None of the Reporting Persons, or to the knowledge of the Reporting Persons, any person listed on Annex A hereto, has, during the last five years: (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors); or (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Please see Annex A for information regarding the directors and executive officers of CBI.
As a result of CBI’s relationships with the other Reporting Persons, it is possible that CBI may be deemed a member of a “group”, within the meaning of Rule 13d-5(b)(1) under Act, with such other Reporting Persons. CBI is making this filing as a precautionary matter and this filing shall not be deemed an admission that CBI is a member of a group or is subject to the reporting requirements of Section 13 of the Exchange Act.
Item 4 Purpose of Transaction
The disclosure in Item 4 is hereby amended to add the following to the end thereof:
On May 20, 2020, Ofer Gonen informed the Issuer’s board of directors of his resignation from the Issuer’s board of directors, effective immediately.
On December 14, 2020, the Issuer entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Chemomab Ltd., an Israeli limited company (“Chemomab”), and CMB Acquisition Ltd., an Israeli limited company and wholly-owned subsidiary of the Issuer (“Merger Sub”). Upon the terms and subject to the satisfaction of the conditions described in the Merger Agreement, including approval of the transaction by the Issuer’s shareholders and Chemomab’s shareholders, Merger Sub will be merged with and into Chemomab (the “Merger”), with Chemomab surviving the Merger as a wholly-owned subsidiary of the Issuer. At the effective time of the Merger (the “Effective Time”): (a) each Chemomab ordinary share outstanding immediately prior to the Effective Time (excluding shares held by Merger Sub or Chemomab) will be converted solely into the right to receive a number of ADSs equal to the exchange ratio described in the Merger Agreement, and each outstanding Chemomab option will be assumed by the Issuer, based on the same exchange ratio. Under the exchange ratio formula in the Merger Agreement, following the closing of the Merger (the “Closing”), the former Chemomab securityholders immediately before the Merger are expected to own approximately 90% of the aggregate number of the outstanding securities of the Issuer, and the securityholders of the Issuer immediately before the Merger are expected to own approximately 10% of the aggregate number of the outstanding securities of the Issuer, subject to certain assumptions (on a fully diluted basis) and subject to adjustment pre-closing of the Merger based on the Issuer’s net cash balance at the time of the Closing.
In connection with the Merger Agreement, on December 14, 2020, AIH and CBI entered into a Shareholder Support Agreement with Chemombab (the “Support Agreement”). Pursuant to the Support Agreement, AIH and CBI will vote all of the Ordinary Shares (including Ordinary Shares represented by ADSs) held by them in favor of the issuance of the ADSs in connection with the Merger and the other transactions contemplated by the Merger Agreement.
Concurrently with the execution of the Merger Agreement, AIH, CBI and certain other investors in the Issuer entered into lock-up agreements (the “Lock-up Agreements”) with the Issuer, pursuant to which they accepted certain restrictions on transfers of Ordinary Shares held, or to be held, by them (including Ordinary Shares represented by ADSs) for the 180-day period following the Effective Time.
In connection with the Merger Agreement, on December 14, 2020, CBI and certain other investors in the Issuer executed a Cashless Exercise Notice, Amendment, Waiver, Release and Termination (the “Waiver”) in connection with the Securities Purchase Agreement, dated as of March 28, 2018 (the “2018 Purchase Agreement”), and the warrants issued thereunder among the Issuer, CBI and certain other investors of the Issuer. As an inducement for the Issuer and Chemomab to enter into the Merger Agreement, pursuant to the Waiver, CBI and the other investors agreed to exercise all of their warrants of the Issuer upon the Closing, reduce the number of Ordinary Shares to which they are entitled as a result of the Merger pursuant to the price protection provisions of the 2018 Purchase Agreement and waive their rights to the balance of the price protection, and upon the Closing, release the Issuer from any further obligations under the 2018 Purchase Agreement and terminate the price protection rights and the Investors Rights Agreement, dated June 29, 2018, related to the Ordinary Shares and warrants held by such investors.
