box): |
| ☐ | in lawful money of the United States; or |
| ☐ | if permitted, the cancellation of such number of Warrant
Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum
number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c). |
(3) Please issue said Warrant Shares in the name
of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following
DWAC Account Number:
[SIGNATURE OF HOLDER]
Name of Investing Entity:
Signature of Authorized Signatory of Investing Entity:
Name of Authorized Signatory:
Title of Authorized Signatory:
Date:
EXHIBIT
B
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this
form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and
all rights evidenced thereby are hereby assigned to
| Name: |
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(Please Print) |
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| Address: |
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(Please Print) |
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| Phone Number: |
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| Email Address: |
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| Dated:____________ _____, ______ |
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| Holder’s |
Signature: |
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| Holder’s |
Address: |
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Exhibit 4.2
FORM
OF Pre-Funded Ordinary SHARES PURCHASE WARRANT
Wearable
Devices Ltd.
| Warrant Shares: [●] |
Issue Date: [●], 2025 |
THIS Pre-Funded
ORDINARY SHARES PURCHASE WARRANT (the “Warrant”) certifies that, for value received, [●] or [his][her][its] assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the date hereof (the “Initial Exercise Date”) until this Warrant is exercised in
full (the “Termination Date”) but not thereafter, to subscribe for and purchase from Wearable Devices Ltd., a company
organized under the laws of Israel (the “Company”), up to [●] ordinary shares, no par value per share (the “Ordinary
Shares”) (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one Ordinary Share
under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section 1. Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(the “Purchase Agreement”), dated January [●], 2025, by and among the Company and each purchaser signatory thereto.
Section 2. Exercise.
a) Exercise of Warrant.
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy or PDF copy submitted
by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto as Exhibit A (the “Notice
of Exercise”). Within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement
Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the unpaid portion
of the aggregate Exercise Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s
check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable
Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee
or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required
to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the
Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three
(3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting
in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding
number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and
the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver
any objection to any Notice of Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance
of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the
Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount
stated on the face hereof.
For the avoidance of doubt, there is no circumstance
that would require the Company to net cash settle this Warrant.
b) Exercise Price.
The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.0001 per Warrant Share, was pre-funded to the
Company on or prior to the Initial Exercise Date and, consequently, no additional consideration (other than the nominal exercise price
of $0.0001 per Warrant Share) shall be required to be paid by the Holder to the Company to effect any exercise of this Warrant. The Holder
shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance
or for any reason whatsoever. The remaining unpaid exercise price per Warrant Share shall be $0.0001, subject to adjustment hereunder
(the “Exercise Price”).
c) Cashless Exercise.
Notwithstanding anything to the contrary set forth herein, if at the time of exercise hereof there is no effective registration statement
registering, or the prospectus contained therein is not available for the issuance of, the Warrant Shares to the Holder, then the Holder
may exercise this Warrant, in whole or in part, by means of a “cashless exercise” in which the Holder shall be entitled to
receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as applicable: (i) the
VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is
(1) both executed and delivered pursuant to Section 2.1 above on a day that is not a Trading Day, or
(2) both executed and delivered pursuant to Section 2.1 above on a Trading Day prior to the opening of
“regular trading hours” (as defined in Rule 600(b)(77) of Regulation NMS promulgated under the federal securities laws)
on such Trading Day, (ii) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if
such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2)
hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to
Section 2.1 above, or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of
Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2.1 above after the
close of “regular trading hours” on such Trading Day;
(B) = the Exercise Price, as adjusted
hereunder; and
(X) = the number of Warrant Shares that
would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash
exercise rather than a cashless exercise.
If Warrant Shares are issued
in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant
Shares shall take on the registered characteristics, if any, of the Warrants being exercised. The Company agrees not to take any position
contrary to this Section 2(c).
“Bid Price”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed
or quoted on a Trading Market, the bid price of an Ordinary Share for the time in question (or the nearest preceding date) on the Trading
Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New
York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of
the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not
then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink Sheets”
published by OTC Markets Group Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent
bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of an Ordinary Share as determined by an independent
appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to
the Company, the fees and expenses of which shall be paid by the Company.
“Trading Day”
means any day on which the Trading Market is open for trading, including any day on which the Trading Market is open for trading for a
period of time less than the customary time.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed
or quoted on a Trading Market, the daily volume weighted average price of the Ordinary Shares for such date (or the nearest preceding
date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary
Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported in the “Pink
Sheets” published by OTC Markets Group Inc. (or a similar organization or agency succeeding to its functions of reporting prices),
the most recent bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of an Ordinary Share as determined
by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably
acceptable to the Company, the fees and expenses of which shall be paid by the Company.
d) Mechanics of Exercise.
i. Delivery of Warrant Shares Upon
Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted to the Holder by crediting the account
of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian
system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration
statement permitting the issuance of the Warrant Shares to, or resale of, the Warrant Shares by the Holder or (B) this Warrant is being
exercised via cashless exercise, and otherwise by physical delivery of a certificate representing the Warrant Shares, registered in the
Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled
pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) one
(1) Trading Day after the delivery to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate
Exercise Price to the Company, and (iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the
Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise,
the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which
this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise
Price (other than in the case of a cashless exercise) is received within the earlier of (i) one (1) Trading Day and (ii) the number of
Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason
to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay
to the Holder in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on
the VWAP of the Ordinary Shares on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading
Day on the third (3rd) Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date
until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent and registrar
(which may be the Transfer Agent) that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable.
As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days,
on the Company’s primary Trading Market with respect to the Ordinary Shares as in effect on the date of delivery of the Notice of
Exercise. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City
time) on the Initial Exercise Date, which may be delivered at any time after the time of execution of the Purchase Agreement, the Company
agrees to deliver, or cause to be delivered, the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial
Exercise Date and the Initial Exercise Date shall be the Warrant Share Delivery Date for purposes hereunder, provided that payment of
the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Warrant Share Delivery Date.
ii. Delivery of New Warrants Upon
Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this
Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant certificate evidencing the rights
of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant certificate shall in all other
respects be identical with this Warrant.
iii. Rescission Rights. If the
Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share
Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation for Buy-In on Failure
to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause
the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to
an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in
an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Ordinary Shares to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including
brokerage commissions, if any) for the Ordinary Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant
Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the
sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of
the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed
rescinded) or deliver to the Holder the number of Ordinary Shares that would have been issued had the Company timely complied with its
exercise and delivery obligations hereunder. For example, if the Holder purchases Ordinary Shares having a total purchase price of $11,000
to cover a Buy-In with respect to an attempted exercise of Warrants with an aggregate sale price giving rise to such purchase obligation
of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder
shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect
to the Company’s failure to timely deliver Ordinary Shares upon exercise of the Warrant as required pursuant to the terms hereof.
v. No Fractional Shares or Scrip.
No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of
a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a
cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to
the next whole Ordinary Share.
vi. Charges, Taxes and Expenses.
The issuance and delivery of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant
Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in
the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise
shall be accompanied by the Assignment Form attached hereto as Exhibit B duly executed by the Holder and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company
shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing of Books. The Company
will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms
hereof.
e) Holder’s Exercise
Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion
of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth
on the applicable Notice of Exercise, the Holder (together with (i) the Holder’s Affiliates, (ii) any other Persons acting as a
group together with the Holder or any of the Holder’s Affiliates, and (iii) any other Persons whose beneficial ownership of the
Ordinary Shares would or could be aggregated with the Holder’s for the purposes of Section 13(d) of the Exchange Act (such Persons,
“Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).
For purposes of the foregoing sentence, the number of Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution
Parties shall include the number of Warrant Shares with respect to which such determination is being made, but shall exclude the number
of the Warrant Shares which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned
by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion
of any other securities of the Company (including, without limitation, any other Ordinary Share Equivalents) subject to a limitation on
conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution
Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder
that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the
Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained
in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder
together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion
of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant
is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which
portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation
to verify or confirm the accuracy of such determination and shall have no liability for exercises of the Warrant that are not in compliance
with the Beneficial Ownership Limitation, except to the extent the Holder relies on the number of outstanding Ordinary Shares that was
provided by the Company. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder and the Company shall have no obligation to verify
or confirm the accuracy of such determination and shall have no liability for exercises of the Warrant that are not in compliance with
the Beneficial Ownership Limitation, except to the extent the Holder relies on the number of outstanding Ordinary Shares that was provided
by the Company. For purposes of this Section 2(e), in determining the number of outstanding Ordinary Shares, a Holder may rely on the
number of outstanding Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report filed with the Securities
and Exchange Commission (the “Commission”), as the case may be, (B) a more recent public announcement by the Company
or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Ordinary Shares outstanding. Upon
the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number
of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to
the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties
since the date as of which such number of outstanding Ordinary Shares was reported. The “Beneficial Ownership Limitation”
shall be [24.99% or 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%] of the number of
Ordinary Shares outstanding immediately after giving effect to the issuance of Warrant Shares. The Holder, upon notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation
in no event exceeds 9.99% of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of Warrant Shares
upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the
Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The provisions
of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e)
to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation
herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations
contained in this paragraph shall apply to a successor holder of this Warrant. If the Warrant is unexercisable as a result of the Holder’s
Beneficial Ownership Limitation, no alternate consideration is owing to the Holder. In addition to the above, the Holder will not hold
at any time Ordinary Shares (whether issued at the Closing, or issued as Warrant Shares or purchased or otherwise obtained) that
would cause the Holder and its Affiliates’ holdings together with the holdings of any Person acting as a group together with
such Holder and/or its Affiliate to represent 25% or more of the total voting rights in the Company, unless in compliance with the special
tender offer rules as provided in sections 328-335 of the Israeli Companies Law, 5759-1999 and guidance of the Israel Securities Authority.
Section 3. Certain Adjustments.
a) Share Dividends and
Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes a distribution
on its Ordinary Shares or any other equity or equity equivalent securities payable in Ordinary Shares (which, for avoidance of doubt,
shall not include any Warrant Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding Ordinary Shares
into a larger number of shares, (iii) combines (including by way of reverse share split) outstanding Ordinary Shares into a smaller number
of shares or (iv) issues by reclassification of Ordinary Shares any shares of capital stock of the Company, then in each case the Exercise
Price shall be multiplied by a fraction of which the numerator shall be the number of Ordinary Shares (excluding treasury shares, if any)
outstanding immediately before such event and of which the denominator shall be the number of Ordinary Shares outstanding immediately
after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate
Exercise Price of this Warrant remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately
after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination or re-classification.
b) [RESERVED]
c) Subsequent Rights Offerings.
In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any Ordinary Shares
Equivalents or rights to purchase Ordinary Shares, warrants, securities or other property pro rata to the record holders of any class
of Ordinary Shares (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable
to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Ordinary
Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase
Rights, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the grant,
issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase
Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in
such Purchase Right to such extent (or beneficial ownership of such Ordinary Shares as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not
result in the Holder exceeding the Beneficial Ownership Limitation).
d) Pro Rata Distributions.
During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets
(or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, Ordinary Shares or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance
of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the
Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon complete exercise of this
Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately
before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders
of Ordinary Shares are to be determined for the participation in such Distribution (provided, however, to the extent that the Holder’s
right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder
shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Ordinary Shares as a result
of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
e) Fundamental Transaction.
If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects
any merger or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary), directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of the Company’s
assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Ordinary Shares are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of more than 50% of the outstanding Ordinary
Shares or more than 50% of the voting power of the share equity of the Company, (iv) the Company, directly or indirectly, in one or more
related transactions effects any reclassification, reorganization or recapitalization of Ordinary Shares or any compulsory share exchange
pursuant to which the Ordinary Shares are effectively converted into or exchanged for other securities, cash or property, or (v) the Company,
directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination
(including, without limitation, a reorganization or recapitalization that requires the approval of the shareholders of the Company, spin-off,
merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of
the outstanding Ordinary Shares or more than 50% of the voting power of the share equity of the Company (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of Ordinary Shares of
the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of Ordinary Shares for which
this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on
the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Ordinary Share in such
Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting
the relative value of any different components of the Alternate Consideration. If holders of Ordinary Shares are given any choice as to
the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the
Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction; provided, however, that,
if the Fundamental Transaction is not within the Company’s control, including not approved by the Board of Directors, the Holder
shall only be entitled to receive from the Company or any Successor Entity the same type or form of consideration (and in the same proportion),
at the value of the unexercised portion of this Warrant, that is being offered and paid to the holders of Ordinary Shares in connection
with the Fundamental Transaction, whether that consideration be in the form of cash, stock or any combination thereof, or whether the
holders of Ordinary Shares are given the choice to receive from among alternative forms of consideration in connection with the Fundamental
Transaction; provided, further, that if holders of Ordinary Shares are not offered or paid any consideration in such Fundamental Transaction,
such holders will be deemed to have received Ordinary Shares of the Successor Entity (which Successor Entity may be the Company following
such Fundamental Transaction) in such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction
in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the
Company under this Warrant and the other Transaction Documents. Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall be added to the term “Company” under this Warrant (so that from and after the occurrence or consummation of such
Fundamental Transaction, each and every provision of this Warrant and the other Transaction Documents referring to the “Company”
shall refer instead to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Successor Entity
or Successor Entities, jointly and severally with the Company, may exercise every right and power of the Company prior thereto and the
Successor Entity or Successor Entities shall assume all of the obligations of the Company prior thereto under this Warrant and the other
Transaction Documents with the same effect as if the Company and such Successor Entity or Successor Entities, jointly and severally, had
been named as the Company herein.
f) Calculations. All
calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes
of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding as of a given date shall be the sum of the number
of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.
g) Notice to Holder.
i. Adjustment to Exercise Price.
Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder
by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant
Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice to Allow Exercise by Holder.
If (A) the Company declares a dividend (or any other distribution in whatever form) on the Ordinary Shares, (B) the Company declares a
special nonrecurring cash dividend on or a redemption of the Ordinary Shares, (C) the Company authorizes the granting to all holders of
the Ordinary Shares rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the
approval of any shareholders of the Company is required in connection with any Fundamental Transaction, or (E) the Company authorizes
the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall
cause to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant
Register of the Company, at least five (5) calendar days prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Ordinary Shares of record to be entitled to such dividend,
distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger,
sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Ordinary Shares of record shall be entitled to exchange their Ordinary Shares for securities, cash or other property deliverable upon
such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any
defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice
and provided, further that no notice shall be required if the information is disseminated in a press release or document filed with the
Commission within such time period. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public
information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant
to a Report on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice
to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
(h) Voluntary Adjustment
By Company. Subject to the rules and regulations of the Trading Market and requirements of any applicable law, the Company may at
any time during the term of this Warrant, subject to the consent of the Holder, reduce the then current Exercise Price to any amount and
for any period of time deemed appropriate by the board of directors of the Company
Section 4. Transfer of
Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws, this Warrant and all rights hereunder (including, without limitation, any registration
rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated
agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its
agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable,
and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing
the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full,
in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers
an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised
by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
b) New Warrants. This
Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with
a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney.
Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall
execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such
notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and shall be identical
with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
c) Warrant Register.
The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the
absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual
notice to the contrary.
Section 5. Miscellaneous.
a) Currency. All dollar
amounts referred to in this Warrant are in United States Dollars (“U.S. Dollars”). All amounts owing under this Warrant
shall be paid in U.S. Dollars. All amounts denominated in other currencies shall be converted in the U.S. Dollar equivalent amount in
accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency
to be converted into U.S. Dollars pursuant to this Warrant, the U.S. Dollar exchange rate as published in the Wall Street Journal (NY
edition) on the relevant date of calculation.
b) No Rights as Shareholder
Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as
a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section
3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 2(c) or
to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net
cash settle an exercise of this Warrant.
c) Loss, Theft, Destruction
or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the
loss, theft, destruction or mutilation of this Warrant or any share certificate relating to the Warrant Shares, and in case of loss, theft
or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting
of any bond), and upon surrender and cancellation of such Warrant or share certificate, if mutilated, the Company will make and deliver
a new Warrant or share certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or share certificate.
d) Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein
shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading Day.
e) Authorized Shares.
The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Ordinary Shares
a sufficient number of shares to provide for the issuance of the Warrant Shares underlying this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary
Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be
necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or
of any requirements of the Trading Market upon which the Ordinary Shares may be listed. The Company covenants that all Warrant Shares
underlying this Warrant, which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except and to the extent as
waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its articles of incorporation
or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith
assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights
of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not
increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in
par value (it is being clarified that the foregoing shall not prevent the Company from effecting a reverse share split in order to satisfy
listing requirements), (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain
all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable
the Company to perform its obligations under this Warrant.
Before taking any action which
would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company
shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or
bodies having jurisdiction thereof.
f) Jurisdiction. All
questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with
the provisions of the Purchase Agreement.
g) Restrictions. The
Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize
cashless exercise, will have restrictions upon resale imposed by state and federal securities laws, and in such case, the Holder, by the
acceptance hereof, represents and warrants that the Holder will acquire such Warrant Shares issuable upon such exercise for its own account
and not with a view to or for distributing or reselling Warrant Shares or any part thereof in violation of the Securities Act or any applicable
state securities law.
h) Nonwaiver and Expenses.
No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right
or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company
willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company
shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable
attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto
or in otherwise enforcing any of its rights, powers or remedies hereunder.
i) Notices. Any notice,
request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance
with the notice provisions of the Purchase Agreement.
j) Limitation of Liability.
No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no
enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of
any Ordinary Share or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
k) Remedies. The Holder,
in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance
of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by
reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for
specific performance that a remedy at law would be adequate.
l) Successors and Assigns.
Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and
be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions
of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder
or holder of Warrant Shares.
m) Amendment and Waiver.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
n) Severability. Wherever
possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if
any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
o) Headings. The headings
used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company has caused this
Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
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Wearable Devices Ltd. |
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EXHIBIT
A
NOTICE OF EXERCISE
TO: Wearable
Devices Ltd.
| (1) | The undersigned hereby elects to purchase ________ Warrant
Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the
exercise price in full, together with all applicable transfer taxes, if any. |
| (2) | Payment shall take the form of (check applicable box): |
| ☐ | in lawful money of the United States; or |
| ☐ | if permitted, the cancellation of such number of Warrant
Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum
number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c). |
(3) Please issue said Warrant Shares in the name
of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following
DWAC Account Number:
[SIGNATURE OF HOLDER]
Name of Investing Entity:
Signature of Authorized Signatory of Investing Entity:
Name of Authorized Signatory:
Title of Authorized Signatory:
Date:
EXHIBIT
B
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this
form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and
all rights evidenced thereby are hereby assigned to
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Exhibit 4.3
Form of AMENDMENT
TO
ORDINARY SHARES
PURCHASE WARRANT
This AMENDMENT TO THE ORDINARY
SHARES PURCHASE WARRANT (this “Amendment”) is entered into as of January [●], 2025, by and between Wearable Devices
Ltd., a company organized under the laws of Israel (the “Company”), and __________Ltd. (the “Holder”).
WHEREAS, the Holder
is the holder of an Ordinary Shares Purchase Warrant issued on November 26, 2024 (the “November 2024 Warrant”) to purchase
822,000 ordinary shares, no par value per share (the “Ordinary Shares”) of the Company;
WHEREAS, pursuant to
Section 5(m) of the November 2024 Warrant, the November 2024 Warrant may be modified or amended or the provisions thereof waived with
the written consent of the Company and the Holder; and
WHEREAS, the Company
and the Holder desire to amend the November 2024 Warrant as set forth in this Amendment.
NOW, THEREFORE, in
consideration of the mutual agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and intending to be legally bound hereby, the Company and the Holder hereby agree as follows:
| 1. | Amendment to “Exercise Price”. Section 2(b)
of the November 2024 Warrant is hereby amended and restated in its entirety as follows: |
“b) Exercise
Price. The exercise price under this Warrant shall be $[●] per Ordinary Share, subject to adjustment hereunder (the
“Exercise Price”).”
| 2. | Amendment to “Termination Date” Defined Term. The defined term “Termination
Date” in the November 2024 Warrant is hereby defined to mean January [●], 2030. |
| 3. | No Further Amendment. Except as amended by this Amendment, the November 2024 Warrant remains unaltered
and shall remain in full force and effect. |
| 4. | Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation
of this Amendment shall be determined in accordance with the provisions of that certain Securities Purchase Agreement, dated as of November
26, 2024, by and between the Company and the Holder with respect to the November 2024 Warrant. |
| 5. | Counterparts. This Amendment may be executed in any number of counterparts, each of which will
be deemed an original and all of which together will constitute one and the same instrument. Signatures delivered by facsimile, electronic
mail (including as a PDF file) or other transmission method shall be deemed to be original signatures, shall be valid and binding, and,
upon delivery, shall constitute due execution of this Amendment. |
| 6. | No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto
and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any
other Person. |
(Signature page follows)
IN WITNESS WHEREOF, each of
the Company and the Holder has caused this Amendment to be executed by its officer thereunto duly authorized as of the date first above
indicated.
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COMPANY |
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Wearable Devices Ltd. |
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Asher Dahan |
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Chief Executive Officer |
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HOLDER |
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Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase
Agreement (this “Agreement”) is dated as of January 28, 2025, between Wearable Devices Ltd., a company organized under
the laws of Israel (the “Company”), and each purchaser identified on the signature pages hereto (each, including its
successors and assigns, a “Purchaser” and collectively, the “Purchasers”).
WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act (as
defined below), the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase
from the Company, securities of the Company as more fully described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION
of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and adequacy of which are
hereby acknowledged, the Company and each Purchaser agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. In
addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set
forth in this Section 1.1:
“Acquiring Person”
shall have the meaning ascribed to such term in Section 4.5.
“Action”
shall have the meaning ascribed to such term in Section 3.1(l).
“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person as such terms are used in and construed under Rule 405 under the Securities Act. For purposes of Israeli law, a Person shall
be regarded as in control of the Company if the Company owns or directly or indirectly controls more than fifty percent (50%) of the voting
rights or other ownership interest of the other person, or if it possesses, directly or indirectly, the power to direct or cause the direction
of the management and policies of such person.
“Applicable Laws”
shall have the meaning ascribed to such term in Section 3.1(jj).
“Auditors”
means Ziv Haft, Certified Public Accountants, Isr., BDO Member Firm.
“Authorizations”
shall have the meaning ascribed to such term in Section 3.1(jj).
“Beneficial Ownership
Limitation” shall have the meaning ascribed to such term in Section 2.1(a).
“BHCA”
shall have the meaning ascribed to such term in Section 3.1(qq).
“Board of Directors”
means the board of directors of the Company.
“Business Day”
means any day other than Saturday, Sunday, or other day on which banking institutions in the State of New York are authorized or required
by law to remain closed.
“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.
“Closing Date”
means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties thereto, and
all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount at the Closing and (ii) the Company’s
obligations to deliver the Securities, in each case, at the Closing have been satisfied or waived, but in no event later than the first
(1st) Trading Day following the date hereof.
“Commission”
means the United States Securities and Exchange Commission.
“Company Israeli
Counsel” means Sullivan & Worcester Tel Aviv (Har-Even & Co.), with offices located at 28 HaArba’a St. HaArba’a
Towers North Tower, 35th Floor, Tel-Aviv, Israel.
“Company U.S. Counsel”
means Sullivan & Worcester LLP, with offices located at 1251 Avenue of the Americas, New York, New York 10020.
“Disclosure Schedules”
means the Disclosure Schedules of the Company delivered concurrently herewith.
“Disclosure Time”
means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and before midnight
(New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date hereof, unless
otherwise instructed as to an earlier time by the Placement Agent, and (ii) if this Agreement is signed between midnight (New York City
time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time) on the date hereof, unless otherwise
instructed as to an earlier time by the Placement Agent.
“DVP”
shall have the meaning ascribed to such term in Section 2.1(a).
“DWAC”
shall have the meaning ascribed to such term in Section 2.2(a)(iv).
“Environmental Law”
shall have the meaning ascribed to such term in Section 3.1(o).
“Evaluation Date”
shall have the meaning ascribed to such term in Section 3.1(v).
“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Exempt
Issuance” means the issuance of (a) Ordinary Shares or options to employees, officers, directors, service providers or
consultants of the Company pursuant to any share or option plan or arrangement duly adopted for such purpose, by a majority of the
non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for
such purpose for services rendered to the Company, (b) securities upon the exercise or exchange of or conversion of any Securities
issued hereunder and/or other securities exercisable or exchangeable for or convertible into Ordinary Shares issued and outstanding
on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the
number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in
connection with share splits or combinations) or to extend the term of such securities, (c) Ordinary Shares or securities
convertible into or exchangeable for Ordinary Shares as consideration for mergers, acquisitions, sale or purchase of assets or other
business combinations occurring after the date of this Agreement which are not issued for capital raising purposes, (d) Ordinary
Shares or securities convertible into or exchangeable for Ordinary Shares offered and sold in a privately negotiated transaction to
vendors, customers, lenders, strategic partners or potential strategic partners or other investors conducted in a manner so as not
to be integrated with the offering hereby, provided that such securities are issued as “restricted securities” (as
defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection
therewith during the prohibition period in Section 4.11(a) herein, and (e) Ordinary Shares or securities convertible into or
exchangeable for Ordinary Shares in connection with any acquisition, debt financing, strategic investment or other similar
transaction (including any joint venture, strategic alliance or partnership); provided, however that any such transaction shall not
include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose
primary business is investing in securities and provided that such securities are issued as “restricted securities” (as
defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection
therewith during the prohibition period in Section 4.11(a) herein, and provided that any such issuance shall only be to a Person (or
to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a
business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the
investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of
raising capital or to an entity whose primary business is investing in securities.
“GAAP”
means accounting principles generally accepted in the United States of America.
“Hazardous Substances”
shall have the meaning ascribed to such term in Section 3.1(o).
“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(cc).
“Intellectual Property
Rights” shall have the meaning ascribed to such term in Section 3.1(r).
“Issuer Free Writing
Prospectus” shall have the meaning ascribed to such term in Section 3.1(g).
“IT Systems”
shall have the meaning ascribed to such term in Section 3.1(ss).
“IT Systems and
Data” shall have the meaning ascribed to such term in Section 3.1(nn).
“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Lock-Up Agreement”
means the Lock-Up Agreement, dated as of the date hereof, by and among the Company and the directors and officers of the Company, in the
form of Exhibit C attached hereto.
“Material Adverse
Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Material Permits”
shall have the meaning assigned to such term in Section 3.1(p).
“Money Laundering
Laws” shall have the meaning assigned to such term in Section 3.1(rr).
“OFAC”
means the Office of Foreign Assets Control of the U.S. Treasury Department.
“Offering”
means the offering of the Securities hereunder.
“Ordinary Shares”
means ordinary shares of the Company, no par value per share.
“Ordinary Share
Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any
time Ordinary Shares, including, without limitation, any debt, preferred share, right, option, warrant or other instrument that is at
any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.”Ordinary
Warrants” means, collectively, the Ordinary Share purchase warrants delivered to the Purchasers at Closing in accordance with
Section 2.2(a) hereof, in the form of Exhibit A attached hereto.
“Ordinary Warrant
Shares” means the Ordinary Shares issuable upon exercise of the Ordinary Warrants.
“Per Pre-Funded Warrant
Purchase Price” equals $0.9999, subject to adjustment for reverse and forward share splits, share dividends, share combinations
and other similar transactions relating to the Ordinary Shares that occur after the date of this Agreement.
“Per Share Purchase
Price” equals $1.00, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other
similar transactions of Ordinary Shares that occur between the date hereof and the Closing Date.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company,
joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Personal Data”
shall have the meaning ascribed to such term in Section 3.1(ss).
“Placement Agency
Agreement” means that certain Placement Agency Agreement by and between the Company and the Placement Agent, dated as of the
date hereof.
“Placement Agent”
means A.G.P./Alliance Global Partners.
“Placement Agent
Counsel” means Blank Rome LLP with offices located at 1271 Avenue of the Americas, New York, New York 10020.
“Pre-Funded Warrant
Purchase Price” means the Per Share Purchase Price minus $0.0001.
“Pre-Funded Warrants”
means, collectively, the pre-funded Ordinary Share purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.2(a) hereof, in the form of Exhibit B attached hereto.
“Pre-Funded Warrant
Shares” means the Ordinary Shares issuable upon exercise of the Pre-Funded Warrants.
“Preliminary Prospectus”
means the preliminary prospectus included in the Registration Statement at the time the Registration Statement is declared effective.
“Pre-Settlement
Period” shall have the meaning ascribed to such term in Section 2.1(b).
“Pre-Settlement
Securities” shall have the meaning ascribed to such term in Section 2.1(b).
“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding,
such as a deposition) pending or, to the Company’s knowledge, threatened in writing against the Company, a Subsidiary or any of
their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal,
state, county, local or foreign).
“Prospectus”
means the final prospectus filed pursuant to the Registration Statement complying with Rule 424(b).
“Purchaser Party”
shall have the meaning ascribed to such term in Section 4.8.
“Registration Statement”
means the effective registration statement of the Company on Form F-1 with Commission File No. 333-284023, as amended, including all information,
documents and exhibits filed with or incorporated by reference into such registration statement, which registers the sale of the Securities
and includes any Rule 462(b) Registration Statement.
“Required Approvals”
shall have the meaning ascribed to such term in Section 3.1(e).
“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 424”
means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time,
or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 462(b) Registration
Statement” means any registration statement prepared by the Company registering additional Securities, which was filed with
the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the Commission
pursuant to the Securities Act.
“SEC Reports”
shall have the meaning ascribed to such term in Section 3.1(j).
“Securities”
means for each Purchaser, the Shares, the Warrants and the Warrant Shares purchased pursuant to this Agreement.
“Securities Act”
means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Shares”
means the Ordinary Shares delivered to the Purchasers at Closing pursuant to this Agreement.
“Short Sales”
means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be deemed to include
locating and/or borrowing Ordinary Shares).
“Subscription Amount”
means, as to each Purchaser, the aggregate amount to be paid for the Shares and Warrants purchased hereunder as specified below such Purchaser’s
name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United States dollars and in
immediately available funds.
“Subsidiary”
means any subsidiary of the Company as set forth in the SEC Reports and shall, where applicable, also include any direct or indirect subsidiary
of the Company formed or acquired after the date hereof.
“Trading Day”
means a day on which the principal Trading Market is open for trading.
“Trading Market”
means any of the following markets or exchanges on which the Ordinary Shares are listed or quoted for trading on the date in question:
the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange
(or any successors to any of the foregoing).
“Transaction Documents”
means this Agreement, the Warrants, the Lock-Up Agreements, the Placement Agency Agreement and all exhibits and schedules thereto and
hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder.
“Transfer Agent”
means VStock Transfer, LLC, the current transfer agent of the Company, with a mailing address of 18 Lafayette Place, Woodmere, New York
11598, and any successor transfer agent of the Company.
“Variable Rate Transaction”
shall have the meaning ascribed to such term in Section 4.12(b).
“Warrants”
means, collectively, the Ordinary Warrants and the Pre-Funded Warrants.
“Warrant Shares”
means, collectively, the Ordinary Warrant Shares and the Pre-Funded Warrant Shares.
ARTICLE II
PURCHASE AND SALE
2.1 Closing. (a) On
the Closing Date, upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, (i) the aggregate number of Shares set forth under the heading “Subscription Amount” on
each Purchaser’s signature page hereto, at the Per Share Purchase Price and (ii) Warrants exercisable for Ordinary Shares as calculated
pursuant to 2.2(a); provided, however, that, to the extent that a Purchaser determines, in its sole discretion, that such
Purchaser (together with such Purchaser’s Affiliates, and any Person acting as a group together with such Purchaser or any of such
Purchaser’s Affiliates) would beneficially own in excess of the Beneficial Ownership Limitation, or as such Purchaser may otherwise
choose, in lieu of purchasing Ordinary Shares, such Purchaser may elect to purchase Pre-Funded Warrants in such manner to result in the
full Subscription Amount being paid by such Purchaser to the Company. Provided, further, that to the extent that a Purchaser will beneficially
own in excess of 24.99% of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of the Securities
on the Closing Date, such Purchaser shall, in lieu of purchasing Shares, purchase Pre-Funded Warrants in such manner to result in such
Purchaser not exceeding beneficial ownership of 24.99% and to result in the same aggregate purchase price being paid by such Purchaser
to the Company. The “Beneficial Ownership Limitation” shall be 24.99% or 4.99% (or, at the election of the Purchaser,
9.99%) of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of the Securities on the Closing Date.
Each Purchaser’s
Subscription Amount as set forth on the signature page hereto executed by such Purchaser shall be made available for Delivery Versus
Payment (“DVP”) settlement with the Company or its designees. The Company shall deliver to each Purchaser its
respective Shares, Pre-Funded Warrants and Warrants as determined pursuant to Section 2.2(a), and the Company and each Purchaser
shall deliver the other items set forth in Section 2.2 at the Closing. Upon satisfaction of the covenants and conditions set forth
in Sections 2.2 and 2.3, the Closing shall occur at the offices of Placement Agent Counsel or such other location as the parties
shall mutually agree. Unless otherwise directed by the Placement Agent, settlement of the Shares shall occur via DVP. On the Closing
Date, payment for the Shares and the Warrants shall be made by the Placement Agent (or its clearing firm) by wire transfer to the
Company; upon receipt of such funds, the Company shall issue the Shares registered in the Purchasers’ names and addresses and
released by the Transfer Agent directly to the account(s) identified by each Purchaser. Notwithstanding anything herein to the
contrary, if at any time on or after the time of execution of this Agreement by the Company and an applicable Purchaser through the
Closing (the “Pre-Settlement Period”), such Purchaser sells to any Person all, or any portion, of any Shares to
be issued hereunder to such Purchaser at the Closing (collectively, the “Pre-Settlement Shares”), such Person
shall, automatically hereunder (without any additional required actions by such Purchaser or the Company), be deemed to be a
Purchaser under this Agreement unconditionally bound to purchase, and the Company shall be deemed unconditionally bound to sell,
such Pre-Settlement Shares at the Closing; provided, that the Company shall not be required to deliver any Pre-Settlement Shares to
such Purchaser prior to the Company’s receipt of the Subscription Amount for such Pre-Settlement Shares hereunder; provided,
further, that the Company hereby acknowledges and agrees that the forgoing shall not constitute a representation or covenant by such
Purchaser as to whether or not such Purchaser will elect to sell any Pre-Settlement Shares during the Pre-Settlement Period. The
decision to sell any Shares will be made in the sole discretion of such Purchaser from time to time, including during the
Pre-Settlement Period. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise (as defined in the Warrants)
delivered on or prior to 12:00 p.m. (New York City time) on the Closing Date, which may be delivered at any time after the time of
execution of this Agreement, the Company agrees to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City
time) on the Closing Date and the Closing Date shall be the Warrant Share Delivery Date (as defined in the Warrants) for purposes
hereunder.
(b) Notwithstanding anything
herein to the contrary, if at any time on or after the time of execution of this Agreement by the Company and an applicable Purchaser
through, and including the time immediately prior to, the Closing (the “Pre-Settlement Period”), such Purchaser sells
to any Person all, or any portion, of any Securities to be issued hereunder to such Purchaser at the Closing (collectively, the “Pre-Settlement
Securities”), such Person shall, automatically hereunder (without any additional required actions by such Purchaser or the Company),
be deemed to be a Purchaser under this Agreement unconditionally bound to purchase, and the Company shall be deemed unconditionally bound
to sell, such Pre-Settlement Securities to such Purchaser at the Closing; provided, that the Company shall not be required to deliver
any Pre-Settlement Securities to such Person prior to the Company’s receipt of the purchase price for such Pre-Settlement Securities
hereunder; and provided, further, that the Company hereby acknowledges and agrees (i) that the foregoing shall not constitute a representation
or covenant by such Purchaser as to whether or not such Purchaser will elect to sell any Pre-Settlement Securities during the Pre-Settlement
Period and (ii) that any such decision to sell any Ordinary Shares by such Purchaser shall solely be made at the time such Purchaser elects
to effect any such sale, if any.
2.2 Deliveries.
(a) On or prior to the Closing
Date, the Company shall deliver or cause to be delivered to each Purchaser the following:
(i) this Agreement
duly executed by the Company;
(ii) a legal opinion
and negative assurance letter of Company U.S. Counsel and a legal opinion of Company Israeli Counsel, each in a form reasonably acceptable
to the Purchasers and the Placement Agent;
(iii) the Company’s
wire instructions, on Company letterhead and executed by the Company’s Chief Executive Officer or Chief Financial Officer;
(iv) subject to
Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis
via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”) Ordinary Shares equal to the portion of
such Purchaser’s Subscription Amount divided by the Per Share Purchase Price, registered in the name of such Purchaser;
(v) the Preliminary
Prospectus and the Prospectus (which may be delivered in accordance with Rule 172 under the Securities Act);
(vi) an Ordinary
Warrant registered in the name of such Purchaser to purchase up to a number of shares of Ordinary Share’s equal to 100% of such
Purchaser’s Shares (and Pre-Funded Warrants, if applicable), subject to adjustment as specified therein; and
(vii) for each
Purchaser of Pre-Funded Warrants pursuant to Section 2.1, a Pre-Funded Warrant registered in the name of such Purchaser to purchase up
to a number of Ordinary Shares equal to the portion of such Purchaser’s Subscription Amount applicable to Pre-Funded Warrants divided
by the Per Pre-Funded Warrant Purchase Price, subject to adjustment as specified therein;
(viii) Secretary’s
certificate executed by an officer of the Company, dated as of the date of Closing, in form and substance reasonable acceptable to the
Purchasers and Placement Agent;
(ix) an Officer’s
Certificate, in form and substance reasonably satisfactory to the Placement Agent; and
(x) Lock-up Agreements,
in form and substance reasonably acceptable to the Placement Agent and the Purchasers, executed by each of the Company’s executive
officers, directors and shareholders beneficially owning 5% or more of the issued and outstanding Ordinary Shares as of the date hereof.
(b) On or prior to the Closing
Date, each Purchaser shall deliver or cause to be delivered to the Company, the following:
(i) this Agreement
duly executed by such Purchaser; and
(ii) such Purchaser’s
Subscription Amount with respect to the Securities purchased by such Purchaser, which shall be made available for DVP settlement with
the Company or its designees.
(c) At the time
this Agreement is executed, the Placement Agent shall have received:
(i) from the Auditors a cold
comfort letter containing statements and information of the type customarily included in accountants’ comfort letters with respect
to the financial statements and certain financial information contained in the Registration Statement, the Preliminary Prospectus and
the Prospectus, or any Issuer Free Writing Prospectus, addressed to the Placement Agent and in form and substance satisfactory in all
respects to the Placement Agent, dated as of the date of this Agreement; and
(ii) from the Chief Financial
Officer of the Company, a certificate certifying as to certain financial matters set forth therein and in form and substance satisfactory
in all respects to the Placement Agent, dated as of the date of this Agreement.
(d) On the Closing
Date, the Placement Agent shall have received:
(i) from the Auditors a letter,
dated as of the Closing Date, to the effect that the Auditors reaffirm the statements made in the letter furnished pursuant to Section
2.2(c)(i); and
(ii) from the Chief Financial
Officer of the Company, a certificate, dated as of the Closing Date, to the effect that the Chief Financial Officer of the Company reaffirms
the statements made in the certificate furnished pursuant to Section 2.2(c)(ii).
2.3 Closing Conditions.
(a) The obligations of the
Company hereunder in connection with the Closing are subject to the following conditions being met:
(i) the accuracy
in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect (as
defined below), in all respects) when made and on the Closing Date of the representations and warranties of the Purchasers contained herein
(unless as of a specific date therein in which case they shall be accurate as of such date);
(ii) all obligations,
covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and
(iii) the delivery
by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.
(b) The respective obligations
of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:
(i) the accuracy
in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in
all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a
specific date therein in which case they shall be accurate as of such date);
(ii) all obligations,
covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed;
(iii) the delivery
by the Company of the items set forth in Section 2.2(a) of this Agreement;
(iv) the delivery
by the Company to the Placement Agent of copies of the executed Lock-Up Agreements;
(v) there shall
have been no Material Adverse Effect with respect to the Company since the date hereof; and
(vi) from the date
hereof to the Closing Date, trading in the Ordinary Shares shall not have been suspended by the Commission or any Trading Market, and,
at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or
limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading
Market, nor shall a banking moratorium have been declared either by the United States, New York State or Israeli authorities nor shall
there have occurred after the date of this Agreement any material outbreak or escalation of hostilities or other national or international
calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable
judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Securities at the Closing.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Representations
and Warranties of the Company. The Company hereby makes the following representations and warranties to each Purchaser in
addition to the information included in the Disclosure Schedules attached hereto, which Disclosure Schedules shall be deemed a part
hereof and shall qualify any representation or warranty made herein to the extent of the disclosure contained in the corresponding
section of the Disclosure Schedules:
(a) Subsidiaries. All
of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a). The Company owns, directly or indirectly,
all of the capital stock or other equity interests of each Subsidiary, free and clear of any Liens, and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities. If the Company has no subsidiaries, all other references to the Subsidiaries or any of them in
the Transaction Documents shall be disregarded.
(b) Organization and Qualification.
The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing, and, if applicable under
the laws of the jurisdiction in which they are formed, in good standing under the laws of the jurisdiction of its incorporation or organization,
with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither
the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective memorandum of association, articles
of association, certificate or articles of incorporation, bylaws, operating agreement, or other organizational or charter documents. Each
of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity
in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i)
a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the
results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as
a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations
under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”); provided that a change in
market price or trading volume of the Ordinary Shares alone shall not be deemed, in and of itself, to constitute a Material Adverse Effect.
No Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such
power and authority or qualification.
(c) Authorization; Enforcement.
The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement
and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery
of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated
hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the
Company, the Board of Directors, a committee of the Board of Directors or the Company’s shareholders in connection herewith or therewith
other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which it is a party has been
(or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will
constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as
limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable
law.
(d) No Conflicts.
The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party,
the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do not and
will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s memorandum of association,
articles of association, certificate or articles of incorporation, bylaws, operating agreement, or other organizational or charter
documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a
default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to
others any rights of termination, amendment, anti-dilution or similar adjustments acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt
or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation
of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to
which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property
or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could
not have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings, Consents and
Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing
or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the
execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant to Section
4.5 of this Agreement, (ii) the filing with the Commission of the Prospectus, (iii) notices and/or application(s) to and approvals by
each applicable Trading Market for the listing of the applicable Securities for trading thereon in the time and manner required thereby,
and (iv) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).
(f) Issuance of the Securities;
Registration. (i) The Shares and Warrant Shares are duly authorized and, when issued and paid for in accordance with the applicable
Transaction Documents, will be duly and validly issued, fully paid and non-assessable, free and clear of all Liens imposed by the Company.
The Warrants are duly authorized and, when issued in accordance with this Agreement, will be duly and validly issued, fully paid and non-assessable,
and free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock the maximum number
of Ordinary Shares issuable pursuant to the Warrants.
(ii) The Company has prepared
and filed the Registration Statement in conformity with the requirements of the Securities Act, which Registration Statement became effective
on January 28, 2025, including the Preliminary Prospectus, and such amendments and supplements thereto as may have been required to the
date of this Agreement. The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the
effectiveness of the Registration Statement or suspending or preventing the use of the Preliminary Prospectus or the Prospectus has been
issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge of the Company, are threatened
by the Commission. The Company, as required by the rules and regulations of the Commission, shall file the Preliminary Prospectus and
the Prospectus with the Commission pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto became effective
as determined under the Securities Act, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments
thereto conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain
any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements
therein not misleading; and the Prospectus and any amendments or supplements thereto, at the time the Preliminary Prospectus, the Prospectus
or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to the
requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The Company is a “foreign private issuer” as defined in Rule 405 of Regulation C under the Securities Act and Rule 3b-4 under
the Exchange Act. The Company is eligible to use Form F-1 under the Securities Act.
(g) Any “issuer free
writing prospectus” (as defined in Rule 433 under the Securities Act) relating to the Securities is hereafter referred to as an
“Issuer Free Writing Prospectus.” Any reference herein to the Preliminary Prospectus and the Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein as of the date of filing thereof; and any reference herein to
any “amendment” or “supplement” with respect to any of the Preliminary Prospectus and the Prospectus shall be
deemed to refer to and include (i) the filing of any document with the Commission incorporated or deemed to be incorporated therein by
reference after the date of filing of such Preliminary Prospectus or Prospectus and (ii) any such document so filed. Securities
Act Compliance. The Registration Statement complies, and the Prospectus and any further amendments or supplements to the Registration
Statement or the Prospectus will comply, in all material respects, with the applicable provisions of the Securities Act. Each part of
the Registration Statement, when such part became effective, did not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein not misleading. The Prospectus, as of its filing
date, and any amendment thereof or supplement thereto, did not and will not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(h) No Stop Orders. No
order preventing or suspending the use of the Registration Statement, the Preliminary Prospectus or any Issuer Free Writing Prospectus
has been issued by the Commission.
(i) Capitalization.
The equity capitalization of the Company is as set forth in the Registration Statement and Schedule 3.1(i), as of the dates
indicated therein. All of the issued and outstanding Ordinary Shares are fully paid and non-assessable and have been duly and
validly authorized and issued, in compliance with all applicable federal and state securities laws and not in violation of or
subject to any preemptive or similar right that entitles any person to acquire from the Company any Ordinary Shares or other
security of the Company or any security convertible into, or exercisable or exchangeable for, Ordinary Shares or any other such
security, except for such rights as may have been fully satisfied or waived prior to the date hereof. Except as set forth
on Schedule 3.1(i), or as a result of the issuance and sale of the Securities, the Company has not issued any capital
stock since its most recently filed SEC Report. Except as set forth on Schedule 3.1(i), or as a result of the issuance
and sale of the Securities, the Company has no outstanding options, warrants, scrips or rights to subscribe to, calls or commitments
of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for,
or giving any Person any right to subscribe for or acquire, any Ordinary Shares, or contracts, commitments, understandings or
arrangements by which the Company is or may become bound to issue additional Ordinary Shares or Ordinary Shares Equivalents and no
Person has any right of first refusal, pre-emptive right, right of participation, or any similar right to participate in the
transactions contemplated by the Transaction Documents, except for such rights as may have been fully satisfied or waived prior to
the date hereof. Except as set forth on Schedule 3.1(i), the issuance and sale of the Securities will not obligate the
Company to issue Ordinary Shares or other securities to any Person (other than the Purchasers) and will not result in a right of any
holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. There are no
outstanding securities or instruments of the Company with any provision that adjusts the exercise, conversion, exchange or reset
price of such security or instrument upon an issuance of securities by the Company (other than in connection with a stock split,
recapitalization, or similar transaction). There are no outstanding securities or instruments of the Company that contain any
redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company is or
may become bound to redeem an equity security of the Company. The Company does not have any stock appreciation rights or
“phantom share” plans or agreements or any similar plan or agreement. All of the outstanding Ordinary Sares of the
Company are duly authorized, validly issued, fully paid and non-assessable, have been issued in compliance with all federal and
state securities laws where applicable, and none of such outstanding shares was issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities. Except for the Required Approvals, no further approval or authorization of
any shareholder, the Board of Directors or others is required for the issuance and sale of Securities. Except as set forth in the
SEC Reports, there are no shareholders agreements, voting agreements or other similar agreements with respect to the Company’s
capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s
shareholders.
(j) SEC Reports; Financial
Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company
under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two (2) years preceding the
date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein, together with the Registration Statement, the Preliminary
Prospectus and the Prospectus, being collectively referred to herein as the “SEC Reports”) on a timely basis or has
received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As
of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange
Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements
of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance
with GAAP, except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial
statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.
(k) Material Changes; Undisclosed
Events, Liabilities or Developments. Since the date of the latest consolidated financial statements included within or incorporated
by reference into the Registration Statement, the Preliminary Prospectus and the Prospectus, except as disclosed in Schedule 3.1(k),
(i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse
Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past practice and strategic acquisitions and (B) liabilities not required
to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the
Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other
property to its shareholders or purchased, redeemed or made any agreements to purchase or redeem any of its Ordinary Shares and (v) the
Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company share option plans.
Except for the issuance of the Securities contemplated by this Agreement or as set forth in the SEC Reports, no event, liability, fact,
circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company
or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required
to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been
publicly disclosed at least one (1) Trading Day prior to the date that this representation is made.
(l) Litigation.
There is no action, suit, inquiry, notice of violation, Proceeding or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively,
an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the
Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably be expected to
result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the
subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of
fiduciary duty, which could have or reasonably be expected to result in a Material Adverse Effect. There has not been, and to the
knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any
current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the
effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(m) Labor Relations.
No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could
reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is a member
of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of
its Subsidiaries is a party to a collective bargaining agreement. To the knowledge of the Company, no executive officer of the Company
or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure
or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor
of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries
to any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all applicable
U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment
and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(n) Compliance. Neither
the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with
notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary
received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other
agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation
has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii)
is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation
all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality
and safety and employment and labor matters, except in each case of (i), (ii) and (iii) as could not have or reasonably be expected to
result in a Material Adverse Effect.
(o) Environmental Laws.
The Company and its Subsidiaries (i) are in compliance with all applicable federal, state, local and foreign laws relating to pollution
or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata),
including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or
hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as
all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received
all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and
(iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii),
the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(p) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC
Reports, except where the failure to possess such certificates, authorizations or permits could not reasonably be expected to result
in a Material Adverse Effect (“Material Permits”), and neither the Company nor any Subsidiary has received any
notice of proceedings relating to the revocation or modification of any Material Permit.
(q) Title to Assets.
The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable
title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and
clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the
use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state
or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of which is neither delinquent
nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under
valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance in all material respects.
(r) Intellectual Property.
The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service
marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights necessary
or required for use in connection with their respective businesses as described in the SEC Reports and which the failure to so have could
have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None of, and neither the Company
nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated
or been abandoned, except as would not reasonably be expected to have a Material Adverse Effect. Neither the Company nor any Subsidiary
has received, since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or
otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not
have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property
Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company
and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual
properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The Company has no knowledge of any facts that would preclude it from having valid license rights or clear title to the Intellectual
Property Rights. The Company has no knowledge that it lacks or will be unable to obtain any rights or licenses to use all Intellectual
Property Rights that are necessary to conduct its business.
(s) Insurance. The
Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited
to, commercially reasonable directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business without a significant increase in cost.
(t) Application of Takeover
Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable any control
share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover
provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its jurisdiction of incorporation
that is or could become applicable to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising
their rights under the Transaction Documents, including without limitation as a result of the Company’s issuance of the Securities
and the Purchasers’ ownership of the Securities.
(u) Transactions with Affiliates
and Employees. Except as disclosed in the SEC Reports, none of the officers or directors of the Company or any Subsidiary and, to
the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the
Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement
providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing
of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge
of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director,
trustee, shareholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for
services rendered, (ii) reimbursement for expenses incurred on behalf of the Company or a Subsidiary and (iii) other employee benefits,
including share option agreements under any share option plan of the Company.
(v) Sarbanes-Oxley; Internal
Accounting Controls; Disclosure Controls. The Company and the Subsidiaries are in material compliance with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules
and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. Except as
disclosed in the SEC Reports, the Company maintains systems of disclosure controls and “internal controls over financial reporting”
(as defined under Rules 13a-15 and 15d-15 under the Exchange Act) that comply with the requirements of the Exchange Act and have been
designed by, or under the supervision of, the Company’s principal executive and principal financial officers, or persons performing
similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with GAAP, to ensure that information required to be disclosed by the Company in reports that it files
or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s
rules and forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company’s
management as appropriate to allow timely decisions regarding required disclosure. Since the date of the latest audited financial statements
included in the Registration Statement, the Preliminary Prospectus and the Prospectus, there has been no change in the Company’s
internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting. The Company’s certifying officers have evaluated the effectiveness of the disclosure
controls and procedures of the Company and the Subsidiaries as of applicable dates specified under the Exchange Act (such date, the “Evaluation
Date”). The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying
officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Except
as set forth in the Registration Statement, the Preliminary Prospectus and the Prospectus, since the Evaluation Date, there have been
no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and the Subsidiaries
that have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company
and the Subsidiaries.
(w) Certain Fees. Except
as set forth in the Prospectus, no brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiary
to any broker, placement agent or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions
contemplated by the Transaction Documents (for the avoidance of doubt, the foregoing shall not include any fees and/or commissions owed
to the Transfer Agent). Other than for Persons engaged by any Purchaser, if any, the Purchasers shall have no obligation with respect
to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may
be due in connection with the transactions contemplated by the Transaction Documents.
(x) Investment Company.
The Company is not, and immediately after receipt of payment for the Securities, will not be an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.
(y) Registration Rights.
Except as contemplated by the Transaction Documents, no Person has any right to cause the Company to effect the registration under the
Securities Act of any securities of the Company or any Subsidiary.
(z) Listing and Maintenance
Requirements. The Ordinary Shares are registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken
no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Ordinary Shares
under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration.
Except as disclosed in the SEC Reports, the Company has not, in the twelve (12) months preceding the date hereof, received notice from
any Trading Market on which the Ordinary Shares are or has been listed or quoted to the effect that the Company is not in compliance with
the listing or maintenance requirements of such Trading Market. Except as described in Disclosure Schedule 3.1(z), the Company
is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance
requirements. The Ordinary Shares are currently eligible for electronic transfer through The Depository Trust Company, or another established
clearing corporation and the Company is current in payment of the fees to The Depository Trust Company (or such other established clearing
corporation) in connection with such electronic transfer.
(aa) Disclosure. Except
with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information
that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed in the Registration
Statement, the Preliminary Prospectus or the Prospectus. The Company understands and confirms that the Purchasers will rely on the foregoing
representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf of the Company
to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby is
true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.
The press releases disseminated by the Company during the twelve (12) months preceding the date of this Agreement taken as a whole do
not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they were made and when made, not misleading. The Company acknowledges
and believes that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby
other than those specifically set forth in Section 3.2 hereof.
(bb) No Integrated Offering.
Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company, nor
any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security
or solicited any offers to buy any security, under circumstances that would cause this offering of the Securities to be integrated with
prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the
securities of the Company are listed or designated.
(cc) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the
Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry
on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital
availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it
to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts
on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its
ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its
debt). The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or
liquidation under the bankruptcy or reorganization laws of any jurisdiction within one (1) year from the Closing Date. The SEC
Reports set forth all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or
any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities for
borrowed money or amounts owed by the Company in excess of $50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others to third
parties, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes
thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be
capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
(dd) Tax Compliance.
Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect,
the Company and its Subsidiaries each (i) has made or filed all federal, state and local income and all foreign income and franchise tax
returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental
assessments and charges, fines or penalties that are material in amount, shown or determined to be due on such returns, reports and declarations
and (iii) has set aside on its financial statements provision reasonably adequate for the payment of all material tax liability of which
has not been finally determined and all material taxes for periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company or of any Subsidiary know of no basis for any such claim.
(ee) Foreign Corrupt Practices.
Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf
of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other
unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government
officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully
any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which
is in violation of law, or (iv) violated in any material respect any provision of FCPA.
(ff) Accountants. The
Company’s independent registered public accounting firm is as set forth in the Prospectus. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with
respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ended December 31, 2024.
(gg) Acknowledgment Regarding
Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting solely in the
capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby. The Company
further acknowledges that no Purchaser is acting as a placement agent or fiduciary of the Company (or in any similar capacity) with respect
to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective
representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental
to the Purchasers’ purchase of the Securities. The Company further represents to each Purchaser that the Company’s decision
to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions
contemplated hereby by the Company and its representatives.
(hh) Acknowledgment Regarding
Purchaser’s Trading Activity. Other than as contemplated herein, it is understood and acknowledged by the Company that: (i)
none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long
and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the
Securities for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without
limitation, Short Sales or “derivative” transactions, before or after the closing of this or future securities offering, may
negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative”
transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short” position in the
Ordinary Shares, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party
in any “derivative” transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage
in hedging activities at various times during the period that the Securities are outstanding, and (z) such hedging activities (if any)
could reduce the value of the existing shareholders’ equity interests in the Company at and after the time that the hedging activities
are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction
Documents.
(ii) Regulation M Compliance.
The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause
or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any
of the Ordinary Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Ordinary Shares,
or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company,
other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s Placement Agent in connection with the placement
of the Ordinary Shares.
(jj) Regulatory. Except
as described in the Registration Statement and the Prospectus, as applicable, the Company and its Subsidiaries (i) are and at all times
have been in material compliance with all statutes, rules and regulations applicable to its business (collectively, the “Applicable
Laws”); (ii) have not received any notice from any court or arbitrator or governmental or regulatory authority or third party
alleging or asserting noncompliance with any Applicable Laws or any licenses, exemptions, certificates, approvals, clearances, authorizations,
permits, registrations and supplements or amendments thereto required by any such Applicable Laws (“Authorizations”);
(iii) possess all material Authorizations and such Authorizations are valid and in full force and effect and are not in violation of any
term of any such Authorizations; (iv) have not received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation
arbitration or other action from any court or arbitrator or governmental or regulatory authority or third party alleging that any product
operation or activity is in violation of any Applicable Laws or Authorizations nor is any such claim, action, suit, proceeding, hearing,
enforcement, investigation, arbitration or other action threatened; (v) have not received any written notice that any court or arbitrator
or governmental or regulatory authority has taken, is taking or intends to take, action to limit, suspend, materially modify or revoke
any Authorizations nor is any such limitation, suspension, modification or revocation threatened; (vi) have filed, obtained, maintained
or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments
as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments were complete and accurate on the date filed (or were corrected or supplemented by a subsequent
submission); and (vii) are not a party to any corporate integrity agreements, monitoring agreements, consent decrees, settlement orders,
or similar agreements with or imposed by any governmental or regulatory authority.
(kk) Data
Privacy. To Company’s knowledge, the Company has and is currently taking the measures required by any and all applicable
law or any applicable binding directive, guidelines or requirements of a regulator in all relevant jurisdictions to protect the
privacy of any Personal Information (as defined below) (the “Data Privacy Laws”) in connection with
Company’s collection, storage, use, transfer of, (a) any personally identifiable information from any individuals, including
name, address, telephone number, email address, financial account number, government-issued identifier, and any other data used or
intended to be used to identify, contact or precisely locate a person, (b) any information from or about an individual whose
use, aggregation, holding or management is restricted under any applicable Law, (c) Internet Protocol address or other
persistent identifier; (d) “information” as defined by the Israeli Privacy Protection Law (whether or not such
“information” constitutes “sensitive information” as defined thereunder) (collectively “Personal
Information”) to maintain in confidence such Personal Information. To Company’s knowledge, the Company has at
all times complied with the Data Privacy Laws, and is in compliance with any contractual obligations, if any, relating to privacy,
data protection, and the collection, storage and use of the Personal Information, if any. No claims have been asserted or, to the
best knowledge of the Company, are threatened against the Company by any Person alleging a violation of any Person’s or any
entity’s privacy, personal or confidentiality rights under the Data Privacy Laws and/or contractual obligations relating to
privacy. To the best knowledge of the Company, there has been no unauthorized access to or other misuse of Personal Information. The
Company has never reported a data breach to any relevant regulator in any jurisdiction.
(ll) Material Agreements.
The agreements and documents described in the Registration Statement or Prospectus conform in all material respects to the descriptions
thereof contained or incorporated by reference therein conformed in all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable at the time filed, and were filed on a timely basis with the Commission and none of such documents contained
an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; any further documents so filed and there are no agreements or other documents
required by the Securities Act and the rules and regulations thereunder to be described in the Prospectus or to be filed with the Commission
as exhibits to the Registration Statement or to be incorporated by reference in the Registration Statement or Prospectus, that have not
been so described or filed or incorporated by reference.
(mm) Share Option Plans.
Each share option granted by the Company under the Company’s equity incentive plan was granted (i) in accordance with the terms
of such plan and (ii) with an exercise price established in accordance with the terms of such plan. No share option granted under the
Company’s equity incentive plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company
policy or practice to knowingly grant, share options prior to, or otherwise knowingly coordinate the grant of share options with, the
release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.
(nn) Cybersecurity.
(i)(x) To the Company’s knowledge there has been no security breach or other compromise of or relating to any of the Company’s
or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective
customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively,
“IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of
any event or condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and Data,
except as would not, individually or in the aggregate for all such matters referred to in this clause (i), have a Material Adverse Effect;
(ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules
and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating
to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation
or modification, except as would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the Subsidiaries
have implemented and maintained commercially reasonable safeguards to maintain and protect their material confidential information and
the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have
implemented backup and disaster recovery technology consistent with commercially reasonable industry standards and practices.
(oo) Office of Foreign
Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent, employee
or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the OFAC.
(pp) U.S. Real Property
Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section
897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.
(qq) Bank Holding Company
Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended
(the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).
Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the
outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity
that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises
a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal
Reserve.
(rr) Money Laundering.
The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping
and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes
and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no action, suit or
proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary
with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(ss) Information Technology.
The Company’s and the Subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software,
websites, applications, and databases (collectively, “IT Systems”) operate and perform in all material respects as
required in connection with the operation of the business of the Company and the Subsidiaries as currently conducted. The Company and
the Subsidiaries maintain commercially reasonable controls, policies, procedures, and safeguards to maintain and protect their material
confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and all personal, personally
identifiable, sensitive, confidential or regulated data (“Personal Data”) processed and stored thereon, and to the
knowledge of the Company, there have been no breaches, incidents, violations, outages, compromises or unauthorized uses of or accesses
to same, except for those that have been remedied without material cost or liability or the duty to notify any other person, nor any incidents
under internal review or investigations relating to the same. The Company and the Subsidiaries are presently in compliance in all material
respects with all applicable laws or statutes and all applicable judgments, orders, rules and regulations of any court or arbitrator or
governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems
and Personal Data and to the protection of such IT Systems and Personal Data from unauthorized use, access, misappropriation or modification,
except for any such noncompliance that would not have a Material Adverse Effect.
3.2. Representations
and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the
date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they shall be accurate
as of such date):
(a) Organization;
Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited
liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction
Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction
Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized
by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser.
Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in
accordance with the terms hereof or thereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable
against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights
generally; (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable
remedies; and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(b) Understandings
or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and has no direct or indirect arrangement
or understandings with any other persons to distribute or regarding the distribution of such Securities (this representation and warranty
not limiting such Purchaser’s right to sell the Securities pursuant to the Registration Statement or otherwise in compliance with
applicable federal and state securities laws).
(c) Experience of
Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience
in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities,
and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the
Securities and, at the present time, is able to afford a complete loss of such investment.
(d) Access to Information.
Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits and schedules
thereto) and the SEC Reports, the Registration Statement and the Preliminary Prospectus, and has been afforded: (i) the opportunity to
ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and
conditions of the Offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about
the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it
to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire
without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment. Such
Purchaser acknowledges and agrees that neither of the Placement Agent, nor any Affiliate of the Placement Agent, has provided such Purchaser
with any information or advice with respect to the Securities nor is such information or advice necessary or desired. Neither of the Placement
Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Securities and the Placement Agent
and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser agrees need not be provided
to it. In connection with the issuance of the Securities to such Purchaser, neither of the Placement Agent, nor any of its Affiliates
has acted as a financial advisor or fiduciary to such Purchaser.
(e) Certain
Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor
has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any
purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such
Purchaser first received a term sheet (written or oral) from the Company, the Placement Agent, or any other Person representing the
Company setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution
hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate
portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of
the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation
set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment
decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such
Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors,
employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection with
this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt,
nothing contained herein shall constitute a representation or warranty against, or a prohibition of, any actions with respect to the
borrowing of, arrangement to borrow, identification of the availability of, and/or securing of, securities of the Company in order
for such Purchaser (or its broker or other financial representative) to effect Short Sales or similar transactions in the
future.
(f) No Voting Agreements.
The Purchaser is not a party to any agreement or arrangement, whether written or oral, between the Purchaser and any other Purchaser and
any of the Company’s shareholders as of the date hereof, regulating the management of the Company, the shareholders’ rights
in the Company, the transfer of shares in the Company, including any voting agreements, shareholder agreements or any other similar agreement,
even if its title is different or has any other relations or agreements with any of the Company’s shareholders, directors or officers.
(g) Brokers.
Except as set forth in the Prospectus, no agent, broker, investment banker, person or firm acting in a similar capacity on behalf of or
under the authority of the Purchaser is or will be entitled to any broker’s or finder’s fee or any other commission or similar
fee, directly or indirectly, for which the Company or any of its Affiliates after the Closing could have any liabilities in connection
with this Agreement, any of the transactions contemplated by this Agreement, or on account of any action taken by the Purchaser in connection
with the transactions contemplated by this Agreement.
(h) Independent Advice.
Each Purchaser understands that nothing in this Agreement or any other materials presented by or on behalf of the Company to the Purchaser
in connection with the purchase of the Securities constitutes legal, tax or investment advice.
(i) Limitation Under Section
328. Such Purchaser acknowledges and agrees that it may not beneficially own any Ordinary Shares or Ordinary Share Equivalents in
an amount equal to more than 24.99% of the Company’s outstanding Ordinary Shares at any time without having received approval of
the Company’s shareholders under Section 328 of the Companies Law. Such Purchaser further acknowledges and agrees that the Company
has not agreed to seek shareholder approval under Section 328 of the Companies Law to permit any Purchaser to beneficially own in excess
of 24.99% of the Company’s outstanding Ordinary Shares.
The Company acknowledges and
agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on
the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any
other Transaction Document, or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation
of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute
a representation or warranty, or preclude any actions, except as set forth in this Agreement, with respect to locating or borrowing shares
in order to effect Short Sales or similar transactions in the future.
ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
4.1. Legends.
The Shares and, if all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover
the issuance of the Warrant Shares or if the Warrant is exercised via cashless exercise, the Warrant Shares shall be issued free of
all restrictive legends. If at any time following the date hereof the Registration Statement (or any subsequent registration
statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the initial sale
by the Company of the Shares, the Warrants or the Warrant Shares, the Company shall immediately notify the holders of the Warrants
in writing that such registration statement is not then effective and thereafter shall promptly notify such holders when the
registration statement is effective again and available for the initial sale by the Company of the Shares, the Warrants or the
Warrant Shares (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any
Purchaser to sell, any of the Shares, the Warrants or the Warrant Shares in compliance with applicable federal and state securities
laws). The Company shall use commercially reasonable efforts to keep a registration statement (including the Registration Statement)
registering the issuance of the Warrant Shares effective during the term of the Warrants.
4.2. Furnishing of
Information; Public Information. Until the earliest of the time that (i) no Purchaser owns Securities and (ii) the Common Warrants
have expired, the Company covenants to maintain the registration of the Ordinary Shares under Section 12(b) or 12(g) of the Exchange Act
and to file all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act, unless the Company is
not then subject to the reporting requirements of the Exchange Act, except in the event that the Company consummates (in each case on
or after the date as of which the Purchasers may sell all of their Securities without restriction or limitation pursuant to Rule 144)
(a) any transaction or series of related transactions as a result of which any Person (together with its Affiliates) acquires then outstanding
securities of the Company representing more than fifty percent (50%) of the voting control of the Company; (b) a merger or reorganization
of the Company with one or more other entities in which the Company is not the surviving entity; or (c) a sale of all or substantially
all of the assets of the Company, where the consummation of such transaction results in the Company no longer subject to the reporting
requirements of the Exchange Act.
4.3 Integration. The
Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section
2 of the Securities Act) that would be integrated with the offer or sale of the Securities for purposes of the rules and regulations of
any Trading Market such that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval
is obtained before the closing of such subsequent transaction.
4.4 Securities Laws Disclosure;
Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the transactions contemplated
hereby, and (b) file a Report of Foreign Private Issuer on Form 6-K, including the Transaction Documents as exhibits thereto, with the
Commission within the time required by the Exchange Act. From and after the issuance of such press release, the Company represents to
the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company
or any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions contemplated
by the Transaction Documents. In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that
any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or Affiliates, on the one hand, and any of the Purchasers or any of
their Affiliates on the other hand, which was entered into solely in connection with the subject matter hereof, shall terminate and be
of no further force or effect. The Company and each Purchaser shall consult with each other in issuing any other press releases with respect
to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make
any such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or without the
prior consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably be withheld or
delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with
prior notice of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name
of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without
the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with the filing of final Transaction
Documents with the Commission, and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the
Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).
4.5 Shareholder Rights
Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser is
an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution under
a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser
could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities under the Transaction Documents
or under any other agreement between the Company and the Purchasers.
4.6 Non-Public Information.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall be
disclosed pursuant to Section 4.4, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide
any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material
non-public information, unless prior thereto such Purchaser shall have consented to the receipt and use of such information and agreed
with the Company to keep such information confidential. The Company understands and confirms that each Purchaser shall be relying on the
foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any of its Subsidiaries, or
any of their respective officers, directors, agents, employees or controlled Affiliates delivers any material, non-public information
to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any
duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or
Affiliates, or a duty to the Company, and of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates
not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable law.
The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities
of the Company.
4.7 Use of Proceeds.
The Company shall use the net proceeds from the sale of the Securities hereunder as described in the Preliminary Prospectus and the Prospectus,
which states that such net proceeds shall be used for working capital and general corporate purposes and under no circumstances shall
such proceeds be used for: (a) for the satisfaction of any portion of the Company’s debt (other than payment of trade payables in
the ordinary course of the Company’s business), (b) for the redemption of any Ordinary Shares or Ordinary Share Equivalents, (c)
for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations or similar applicable regulations.
4.8 Indemnification
of Purchasers. Subject to the provisions of this Section 4.8, the Company will indemnify and hold each Purchaser and its
directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such
Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers,
shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding
such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser
Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable and documented attorneys’ fees and costs of
investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the
representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or
(b) any action instituted against a Purchaser Party in any capacity (including a Purchaser Party’s status as an investor), or
any of them or their respective Affiliates, by any shareholder of the Company who is not an Affiliate of such Purchaser Party,
arising out of or relating to any of the transactions contemplated by the Transaction Documents (unless such action is based upon a
material breach of such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any
agreements or understandings such Purchaser Party may have with any such shareholder or any violations by such Purchaser Party of
state or federal securities laws or any conduct by such Purchaser Party which is finally judicially determined to constitute fraud,
gross negligence or willful misconduct). If any action shall be brought against any Purchaser Party in respect of which indemnity
may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall
have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any
Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the
reasonable and documented fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent
that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a
reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion
of counsel to the applicable Purchaser Party (which may be internal counsel), a material conflict on any material issue between the
position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable
and documented fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser Party
under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which
shall not be unreasonably withheld or delayed; or (z) to the extent that a loss, claim, damage or liability is attributable to any
Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in
this Agreement or in the other Transaction Documents. The indemnification and other payment obligations required by this Section 4.8
shall be made by periodic payments of the amount thereof during the course of the investigation, defense, collection, enforcement or
action, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause
of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to
pursuant to law.
4.9 Reservation of Ordinary
Shares. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times,
free of preemptive rights, a sufficient number of Ordinary Shares for the purpose of enabling the Company to issue Shares pursuant to
this Agreement and Warrant Shares pursuant to any exercise of the Warrants.
4.10 Listing of Ordinary
Shares. The Company hereby agrees to use commercially reasonable best efforts to maintain the listing or quotation of the Ordinary
Shares on each Trading Market on which each is currently listed, and concurrently with the Closing, the Company shall apply to list or
quote all of the Shares and Warrant Shares on such Trading Markets and promptly secure the listing of all of the Shares and Warrant Shares
on such Trading Markets. The Company further agrees, if the Company applies to have the Ordinary Shares traded on any other Trading Market,
it will then include in such application all of the Shares and Warrant Shares, and will take such other action as is necessary to cause
all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will then
take all action reasonably necessary to continue the listing and trading of the Ordinary Shares on a Trading Market and will comply in
all material respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market.
The Company agrees to use commercially reasonable efforts to maintain the eligibility of the for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository
Trust Company or such other established clearing corporation in connection with such electronic transfer.
4.11 Subsequent Equity
Sales.
(a) From the date hereof until
forty-five (45) days after the Closing Date, neither the Company nor any Subsidiary shall (i) issue, enter into any agreement to issue
or announce the issuance or proposed issuance of Ordinary Shares or Ordinary Share Equivalents or (ii) file any registration statement
or amendment or supplement thereto, other than the Prospectus, a registration statement on Form S-8 in connection with any employee benefit
plan and the Resale Registration Statement (as defined below).
(b) From the date hereof until
one-hundred and eighty (180) days after the Closing Date, the Company shall be prohibited from effecting or entering into an agreement
to effect any issuance by the Company or any of its Subsidiaries of Ordinary Shares or Ordinary Share Equivalents (or a combination of
units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right
to receive additional Ordinary 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 Ordinary 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 the
business of the Company or the market for Ordinary Shares or (ii) enters into, or effects a transaction under, any agreement, including,
but not limited to, an equity line of credit, or an at-the-market offerings whereby the Company may issue securities at a future determined
price; provided, however, that after forty-five (45) days after the Closing Date, the Company shall be permitted to enter into and effect
sales pursuant to an at-the-market offering facility with A.G.P./Alliance Global Partners and make sales thereunder. Any Purchaser shall
be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right
to collect damages.
(c) Notwithstanding the foregoing,
this Section 4.11 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an Exempt
Issuance.
4.12 Equal Treatment
of Purchasers. No consideration (including any modification of the Transaction Documents) shall be offered or paid to any Person to
amend or consent to a waiver or modification of any provision of the Transaction Documents unless the same consideration is also offered
to all of the parties to the Transaction Documents. For clarification purposes, this provision constitutes a separate right granted to
each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as
a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition
or voting of the Ordinary Shares or otherwise.
4.13 Certain Transactions
and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it nor any Affiliate
acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales of any of the
Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions
contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4. Each Purchaser,
severally and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement
are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.4, such Purchaser will maintain
the confidentiality of the existence and terms of this transaction. Notwithstanding the foregoing, and notwithstanding anything contained
in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty
or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions
contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4, (ii) no
Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance with applicable
securities laws from and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to
the initial press release as described in Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade
in the securities of the Company to the Company or its Subsidiaries after the issuance of the initial press release as described in Section
4.4. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers
manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply
with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered
by this Agreement.
4.14 Exercise
Procedures. The forms of Notice of Exercise included in the Warrants set forth the totality of the procedures required of the
Purchasers in order to exercise the Warrants. No additional legal opinion, other information or instructions shall be required of
the Purchasers to exercise their Warrants. Without limiting the preceding sentences, no ink-original Notice of Exercise shall be
required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required
in order to exercise the Warrants. The Company shall honor exercises of the Warrants and shall deliver Warrant Shares in accordance
with the terms, conditions and time periods set forth in the Transaction Documents.
4.15 Lock-Up Agreements.
The Company shall not amend, modify, waive or terminate any provision of any of the Lock-Up Agreements without the prior written consent
of the Placement Agent, except to extend the term of the lock-up period, and shall enforce the provisions of each Lock-Up Agreement in
accordance with its terms. If any party to a Lock-Up Agreement breaches any provision of a Lock-Up Agreement, the Company shall promptly
use its reasonable commercial efforts to seek specific performance of the terms of such Lock-Up Agreement.
4.16 Capital Changes.
From the date hereof until ninety (90) days after the Closing Date, the Company shall not undertake a reverse or forward stock split or
reclassification of the Ordinary Shares without the prior written consent of the Purchasers holding a majority in interest of the Securities,
except for any reverse or forward stock split or reclassification previously approved by the Company’s shareholders and expressly
contemplated by the SEC Reports.
ARTICLE V
MISCELLANEOUS
5.1 Termination. This
Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever
on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated
on or before the fifth (5th) Trading Day following the date hereof; provided, however, that no such termination will affect
the right of any party to sue for any breach by any other party (or parties).
5.2 Fees and Expenses.
Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any
fees required for same-day processing of any instruction letter delivered by the Company and any exercise notice delivered by a Purchaser),
stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.
5.3 Entire Agreement.
The Transaction Documents, together with the exhibits and schedules thereto, the Registration Statement, the Preliminary Prospectus and
the Prospectus, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into
such documents, exhibits and schedules.
5.4 Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and
shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered
via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto
at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such
notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on
the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading
Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service
or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications
shall be as set forth on the signature pages attached hereto. To the extent that any notice provided pursuant to any Transaction
Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall
simultaneously file such notice with the Commission pursuant to a Report of Foreign Private Issuer on Form 6-K or by issuing a press
release containing such material non-public information.
5.5 Amendments; Waivers.
No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of
an amendment, by the Company and the Purchasers who purchased at least 50.1% of the then sum of (i) the Shares and (ii) the Pre-Funded
Warrant Shares initially issuable upon exercise of the Pre-Funded Warrants based on the initial Subscription Amounts hereunder, or, in
the case of a waiver, by the party against whom enforcement of any such waived provision is sought; provided, that if any amendment, modification
or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of at least 50.1% in interest of
such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise
any right hereunder in any manner impair the exercise of any such right. Any proposed amendment or waiver that disproportionately, materially
and adversely affects the rights and obligations of any Purchaser relative to the comparable rights and obligations of the other Purchasers
shall require the prior written consent of such adversely affected Purchaser. Any amendment effected in accordance with this Section 5.5
shall be binding upon each Purchaser and holder of Securities and the Company.
5.6 Headings. The
headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of
the provisions hereof.
5.7 Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company may
not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger).
Any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or transfers any Securities,
provided that such transferee agrees in writing to be bound, with respect to the transferred Securities, by the provisions of the Transaction
Documents that apply to the “Purchasers.”
5.8 No Third-Party Beneficiaries.
The Placement Agent shall be the third-party beneficiary of the representations and warranties of the Company in Section 3.1 and the representations
and warranties of the Purchasers in Section 3.2. This Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except
as otherwise set forth in Section 4.8, this Section 5.8 and the Placement Agency Agreement, as applicable.
5.9 Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be
governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and
defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party
hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any
dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect
to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action
or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or
certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall
commence an action, suit or proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations
of the Company under Section 4.8, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for
its reasonable and documented attorneys’ fees and other costs and expenses incurred with the investigation, preparation and
prosecution of such action or proceeding.
5.10 Survival. The
representations and warranties contained herein shall survive the Closing and the delivery of the Securities for the applicable statute
of limitations.
5.11 Execution. This
Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that
the parties need not sign the same counterpart. In the event that any signature is delivered by e-mail delivery of a “.pdf”
format data file, by other electronic signing created on an electronic platform (such as DocuSign) or by digital signing (such as Adobe
Sign), such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed)
with the same force and effect as if such “.pdf” or other electronic or digital signature page were an original thereof.
5.12 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force
and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts
to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
5.13 Rescission and Withdrawal
Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction
Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not
timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw, in its sole discretion
from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to
its future actions and rights; provided, however, that, in the case of a rescission of an exercise of a Warrant, the applicable Purchaser
shall be required to return any Ordinary Shares subject to any such rescinded exercise notice concurrently with the return to such Purchaser
of the aggregate exercise price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such
shares pursuant to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).
5.14 Replacement of Securities.
If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to
be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor,
a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction.
The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including
customary indemnity) associated with the issuance of such replacement Securities.
5.15 Remedies. In
addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers
and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may
not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby
agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would
be adequate. Each party agrees that it shall not have a remedy of punitive or consequential damages against the other and hereby waives
any right or claim to punitive or consequential damages it may now have or that may arise in the future.
5.16 Payment
Set Aside; Currency. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document
or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise
or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or
are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including,
without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such
restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such enforcement or setoff had not occurred. Unless otherwise expressly indicated, all dollar
amounts referred to in this Agreement and the other Transaction Documents are in United States Dollars (“U.S. Dollars”),
and all amounts owing under this Agreement and all other Transaction Documents shall be paid in U.S. Dollars. All amounts denominated
in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date
of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S. Dollars pursuant
to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation.
5.17 Judgment Currency.
(a) If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to
convert into any other currency (such other currency being hereinafter in this Section 5.17 referred to as the “Judgment Currency”)
an amount due in U.S. Dollars under this Agreement or any other Transaction Document, the conversion shall be made at the Exchange Rate
prevailing on the Trading Day immediately preceding: (A) the date actual payment of the amount due, in the case of any proceeding in the
courts of New York or in the courts of any other jurisdiction that will give effect to such conversion being made on such date or (B)
the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of
which such conversion is made pursuant to this Section 5.17 being hereinafter referred to as the “Judgment Conversion Date”).
(b) If in the case of any
proceeding in the court of any jurisdiction referred to in Section 5.17(a) above, there is a change in the Exchange Rate prevailing between
the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party shall pay such adjusted amount as
may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing on the date of
payment, will produce the amount of U.S. Dollars which could have been purchased with the amount of Judgment Currency stipulated in the
judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.
(c) Any amount due from the
Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts
due under or in respect of this Agreement or any other Transaction Document.
5.18 Submission
to Jurisdiction. Each of the parties hereto irrevocably (i) agrees that any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in any New York Court, (ii)
waives, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to the laying of venue of
any such proceeding and (iii) submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. The
Company has appointed Mudra Wearable, Inc., as its authorized agent (the “Authorized Agent”) upon whom process
may be served in any such action arising out of or based on this Agreement or the transactions contemplated hereby which may be
instituted in any New York Court by any Purchaser or by any person who controls any Purchaser, expressly consents to the
jurisdiction of any such court in respect of any such action, and waives any other requirements of or objections to personal
jurisdiction with respect thereto. Such appointment shall be irrevocable. The Company represents and warrants that the Authorized
Agent has agreed to act as such agent for service of process and agrees to take any and all action, including the filing of any and
all documents and instruments, which may be necessary to continue such appointment in full force and effect as aforesaid.
Service of process upon the Authorized Agent and written notice of such service to the Company shall be deemed, in every respect,
effective service of process upon the Company.
5.19 Independent Nature
of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several and not
joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance
of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document,
and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association,
a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group
with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently
protect and enforce its rights including, without limitation, the rights arising out of this Agreement or out of the other Transaction
Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose.
Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents. For
reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company through
Placement Agent Counsel. Placement Agent Counsel does not represent any of the Purchasers and only represents the Placement Agent. The
Company has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not
because it was required or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained
in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and
the Purchasers collectively and not between and among the Purchasers.
5.20 Saturdays, Sundays,
Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein
shall not be a Business Day, then such action may be taken, or such right may be exercised on the next succeeding Business Day.
5.21 Liquidated Damages.
The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents is a continuing
obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been paid notwithstanding
the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due and payable shall
have been canceled.
5.22 Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents
and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to
share prices and Ordinary Shares in any Transaction Document shall be subject to adjustment for reverse and forward share splits, share
dividends, share combinations and other similar transactions relating to Ordinary Shares that occur after the date of this Agreement.
5.23 WAIVER OF JURY TRIAL.
IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND
INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES
FOREVER TRIAL BY JURY.
(Signature Pages Follow)
IN WITNESS WHEREOF, the parties
hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first
indicated above.
| WEARABLE DEVICES LTD. |
|
Address
for Notice: |
| |
|
|
| By: |
|
|
5
Ha-Tnufa Street |
| Name |
|
|
Yokne-am
Illit, Israel 2066736 |
| Title: |
|
|
Attention:
Asher Dahan, Chief Executive Officer |
| |
|
|
| With a copy to (which shall not constitute notice): |
|
| |
|
|
Sullivan & Worcester LLP
1251 Avenue of the Americas
New York, New York 10020
|
|
|
| Attn: |
Oded Har-Even; Eric Victorson |
|
|
| Email: |
ohareven@sullivanlaw.com; |
|
|
| |
evictorson@sullivanlaw.com |
|
|
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR PURCHASER FOLLOWS]
[PURCHASER SIGNATURE PAGES TO WLDS SECURITIES PURCHASE
AGREEMENT]
IN WITNESS WHEREOF, the undersigned
have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated
above.
Name of Purchaser: _____________________________________________________________________________
Signature of Authorized Signatory of Purchaser: ______________________________________________________
Name of Authorized Signatory: ____________________________________________________________________
Title of Authorized Signatory: _____________________________________________________________________
Email Address of Authorized Signatory: ______________________________________________________________
Facsimile Number of Authorized Signatory: ____________________________________________________________
Address for Notice to Purchaser: ____________________________________________________________________
Address for Delivery of Warrants and Warrant
Shares to the Purchaser (if not same as address for notice):
DWAC for Ordinary
Shares:________________________________________________________________________
Subscription Amount: $ __________________________________
Ordinary Shares: _______________________________________
Ordinary Shares underlying the Warrants: ____________
Beneficial Ownership Blocker ☐ 4.99%
or ☐ 9.99%
Ordinary Shares underlying the Pre-Funded Warrants:
________
Beneficial Ownership Blocker ☐ 4.99%
or ☐ 9.99%
EIN Number: _____________________________________________
☐ Notwithstanding anything contained in
this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase the securities set forth in this
Agreement to be purchased from the Company by the above-signed, and the obligations of the Company to sell such securities to the above-signed,
shall be unconditional and all conditions to Closing shall be disregarded, (ii) the Closing shall occur on the second (2nd) Trading Day
following the date of this Agreement and (iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded
by clause (i) above) that required delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or
purchase price (as applicable) shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed
(as applicable) to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on
the Closing Date.
EXHIBIT A
Form of Ordinary Warrant
See attached.
EXHIBIT B
Form of Pre-Funded Warrant
See attached.
EXHIBIT C
Form of Lock-Up Agreement
See attached.
Exhibit 10.2
A.G.P./Alliance Global Partners
590 Madison Avenue, 28th Floor
New York, NY 10022
January 28, 2025
Wearable Devices Ltd.
5 Ha-Tnufa Street
Yokne-am Illit, Israel 2066736
Attention: Asher Dahan, Chief Executive Officer
Re: Placement Agency Agreement
Dear Mr. Dahan,
This letter (the “Agreement”)
constitutes the agreement between A.G.P./Alliance Global Partners (the “Placement Agent”) and Wearable Devices Ltd.,
a company organized under the laws of Israel (the “Company”), that the Placement Agent shall serve as the exclusive
placement agent for the Company, on a “reasonable best-efforts” basis, in connection with the proposed placement (the “Placement”)
of the following registered securities: (i) ordinary shares (the “Shares”) of the Company, no par value per share (the
“Ordinary Shares”), (ii) warrants to purchase Ordinary Shares (the “Warrants”) and (iii) pre-funded
warrants to purchase Ordinary Shares (the “Pre-Funded Warrants” and together with the Ordinary Shares and Warrants,
the “Securities”). The Securities actually placed by the Placement Agent are referred to herein as the “Placement
Agent Securities.” The documents executed and delivered by the Company and the Purchasers (as defined below) in connection with
the Placement, including, without limitation the Purchase Agreement (as defined below), shall be collectively referred to herein as the
“Transaction Documents.” The terms of the Placement shall be mutually agreed upon by the Company and the purchasers
that execute the Purchase Agreement (each, a “Purchaser” and collectively, the “Purchasers”), and
nothing herein constitutes (i) that the Placement Agent would have the power or authority to bind the Company or any Purchaser, or (ii)
an obligation for the Company will issue any Securities or complete the Placement. The Company expressly acknowledges and agrees that
the Placement Agent’s obligations hereunder are on a reasonable best-efforts basis only and that the execution of this Agreement
does not constitute a commitment by the Placement Agent to purchase the Securities and does not ensure the successful placement of the
Securities or any portion thereof or the success of the Placement Agent with respect to securing any other financing on behalf of the
Company. The Placement Agent may retain other brokers or dealers to act as sub-agents or selected-dealers on its behalf in connection
with the Placement. Certain affiliates of the Placement Agent may participate in the Placement by purchasing some of the Placement Agent
Securities. The sale of Placement Agent Securities to any Purchaser will be evidenced by a securities purchase agreement (the “Purchase
Agreement”) between the Company and any such Purchaser that executes the Purchase Agreement, in a form reasonably acceptable
to the Company and the Purchaser. Capitalized terms that are not otherwise defined herein have the meanings given to such terms in the
Purchase Agreement. Prior to the signing of any Purchase Agreement, officers of the Company will be available to answer inquiries from
prospective Purchasers.
SECTION 1. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY; COVENANTS OF THE COMPANY.
A. Representations of
the Company. With respect to the Placement Agent Securities, each of the representations and warranties (together with any related
disclosure schedules thereto) and covenants made by the Company to the Purchasers in the Purchase Agreement in connection with the Placement,
are hereby incorporated herein by reference into this Agreement (as though fully restated herein) and is, as of the date of this Agreement
and as of the Closing Date, hereby made to, and in favor of, the Placement Agent. In addition to the foregoing, the Company represents
and warrants that there are no affiliations with any Financial Industry Regulatory Authority, Inc. (“FINRA”) member
firm among the Company's officers, directors or, to the knowledge of the Company, any five percent (5.0%) or greater securityholder of
the Company, except as set forth in the Purchase Agreement.
B. Covenants of
the Company. The Company covenants and agrees to continue to retain (i) a firm of independent, Public Company Accounting Oversight
Board registered public accountants for a period of at least two (2) years after the Closing Date and (ii) a competent transfer agent
with respect to the Ordinary Shares for a period of two (2) years after the Closing Date. In addition, from the date hereof until forty-five
(45) days after the Closing Date, neither the Company nor any Subsidiary shall (i) issue, enter into any agreement to issue or announce
the issuance or proposed issuance of Ordinary Shares or Ordinary Share Equivalents, or (ii) file any registration statement or amendment
or supplement thereto, other than the Prospectus, a registration statement on Form S-8 in connection with any employee benefit plan approved
by independent directors of the Company, except that such restrictions shall not apply with respect to an Exempt Issuance. In addition,
from the date hereof until one-hundred and eighty (180) days after the Closing Date, the Company shall be prohibited from effecting or
entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Ordinary Shares or Ordinary Shares Equivalents
(or a combination of units thereof) involving a Variable Rate Transaction; provided, however, that (after forty-five (45) days after the
Closing Date, the Company shall be permitted to enter into and effect sales pursuant to an at-the-market offering facility with A.G.P./Alliance
Global Partners and make sales thereunder.
SECTION 2. REPRESENTATIONS
OF THE PLACEMENT AGENT. The Placement Agent represents and warrants that it (i) is a member in good standing of FINRA, (ii) is registered
as a broker/dealer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the securities laws
of each state in which an offer or sale of Placement Agent Securities is made (unless exempted from the respective state’s broker-dealer
registration requirements), (iii) is licensed as a broker/dealer under the laws of the United States of America, applicable to the offers
and sales of the Placement Agent Securities by the Placement Agent, (iv) is and will be a corporate body validly existing under the laws
of its place of incorporation, (v) has full power and authority to enter into and perform its obligations under this Agreement, and (vi)
it is not currently or in the past a tax resident of, has a permanent establishment in, the State of Israel and it has not performed its
services under this Agreement inside the State of Israel. The Placement Agent will immediately notify the Company in writing of any change
in its status with respect to subsections (i) through (vi) above. The Placement Agent covenants that it will use its reasonable best-efforts
to conduct the Placement hereunder in compliance with the provisions of this Agreement and the requirements of applicable law.
SECTION 3. COMPENSATION.
A. (1) In consideration of the services to be provided for hereunder, the Company shall pay to the Placement Agent and/or its respective
designees a cash fee of seven percent (7.0%) of the aggregate gross proceeds raised from the sale of the Placement Agent Securities (the
“Cash Fee”). The Cash Fee shall be paid on the Closing Date. The Placement Agent shall
also be entitled to a management fee equal to one percent (1.0%) of the gross proceeds raised from the sale of the Placement Agent
Securities (the “Management Fee”). (2) Concurrently out of the proceeds of the Closing,
the Company also agrees to reimburse the Placement Agent for reasonable and documented out-of-pocket accountable legal expenses incurred
by A.G.P. in connection with the transaction in the amount of up to $50,000 if the gross proceeds raised in the Placement are $3 million
or less, and up to $65,000 if the gross proceeds raised in the Placement exceed $3 million (provided, however, that such reimbursement
amount in no way limits or impairs the indemnification and contribution provisions of this Agreement). In addition, following the Closing
of the Placement, the Placement Agent shall be entitled to compensation under clauses (1) and (2) of this Section 3.A, calculated in the
manner set forth therein, with respect to any public or private offering or other financing or capital-raising transaction of any kind
(“Tail Financing”) to the extent that such financing is both (i) provided to the Company by investors that were brought
“over-the-wall” by the Placement Agent, and (ii) such Tail Financing is consummated at any time within the six (6) month period
following the expiration or termination of the Term (as defined below) set forth in this Agreement. Notwithstanding anything to the contrary
herein, the compensation due hereunder shall expressly not include any stock or equity of the Company issued to its officers, directors,
employees, consultants, or in relation to the transaction contemplated under the Standby Equity Purchase Agreement. The Placement Agent
will provide a list of investors whom the Placement Agent has introduced to the Company and brought over the wall during the Term.
The Company shall not be required
to pay the Placement Agent any fees or expenses except for the Cash Fee, the Management Fee and the Tail Financing, the reimbursement
of up to $50,000 or $65,000 in legal expenses (as described above), with respect to the engagement hereunder; provided, however, that
this sentence in no way limits or impairs the indemnification or contribution provisions contained herein. The terms of the compensation
described herein shall comply in all respects with the requirements of FINRA, including with respect to FINRA Rule 5110. The Placement
Agent reserves the right to reduce any item of compensation or adjust the terms thereof as specified herein in the event that a determination
shall be made by FINRA to the effect that the Placement Agent’s aggregate compensation is in excess of FINRA Rules or that the terms
thereof require adjustment.
SECTION 4. INDEMNIFICATION.
A. To the extent
permitted by law, with respect to the Placement Agent Securities, the Company will indemnify the Placement Agent and its affiliates, stockholders,
directors, officers, employees, members and controlling persons (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) against all losses, claims, damages, expenses and liabilities, as the same are incurred (including the reasonable
fees and expenses of counsel), relating to or arising out of its activities hereunder or pursuant to this Agreement, except to the extent
that any losses, claims, damages, expenses or liabilities (or actions in respect thereof) are found in a final judgment (not subject to
appeal) by a court of law to have resulted primarily and directly from the Placement Agent’s fraud, willful misconduct or gross
negligence in performing the services described herein.
B. Promptly after receipt
by the Placement Agent of notice of any claim or the commencement of any action or proceeding with respect to which the Placement Agent
is entitled to indemnity hereunder, the Placement Agent will promptly notify the Company in writing of such claim or of the commencement
of such action or proceeding, but failure to so notify the Company shall not relieve the Company from any obligation it may have hereunder,
except and only to the extent such failure results in the forfeiture by the Company of substantial rights and defenses. If the Company
so elects or is requested by the Placement Agent, the Company will assume the defense of such action or proceeding and will employ counsel
reasonably satisfactory to the Placement Agent and will pay the reasonable and documented fees and expenses of such counsel. Notwithstanding
the preceding sentence, the Placement Agent will be entitled to employ counsel separate from counsel for the Company and from any other
party in such action if counsel for the Placement Agent reasonably determines that it would be inappropriate under the applicable rules
of professional responsibility for the same counsel to represent both the Company and the Placement Agent. In such event, the reasonable
fees and disbursements of no more than one such separate counsel will be paid by the Company, in addition to reasonable and documented
fees of local counsel. The Company will have the right to settle the claim or proceeding provided that the Company will not settle any
such claim, action or proceeding without the prior written consent of the Placement Agent, which will not be unreasonably withheld, conditioned
or delayed. The Company shall not be liable for any settlement of any action effected without its written consent, which will not be unreasonably
withheld, conditioned or delayed.
C. The Company agrees
to notify the Placement Agent promptly of the assertion against it or any other person of any claim or the commencement of any action
or proceeding relating to a transaction contemplated by this Agreement.
D. If for any reason the foregoing
indemnity is unavailable to the Placement Agent or insufficient to hold the Placement Agent harmless, other than as a result of the Placement
Agent’s fraud, willful misconduct or gross negligence, then the Company shall contribute to the amount paid or payable by the Placement
Agent as a result of such losses, claims, damages or liabilities in such proportion as is appropriate to reflect not only the relative
benefits received by the Company on the one hand and the Placement Agent on the other, but also the relative fault of the Company on the
one hand and the Placement Agent on the other that resulted in such losses, claims, damages or liabilities, as well as any relevant equitable
considerations. The amounts paid or payable by a party in respect of losses, claims, damages and liabilities referred to above shall be
deemed to include any reasonable and documented legal or other fees and expenses incurred in defending any litigation, proceeding or other
action or claim. Notwithstanding the provisions hereof, the Placement Agent’s share of the liability hereunder shall not be in excess
of the amount of fees actually received, or to be received, by the Placement Agent under this Agreement (excluding any amounts received
as reimbursement of expenses incurred by the Placement Agent).
E. These indemnification
provisions shall remain in full force and effect whether or not the transaction contemplated by this Agreement is completed and shall
survive the termination of this Agreement, and shall be in addition to any liability that the Company might otherwise have to any indemnified
party under this Agreement or otherwise.
SECTION 5. ENGAGEMENT
TERM. The Placement Agent’s engagement hereunder will be until the earlier of the Closing Date and February
28, 2025 (the “Term”). The date of termination of this Agreement is referred to herein as the “Termination
Date.” In the event, however, in the course of the Placement Agent’s performance of due diligence it deems it necessary
to terminate the engagement, the Placement Agent may do so prior to the Termination Date. The Company may elect to terminate the engagement
hereunder for any reason prior to the Termination Date but will remain responsible for fees pursuant to Section 3 hereof and fees with
respect to the Placement Agent Securities if sold in the Placement. Notwithstanding anything to the contrary contained herein, the provisions
concerning the Company’s obligation to pay any fees actually earned pursuant to Section 3 hereof and the provisions concerning confidentiality,
indemnification and contribution contained herein will survive any expiration or termination of this Agreement. If this Agreement is terminated
prior to the completion of the Placement, all fees due to the Placement Agent shall be paid by the Company to the Placement Agent on or
before the Termination Date (in the event such fees are earned or owed as of the Termination Date). The Placement Agent agrees not to
use any confidential information concerning the Company provided to the Placement Agent by the Company for any purposes other than those
contemplated under this Agreement.
SECTION 6. PLACEMENT
AGENT INFORMATION. The Company agrees that any information or advice rendered by the Placement Agent in connection with this engagement
is for the confidential use of the Company only in its evaluation of the Placement and, except as otherwise required by law, the Company
will not disclose or otherwise refer to the advice or information in any manner without the Placement Agent’s prior written consent.
SECTION 7. NO
FIDUCIARY RELATIONSHIP. This Agreement does not create, and shall not be construed as creating rights enforceable by any person or
entity not a party hereto, except those entitled hereto by virtue of the indemnification provisions hereof. The Company acknowledges and
agrees that the Placement Agent is not and shall not be construed as a fiduciary of the Company and shall have no duties or liabilities
to the equity holders or the creditors of the Company or any other person by virtue of this Agreement or the retention of the Placement
Agent hereunder, all of which are hereby expressly waived.
SECTION 8. CLOSING.
The obligations of the Placement Agent, and the closing of the sale of the Placement Agent Securities hereunder are subject to the accuracy,
when made and on the Closing Date, of the representations and warranties on the part of the Company contained herein and in the Purchase
Agreement, to the performance by the Company of its obligations hereunder and in the Purchase Agreement, and to each of the following
additional terms and conditions, except as otherwise disclosed to and acknowledged and waived by the Placement Agent:
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A. |
All corporate proceedings and other legal matters incident to the authorization, form, execution, delivery and validity of each of this Agreement, the Placement Agent Securities, and all other legal matters relating to this Agreement and the transactions contemplated hereby with respect to the Placement Agent Securities shall be reasonably satisfactory in all material respects to the Placement Agent. |
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B. |
The Placement Agent shall have received a legal opinion and negative assurance letter of Company U.S. Counsel and a legal opinion of Company Israel Counsel , each in a form reasonably acceptable to the Placement Agent, addressed to the Placement Agent and the Purchasers and dated as of the Closing Date, in form and substance reasonably satisfactory to the Placement Agent. |
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C. |
The Placement Agent shall have received an executed FINRA questionnaire or bring down letter from each of the Company and the Company’s executive officers and directors. |
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D. |
Ordinary Shares sold in the Placement, including Ordinary Shares issuable upon the exercise of the Warrants, must be registered under the Exchange Act and, as of the Closing Date, the Placement Agent Securities shall be listed and admitted and authorized for trading on the Trading Market or other applicable U.S. national exchange and satisfactory evidence of such action shall have been provided to the Placement Agent. The Company shall have taken no action designed to, or likely to have the effect of, terminating the registration of the Ordinary Shares under the Exchange Act or delisting or suspending from trading the Ordinary Shares from the Trading Market or other applicable U.S. national exchange, nor has the Company received any information suggesting that the Securities and Exchange Commission or the Trading Market or other U.S. applicable national exchange is contemplating terminating such registration or listing, except as otherwise publicly disclosed. |
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E. |
No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted or issued by any governmental agency or body which would, as of the Closing Date, prevent the issuance or sale of the Placement Agent Securities or materially and adversely affect or potentially and adversely affect the business or operations of the Company; and no injunction, restraining order or order of any other nature by any federal or state court of competent jurisdiction shall have been issued as of the Closing Date which would prevent the issuance or sale of the Placement Agent Securities or materially and adversely affect or potentially and adversely affect the business or operations of the Company. |
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F. |
The Company shall have entered into a Purchase Agreement with each of the Purchasers or the sole Purchaser (as the case may be) of the Placement Agent Securities and such agreements shall be in full force and effect and shall contain representations, warranties and covenants of the Company as agreed upon between the Company and the Purchaser(s). |
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G. |
FINRA shall have raised no objection to the fairness and reasonableness of the terms and arrangements of this Agreement. In addition, the Company shall, if requested by the Placement Agent, make or authorize Placement Agent’s counsel to make on the Company’s behalf, any filing with the FINRA Corporate Financing Department pursuant to FINRA Rule 5110 with respect to the Placement and pay all filing fees required in connection therewith. |
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H. |
The Placement Agent shall have received customary certificates of the Company’s executive officers, as to the accuracy of the representations and warranties contained in the Purchase Agreement, a certificate of the Company’s Chief Financial Officer in a form reasonably acceptable to the Placement Agent, and a certificate of the Company’s secretary certifying (i) that the Company’s charter documents are true and complete, have not been modified and are in full force and effect; (ii) that the resolutions of the Company’s Board of Directors relating to the Placement are in full force and effect and have not been modified; and (iii) as to the incumbency of the officers of the Company. |
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I. |
The Placement Agent shall have received an
executed lock-up agreement from each of the Company’s executive officers and directors prior to the Closing Date. |
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J. |
(1) On the date hereof, the Placement Agent
shall have received, a letter from the Auditors of the Company, addressed to the Placement Agent, dated as of the date hereof, and a
bring-down “comfort letter” addressed to the Placement Agent on the Closing Date, each in form and substance satisfactory
to the Placement Agent. The letters shall not disclose any change in the condition (financial or other), earnings, operations or business
of the Company, which, in the Placement Agent’s sole judgment, is material and adverse and that makes it, in the Placement Agent’s
sole judgment, impracticable or inadvisable to proceed with the Placement of the Securities. (2) On the Closing Date, the Placement Agents
shall have received from the Auditors of the Company a “bring-down” comfort letter dated as of the Closing Date, in form
and substance satisfactory to the Placement Agents, to the effect that they reaffirm the statements made in the letter furnished pursuant
to this Section 8(J)(1), except that the specified date referred to therein for the carrying out of procedures shall be no more
than three business days prior to such Closing Date. |
If any of the conditions specified in this Section
8 shall not have been fulfilled when and as required by this Agreement, all obligations of the Placement Agent hereunder may be cancelled
by the Placement Agent at, or at any time prior to, the Closing Date. Notice of such cancellation shall be given to the Company in writing
or orally. Any such oral notice shall be confirmed promptly thereafter in writing.
SECTION 9. GOVERNING
LAW. This Agreement will be governed by, and construed in accordance with, the laws of the State of New York applicable to agreements
made and to be performed entirely in such State, without regard to its conflict of laws principles. This Agreement may not be assigned
by either party without the prior written consent of the other party. This Agreement shall be binding upon and inure to the benefit of
the parties hereto, and their respective successors and permitted assigns. Any right to trial by jury with respect to any dispute arising
under this Agreement or any transaction or conduct in connection herewith is waived. Any dispute arising under this Agreement may be brought
into the courts of the State of New York or into the federal courts located in New York, New York and, by execution and delivery of this
Agreement, the Company hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of aforesaid
courts. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by delivering a copy thereof via overnight delivery (with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. If either
party shall commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing party in such action or
proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such action or proceeding.
SECTION 10. ENTIRE
AGREEMENT/MISCELLANEOUS. This Agreement embodies the entire agreement and understanding between the parties hereto, and supersedes
all prior agreements and understandings, relating to the subject matter hereof. If any provision of this Agreement is determined to be
invalid or unenforceable in any respect, such determination will not affect such provision in any other respect or any other provision
of this Agreement, which will remain in full force and effect. This Agreement may not be amended or otherwise modified or waived except
by an instrument in writing signed by both the Placement Agent and the Company. The representations, warranties, agreements and covenants
contained herein shall survive the Closing Date of the Placement and delivery of the Placement Agent Securities for the applicable statute
of limitations. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and
the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission
or a .pdf format file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such facsimile or .pdf signature page were an original thereof.
SECTION 11. NOTICES.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of (a) the date of transmission, if such notice or communication is sent to the email address
specified on the signature pages attached hereto prior to 6:30 p.m. (New York City time) on a business day, (b) the next business day
after the date of transmission, if such notice or communication is sent to the email address on the signature pages attached hereto on
a day that is not a business day or later than 6:30 p.m. (New York City time) on any business day, (c) the third business day following
the date of mailing, if sent by an internationally recognized air courier service, or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages hereto.
SECTION 12. Press
Announcements. The Company agrees that the Placement Agent shall, on and after the Closing Date, have the right to reference
the Placement and the Placement Agent’s role in connection therewith in the Placement Agent’s marketing materials and on its
website and to place advertisements in financial and other newspapers and journals, in each case at its own expense.
SECTION 13. PAYMENTS.
All payments made or deemed to be made by the Company to the Placement Agent, its affiliates, stockholders, directors, officers, employees,
members and controlling persons (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) (each, a “Payee”),
if any, will be made without withholding or deduction for or on account of any present or future taxes, duties, assessments or governmental
charges of whatever nature (other than taxes on net income or similar taxes) imposed or levied by or on behalf of the State of Israel
or any political subdivision or any taxing authority thereof or therein unless the Company is or becomes required by law to withhold or
deduct such taxes, duties, assessments or other governmental charges. In such event, the Company will pay such additional amounts as will
result, after such withholding or deduction, in the receipt by the Payee of the amounts that would otherwise have been received had such
deduction or withholding not been required. For the avoidance of doubt, all sums payable, paid or deemed payable under this Agreement
shall be considered exclusive of value added tax, sales tax or other similar taxes which shall be borne by, paid, collected and remitted
by the Company in accordance with applicable law. The Placement Agent shall reasonably cooperate with the Company, by providing reasonably
required information for the Company to obtain a withholding certificate from the Israel Tax Authority that would permit payments made
or deemed to be made hereunder by the Company to be subject to a reduced rate of, or exemption from, withholding or deduction.
[The remainder of this page has been intentionally
left blank.]
Please confirm that the foregoing
correctly sets forth our agreement by signing and returning to the Placement Agent the enclosed copy of this Agreement.
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Very truly yours, |
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A.G.P./ALLIANCE GLOBAL PARTNERS |
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By: |
/s/ Thomas J. Higgins |
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Name: |
Thomas J. Higgins |
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Title: |
Managing Director |
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Address for notice: |
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590 Madison Avenue 28th Floor |
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New York, New York 10022 |
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Attn: Thomas Higgins |
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Email: thiggins@allianceg.com |
| Accepted and agreed to as of the date first written above: |
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| WEARABLE DEVICES LTD. |
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| By: |
/s/ Asher Dahan |
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Name: |
Asher Dahan |
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Title: |
Chief Executive Officer |
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Address for notice: |
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Wearable Devices Ltd. |
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5 Ha-Tnufa St. |
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Yokne’am Illit, 2066736 Israel |
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Attention: Asher Dahan, |
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Chief Executive Officer |
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Email: asher.dahan@wearabledevices.co.il |
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[Signature Page to the Placement Agency Agreement]
Exhibit 99.1
Wearable Devices Ltd. Announces Pricing
of $2.5 Million Public Offering
Yokneam Illit, Israel, Jan. 28, 2025 (GLOBE
NEWSWIRE) -- Wearable Devices Ltd. (the “Company” or “Wearable Devices”) (Nasdaq: WLDS, WLDSW), an award-winning
pioneer in artificial intelligence (“AI”)-based wearable gesture control technology, today announced the pricing of its “reasonable
best efforts” public offering with a single institutional investor for the purchase and sale of up 2,500,000 ordinary shares (or
pre-funded warrants in lieu thereof) and warrants to purchase up to 2,500,000 ordinary shares, at a combined offering price of $1.00 per
share and accompanying warrant (the “Offering”). The Company expects to receive aggregate gross proceeds of approximately
$2.5 million, before deducting placement agent fees and other offering expenses and assuming no exercise of the warrants. The warrants
will have an exercise price of $1.00 per share, will be exercisable immediately and will expire five years from the issuance date.
The closing of the Offering is expected to occur
on or about January 30, 2025, subject to the satisfaction of customary closing conditions. The Company intends to use the net proceeds
from the Offering for working capital and general corporate purposes.
A.G.P./Alliance Global Partners is acting as the
sole placement agent for the Offering.
In connection with the Offering, the Company also
agreed to amend existing warrants that were previously issued to the investor participating in the Offering to purchase up to 822,000
ordinary shares of the Company, with an exercise price of $2.50 per share. Effective upon closing of the Offering, such existing warrants
will be amended to reduce the exercise price to $1.00 per share and will expire five years following the closing of the Offering.
The securities described above are being offered
pursuant to a registration statement on Form F-1, as amended (File No. 333-284023), previously filed with the Securities and Exchange
Commission (“SEC”), which was declared effective on January 28, 2025. The Offering is being made only by means of a prospectus
forming part of the effective registration statement. Copies of the preliminary prospectus and, when available, copies of the final prospectus,
relating to the Offering may be obtained on the SEC’s website located at http://www.sec.gov. Electronic copies of the final
prospectus relating to the Offering may be obtained, when available, from A.G.P./Alliance Global Partners, 590 Madison Avenue, 28th Floor,
New York, NY 10022, or by telephone at (212) 624-2060, or by email at prospectus@allianceg.com.
This press release does not constitute an offer
to sell or a solicitation of an offer to buy any of the securities in this Offering, nor shall there be any sale of these securities in
any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification
under the securities laws of any such state or other jurisdiction.
About Wearable Devices Ltd.
Wearable Devices Ltd. is a pioneering growth company
revolutionizing human-computer interaction through its AI-powered neural input technology for both consumer and business markets. Leveraging
proprietary sensors, software, and advanced AI algorithms, the Company’s innovative products, including the Mudra Band for iOS and
Mudra Link for Android, enable seamless, touch-free interaction by transforming subtle finger and wrist movements into intuitive controls.
These groundbreaking solutions enhance gaming, and the rapidly expanding AR/VR/XR landscapes. The Company offers a dual-channel business
model: direct-to-consumer sales and enterprise licensing. Its flagship Mudra Band integrates functional and stylish design with cutting-edge
AI to empower consumers, while its enterprise solutions provide businesses with the tools to deliver immersive and interactive experiences.
By setting the input standard for the XR market, Wearable Devices is redefining user experiences and driving innovation in one of the
fastest-growing tech sectors. Wearable Devices’ ordinary shares and warrants trade on the Nasdaq under the symbols “WLDS”
and “WLDSW,” respectively.
Forward-Looking Statements
This press release contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, that are intended to be covered by the “safe harbor” created by those sections. Forward-looking statements,
which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the
use of forward-looking terms such as “believe,” “expect,” “may,” “should,” “could,”
“seek,” “intend,” “plan,” “goal,” “estimate,” “anticipate,” “will”
or other comparable terms. For example, we are using forward-looking statements when we discuss the expected closing date of the Offering,
the use of proceeds, and the satisfaction of customary closing conditions. All statements other than statements of historical facts included
in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking
statements. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only
on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated
events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.
Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you
should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition
to differ materially from those indicated in the forward-looking statements include, among others, the following: the trading of our ordinary
shares or warrants and the development of a liquid trading market; our ability to successfully market our products and services; the acceptance
of our products and services by customers; our continued ability to pay operating costs and ability to meet demand for our products and
services; the amount and nature of competition from other security and telecom products and services; the effects of changes in the cybersecurity
and telecom markets; our ability to successfully develop new products and services; our success establishing and maintaining collaborative,
strategic alliance agreements, licensing and supplier arrangements; our ability to comply with applicable regulations; and the other risks
and uncertainties described in our annual report on Form 20-F for the year ended December 31, 2023, filed on March 15, 2024 and our other
filings with the SEC, including the registration statement on Form F-1, as amended (File No. 333-284023). We undertake no obligation to
publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new
information, future developments or otherwise.
Investor Relations Contact
Michal Efraty
IR@wearabledevices.co.il
Wearable Devices (NASDAQ:WLDSW)
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