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 November 2023 (Report No. 4)
Commission File Number: 001-38041
SCISPARC LTD.
(Translation of registrant’s name into English)
20 Raul Wallenberg Street, Tower A
Tel Aviv 6971916, Israel |
(Addresses 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
Adoption of Rights Plan
On November 27, 2023, the
Board of Directors (the “Board”) of SciSparc Ltd., a company incorporated under the laws of the State of Israel (the
“Company,” “our Company,” “us,” “we” or “SciSparc”),
unanimously adopted a rights plan (the “Rights Plan”) to protect the interests of the Company’s shareholders.
The Rights Plan, if triggered, will significantly dilute the ownership of any Acquiring Person (as defined below). However, the Board
may, in its sole and absolute discretion, determine that a shareholder or potential shareholder is exempt from the Rights Plan at any
time before such person becomes an Acquiring Person. The Board believes the Rights Plan is an effective course of action for the Board
to fulfill its fiduciary duties to the Company and its shareholders and to enable shareholders to realize the long-term value of their
investment. The Rights Plan was adopted following a careful evaluation and consultation with the Company’s external legal advisors.
The adoption of the Rights
Plan is not intended to prevent or interfere with any action with respect to SciSparc that the Board determines to be in the best interests
of the Company and its shareholders. Instead, it will position the Board to fulfill its fiduciary duties on behalf of all shareholders
by ensuring that the Board has sufficient time to make informed judgments about any attempts to control or significantly influence SciSparc.
The Rights Plan will encourage anyone seeking to gain a significant interest in SciSparc to negotiate directly with the Board prior to
attempting to control or significantly influence the Company. Further to those goals, the Rights (as defined below) may cause substantial
dilution to a person or group that acquires 10% or more of the ordinary shares, no par value per share, of the Company (“Ordinary
Shares”) or any existing holder of 10% or more of the Ordinary Shares who shall acquire any additional Ordinary Shares, unless
the Rights are first redeemed by the Board. The Rights should not interfere with a transaction that is in the best interests of the Company
and its shareholders given that the Rights can be redeemed, or the Rights Plan can be terminated, before the consummation of such transaction.
We provide a summary of
the terms of the Rights Plan below. The below description is only a summary, and is not complete, and should be read together with the
entire Rights Agreement (as defined below) (which includes as Exhibit A thereto, the Form of Right Certificate, and as Exhibit
B thereto, the Form of Summary of Rights), a copy of which has been furnished as Exhibit 4.1 to this Report of Foreign Private
Issuer on Form 6-K (“Form 6-K”).
Summary of the Rights Plan
Rights and Rights Agreement
The Board has authorized,
pursuant to the Rights Plan, (i) the issuance, on December 8, 2023, of one special purchase right (a “Right”) for each
Ordinary Share outstanding at the Close of Business on December 8, 2023 (the “Record Date”), as well as (ii) the issuance
of one Right for each Ordinary Share issued after the Record Date and prior to the earliest of the Issuance Date, the Redemption Date
(as defined below) and the Final Expiration Date (as defined below) (including Ordinary Shares issued pursuant to the exercise, conversion
or settlement of securities exercisable for, convertible into or that may be settled for, Ordinary Shares or rights, in each case, issued
or granted prior to, and outstanding as of, the Issuance Date). Each Right will represent the right to purchase one (1) Ordinary Share,
at the price of $0.001 per share, upon the terms and subject to the conditions described below.
The Rights will be issued
pursuant to a Rights Agreement, dated as of November 28, 2023 (the “Rights Agreement”), between the Company and VStock
Transfer LLC, as rights agent (the “Rights Agent”). Capitalized terms used in this Form 6-K but not otherwise defined
herein have the meanings given to them in the Rights Agreement. Each Right will allow its holder to purchase from the Company one (1)
Ordinary Share, at a purchase price of $0.001 per Ordinary Share, once the Rights become exercisable. Prior to exercise, each Right does
not give its holder any dividend, voting, liquidation or other rights as a shareholder of SciSparc.
Exercise Period; Rights Certificates
The Rights will not be exercisable
until the Close of Business on the tenth (10th) day after the public announcement or public disclosure that a person or group
has become an “Acquiring Person” by obtaining beneficial ownership of 10% or more of the Company’s outstanding Ordinary
Shares (subject to the parameters and exceptions described below and in the Rights Agreement, an “Acquiring Person”),
except if such person or group has become an Acquiring Person pursuant to an offer approved by the majority of the Board (such date, upon
which the Rights become exercisable, is referred to as the “Issuance Date”).
If a Person’s beneficial
ownership of the then-outstanding Ordinary Shares as of the time of the public announcement of the Rights Plan is at or above 10% (including
through entry into certain derivative positions), that person or group’s then-existing ownership percentage would be grandfathered
and would not trigger the exercisability of the Rights, as that Person will not be deemed to be an Acquiring Person. However, the Rights
would become exercisable (and such Person will be deemed to be an Acquiring Person) if at any time after such announcement, that shareholder
increases its beneficial ownership percentage of Ordinary Shares of the Company by 0.5% or if at any time after such announcement, such
shareholder’s beneficial ownership of Ordinary Shares is reduced to an amount that is less than 10% of the then-outstanding Ordinary
Shares and thereafter such shareholder becomes an Acquiring Person.
Until the Issuance Date, the
balances in the book-entry accounting system of the transfer agent for our Ordinary Shares or, in the case of certificated shares, Ordinary
Shares certificates, will also evidence the Rights, and any transfer of Ordinary Shares or, in the case of certificated shares, certificates
for Ordinary Shares, will constitute a transfer of Rights. After that date, the Rights will separate from the Ordinary Shares and be evidenced
solely by Rights Certificates that we will mail to all eligible holders of Ordinary Shares, or we may choose to use book-entry in lieu
of physical certificates. Under certain circumstances, any Rights held by an Acquiring Person or any Associate or Affiliate thereof are
void and may not be exercised. The Rights shall not be exercisable, and shall be void so long as held, by a holder in any jurisdiction
where the requisite qualification for the issuance to such holder, or the exercise by such holder of the Rights in such jurisdiction,
shall not have been obtained or be obtainable.
In addition, in connection
with the issuance or sale of Ordinary Shares following the Issuance Date and prior to the redemption, exchange, or expiration of the Rights,
the Company (a) shall, with respect to Ordinary Shares so issued or sold pursuant to the exercise of share options or pursuant to any
other award or right under any employee benefit plan or arrangement, granted or awarded as of the Issuance Date (including, for example,
upon the or purchase of Ordinary Shares under the Company’s 2015 Share Option Plan), or upon the exercise, conversion or exchange
of securities hereinafter issued by the Company (except as may otherwise be provided in the instrument(s) governing such securities),
and (b) may, in any other case, if deemed necessary or appropriate by the Board, issue Rights Certificates representing the appropriate
number of Rights in connection with such issuance or sale; provided, however, that (i) no such Rights Certificate shall be issued if,
and to the extent that, the Company shall be advised by counsel that such issuance would create a significant risk of material adverse
tax consequences to the Company or the Person to whom such Rights Certificate would be issued, and (ii) no such Rights Certificate shall
be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof.
Flip-In/Flip-Over
If a person or group becomes
an Acquiring Person, then beginning on the Issuance Date, all holders of Rights except the Acquiring Person or any Associate or Affiliate
thereof may, for a purchase price of $0.001 per one Ordinary Share, purchase one (1) Ordinary Share for each Ordinary Share of the Company
then beneficially owned by such person.
If our Company is later
acquired in a merger or similar transaction after the Issuance Date, all holders of Rights except the Acquiring Person or any Associate
or Affiliate thereof may, for a purchase price of $0.001 per share (subject to adjustments as provided in the Rights Agreement, purchase
one (1) times the number of shares of the acquiring corporation, that each shareholder of the Company is entitled for each Ordinary Share
held.
Scope of “Acquiring Person” Definition
An “Acquiring Person”
is any Person who or which, together with all Affiliates and Associates of such Person, shall be the Beneficial Owner of 10% or more of
the Ordinary Shares of the Company then outstanding, but shall not include the Company, any Subsidiary of the Company, any employee benefit
or share ownership plan of the Company or any Subsidiary of the Company, or any entity holding Ordinary Shares for or pursuant to the
terms of any such plan. Notwithstanding the foregoing, no Person shall become an “Acquiring Person” as the result of an acquisition
of Ordinary Shares by the Company which, by reducing the number of Ordinary Shares of the Company outstanding, increases the proportionate
number of Ordinary Shares of the Company beneficially owned by such Person to 10% or more of the Ordinary Shares of the Company then outstanding; provided, however,
that, if a Person shall become the Beneficial Owner of 10% or more of the Ordinary Shares of the Company then outstanding by reason of
share purchases by the Company and shall, after the public disclosure of such share purchases by the Company, become the Beneficial Owner
of any additional Ordinary Shares of the Company, then such Person shall be deemed to be an “Acquiring Person.” Notwithstanding
the foregoing, if the Board determines in good faith that a Person who would otherwise be an “Acquiring Person” has become
such inadvertently, and such Person divests or undertakes to divest, as promptly as practicable a sufficient number of Ordinary Shares,
so that such Person would no longer be an “Acquiring Person,” as defined pursuant to the foregoing provisions of this paragraph,
then such Person shall not be deemed to be an “Acquiring Person” for any purposes of the Rights Agreement.
If a bona fide swaps dealer
who would otherwise be an “Acquiring Person” has become so as a result of its actions in the ordinary course of its business
that the Board determines were taken without the intent or effect of evading or assisting any other Person to evade the purposes and intent
of the Rights Agreement, or otherwise seeking to control or influence the management or policies of the Company, then, and unless and
until the Board shall otherwise determine, such Person shall not be deemed to be an “Acquiring Person” for purposes of the
Rights Agreement. Furthermore, no Person who purchases securities of the Company either directly from the Company or from any underwriters
engaged by the Company, in each case in a securities offering transaction approved by the Board as an offering intended to allow a Person
or a group of Persons to beneficially own, upon the consummation of such offering, more than 10% of the Ordinary Shares of the Company
then outstanding, shall become an “Acquiring Person” unless such Person shall, after the consummation of such offering, beneficially
own additional Ordinary Shares of the Company in the amount equal to or greater than the sum of (I) the lowest Ordinary Shares beneficially
owned by such Person as a percentage of the outstanding Ordinary Shares as of immediately after the consummation of such offering and
(II) 0.5%. The definition of Acquiring Person is furthermore subject to the “grandfathering” scenarios described under “Exercise
Period; Rights Certificates” above.
Exchange
The Board may, at its option,
at any time after the Issuance Date, exchange all or part of the then outstanding and exercisable Rights (except for Rights that have
become void) for Ordinary Shares at an exchange ratio of one (1) Ordinary Share per Right, appropriately adjusted to reflect any adjustment
in the number of Rights (the “Exchange Ratio”). However, the Board will not be empowered to effect such exchange at
any time after any Person (other than the Company, any Subsidiary of the Company, any employee benefit or share ownership plan of the
Company or any such Subsidiary, or any entity holding Ordinary Shares for or pursuant to the terms of any such plan), together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or more of the Ordinary Shares then outstanding.
Immediately upon the action
of the Board ordering the foregoing exchange, the right to exercise the Rights that are to be exchanged will terminate and the only right
thereafter of a holder of such Rights shall be to receive that number of Ordinary Shares equal to the number of such Rights held by such
holder multiplied by the Exchange Ratio. In the event that there shall not be sufficient Ordinary Shares issued but not outstanding or
authorized but unissued to permit any exchange of Rights, the Company will take all such action as may be necessary to authorize additional
Ordinary Shares for issuance upon exchange of the Rights.
Anti-Dilution Provisions
Our Board may adjust the
purchase price of Ordinary Shares under each Right, the number of Ordinary Shares issuable under each Right, and the number of outstanding
Rights to prevent dilution that may occur from a share dividend, a share split, or a reclassification of the Ordinary Shares.
Amendments
The terms of the Rights
Agreement may be amended by our Board without the consent of the holders of the Rights. After a person or group becomes an Acquiring Person,
our Board may not amend the Rights Agreement in a way that adversely affects holders of the Rights.
Redemption
The Board may, at its option,
at any time prior to the Issuance Date, redeem all but not less than all the then outstanding Rights. The redemption of the Rights by
the Board may be made effective at such time, on such basis and with such conditions as the Board, in its sole discretion, may establish
(the effective date of redemption, the “Redemption Date”). Immediately upon the effectiveness of the action of the
Board ordering the redemption of the Rights, and without any further action and without any notice, the right to exercise the Rights will
terminate.
Expiration
The Rights will expire on November 27, 2024 (the
“Final Expiration Date”).
Press Release
On November 28, 2023, the Company issued a press
release titled “SciSparc Adopts Limited Duration Shareholder Rights Plan.” A copy of this press release is furnished herewith
as Exhibit 99.1 and incorporated by reference herein.
Incorporation by Reference
The
contents of this Form 6-K, including Exhibit 99.1 hereto, are incorporated by reference into the Company’s registration statements
on Form S-8 (File No. 333-225773) and Form F-3 (File No. 333-275305, File No. 333-269839, File No. 333-266047,
and File No. 333-233417), filed by the Company with the U.S. Securities and Exchange Commission,
to be a part thereof from the date on which this report is furnished, to the extent not superseded by documents or reports subsequently
filed or furnished.
Exhibit
Index
The following exhibits are furnished as part
of this Form 6-K:
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.
|
SCISPARC LTD. |
|
|
Dated: November 28, 2023 |
By: |
/s/ Oz Adler |
|
Name: |
Oz Adler |
|
Title: |
Chief Executive Officer |
6
Exhibit 4.1
Execution Copy
SCISPARC LTD.
AND
VSTOCK TRANSFER, LLC
Rights Agreement
Dated as of November 28, 2023
TABLE OF CONTENTS
1. |
Definitions. |
1 |
2. |
Appointment of Rights Agent. |
4 |
3. |
Issue of Right Certificates. |
4 |
4. |
Form of Right Certificates. |
6 |
5. |
Countersignature and Registration. |
6 |
6. |
Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. |
7 |
7. |
Exercise of Rights; Purchase Price; Expiration Date of Rights. |
7 |
8. |
Cancellation and Destruction of Right Certificates. |
8 |
9. |
Availability of Ordinary Shares. |
8 |
10. |
Ordinary Shares Record Date. |
9 |
11. |
Adjustment of Purchase Price, Number of Shares or Number of Rights. |
9 |
12. |
Certificate of Adjusted Purchase Price or Number of Shares. |
11 |
13. |
Consolidation, Merger or Sale or Transfer of Assets or Earning Power. |
12 |
14. |
Fractional Rights and Fractional Shares. |
12 |
15. |
Rights of Action. |
13 |
16. |
Agreement of Right Holders. |
13 |
17. |
Right Certificate Holder Not Deemed a Shareholder. |
13 |
18. |
Concerning the Rights Agent. |
14 |
19. |
Merger or Consolidation or Change of Name of Rights Agent. |
14 |
20. |
Duties of Rights Agent. |
14 |
21. |
Change of Rights Agent. |
16 |
22. |
Issuance of New Right Certificates. |
16 |
23. |
Redemption. |
16 |
24. |
Exchange. |
17 |
25. |
Compliance with the Israeli Companies Law. |
17 |
26. |
Notice of Certain Events. |
17 |
27. |
Notices. |
18 |
28. |
Supplements and Amendments. |
18 |
29. |
Successors. |
18 |
30. |
Determinations and Actions by the Board of Directors, etc. |
19 |
31. |
Benefits of this Agreement. |
19 |
32. |
Severability. |
19 |
33. |
Governing Law. |
19 |
34. |
Counterparts. |
19 |
35. |
Descriptive Headings; Interpretation. |
19 |
36. |
Force Majeure. |
19 |
Exhibit A |
A-1 |
Exhibit B |
B-1 |
Rights Agreement (“Agreement”),
dated as of November 28, 2023, between SCISPARC LTD., an Israeli company (the “Company”), and VSTOCK
TRANSFER, LLC, a California limited liability company, as rights agent (the “Rights Agent”).
The Board of Directors of
the Company has authorized and directed the issuance of one special purchase right (a “Right”) for each Ordinary Share
(as hereinafter defined) of the Company outstanding as of the Close of Business (as hereinafter defined) on December 8, 2023 (the “Record
Date”), each Right representing the right to purchase one (1) Ordinary Share, at the price of $0.001 per share, upon the terms
and subject to the conditions set forth herein, and the Board of Directors of the Company has further authorized and directed the issuance
of one Right with respect to each Ordinary Share that shall become outstanding between the Record Date and the earliest of the Redemption
Date and the Final Expiration Date (as such terms are hereinafter defined).
Accordingly, in consideration
of the premises and the mutual agreements herein set forth, the parties hereby agree as follows:
For purposes of this Agreement,
the following terms have the meanings indicated:
(a) “Acquiring Person”
shall mean:
i. any
Person who or which, together with all Affiliates and Associates of such Person, shall be the Beneficial Owner of 10% or more of the Ordinary
Shares of the Company then outstanding, but shall not include the Company, any Subsidiary of the Company, any employee benefit or share
ownership plan of the Company or of any Subsidiary of the Company, or any entity holding Ordinary Shares for or pursuant to the terms
of any such plan.
ii. Notwithstanding
anything to the contrary in Section 1(a)i:
A. no
Person shall become an “Acquiring Person” as the result of an acquisition of Ordinary Shares by the Company which, by reducing
the number of Ordinary Shares of the Company outstanding, increases the proportionate number of Ordinary Shares of the Company beneficially
owned by such Person to 10% or more of the Ordinary Shares of the Company then outstanding; provided, however,
that, if a Person shall become the Beneficial Owner of 10% or more of the Ordinary Shares of the Company then outstanding by reason of
share purchases by the Company and shall, after the public disclosure of such share purchases by the Company, become the Beneficial Owner
of any additional Ordinary Shares of the Company, then such Person shall be deemed to be an “Acquiring Person” for any purposes
of this Agreement;
B. if
the Board of Directors of the Company determines in good faith that a Person who would otherwise be an “Acquiring Person,”
as defined pursuant to Section 1(a)i, has become such inadvertently, and such Person divests, or undertakes to divest, as promptly as
practicable a sufficient number of Ordinary Shares, so that such Person would no longer be an “Acquiring Person,” as defined
pursuant to Section 1(a)i, then such Person shall not be deemed to be an “Acquiring Person” for any purposes of this Agreement;
C. no
Person who at the time of the first public announcement of the declaration of the Rights is the Beneficial Owner of 10% or more of the
then-outstanding Ordinary Shares of the Company shall become an “Acquiring Person” for any purpose of this Agreement unless
(i) such Person shall, after the time of the public announcement of the declaration of the Rights, increase the beneficial ownership of
Ordinary Shares of the Company owned by such Person as a percentage of the then-outstanding Ordinary Shares of the Company (other than
as a result of an acquisition of Ordinary Shares by the Company) by 0.5%or more, or (ii) following the time of the public announcement
of the declaration of the Rights, such Person’s beneficial ownership of Ordinary Shares of the Company as a percentage of the then-outstanding
Ordinary Shares of the Company is reduced to an amount that is less than 10% and thereafter such Person becomes an “Acquiring Person”
as defined pursuant to Section 1(a)i;
D. if
a bona fide swaps dealer who would otherwise be an “Acquiring Person,” as defined pursuant to Section 1(a)i,
has become so as a result of its actions in the ordinary course of its business that the Board of Directors of the Company determines,
in its sole discretion, were taken without the intent or effect of evading or assisting any other Person to evade the purposes
and intent of this Agreement, or otherwise seeking to control or influence the management or policies of the Company, then, and unless
and until the Board of Directors shall otherwise determine, such Person shall not be deemed to be an “Acquiring Person” for
any purposes of this Agreement; any
E. no
Person who purchases securities of the Company (including Ordinary Shares and securities convertible into or exchangeable for Ordinary
Shares) either directly from the Company or from any underwriters engaged by the Company, in each case in a securities offering transaction
approved by the Board of Directors of the Company as an offering intended to allow a Person or a group of Persons to beneficially own,
upon the consummation of such offering, more than 10% of the Ordinary Shares of the Company then outstanding (such a securities offering,
a “Permitted Offering”), shall become an “Acquiring Person” for any purpose of this Agreement unless such
Person shall, after the consummation of such Permitted Offering, become the Beneficial Owner of additional Ordinary Shares of the Company
in the amount equal to or greater than the sum of (I) the lowest Ordinary Shares beneficially owned by such Person as a percentage of
the outstanding Ordinary Shares as of immediately after the consummation of the Permitted Offering and (II) 0.5 %.
(b) “Affiliate”
shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act as in effect on
the date of this Agreement.
(c) “Agreement”
shall have the meaning set forth in the first paragraph hereof.
(d) “Associate”
shall have the meaning ascribed to such term in Rule 12b-2 of the General Rules and Regulations under the Exchange Act as in effect on
the date of this Agreement.
(e) A
Person shall be deemed the “Beneficial Owner” of and shall be deemed to “beneficially own” any securities:
i. which
such Person or any of such Person’s Affiliates or Associates, directly or indirectly, beneficially owns, within the meaning of Rule 13d-3
of the General Rules and Regulations promulgated under the Exchange Act;
ii. which
such Person or any of such Person’s Affiliates or Associates has (A) the right or the obligation to acquire (whether such right
is exercisable, or such obligation is required to be performed, immediately or only after the passage of time or upon the satisfaction
of any condition, whether or not within the control of such Person, Affiliate or Associate) pursuant to any agreement, arrangement, tender
offer (assuming upon launch, for this purpose, that such offer is successful) or understanding (whether or not in writing), but other
than customary agreements with and between underwriters and selling group members with respect to a bona fide public
offering of securities, or upon the exercise of conversion rights, exchange rights, rights (other than these Rights), warrants or options,
or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially
own, securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates
or Associates until such tendered securities are accepted for purchase or exchange or if the Board of Directors of the Company has approved
such tender or exchange prior to the Issuance Date; or (B) the right to vote pursuant to any agreement, arrangement or understanding (whether
or not in writing); provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially
own, any security if the agreement, arrangement or understanding to vote such security (1) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules
and regulations promulgated under the Exchange Act and (2) is not also then reportable on Schedule 13D under the Exchange Act (or
any comparable or successor report);
iii. which
are beneficially owned, directly or indirectly, by any other Person with which such Person or any of such Person’s Affiliates or
Associates has any agreement, arrangement or understanding (whether or not in writing), but other than customary agreements with and between
underwriters and selling group members with respect to a bona fide public offering of securities, for the
purpose of acquiring, holding, voting (except to the extent contemplated by the proviso to Section 1(e)(ii)(B) hereof) or disposing
of any securities of the Company; or
iv. which
are beneficially owned, directly or indirectly, by a Counterparty (or any of such Counterparty’s Affiliates or Associates) under
any Derivatives Contract (without regard to any short or similar position under the same or any other Derivatives Contract) to which such
Person or any of such Person’s Affiliates or Associates is a Receiving Party (as such terms are defined in the immediately following
paragraph); provided, however, that the number of Ordinary Shares and Rights that a Person is deemed to Beneficially Own pursuant to this
clause (iv) in connection with a particular Derivatives Contract shall not exceed, in each case, the number of Notional Ordinary Shares
with respect to such Derivatives Contract; provided, further, that the number of securities beneficially owned by each Counterparty (including
its Affiliates and Associates) under a Derivatives Contract shall for purposes of this clause (iv) be deemed to include all securities
that are beneficially owned, directly or indirectly, by any other Counterparty (or any of such other Counterparty’s Affiliates or
Associates) under any Derivatives Contract to which such first Counterparty (or any of such first Counterparty’s Affiliates or Associates)
is a Receiving Party, with this proviso being applied to successive Counterparties as appropriate.
A. “Derivatives
Contract” is a contract between two parties (the “Receiving Party” and the “Counterparty”)
that is designed to produce economic benefits and risks to the Receiving Party that correspond substantially to the ownership by the Receiving
Party of a number of Ordinary Shares specified or referenced in such contract (the number corresponding to such economic benefits and
risks, the “Notional Ordinary Shares”), regardless of whether obligations under such contract are required or permitted to
be settled through the delivery of cash, Ordinary Shares or other property, without regard to any short position under the same or any
other Derivatives Contract. For the avoidance of doubt, interests in broad-based index options, broad-based index futures and broad-based
publicly traded market baskets of stocks approved for trading by the appropriate federal governmental authority shall not be deemed to
be Derivatives Contracts.
Notwithstanding anything
in this definition of Beneficial Ownership to the contrary, (i) the phrase “then outstanding,” when used with reference to
a Person’s Beneficial Ownership of securities of the Company, shall mean the number of such securities then issued and outstanding
together with the number of such securities not then actually issued and outstanding which are issuable by the Company and which such
Person would be deemed to Beneficially Own hereunder and (ii) nothing in this Section 1(d) shall cause a Person engaged in business as
an underwriter of securities to be the “Beneficial Owner” of, or to “beneficially own,” any securities acquired
through such Person’s participation in good faith in a firm commitment underwriting until the expiration of forty days after the
date of such acquisition, and then only if such securities continue to be owned by such Person at such expiration of forty days.
(f) “Business
Day” shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in New York, New York are authorized
or obligated by law or executive order to close.
(g) “Close
of Business” on any given date shall mean 5:00 P.M., New York, New York time, on such date; provided, however,
that, if such date is not a Business Day, it shall mean 5:00 P.M., New York, New York time, on the next succeeding Business Day.
(h) “Issuance
Date” shall have the meaning set forth in Section 3(a) hereof.
(i) “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.
(j) “Exchange
Ratio” shall have the meaning set forth in Section 24(a) hereof.
(k) “Final
Expiration Date” shall have the meaning set forth in Section 7(a) hereof.
(l) “Israeli
Companies Law” shall mean the Israeli Companies Law, 5759-1999.
(m) “Nasdaq”
shall mean the Nasdaq Stock Market LLC.
(n) “Ordinary
Shares” when used with reference to the Company shall mean the ordinary shares, no par value, of the Company. “Ordinary
Shares” when used with reference to any Person other than the Company shall mean the share capital (or equity interest) with the
greatest voting power of such other Person or, if such other Person is a Subsidiary of another Person, the Person or Persons which ultimately
control such first-mentioned Person.
(o) “Person”
shall mean any individual, firm, corporation, partnership, limited liability company, limited liability partnership, association, trust,
syndicate or other entity, and shall include any successor (by merger or otherwise) of such entity, as well as any joint venture or unincorporated
group of individuals or entities that, by formal or informal agreement or arrangement (whether or not in writing), have embarked on a
common purpose or act.
(p) “Purchase
Price” shall have the meaning set forth in Section 4 hereof.
(q) “Record
Date” shall have the meaning set forth in the second paragraph hereof.
(r) “Redemption
Date” shall have the meaning set forth in Section 7(a) hereof.
(s) “Right”
shall have the meaning set forth in the second paragraph hereof.
(t) “Right
Certificate” shall have the meaning set forth in Section 3(a) hereof.
(u) “Subsidiary”
of any Person shall mean any corporation or other entity of which a majority of the voting power of the voting equity securities or equity
interest is owned, directly or indirectly, by such Person.
(v) “Summary
of Rights” shall have the meaning set forth in Section 3(b) hereof.
(w) “Trading
Day” shall mean a day on which the principal national securities exchange on which the security is listed or admitted to trading
is open for the transaction of business, or, if the security is not listed or admitted to trading on any national securities exchange
but are quoted on Nasdaq, a day on which Nasdaq is in operation or if the security is neither listed nor admitted to trading on any national
securities exchange, a Business Day.
(x) “Triggering
Date” shall mean the first date of public announcement or public disclosure by the Company or an Acquiring Person that an Acquiring
Person has become such.
| 2. | Appointment of Rights Agent. |
The Company hereby appoints
the Rights Agent to act as rights agent for the Company in accordance with the terms and conditions hereof, and the Rights Agent hereby
accepts such appointment. The Company may from time to time appoint such co-Rights Agents as it may deem necessary or desirable, upon
ten (10) days’ prior written notice to the Rights Agent. The Rights Agent shall have no duty to supervise, and shall in no event
be liable for, the acts or omissions of any such co-Rights Agent.
| 3. | Issue of Right Certificates. |
(a) Until
the Close of Business on the tenth day after the first Triggering Date (including any such Triggering Date which is after the date of
this Agreement and prior to the issuance of the Rights) (such date, the “Issuance Date”), (i) the Rights will be evidenced
(subject to the provisions of Section 3(b) hereof) by the balances indicated in the book-entry account system of the transfer agent for
the Ordinary Shares registered in the names of the holders thereof (which Ordinary Shares shall also be deemed to represent Right Certificates)
or, in the case of certificated shares, the certificates for Ordinary Shares of the Company registered in the names of the holders thereof
(which certificates shall also be deemed to be Right Certificates) and not by separate Right Certificates, and (ii) the right to receive
Right Certificates will be transferable only in connection with the transfer of Ordinary Shares of the Company. As soon as practicable
after the Issuance Date, the Company will prepare and execute, the Rights Agent will countersign, and the Company will send or cause to
be sent (and the Rights Agent will, if requested, send) by first-class, insured, postage-prepaid mail, to each record holder of Ordinary
Shares of the Company as of the Close of Business on the Issuance Date, at the address of such holder shown on the records of the Company
or the transfer agent or registrar for the Ordinary Shares of the Company, a Right Certificate, in substantially the form of Exhibit A
hereto (a “Right Certificate”), evidencing one Right for each Ordinary Share so held; provided, however, that notwithstanding
anything to the contrary herein, the Company may choose to use book-entry in lieu of physical certificates, in which case “Right
Certificates” shall be deemed to mean the uncertificated book-entry representing the related Rights. As of and after the Issuance
Date, the Rights will be evidenced solely by such Right Certificates. In addition, in connection with the issuance or sale of Ordinary
Shares following the Issuance Date and prior to the earlier of the Redemption Date and the Final Expiration Date, the Company (1) shall,
with respect to Ordinary Shares so issued or sold pursuant to the exercise of share options, the settlement of restricted share units
or under any employee benefit plan or arrangement, granted or awarded as of the Issuance Date, or upon the exercise, conversion or exchange
of securities hereinafter issued by the Company (except as may otherwise be provided in the instrument(s) governing such securities),
and (2) may, in any other case, if deemed necessary or appropriate by the Board of Directors, issue Rights Certificates representing the
appropriate number of Rights in connection with such issuance or sale; provided, however, that (x) no such Rights Certificate shall be
issued if, and to the extent that, the Company shall be advised by counsel that such issuance would create a significant risk of material
adverse tax consequences to the Company or the Person to whom such Rights Certificate would be issued, and (y) no such Rights Certificate
shall be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof The
Company shall promptly notify the Rights Agent in writing upon the occurrence of the Triggering Date, the Issuance Date, the Redemption
Date and/or the Final Expiration Date and, if such notification is given orally, the Company shall confirm the same in writing on or prior
to the Business Day next following. Until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively
for all purposes that none of the Issuance Date, the Redemption Date or the Final Expiration Date has occurred. For the avoidance of doubt,
nothing in this Agreement shall obligate the Company to issue certificates in respect of any Ordinary Shares of the Company.
(b) On
the Record Date, or as soon as practicable thereafter, the Company will send (directly, or at the expense of the Company, upon the written
request of the Company and after the Company provides all necessary information and documents, through the Rights Agent or the Company’s
transfer agent for the Ordinary Shares) a copy of a Summary of Rights to Purchase Ordinary Shares, in substantially the form of Exhibit
B hereto (the “Summary of Rights”), by first-class, postage-prepaid mail, to each record holder of Ordinary Shares
as of the Close of Business on the Record Date (other than any Acquiring Person or any Associate or Affiliate thereof), at the address
of such holder shown on the records of the Company or the transfer agent or registrar for the Ordinary Shares of the Company. At any time
following the Record Date, the Company will send a copy of the Summary of Rights, by first-class, postage-prepaid mail, to any record
holder of Ordinary Shares who requests in writing a copy of the Summary of Rights, at the address of such holder shown on the records
of the Company or the transfer agent or registrar for the Ordinary Shares of the Company. With respect to certificates for Ordinary Shares
of the Company or book-entry Ordinary Shares of the Company, in each case outstanding as of the Record Date, until the Issuance Date,
the Rights will be evidenced by the balances indicated in the book-entry account system of the transfer agent for the Ordinary Shares
or, in the case of certificated shares, such certificates registered in the names of the holders thereof together with a copy of the Summary
of Rights attached thereto. Until the Issuance Date (or the earlier of the Redemption Date or the Final Expiration Date), the surrender
for transfer of any certificate for Ordinary Shares of the Company or the transfer of any book-entry Ordinary Shares of the Company, with
or without a copy of the Summary of Rights attached thereto, shall also constitute the transfer of the Rights associated with the Ordinary
Shares of the Company represented thereby.
(c) Rights
that shall have been issued in respect of Ordinary Shares issued (or delivered from the Company’s treasury) after the Record Date
but prior to the earliest of the Issuance Date, the Redemption Date and the Final Expiration Date shall be evidenced by the following
legends:
i. Confirmation
and account statements sent to holders of Ordinary Shares in book-entry form (which Ordinary Shares shall also be deemed to represent
the Rights Certificate) bear a legend in substantially the following form:
The ordinary shares,
of no par value, of SciSparc Ltd. (the “Company”) entitle the holder thereof to certain rights as set forth in a Rights
Agreement between the Company and VStock Transfer, LLC, dated as of November 28, 2023, as
it may be amended from time to time (the “Rights Agreement”), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal executive offices of the Company. Under certain circumstances, as set forth
in the Rights Agreement, such Rights (as defined in the Rights Agreement) will be evidenced by separate certificates and will no longer
be evidenced by the shares to which this statement relates. The Company will mail (or cause the Rights Agent to mail) to the holder of
shares to which this statement relates a copy of the Rights Agreement without charge promptly after receipt of a written request therefor.
Under certain circumstances set forth in the Rights Agreement, Rights beneficially owned by any Person (as defined in the Rights Agreement)
who becomes an Acquiring Person or any Associate or Affiliate thereof (as such terms are defined in the Rights Agreement) may be null
and void. The Rights shall not be exercisable, and shall be void so long as held, by a holder in any jurisdiction where the requisite
qualification for the issuance to such holder, or the exercise by such holder of the Rights in such jurisdiction, shall not have been
obtained or be obtainable.
With respect to Ordinary
Shares in book-entry form for which there has been sent a confirmation or account statement containing the foregoing legend, until the
earliest of the Issuance Date, the Redemption Date or the Final Expiration Date, the Rights associated with the Ordinary Shares shall
be evidenced by such Ordinary Shares alone and registered holders of such Ordinary Shares shall also be the registered holders of the
associated Rights, and the transfer of any of such Ordinary Shares shall also constitute the transfer of the Rights associated with such
Ordinary Shares.
ii. In
the case of certificated shares, certificates for Ordinary Shares which become outstanding (including, without limitation, reacquired
Ordinary Shares referred to in the last sentence of this paragraph (c)) after the Record Date but prior to the earliest of the Issuance
Date, the Redemption Date or the Final Expiration Date shall have impressed on, printed on, written on or otherwise affixed to them a
legend in substantially the following form:
This certificate also
evidences and entitles the holder hereof to certain rights as set forth in an Agreement between SciSparc Ltd. (the “Company”)
and VStock Transfer, LLC., as Rights Agent, dated as of November 28, 2023, as it may be amended
from time to time (the “Rights Agreement”), the terms of which are hereby incorporated herein by reference and a copy
of which is on file at the principal executive offices of the Company. Under certain circumstances, as set forth in the Rights Agreement,
such Rights (as defined in the Rights Agreement) will be evidenced by separate certificates and will no longer be evidenced by this certificate.
The Company will mail (or cause the Rights Agent to mail) to the holder of this certificate a copy of the Agreement without charge promptly
after receipt of a written request therefor. Under certain circumstances set forth in the Rights Agreement, Rights beneficially owned
by any Person (as defined in the Rights Agreement) who becomes an Acquiring Person, or any Associate or Affiliate thereof (as such terms
are defined in the Agreement) may be null and void. The Rights shall not be exercisable, and shall be void so long as held, by a holder
in any jurisdiction where the requisite qualification for the issuance to such holder, or the exercise by such holder of the Rights in
such jurisdiction, shall not have been obtained or be obtainable.
With respect to such certificates
containing the foregoing legend, until the earliest of the Issuance Date, the Redemption Date or the Final Expiration Date, the Rights
associated with the Ordinary Shares of the Company represented by such certificates shall be evidenced by such certificates alone, and
the surrender for transfer of any such certificate shall also constitute the transfer of the Rights associated with the Ordinary Shares
of the Company represented thereby. In the event that the Company purchases or acquires any Ordinary Shares of the Company after the Record
Date but prior to the earlier of the Redemption Date and the Final Expiration Date, any Rights associated with such Ordinary Shares of
the Company shall be deemed cancelled and retired so that the Company shall not be entitled to exercise any Rights associated with the
Ordinary Shares of the Company which are no longer outstanding. Notwithstanding this Section 3(c), the omission of a legend shall not
affect the enforceability of any part of this Agreement or the rights of any holder of the Rights.
| 4. | Form of Right Certificates. |
The Right Certificates (and
the forms of election to purchase Ordinary Shares and of assignment to be printed on the reverse thereof) shall be substantially the same
as Exhibit A hereto, and may have such marks of identification or designation and such legends, summaries or endorsements printed thereon
as the Company may deem appropriate and as are not inconsistent with the provisions of this Agreement, or as may be required to comply
with any applicable law or with any applicable rule or regulation made pursuant thereto or with any applicable rule or regulation of any
stock exchange, trading market or automated quotation system on which the Right Certificates may from time to time be listed, or to conform
to customary usage. Subject to the provisions of Section 22 hereof, the Right Certificates shall be dated as of the Record Date and on
their face shall entitle the holders thereof to purchase one (1) Ordinary Share at the price of $0.001 per share (the “Purchase
Price”), but the number of such Ordinary Shares and the Purchase Price shall be subject to adjustment as provided herein.
| 5. | Countersignature and Registration. |
The Right Certificates shall
be executed on behalf of the Company by its Chairman of the Board of Directors, its Chief Executive Officer, either manually or by facsimile
signature or other electronic signature, shall have affixed thereto the Company’s seal or a facsimile thereof, and shall be attested
by the Chief Financial Officer of the Company, either manually or by facsimile signature or other electronic signature. The Right Certificates
shall be countersigned by the Rights Agent, either manually or by facsimile signature or other electronic signature, and shall not be
valid for any purpose unless countersigned. In case any officer of the Company who shall have signed any of the Right Certificates shall
cease to be such officer of the Company before countersignature by the Rights Agent and issuance and delivery by the Company, such Right
Certificates, nevertheless, may be countersigned by the Rights Agent and issued and delivered by the Company with the same force and effect
as though the individual who signed such Right Certificates had not ceased to be such officer of the Company; and any Right Certificate
may be signed on behalf of the Company by any individual who, at the actual date of the execution of such Right Certificate, shall be
a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Agreement any such individual
was not such an officer.
Following the Issuance Date,
the Rights Agent will keep or cause to be kept, at its principal office, books for registration and transfer of the Right Certificates
issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates, the number of Rights
evidenced on its face by each of the Right Certificates and the date of each of the Right Certificates.
| 6. | Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen
Right Certificates. |
Subject to the provisions
of Section 14 hereof, at any time after the Close of Business on the Issuance Date, and at or prior to the Close of Business on the earlier
of the Redemption Date or the Final Expiration Date, any Right Certificate or Right Certificates (other than Right Certificates representing
Rights that have become null and void pursuant to Section 11(a)(ii) hereof or that have been exchanged pursuant to Section 24 hereof)
may be transferred, split up, combined or exchanged for another Right Certificate or Right Certificates entitling the registered holder
to purchase a like number of Ordinary Share as the Right Certificate or Right Certificates surrendered then entitled such holder to purchase.
Any registered holder desiring to transfer, split up, combine or exchange any Right Certificate or Right Certificates shall make such
request in writing delivered to the Rights Agent, and shall surrender, together with any required form of assignment and certificate duly
executed and properly completed, the Right Certificate or Right Certificates to be transferred, split up, combined or exchanged at the
principal office of the Rights Agent, accompanied by a signature guarantee and such other documentation as the Rights Agent may reasonably
request. The Right Certificates are transferrable only on the registry books of the Rights Agent. Neither the Rights Agent nor the Company
shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Right Certificate until the registered
holder shall have properly completed and duly executed the certificate contained in the form of assignment on the reverse side of such
Right Certificate, shall have provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) thereof
and of the Rights evidenced thereby and the Affiliates and Associates of such Beneficial Owner (or former Beneficial Owner) thereof as
the Company or the Rights Agent shall reasonably request and paid a sum sufficient to cover any tax or charge that may be imposed in connection
with any transfer, split up, combination or exchange of Right Certificates as required hereunder. Thereupon, the Rights Agent shall countersign
and deliver to the Person entitled thereto a Right Certificate or Right Certificates, as the case may be, as so requested. The Company
may require payment of a sum sufficient to cover any tax or charge that may be imposed in connection with any transfer, split up, combination
or exchange of Right Certificates. The Rights Agent shall promptly forward any such sum collected by it to the Company or to such Persons
as the Company shall specify by written notice.
Upon receipt by the Company
and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate,
and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them, and, at the Company’s request,
reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon surrender to the Rights Agent
and cancellation of the Right Certificate if mutilated, the Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for delivery to the registered holder in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
| 7. | Exercise of Rights; Purchase Price; Expiration Date of Rights. |
(a) The
registered holder of any Right Certificate (other than an Acquiring Person or any Affiliate or Associate thereof) may exercise the Rights
evidenced thereby (except as otherwise provided herein), in whole or in part, at any time after the Issuance Date and prior to the earlier
of the Final Expiration Date and the Redemption Date, upon surrender of the Right Certificate, with the form of election to purchase on
the reverse side thereof properly completed and duly executed, to the Rights Agent at the principal office of the Rights Agent designated
for such purpose, accompanied by a signature guarantee and such other documentation as the Rights Agent may reasonably request, together
with payment of the Purchase Price for each Ordinary Share as to which the Rights are exercised, at or prior to the earliest of (i) the
Close of Business on November 27, 2024 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed
as provided in Section 23 hereof (the “Redemption Date”), and (iii) the time at which such Rights are exchanged as
provided in Section 24 hereof.
(b) The
Purchase Price for each Ordinary Share purchasable pursuant to the exercise of a Right shall initially be $0.001 per share and shall be
subject to adjustment from time to time as provided in Section 11 or 13 hereof, and shall be payable in lawful money of the United States
of America in accordance with paragraph (c) below.
(c) Upon
receipt of a Right Certificate representing exercisable Rights, with the form of election to purchase properly completed and duly executed,
accompanied by payment of the aggregate Purchase Price for the shares to be purchased and an amount equal to any applicable transfer tax
required to be paid by the holder of such Right Certificate in accordance with Section 9 hereof by cash or by certified check, cashier’s
check or money order payable to the order of the Company, the Rights Agent shall thereupon promptly (i) cause the (A) requisition from
any transfer agent of the Ordinary Shares (or from the Company if there shall be no such transfer agent, or make available if the Rights
Agent is the Transfer Agent) certificates for such number of Ordinary Shares to be purchased and the Company hereby irrevocably authorizes
any such transfer agent to comply with all such requests, or (B) requisition from the depositary agent depositary receipts representing
such number of Ordinary Share as are to be purchased (in which case certificates for the Ordinary Shares represented by such receipts
shall be deposited by the transfer agent of the Ordinary Shares with such depositary agent) and the Company hereby directs such depositary
agent to comply with such request; (ii) when appropriate (and to the extent applicable), cause the requisition from the Company the amount
of cash to be paid in lieu of issuance of fractional shares in accordance with Section 14 hereof; (iii) promptly after receipt of such
certificates or depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Right Certificate,
registered in such name or names as may be designated in writing by such holder; and (iv) when appropriate (and to the extent applicable),
after receipt, promptly deliver such cash to or upon the order of the registered holder of such Right Certificate. In the event that the
Company is obligated to issue securities of the Company other than Ordinary Shares of the Company pursuant to Section 11(a) hereof, the
Company will make all arrangements necessary so that such other securities are available for distribution by the Rights Agent, and shall
provide written notice thereof to the Rights Agent.
(d) Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect
to a registered holder of Rights or other securities upon the occurrence of any purported transfer or exercise as set forth in Section
6 hereof or this Section 7 unless such registered holder shall have (i) properly completed and duly executed the certification following
the appropriate form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such transfer or exercise,
(ii) tendered the Purchase Price (and an amount equal to any applicable transfer tax required to be paid by the holder of such Right Certificate
in accordance with Section 9) to the Company in the manner set forth in Section 7(c), and (iii) provided such additional evidence of the
identity of the beneficial owner (or former beneficial owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall
reasonably request.
(e) In
case the registered holder of any Right Certificate shall exercise less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of such
Right Certificate or to such holder’s duly authorized assigns, subject to the provisions of Section 14 hereof.
| 8. | Cancellation and Destruction of Right Certificates. |
All Right Certificates surrendered
for the purpose of, and accepted for, exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or to
any of its agents (other than the Rights Agent), be delivered to the Rights Agent for cancellation or in cancelled form, or, if delivered
or surrendered to the Rights Agent, shall be cancelled by it, and no Right Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and
the Rights Agent shall so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all cancelled Right Certificates to the Company, or shall, at the written request of
the Company, destroy such cancelled Right Certificates, and, in such case, shall deliver a certificate of destruction thereof to the Company.
| 9. | Availability of Ordinary Shares. |
(a) The
Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued Ordinary Shares or
any Ordinary Shares held in it as dormant shares, the number of Ordinary Shares that will be sufficient to permit the exercise in full
of all outstanding Rights in accordance with Section 7 hereof.
(b) If
the Company is required to file a registration statement pursuant to the Securities Act of 1933, as amended (the “Act”),
the Company shall use its reasonable commercial efforts to (i) file, as soon as practicable following the Issuance Date, or as soon as
is required by law following thereafter, as the case may be, a registration statement under the Act, with respect to the securities purchasable
upon exercise of the Rights on an appropriate form, (ii) cause such registration statement to become effective as soon as practicable
after such filing, and (iii) cause such registration statement to remain effective (with a prospectus at all times meeting the requirements
of the Act) until the earlier of (A) the date as of which the Rights are no longer exercisable for such securities, and (B) the date of
the expiration of the Rights. The Company will also take such action as may be appropriate, and commercially reasonable, under, or to
ensure compliance with, the securities or “blue sky” laws of the various states in connection with the exercisability of the
Rights. The Company may temporarily suspend, for a period of time not to exceed 180 days after the date set forth in clause (i) of the
first sentence of this Section 9(b), the exercisability of the Rights in order to prepare and file such registration statement and permit
it to become effective. Upon any such suspension, the Company shall issue a public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect. Notwithstanding
any provision of this Agreement to the contrary, the Rights shall not be exercisable in any jurisdiction unless the requisite qualification
in such jurisdiction shall have been obtained.
(c) The
Company covenants and agrees that it will take all such action as may be necessary to ensure that all Ordinary Shares delivered upon exercise
of Rights shall, at the time of delivery of the certificates for such Ordinary Shares (subject to payment of the Purchase Price), be duly
and validly authorized and issued and fully paid and nonassessable shares.
(d) The
Company further covenants and agrees that it will pay when due and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Right Certificates or of any Ordinary Shares upon the exercise of Rights.
The Company shall not, however, be required to pay any transfer tax which may be payable in respect of any transfer or delivery of Right
Certificates to a Person other than, or the issuance or delivery of certificates or depositary receipts or entries in the book-entry account
system of the transfer agent for the Ordinary Shares in a name other than that of, the registered holder of the Right Certificate evidencing
Rights surrendered for exercise or to issue or to deliver any certificates for Ordinary Shares or depositary receipts or entries in the
book-entry account system of the transfer agent for Ordinary Shares upon the exercise of any Rights until any such tax shall have been
paid (any such tax being payable by the holder of such Right Certificate at the time of surrender) or until it has been established to
the Company’s satisfaction that no such tax is due.
| 10. | Ordinary Shares Record Date. |
Each Person in whose name
any certificate or entry in the book-entry account system of the transfer agent for Ordinary Shares are issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the Ordinary Shares represented thereby on, and such certificate
or entry in the book-entry account system of the transfer agent shall be dated, the date upon which the Right Certificate evidencing such
Rights was duly surrendered and payment of the Purchase Price (and any applicable transfer taxes) was made; provided, however,
that, if the date of such surrender and payment is a date upon which the Ordinary Shares transfer books of the Company are closed, such
Person shall be deemed to have become the record holder of such shares on, and such certificate or entry in the book-entry account system
of the transfer agent shall be dated, the next succeeding Business Day on which the Ordinary Shares transfer books of the Company are
open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate shall not be entitled to any rights of
a shareholder of the Company with respect to shares for which the Rights shall be exercisable, including, without limitation, the right
to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice
of any proceedings of the Company, except as provided herein.
| 11. | Adjustment of Purchase Price, Number of Shares or Number of Rights. |
The Purchase Price, the
number of Ordinary Shares covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided
in this Section 11.
(a)
i. In
the event the Company shall at any time after the date of this Agreement (A) declare a dividend on the Ordinary Shares payable in Ordinary
Shares, (B) subdivide the outstanding Ordinary Shares, (C) combine the outstanding Ordinary Shares into a smaller number of Ordinary Shares
or (D) issue any shares of its share capital in a reclassification of the Ordinary Shares (including any such reclassification in connection
with a share exchange, consolidation or merger in which the Company is the continuing or surviving corporation), except as otherwise provided
in this Section 11(a), the Purchase Price in effect at the time of the record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and kind of share capital issuable on such date (assuming that such Rights
were then exercisable), may be proportionately adjusted in a manner determined by the Board of Directors; provided, however,
that in no event shall the consideration to be paid upon the exercise of one Right be less than the aggregate par value, if any, of the
share capital of the Company issuable upon exercise of one Right and provided further, that in no event shall the Company be required
to issue fractional Ordinary Shares of the Company or make any payments in cash in lieu of issuing such fractional Ordinary Shares of
the Company.
ii. Subject
to Section 24 hereof, upon and after the Issuance Date and until the earlier of the Redemption Date and the Final Expiration Date, each
holder of a Right, other than any Acquiring Person(or any Associate or Affiliate thereof), shall have a right, upon exercise thereof at
a price equal to the then current Purchase Price, to receive one (1) Ordinary Share of the Company for each Ordinary Share of the Company
then beneficially owned by such Person, as may be adjusted pursuant to this Section 11 and Section 13 hereof.
From and after the occurrence
of such event, any Rights that are or were acquired or beneficially owned by any Acquiring Person (or any Associate or Affiliate of such
Acquiring Person) shall be null and void without any further action, and any holder of such Rights shall thereafter have no right to exercise
such Rights under any provision of this Agreement or otherwise. Neither the Company nor the Rights Agent shall have liability to any holder
of Right Certificates or other Person as a result of the Company’s or the Rights Agent’s failure to make any determinations
with respect to an Acquiring Person or its Affiliates, Associates or transferees hereunder. No Right Certificate shall be issued pursuant
to Section 3 hereof that represents Rights beneficially owned by an Acquiring Person or Affiliate or Associate thereof whose Rights would
be void pursuant to the preceding sentence; no Right Certificate shall be issued at any time upon the transfer of any Rights to an Acquiring
Person or any Affiliate or Associate thereof whose Rights would be void pursuant to the preceding sentence or to any nominee of such Person
or with respect to any Ordinary Shares otherwise deemed to be Beneficially Owned by any of the foregoing; and any Right Certificate delivered
to the Rights Agent for transfer to an Acquiring Person or any Affiliate or Associate thereof whose Rights would be void pursuant to the
preceding sentence shall be cancelled. The Company shall give the Rights Agent written notice of the identity of any such Acquiring Person
or any Associate or Affiliate thereof, or the nominee of any of the foregoing, and the Rights Agent may rely on such written notice in
carrying out its duties under this Agreement and shall be deemed not to have any knowledge of the identity of any such Person, unless
and until it shall have received such written notice.
iii. In
the event that there shall not be sufficient Ordinary Shares issued but not outstanding or authorized but unissued to permit the exercise
in full of the Rights in accordance with subparagraph (ii) above, the Company shall take commercially reasonable efforts to authorize
additional Ordinary Shares for issuance upon exercise of the Rights.
(b) All
calculations under this Section 11 shall be made to the nearest cent or to the nearest one one-millionth of an Ordinary Share or one ten-thousandth
of any other share or security as the case may be. Any adjustment required by this Section 11 shall be made no later than the earlier
of (i) three years from the date of the transaction which may result in such adjustment or (ii) the date of the Final Expiration Date.
(c) If,
as a result of an adjustment made pursuant to Section 11(a) hereof, the holder of any Right thereafter exercised shall become entitled
to receive any share capital of the Company other than Ordinary Shares, thereafter the number of such other shares so receivable upon
exercise of any Right shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to
the provisions with respect to the Ordinary Shares contained in Section 11(a) and (b) hereof, inclusive, and the provisions of Sections
7, 9, 10 and 13 hereof with respect to the Ordinary Shares shall apply on like terms to any such other shares.
(d) All
Rights originally issued by the Company subsequent to any adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number Ordinary Share purchasable from time to time hereunder upon exercise of the Rights,
all subject to further adjustment as provided herein.
(e) The
Company may elect, in lieu of an adjustment to the Purchase Price or the Ordinary Shares of the Company issuable upon the exercise of
a Right, to adjust the number of Rights in substitution for any adjustment in the number of Ordinary Shares purchasable upon the exercise
of a Right in a manner determined by the Board of the Directors of the Company. The Company shall make a public announcement of its election
to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment
to be made. This record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Right Certificates
have been issued, shall be at least 10 days later than the date of the public announcement. If Right Certificates have been issued, upon
each adjustment of the number of Rights pursuant to this Section 11(e), the Company shall, as promptly as practicable, cause to be distributed
to holders of record of Right Certificates on such record date Right Certificates evidencing, subject to Section 14 hereof, the additional
Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed
to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed and countersigned in the manner provided
for herein, and shall be registered in the names of the holders of record of Right Certificates on the record date specified in the public
announcement.
(f) Irrespective
of any adjustment or change in the Purchase Price or in the number of Ordinary Shares issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of Ordinary Shares which were
expressed in the initial Right Certificates issued hereunder.
(g) Before
taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the Ordinary Shares
issuable upon exercise of the Rights, the Company shall take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue fully paid and nonassessable Ordinary Shares at such adjusted Purchase Price.
(h) In
any case in which this Section 11 shall require that an adjustment in the Purchase Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event the issuing to the holder of any Right exercised after such record
date of the Ordinary Shares and other share capital or securities of the Company, if any, issuable upon such exercise over and above the
Ordinary Shares and other shares capital or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase
Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such holder a due
bill or other appropriate instrument evidencing such holder’s right to receive such additional shares upon the occurrence of the
event requiring such adjustment.
(i) Anything
in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price, in addition
to those adjustments expressly required by this Section 11, as and to the extent that it, in its sole discretion, shall determine to be
advisable in order that any consolidation or subdivision of the Ordinary Shares, issuance wholly for cash of any Ordinary Shares at less
than the current market price, issuance wholly for cash of Ordinary Shares or securities which by their terms are convertible into or
exchangeable for Ordinary Shares, dividends on Ordinary Shares payable in Ordinary Shares or issuance of rights, options or warrants referred
to in Section 11(b) hereof, hereafter made by the Company to holders of the Ordinary Shares shall not be taxable to such shareholders.
(j) All
tax consequences under any applicable law which may arise from the grant of any Rights or the exercise thereof, the sale or disposition
of any Ordinary Shares issued upon exercise of any Rights, or the assumption, substitution, cancellation, redemption or exchange of any
Rights or from any other action in connection with the foregoing shall be borne and paid solely by the grantee of such Rights.
| 12. | Certificate of Adjusted Purchase Price or Number of Shares. |
Whenever an adjustment is
made as provided in Section 11 or 13 hereof, the Company shall promptly (a) prepare a certificate setting forth such adjustment and a
brief statement of the facts accounting for such adjustment, (b) file with the Rights Agent and with each transfer agent for the Ordinary
Shares and the Securities and Exchange Commission a copy of such certificate and (c) if such adjustment occurs at any time after the Issuance
Date, mail a brief summary thereof to each holder of a Right Certificate in accordance with Section 25 hereof.
| 13. | Consolidation, Merger or Sale or Transfer of Assets or Earning Power. |
In the event, directly or
indirectly, at any time after the Issuance Date, (a) the Company shall effect a share exchange, consolidate with, or merge with and into,
any other Person, in each case where the Company is not the continuing or surviving corporation (b) any Person shall effect a share exchange,
consolidate with the Company, or merge with and into the Company and the Company shall be the continuing or surviving corporation of such
share exchange, consolidation or merger and, in connection with such transaction, all or part of the Ordinary Shares shall be changed
into or exchanged for shares or other securities of any other Person (or the Company) or cash or any other property , or (c) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets
or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person other than the Company or one or more of its wholly-owned Subsidiaries, then, and in each such case, proper provision shall
be made so that (i) each holder of a Right (except as otherwise provided herein) shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then Purchase Price, in accordance with the terms of this Agreement and in lieu of Ordinary Shares,
one (1) times the number of securities of such other Person to which each shareholder is entitled to for each of its Ordinary Shares of
the Company (including the Company as successor thereto or as the surviving corporation); (ii) the issuer of such securities shall thereafter
be liable for, and shall assume, by virtue of such share exchange, consolidation, merger, sale or transfer, all the obligations and duties
of the Company pursuant to this Agreement; (iii) the term “Company” shall thereafter be deemed to refer to such issuer; and
(iv) such issuer shall take such steps (including, but not limited to, the reservation of a sufficient number of its securities in accordance
with Section 9 hereof) in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter
be applicable, as nearly as reasonably may be, in relation to the securities thereafter deliverable upon the exercise of the Rights. The
Company shall not consummate any such share exchange, consolidation, merger, sale or transfer unless, prior thereto, the Company and such
issuer shall have executed and delivered to the Rights Agent a supplemental agreement so providing. The Company shall not enter into any
transaction of the kind referred to in this Section 13 if at the time of such transaction there are any rights, warrants, instruments
or securities outstanding or any agreements or arrangements which, as a result of the consummation of such transaction, would eliminate
or substantially diminish the benefits intended to be afforded by the Rights. The provisions of this Section 13 shall similarly apply
to successive mergers, share exchanges or consolidations or sales or other transfers.
| 14. | Fractional Rights and Fractional Shares. |
(a) Notwithstanding
anything to the contrary herein, the Company shall not be required to issue fractions of Rights or to distribute Right Certificates which
evidence fractional Rights. If the Company elects not to issue such fractional Rights, the Company may pay, in lieu of such fractional
Rights, to the registered holders of the Right Certificates with regard to which such fractional Rights would otherwise be issuable, an
amount in cash equal to the same fraction of the current market value of a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case, as reported in
the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on Nasdaq or, if the
Rights are not listed or admitted to trading on Nasdaq, as reported in the principal consolidated transaction reporting system with respect
to securities listed on the principal national securities exchange on which the Rights are listed or admitted to trading or, if the Rights
are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market, as reported by Nasdaq or such other system then in use or, if on any
such date the Rights are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Rights selected by the Board of Directors of the Company. If on any such date no such market maker
is making a market in the Rights, the fair value of the Rights on such date as determined in good faith by the Board of Directors of the
Company shall be used.
(b) Notwithstanding
anything to the contrary herein, the Company shall not be required to issue fractions of Ordinary Shares upon exercise of the Rights or
to distribute certificates or make any entries in the book-entry account system of the transfer agent that evidence fractional Ordinary
Shares. If the Company elects not to issue such fractional Ordinary Shares, the Company may pay, in lieu of such fractional Ordinary Shares,
to the registered holders of Right Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the
same fraction of the current market value of one Ordinary Share. For the purposes of this Section 14(b), the current market value of an
Ordinary Share shall be the closing price of an Ordinary Share for the Trading Day immediately prior to the date of such exercise.
(c) The
holder of a Right, by the acceptance of the Right, expressly waives such holder’s right to receive any fractional Rights, any fractional
shares upon exercise of a Right or any cash payment in lieu of such fractional Rights or fractional shares.
All rights of action in
respect of this Agreement, excepting the rights of action vested in the Rights Agent pursuant to Section 18 hereof, are vested in the
respective registered holders of the Right Certificates (and, prior to the Issuance Date, the registered holders of the Ordinary Shares);
and any registered holder of any Right Certificate (or, prior to the Issuance Date, of the Ordinary Shares), without the consent of the
Rights Agent or of the holder of any other Right Certificate (or, prior to the Issuance Date, of the Ordinary Shares), may, in such holder’s
own behalf and for such holder’s own benefit, enforce, and may institute and maintain any suit, action or proceeding against the
Company to enforce, or otherwise act in respect of, such holder’s right to exercise the Rights evidenced by such Right Certificate
in the manner provided in such Right Certificate and in this Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach
of this Agreement, and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened
violations of the obligations of any Person subject to, this Agreement.
| 16. | Agreement of Right Holders. |
Every holder of a Right,
by accepting the same, consents and agrees with the Company and the Rights Agent and with every other holder of a Right that:
(a) prior
to the Issuance Date, the Rights will be evidenced by the balances indicated in the book-entry account system of the transfer agent for
the Ordinary Shares registered in the names of the holders of the Ordinary Shares (which Ordinary Shares shall also be deemed to represent
certificates for Rights) or, in the case of certificated shares, the certificates for the Ordinary Shares registered in the names of the
holders of the Ordinary Shares (which certificates for shares of Ordinary Shares shall also constitute certificates for Rights) and each
Right will be transferable only in connection with the transfer of Ordinary Shares;
(b) after
the Issuance Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at the principal
office of the Rights Agent, duly endorsed or accompanied by a proper instrument of transfer;
(c) the
Company and the Rights Agent may deem and treat the person in whose name the Right Certificate (or, prior to the Issuance Date, the associated
balance indicated in the book-entry account system of the transfer agent for the Ordinary Shares or, in the case of certificated shares,
the associated Ordinary Shares certificate) is registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding
any notations of ownership or writing on the Right Certificate or the associated balance indicated in the book-entry account system of
the transfer agent for the Ordinary Shares or, in the case of certificated shares, the associated Ordinary Shares certificate made by
anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary; and
(d) notwithstanding
anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any liability to any holder of a Right
or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting
or otherwise restraining performance of such obligation; provided, however, the Company must use its reasonable best efforts to have any
such order, decree or ruling lifted or otherwise overturned as soon as possible.
| 17. | Right Certificate Holder Not Deemed a Shareholder. |
No holder, as such, of any
Right Certificate shall be entitled to vote, receive dividends or be deemed for any purpose the holder of the Ordinary Shares or any other
securities of the Company which may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything contained
herein or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a shareholder
of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except
as provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the provisions hereof.
| 18. | Concerning
the Rights Agent. |
The
Company agrees to pay to the Rights Agent compensation as set forth in Schedule I hereto for all services rendered by it hereunder, and,
from time to time, on demand of the Rights Agent, its reasonable an documented expenses and counsel fees and other disbursements incurred
in the administration and execution of this Agreement and the exercise and performance of its duties hereunder, in each case subject
to the terms set forth in Schedule I. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability, or expense incurred without gross negligence, bad faith or willful misconduct on the part of the Rights Agent, for anything
done or omitted by the Rights Agent in connection with the acceptance and administration of this Agreement, including the costs and expenses
of defending against any claim of liability in the premises.
The
Rights Agent shall be protected and shall incur no liability for, or in respect of any action taken, suffered or omitted by it in connection
with, its administration of this Agreement in reliance upon any Right Certificate or certificate for the Ordinary Shares or Ordinary
Shares or any balance indicated in the book-entry account system of the transfer agent, or, for other securities of the Company, instrument
of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or
other paper or document believed by it to be genuine and to be signed, executed and, where necessary, verified or acknowledged, by the
proper person or persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof.
| 19. | Merger
or Consolidation or Change of Name of Rights Agent. |
Any
corporation into which the Rights Agent or any successor Rights Agent may be merged or with which it may effect a share exchange, be
consolidated, or otherwise combined, or any Person resulting from any merger, share exchange, consolidation or combination to which the
Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the stock transfer or corporate trust powers
of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution
or filing of any paper or any further act on the part of any of the parties hereto; provided that such Person would be eligible
for appointment as a successor Rights Agent under the provisions of Section 21. The purchase of all or substantially all of the Rights
Agent’s assets employed in the performance of transfer agent activities shall be deemed a merger or consolidation for purposes
of this Section 19. In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the
Right Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of
the predecessor Rights Agent and deliver such Right Certificates so countersigned; and, in case at that time any of the Right Certificates
shall not have been countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and, in all such cases, such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
In
case at any time the name of the Rights Agent shall be changed and at such time any of the Right Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver Right Certificates so countersigned;
and, in case at that time any of the Right Certificates shall not have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and, in all such cases, such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
| 20. | Duties
of Rights Agent. |
The
Rights Agent undertakes the duties and obligations imposed by this Agreement upon the following terms and conditions, by all of which
the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound:
(a) The
Rights Agent may consult with legal counsel (who may be legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action taken or omitted by it in good faith and in accordance
with such opinion.
(b) Whenever
in the performance of its duties under this Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by
any one of the Chairman of the Board of Directors, the Chief Executive Officer, or the Chief Financial Officer of the Company and delivered
to the Rights Agent; and such certificate shall be full authorization to the Rights Agent for any action taken or suffered in good faith
by it under the provisions of this Agreement in reliance upon such certificate.
(c) The
Rights Agent shall be liable hereunder to the Company and any other Person only for its own gross negligence, bad faith or willful misconduct.
(d) The
Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals are
and shall be deemed to have been made by the Company only.
(e) The
Rights Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Agreement
or in any Right Certificate; nor shall it be responsible for any change in the exercisability of the Rights (including the Rights becoming
void pursuant to Section 11(a)(ii) hereof) or any adjustment in the terms of the Rights (including any adjustment required under the
provisions of Sections 11 or 13 or the manner, method or amount thereof) provided for in Section 3, 11, 13, 23 or 24 hereof, or the ascertaining
of the existence of facts that would require any such change or adjustment (except with respect to the exercise of Rights evidenced by
Right Certificates after actual notice that such change or adjustment is required); nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any Ordinary Shares to be issued pursuant to this Agreement
or any Right Certificate or as to whether any Ordinary Shares will, when issued, be validly authorized and issued, fully paid and nonassessable.
(f) The
Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered
all such further and other acts, instruments and assurances as may reasonably be required by the Rights Agent for the carrying out or
performing by the Rights Agent of the provisions of this Agreement.
(g) The
Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board of Directors, the Chief Executive Officer, or the Chief Financial Officer of the Company, and to apply
to such officers for advice or instructions in connection with its duties, and it shall not be liable for any action taken or suffered
by it in good faith in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions.
(h) The
Rights Agent and any shareholder, director, officer or employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with
or lend money to the Company or otherwise act as fully and freely as though it were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other capacity for the Company or for any other legal entity.
(i) The
Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or
by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, default, neglect or misconduct
of any such attorneys or agents or for any loss to the Company resulting from any such act, default, neglect or misconduct, provided
that reasonable care was exercised in the selection and continued employment thereof.
| 21. | Change
of Rights Agent. |
The
Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement upon 30 days’ notice
in writing mailed to the Company and to each transfer agent of the Ordinary Shares or Ordinary Shares by registered or certified mail,
and to the holders of the Right Certificates by first-class mail. In the event the transfer agency relationship in effect between the
Company and the Rights Agent terminates, the Rights Agent will be deemed to have resigned automatically and be discharged from its duties
under this Agreement as of the effective date of such termination, and the Company shall be responsible for sending any required notice.
The Company may remove the Rights Agent or any successor Rights Agent (with or without cause) upon 30 days’ notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Ordinary Shares or Ordinary
Shares by registered or certified mail, and to the holders of the Right Certificates by first-class mail. If the Rights Agent shall resign
or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company
shall fail to make such appointment within a period of 30 days after giving notice of such removal or after it has been notified in writing
of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right Certificate (which holder
shall, with such notice, submit such holder’s Right Certificate for inspection by the Company), then the registered holder of any
Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent,
whether appointed by the Company or by such a court, shall be a corporation or other entity organized and doing business under the laws
of the United States or of the State of Delaware (or of any other state of the United States so long as such corporation or other entity
is authorized to do business as a banking institution such other state), in good standing, which is authorized under such laws to exercise
corporate trust or stock transfer powers and is subject to supervision or examination by federal or state authority and which has at
the time of its appointment as Rights Agent a combined capital and surplus, along with its Affiliates, of at least $50 million. After
appointment, the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary
for the purpose. Not later than the effective date of any such appointment, the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Ordinary Shares or Ordinary Shares, and mail a notice thereof in writing to the
registered holders of the Right Certificates. Failure to give any notice provided for in this Section 21, however, or any defect therein,
shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights
Agent, as the case may be.
| 22. | Issuance
of New Right Certificates. |
Notwithstanding
any of the provisions of this Agreement or of the Rights to the contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by the Board of Directors of the Company to reflect any adjustment or change in the
Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Right Certificates made
in accordance with the provisions of this Agreement.
(a) The
Board of Directors of the Company may, at its option, at any time prior to an Issuance Date, redeem all but not less than all the then
outstanding Rights at no cost and without the delivery of any consideration in exchange for such redemption. The redemption of the Rights
by the Board of Directors of the Company may be made effective at such time, on such basis and with such conditions as the Board of Directors
of the Company, in its sole discretion, may establish.
(b) Immediately
upon the action of the Board of Directors of the Company ordering the redemption of the Rights pursuant to paragraph (a) of this Section
23, and without any further action and without any notice, the right to exercise the Rights will terminate. The Company shall promptly
give public notice of any such redemption; provided, however, that the failure to give, or any defect in, any
such notice shall not affect the validity of such redemption. Within 10 days after such action of the Board of Directors of the Company
ordering the redemption of the Rights, the Company shall mail a notice of redemption to all the holders of the then outstanding Rights
at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the Issuance Date, on the registry books
of the transfer agent for the Ordinary Shares. Any notice which is mailed in the manner herein provided shall be deemed given, whether
or not the holder receives the notice. Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase for
value any Rights at any time in any manner other than that specifically set forth in this Section 23 or in Section 24 hereof, and other
than in connection with the purchase of Ordinary Shares prior to the Issuance Date.
(a) The
Board of Directors of the Company may, at its option, at any time after Issuance Date, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have become void pursuant to the provisions of Section 11(a)(ii) hereof) for
Ordinary Shares at an exchange ratio of one (1) Ordinary Share per Right, appropriately adjusted to reflect any adjustment in the number
of Rights (such exchange ratio being hereinafter referred to as the “Exchange Ratio”). Notwithstanding the foregoing, the
Board of Directors of the Company shall not be empowered to effect such exchange at any time after any Person (other than the Company,
any Subsidiary of the Company, any employee benefit or share ownership plan of the Company or any such Subsidiary, or any entity holding
Ordinary Shares for or pursuant to the terms of any such plan), together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Ordinary Shares then outstanding. The exchange of Rights by the Board of Directors of the Company
may be made effective at such time, on such basis and with such conditions as the Board of Directors of the Company in its sole discretion
may establish. Without limiting the foregoing, in connection with effecting an exchange pursuant to this Section 24, the Board of Directors
of the Company may direct the Company to enter into a trust agreement in such form and with such terms as the Board of Directors of the
Company shall then approve and issue to the trust created by such trust agreement all or some (as designated by the Board of Directors
of the Company) of the securities to be exchanged for the Rights pursuant to this Section 24, and all Persons entitled to receive such
securities pursuant to the exchange shall be entitled to receive all or some (as designated by the Board of Directors of the Company)
of such securities (and any dividends or distributions made thereon after the date on which such securities are deposited in the trust)
from such trust and upon compliance with the relevant terms of the trust agreement.
(b) Immediately
upon the action of the Board of Directors of the Company ordering the exchange of any Rights pursuant to paragraph (a) of this Section
24 (or at such later times as the Board of Directors of the Company may establish for the effectiveness of such exchange) and without
any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of Ordinary Shares equal to the number of such Rights held by such holder multiplied by
the Exchange Ratio. The Company shall promptly give public notice of any such exchange; provided, however, that
the failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry books of the
Rights Agent. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the exchange of the Ordinary Shares for Rights will be effected,
and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based
on the number of Rights (other than Rights which have become void pursuant to the provisions of Section 11(a)(ii) hereof) held by each
holder of Rights.
(c) In
the event that there shall not be sufficient Ordinary Shares issued but not outstanding or authorized but unissued to permit any exchange
of Rights as contemplated in accordance with this Section 24, the Company shall take all such action as may be necessary to authorize
additional Ordinary Shares for issuance upon exchange of the Rights.
| 25. | Compliance
with the Israeli Companies Law. |
Nothing
herein shall derogate from, or preclude, the Company’s Board of Directors’ rights and duties under the Israeli Companies
Law or from exercising any such rights or duties.
| 26. | Notice
of Certain Events. |
(a) In
case the Company shall, at any time after the Issuance Date, propose (i) to pay any dividend payable in shares of any class to the holders
of the Ordinary Shares or to make any other distribution to the holders of the Ordinary Shares (other than a regular quarterly cash dividend),
(ii) to offer to the holders of the Ordinary Shares rights or warrants to subscribe for or to purchase any additional Ordinary Shares
or shares of any class or any other securities, rights or options, (iii) to effect any reclassification of the Ordinary Shares (other
than a reclassification involving only the subdivision of outstanding Ordinary Shares), (iv) to effect any merger, share exchange, consolidation
or other combination into or with, or to effect any sale or other transfer (or to permit one or more of its Subsidiaries to effect any
sale or other transfer), in one or more transactions, of 50% or more of the assets, cash flow or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person, (v) to effect the liquidation, dissolution or winding up of the Company, or (vi)
to declare or pay any dividend on the Ordinary Shares payable in Ordinary Shares or to effect a subdivision, combination or consolidation
of the Ordinary Shares (by reclassification or otherwise than by payment of dividends in Ordinary Shares), then, in each such case, the
Company shall give to each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of such proposed action, which
shall specify the record date for the purposes of such share dividend, or distribution of rights or warrants, or the date on which such
reclassification, consolidation, share exchange, merger, sale, transfer, liquidation, dissolution, or winding up is to take place and
the date of participation therein by the holders of the Ordinary Shares and/or Ordinary Shares, if any such date is to be fixed, and
such notice shall be so given in the case of any action covered by clause (i) or (ii) above at least 10 days prior to the record date
for determining holders of the Ordinary Shares for purposes of such action, and, in the case of any such other action, at least 10 days
prior to the date of the taking of such proposed action or the date of participation therein by the holders of the Ordinary Shares, whichever
shall be the earlier.
(b) In
case the event set forth in Section 11(a)(ii) hereof shall occur, then the Company shall, as soon as practicable thereafter, give to
each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of the occurrence of such event, which notice shall
describe such event and the consequences of such event to holders of Rights under Section 11(a)(ii) hereof.
Notices
or demands authorized by this Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or on the
Company shall be sufficiently given or made if sent by first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) or in the form of an email transmission (with receipt confirmed) as follows:
SciSparc
Ltd.
20
Raul Wallenberg Street, Tower A
Tel
Aviv, 6971916
Israel
Attention:
Oz Adler, Chief Executive Officer
Email:
oz@scisparc.com
Subject
to the provisions of Section 21 hereof, any notice or demand authorized by this Agreement to be given or made by the Company or by the
holder of any Right Certificate to or on the Rights Agent shall be sufficiently given or made if sent by overnight delivery service or
first-class mail, postage prepaid, addressed (until another address is filed in writing with the Company) as follows:
VStock
Transfer, LLC
18
Lafayette Place
Woodmere,
New York 11598
Attention:
Yoel Goldfeder, Esq.
Email:
yoel@vstocktransfer.com
Notices
or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate
shall be sufficiently given or made if sent by overnight delivery service or first-class mail, postage prepaid, addressed to such holder
at the address of such holder as shown on the registry books of the Company or, if applicable, the transfer agent or registrar for the
Ordinary Shares.
| 28. | Supplements
and Amendments. |
The
Company may from time to time, and the Rights Agent shall, if directed by the Company, supplement or amend this Agreement without the
approval of any holders of Right Certificates in order to cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions herein, or to make any other provisions with respect to the Rights which
the Company may deem necessary or desirable, any such supplement or amendment to be evidenced by a writing signed by the Company and
the Rights Agent; provided, however, that, from and after the Issuance Date, this Agreement shall not be amended in any manner
which would adversely affect the interests of the holders of Rights (other than an Acquiring Person or an Affiliate or Associate thereof).
For the avoidance of doubt, the Company shall be entitled to adopt and implement such procedures and arrangements (including with third
parties) as it may deem necessary or desirable to facilitate the exercise, exchange, trading, issuance or distribution of the Rights
as contemplated hereby and to ensure that an Acquiring Person does not obtain the benefits thereof, and amendments in respect of the
foregoing shall not be deemed to adversely affect the interests of the holders of Rights. Upon the delivery of a certificate from an
appropriate officer of the Company that states that the proposed supplement or amendment is in compliance with the terms of this Section
28, the Rights Agent shall execute such supplement or amendment.
All
the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder.
| 30. | Determinations
and Actions by the Board of Directors, etc. |
For
all purposes of this Agreement, any calculation of the number of Ordinary Shares outstanding at any particular time, including for purposes
of determining the particular percentage of such outstanding Ordinary Shares of which any Person is the Beneficial Owner, shall be made
in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the Exchange Act. The Board of
Directors of the Company shall have the exclusive power, authority and discretion to administer this Agreement and to exercise all rights
and powers specifically granted to such Board of Directors or to the Company, or as may be necessary or advisable in the administration
of this Agreement, including, without limitation, the right and power to (i) interpret the provisions of this Agreement, and (ii) make
all determinations deemed necessary or advisable for the administration of this Agreement (including, but not limited to, a determination
to redeem or not redeem the Rights or to amend the Agreement). All such actions, calculations, interpretations and determinations (including
all omissions with respect to the foregoing) which are done or made by the Board of Directors of the Company or the Company in good faith
shall (x) be final, conclusive and binding on the Company, the Rights Agent, the holders of the Right Certificates and all other parties,
and (y) not subject the Board of Directors of the Company to any liability to the holders of the Rights and Right Certificates.
| 31. | Benefits
of this Agreement. |
Nothing
in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered holders of the
Right Certificates (and, prior to the Issuance Date, the Ordinary Shares) any legal or equitable right, remedy or claim under this Agreement;
but this Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Issuance Date, the Ordinary Shares).
If
any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
This
Agreement, each Right and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of
Israel and for all purposes shall be governed by and construed in accordance with the laws of such state applicable to contracts to be
made and performed entirely within such state, other than with respect to the duties and rights of the Rights Agent under Sections 18-21
hereunder which shall be governed by and construed in accordance with the laws of the State of New York.
This
Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same instrument.
| 35. | Descriptive
Headings; Interpretation. |
Descriptive
headings of the several Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction
of any of the provisions hereof. The words “include,” “includes” and “including” shall be deemed
to be followed by the phrase “without limitation.” Each reference in this Agreement to a period of time following or after
a specified date or event shall be calculated without including such specified date or the day on which such specified event occurs.
Notwithstanding
anything to the contrary contained herein, the Rights Agent shall not be liable for any delays or failures in performance resulting from
acts beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage of supply, breakdowns or malfunctions,
interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information
storage or retrieval systems, labor difficulties, war, or civil unrest. The Rights Agent shall provide the Company prompt notice as soon
as practicable in the event that any such delay or failure in performance occurs and keep the Company apprised of developments and mitigation
effort with respect thereto.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and attested, all as of the day and year first above
written.
SCISPARC LTD. |
|
|
|
By: |
/s/ Oz Adler |
|
Name: |
Oz Adler |
|
Title: |
Chief Executive Officer |
|
VSTOCK TRANSFER, LLC |
|
|
|
By: |
/s/ Yoel Goldfeder |
|
Name: |
Yoel Goldfeder |
|
Title: |
Chief Executive Officer |
|
Exhibit
A
Form
of Right Certificate
Certificate
No. R- |
______
Rights |
NOT
EXERCISABLE AFTER November 27, 2024 OR SUCH LATER DATE AS DETERMINED BY THE COMPANY’S BOARD OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AND TO EXCHANGE ON THE TERMS SET FORTH IN THE AGREEMENT.
Right
Certificate
SCISPARC
LTD.
This
certifies that ________, or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Agreement, dated as of November 28, 2023 (the “Agreement”),
between SciSparc Ltd., a company formed under the laws of the State of Israel (the “Company”), and VStock Transfer, LLC.
(the “Rights Agent”), to purchase from the Company at any time after the Issuance Date (as such term is defined in the Agreement)
and prior to 5:00 P.M., New York, New York time, on November 27, 2024 at the principal office of the Rights Agent, or at the office of
its successor as Rights Agent, one (1) fully paid non-assessable Ordinary Share, no par value, of the Company (the “Ordinary Shares”),
at a purchase price of $0.001 per one Ordinary Share (the “Purchase Price”), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase duly executed. The number of Rights evidenced by this Right Certificate (and the number
of Ordinary Shares which may be purchased upon exercise hereof) set forth above, and the Purchase Price set forth above, are the number
and Purchase Price as of December 8, 2023, based on the Ordinary Shares as constituted at such date. As provided in the Agreement, the
Purchase Price and the number of Ordinary Shares which may be purchased upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening of certain events.
This
Right Certificate is subject to all of the terms, provisions and conditions of the Agreement, which terms, provisions and conditions
are hereby incorporated herein by reference and made a part hereof and to which Agreement reference is hereby made for a full description
of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of
the Right Certificates. Copies of the Agreement are on file at the principal executive offices of the Company and the offices of the
Rights Agent.
This
Right Certificate, with or without other Right Certificates, upon surrender at the principal office of the Rights Agent, may be exchanged
for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like
aggregate number of Ordinary Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered shall have entitled
such holder to purchase. If this Right Certificate shall be exercised in part, the holder shall be entitled to receive upon surrender
hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised.
Subject
to the provisions of the Agreement, the Rights evidenced by this Right Certificate (i) may be redeemed by the Company in accordance with
the terms of the Agreement or (ii) may be exchanged in whole or in part for Ordinary Shares.
No
fractional Ordinary Shares will be issued upon the exercise of any Right or Rights evidenced hereby, and the Company does not undertake
to make a cash payment in lieu thereof.
No
holder of this Right Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the Ordinary
Shares or of any other securities of the Company which may at any time be issuable on the exercise hereof, nor shall anything contained
in the Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a shareholder of the Company
or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided
in the Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate
shall have been exercised as provided in the Agreement.
This
Right Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.
WITNESS
the facsimile signature of the proper officers of the Company and its corporate seal. Dated as of ______, _____.
SCISPARC LTD. |
|
|
|
|
By: |
|
|
|
|
|
Name: |
|
|
|
|
|
Title: |
|
|
Form
of Reverse Side of Right Certificate
FORM
OF ASSIGNMENT
(To
be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR
VALUE RECEIVED ________________________________ hereby sells, assigns and transfers unto _______________________________________________________________________
(Please
print name and address of transferee)
this
Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _________
Attorney, to transfer the within Right Certificate on the books of the within-named Company, with full power of substitution.
Dated:
___________________
Signature
Guaranteed:
Signatures
must be guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agents Medallion Program (“STAMP”),
the Nasdaq Medallion Signature Program (“MSP”), or the Stock Exchanges Medallion Program (“SEMP”), pursuant to
Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended. Guarantees by a notary public are not acceptable.
The
undersigned hereby certifies that the Rights evidenced by this Right Certificate are not beneficially owned by an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Agreement).
Form
of Reverse Side of Right Certificate – continued
FORM
OF ELECTION TO PURCHASE
(To
be executed if holder desires to exercise
Rights represented by the Right Certificate.)
To:
SCISPARC LTD.
The
undersigned hereby irrevocably elects to exercise ______ Rights represented by this Right Certificate to purchase the Ordinary Shares
issuable upon the exercise of such Rights and requests that certificates for such Ordinary Shares be issued in the name of:
Please
insert social security
or
other identifying number
(Please
print name and address)
If
such number of Rights shall not be all the Rights evidenced by this Right Certificate, a new Right Certificate for the balance remaining
of such Rights shall be registered in the name of and delivered to:
Please
insert social security
or
other identifying number
(Please
print name and address)
Dated:
_______________________
Signature
Guaranteed:
Signatures
must be guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agents Medallion Program (“STAMP”),
the Nasdaq Medallion Signature Program (“MSP”), or the Stock Exchanges Medallion Program (“SEMP”), pursuant to
Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended. Guarantees by a notary public are not acceptable.
The
undersigned hereby certifies that the Rights evidenced by this Right Certificate are not beneficially owned by an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Agreement).
NOTICE
The
signature in the Form of Assignment or Form of Election to Purchase, as the case may be, must conform to the name as written upon the
face of this Right Certificate in every particular, without alteration or enlargement or any change whatsoever.
In
the event the certification set forth above in the Form of Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of the Rights evidenced by this Right Certificate to be an
Acquiring Person or an Affiliate or Associate thereof (as defined in the Agreement) and such Assignment or Election to Purchase will
not be honored.
Exhibit
B
SUMMARY
OF RIGHTS TO PURCHASE
ORDINARY SHARES
Introduction
On
November 27, 2023, the Board of Directors (the “Board”) of our Company, SciSparc Ltd., a company formed under the laws of
the State of Israel, declared the issuance of one special purchase right (a “Right”) for each outstanding ordinary share,
no par value (the “Ordinary Shares”) and in connection therewith has entered into that certain Rights Agreement, dated as
of November 28, 2023 (the “Rights Agreement”), by and between the Company and VStock
Transfer, LLC., in its capacity as the Rights Agent (the “Rights Agent”).
Our
Board has adopted this Rights plan to protect shareholders from coercive or otherwise unfair takeover tactics. In general terms, it works
by imposing a significant penalty upon any person or group that acquires 10% or more of our outstanding Ordinary Shares without the approval
of our Board. The Rights Agreement should not interfere with any merger or other business combination approved by our Board.
For
those interested in the specific terms of the Rights Agreement as made between our Company and the Rights Agent, we provide the following
summary description. Please note, however, that this description is only a summary, and is not complete, and should be read together
with the entire Rights Agreement, which has been furnished to the Securities and Exchange Commission as an exhibit to the report on Form
6-K dated November 28, 2023. A copy of the agreement is available free of charge from our Company.
The
Rights. Our Board authorized the issuance of a Right with respect to each outstanding Ordinary Share on December 8, 2023 and with
respect to each Ordinary Share that will become outstanding prior to the earlier of the expiration of the Rights or the redemption thereof.
The Rights will initially trade with, and will be inseparable from, the corresponding Ordinary Share. The Rights are evidenced only by
the balances indicated in the book-entry account system of the transfer agent for our Ordinary Shares or, in the case of certificated
shares, the certificates that represent such Ordinary Shares. New Rights will accompany any new Ordinary Shares we issue after December
8, 2023 until the earliest of the Issuance Date described below, the Redemption Date and the Final Expiration Date.
Exercise
Price. Each Right will allow its holder to purchase from our Company one (1) Ordinary Share, at a purchase price of $ 0.001
per one Ordinary Share, once the Rights become exercisable. Prior to exercise, the Right does not give its holder any dividend, voting,
or liquidation rights. The number of Ordinary Shares into issued upon the exercise of a Right and the purchase price may be adjusted
from time to time, as further detailed in the Rights Agreement.
Exercisability. The
Rights will not be exercisable until the tenth day after the first date of public announcement or public disclosure by the Company or
an Acquiring Person (as such term is defined in the Rights Agreement) that an Acquiring Person has become such, including as a result
of such person becoming a “beneficial owner” (as such term is defined in the Rights Agreement) of 10% or more of the Ordinary
Shares then outstanding (we refer to such date as the “Issuance Date”). The definition of the term beneficial owner in the
Rights Agreement captures also circumstances that are beyond the definition of beneficial ownership under the Exchange Act.
If
a person’s beneficial ownership of the then-outstanding Ordinary Shares as of the time of the public announcement of the rights
plan is at or above 10%, that person or group’s then-existing ownership percentage would be grandfathered, but the Rights would
become exercisable if at any time after such announcement, such person increases its ownership percentage by 0.5% or more, or following
the date hereof such person’s beneficial ownership of Ordinary Shares of the Company as a percentage of the then-outstanding Ordinary
Shares of the Company is reduced to an amount that is less than 10% and thereafter such person becomes an Acquiring Person.
Until
the Issuance Date, the balances in the book-entry accounting system of the transfer agent for our Ordinary Shares or, in the case of
certificated shares, Ordinary Shares certificates will also evidence the Rights, and any transfer of Ordinary Shares or, in the case
of certificated shares, certificates for Ordinary Shares will constitute a transfer of Rights. After that date, the Rights will separate
from the Ordinary Shares and be evidenced solely by Rights certificates that we will mail to all eligible holders of Ordinary Shares;
provided, however, that the Company may choose to use book-entry in lieu of physical certificates. Any Rights held by an Acquiring Person
or any Associate or Affiliate (as such terms are defined in the Rights Agreement) thereof are void and may not be exercised.
Consequences
of a Person or Group Becoming an Acquiring Person.
● |
Flip In. If a person or group becomes an Acquiring Person, all holders of Rights except the Acquiring Person or any Associate or Affiliate thereof may, for a purchase price of $0.001 per one Ordinary Share, purchase one (1) Ordinary Share. |
● |
Flip
Over. If our Company is later acquired in a merger or similar transaction after the Issuance Date, all holders of Rights
except the Acquiring Person or any Associate or Affiliate thereof may, for a purchase price of $0.001 per share, purchase one (1)
times the number of shares of the acquiring corporation, that each shareholder of the Company is entitled for each Ordinary Shares. |
Expiration. The
Rights will expire on November 27, 2024.
Redemption. Our
Board may redeem the Rights for no consideration at any time prior to such time that any person or group becomes an Acquiring Person.
If our Board redeems any Rights, it must redeem all of the Rights.
Exchange. After
a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of our outstanding Ordinary Shares, our
Board may extinguish the Rights by exchanging one (1) Ordinary Share or an equivalent security for each Right, other than Rights held
by the Acquiring Person.
Anti-Dilution
Provisions. Our Board may adjust the purchase price of the Ordinary Shares, the number of Ordinary Shares issuable and the number
of outstanding Rights to prevent dilution that may occur from a share dividend, a share split, a reclassification of the Ordinary Shares.
Amendments. The
terms of the Rights Agreement may be amended by our Board without the consent of the holders of the Rights. After a person or group becomes
an Acquiring Person, our Board may not amend the Rights Agreement in a way that adversely affects holders of the Rights.
B-2
Exhibit 99.1
SciSparc
Adopts Limited Duration Shareholder Rights Plan
TEL
AVIV, Israel, Nov. 28, 2023 (GLOBE NEWSWIRE) -- SciSparc Ltd. (Nasdaq: SPRC) ("Company" or "SciSparc"), a specialty
clinical-stage pharmaceutical company focusing on the development of therapies to treat disorders and rare diseases of the central nervous
system, announced today that its Board of Directors (the “Board”) has unanimously adopted a limited duration shareholder
rights plan (the "Rights Plan"), effective immediately.
“Today
we announced exciting positive results from our weight loss and metabolic disorder program with our proprietary psychedelic-based treatment,”
said Oz Adler, SciSparc’s Chief Executive Officer. “Unfortunately, SciSparc, like many other clinical-stage pharmaceutical
companies, continues to experience a significant and ongoing dislocation in the trading price of its ordinary shares. The adoption of
the Rights Plan is intended to protect the long-term interests of SciSparc and all of our shareholders and enable them to realize the
full potential value of their investment in the Company. The Rights Plan is designed to reduce the likelihood that any entity, person
or group would gain control of, or significant influence over SciSparc, through the open-market accumulation of the Company’s shares
without appropriately compensating all SciSparc shareholders for control,” concluded Mr. Adler.
The
Board did not adopt the Rights Plan in response to a specific takeover threat. The Rights Plan is not intended to prevent or interfere
with any action with respect to SciSparc that the Board determines to be in the best interests of the Company and its shareholders. Instead,
it will position the Board to fulfill its fiduciary duties on behalf of all shareholders by ensuring that the Board has sufficient time
to make informed judgments about any attempts to control or significantly influence SciSparc. The Rights Plan will encourage anyone seeking
to gain a significant interest in SciSparc to negotiate directly with the Board prior to attempting to control or significantly influence
the Company.
The
Rights Plan is similar to those adopted by other publicly traded companies, and does not contain any dead-hand, slow-hand, no-hand or
similar feature that limits the ability of a future Board to redeem the rights. Pursuant to the Rights Plan, SciSparc will issue one
special purchase right for each ordinary share outstanding as of the close of business on December 8, 2023. While the Rights Plan is
effective immediately, the rights generally would become exercisable only if an entity, person or group acquires beneficial ownership
of 10% or more of SciSparc’s outstanding ordinary shares in a transaction not approved by the Company’s Board.
In
that situation, each holder of a right (other than the acquiring entity, person or group) will have the right to purchase one ordinary
share at a purchase price of $0.001 per share. In addition, at any time after an entity, person or group acquires 10% or more of the
Company’s ordinary shares, the Company’s Board of Directors may exchange one ordinary share of the Company for each outstanding
right (other than rights owned by such entity, person or group, which would have become void).
The
Rights Plan has a 364-day term, expiring on November 27, 2024.
Meitar
Law Offices is serving as legal counsel to SciSparc.
About SciSparc Ltd.
(Nasdaq: SPRC):
SciSparc
Ltd. is a specialty clinical-stage pharmaceutical company led by an experienced team of senior executives and scientists. SciSparc’s
focus is on creating and enhancing a portfolio of technologies and assets based on cannabinoid pharmaceuticals. With this focus, the
Company is currently engaged in the following drug development programs based on THC and/or non-psychoactive CBD: SCI-110 for the treatment
of Tourette Syndrome, for the treatment of Alzheimer's disease and agitation; SCI-160 for the treatment of pain; and SCI-210 for the
treatment of ASD and status epilepticus. The Company also owns a controlling interest in a subsidiary whose business focuses on the sale
of hemp seeds oil-based products on Amazon Marketplace.
Forward-Looking
Statements:
This
press release 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, SciSparc is using forward-looking statements when it discusses
the intended protection by the Rights Plan of the long-term interests of SciSparc and all of SciSparc’s shareholders and realization
of the full potential value of shareholders’ investment in the Company. Because such statements deal with future events and are
based on SciSparc's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements
of SciSparc could differ materially from those described in or implied by the statements in this press release. The forward-looking statements
contained or implied in this press release are subject to other risks and uncertainties, including those discussed under the heading
"Risk Factors" in SciSparc's Annual Report on Form 20-F filed with the SEC on May 1, 2023, and in subsequent filings with
the U.S. Securities and Exchange Commission. Except as otherwise required by law, SciSparc disclaims any intention or obligation to update
or revise any forward-looking statements, which speak only as of the date they were made, whether as a result of new information, future
events or circumstances or otherwise.
Investor
Contact:
IR@scisparc.com
Tel: +972-3-6167055
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