Document:

Exhibit
10.1

 

Matinas
biopharma holdings, Inc.

 

(a
Delaware corporation)

 

8,000
Shares of Series B Convertible Preferred Stock

 

PLACEMENT
AGENCY AGREEMENT

 

June
19, 2018

 

ThinkEquity

A
Division of Fordham Financial Management, Inc.

17
State Street, 22nd Floor

New
York, NY 10004

 

Ladies
and Gentlemen:

 

Matinas
BioPharma Holdings, Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the
purchasers (each, a “Purchaser” and, collectively, the “Purchasers”), pursuant
to the terms and conditions of this Placement Agent Agreement (this “Agreement”) up to an aggregate
of 8,000 shares (the “Shares”) of Series B Convertible Preferred Stock, par value $0.0001 per share
(the “Series B Preferred Stock”). The offering and sale of the Shares of Series B Preferred Stock is
hereinafter referred to as the “Offering.” The Company hereby confirms its agreement with ThinkEquity,
a division of Fordham Financial Management, Inc. (the “Placement Agent”) to act as Placement Agent in
accordance with the terms and conditions hereof.

 

Each
Share of Series B Preferred Stock will have a stated capital of $1,000 per share and will initially be convertible into 2,000
shares of the Company’s common stock, $0.0001 par value per share (the “Common Stock”). Such Common
Stock of the Company into which the Shares are convertible are hereinafter referred to as the “Conversion Shares.”
In addition, dividends on the Series B Preferred Stock will be payable in shares of Common Stock pursuant to the Certificate of
Designation (as defined below). Such Common Stock of the Company which may be issued as dividends on the Shares are hereinafter
referred to as the “Dividend Shares.” The Shares and, where applicable, the Conversion Shares and the
Dividend Shares, are collectively referred to as the “Securities.”

 

The
terms of the Series B Preferred Stock will be set forth in the Certificate of Designation (the “Certificate of Designation”)
to be filed by the Company with the Secretary of State of the State of Delaware as an amendment to the Company’s Certificate
of Incorporation.

 

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The
Company has filed with the Securities and Exchange Commission (the “Commission”) a shelf registration
statement on Form S-3 (No. 333-217106) covering the public offering and sale of certain
securities, including the Securities, under the Securities Act of 1933, as amended (the “1933 Act”)
and the rules and regulations promulgated thereunder (the “1933 Act Regulations”). As used herein “Registration
Statement,” means such registration statement as amended by any post-effective amendments thereto, including the
exhibits and any schedules thereto, the documents incorporated or deemed to be incorporated by reference therein pursuant to Item
12 of Form S-3 under the 1933 Act and the documents otherwise deemed to be a part thereof pursuant to Rule 430B under the 1933
Act Regulations (the “Rule 430B Information”). Each preliminary prospectus used in connection with the
offering of the Securities, including the documents incorporated or deemed to be incorporated by reference therein pursuant to
Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as a “preliminary prospectus.”
Promptly after execution and delivery of this Agreement, the Company will prepare and file a final prospectus relating to the
Securities in accordance with the provisions of Rule 424(b) (“Rule 424(b)”) of the 1933 Act Regulations.
Any registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein called the “Rule 462(b)
Registration Statement” and, after such filing, the term “Registration Statement” shall
include the Rule 462(b) Registration Statement. The final prospectus, in the form first furnished or made available to the Placement
Agent for use in connection with the offering of the Securities, including the documents incorporated or deemed to be incorporated
by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act, are collectively referred to herein as the “Prospectus.”
For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system or any successor system (“EDGAR”).

 

SECTION
1. Agreement to Act as Placement Agent; Placement of Securities. On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth:

 

(a)
Appointment of Placement Agent. The Company hereby authorizes the Placement Agent to act as its exclusive agent to solicit
offers for the purchase of all or part of the Securities from the Company in connection with the proposed Offering. Until the
Closing Date (as defined in Section 1(e) below) or earlier upon termination of this Agreement pursuant to Section 9, the
Company shall not, without the prior written consent of the Placement Agent (which consent shall not be unreasonably withheld,
delayed or conditioned), solicit or accept offers to purchase the Securities otherwise than through the Placement Agent.

 

(b)
Reasonable Efforts. The Company hereby acknowledges that the Placement Agent has agreed, as agent of the Company, to use
its reasonable efforts to solicit offers to purchase the Securities from the Company on the terms and subject to the conditions
set forth in the Prospectus. The Placement Agent shall use reasonable efforts to assist the Company in obtaining performance by
each Purchaser whose offer to purchase Securities has been solicited by the Placement Agent and accepted by the Company, but the
Placement Agent shall not, except as otherwise provided in this Agreement, be obligated to disclose the identity of any potential
purchaser or have any liability to the Company in the event any such purchase is not consummated for any reason. Under no circumstances
will the Placement Agent be obligated to underwrite or purchase any Securities for its own account and, in soliciting purchases
of the Securities, the Placement Agent shall act solely as the Company’s agent and not as principal.

 

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(c)
Solicitation of Offers. Subject to the provisions of this Section 1, offers for the purchase of the Securities may
be solicited by the Placement Agent as agent for the Company at such times and in such amounts as the Placement Agent deems reasonably
advisable. The Placement Agent shall communicate to the Company, orally or in writing, each reasonable offer to purchase Securities
received by it as agent of the Company. The Company shall have the sole right to accept offers to purchase Securities and may
reject any such offer, in whole or in part. The Company shall have the right, in its sole discretion, to reject any offer to purchase
Securities received by it, in whole or in part, and any such rejection shall not be deemed a breach of this Agreement.

 

(d)
Initial Public Offering Price. The Securities are being sold to the Purchasers at the following initial public offering
price: $1,000.00 per Share of Series B Preferred Stock.

 

(e)
Payment. Payment of the purchase price for, and delivery of, the Securities (the “Closing”) shall
be made at the offices of Meister Seelig & Fein LLP (“Placement Agent Counsel”), 125 Park Avenue,
7th Floor, New York, New York 10017, or at such other place as shall be agreed upon by the Placement Agent and the
Company, at 10:00 a.m. (New York City time) on June 21, 2018, or such other time not later than ten Business Days after such date
as shall be agreed upon by the Placement Agent and the Company (such time and date of payment and delivery being herein called
“Closing Date”). The term “Business Day” means any day other than a Saturday,
a Sunday or a legal holiday or a day on which banking institutions are authorized or obligated by law to close in New York, New
York.

 

At
the Closing, the Company shall deliver the Shares purchased on such Closing Date to the Placement Agent, which delivery may be
made through the facilities of the Depository Trust Company (“DTC”). Following the delivery of the Shares
by the Placement Agent to the Purchasers against payment therefor, the Placement Agent shall wire transfer, in immediately available
funds, the aggregate Purchase Price of the Shares purchased on such Closing Date, net of the Placement Fee (as defined Section
1(f) below) and the expenses set forth in Section 4 of this Agreement, to the Company. All actions taken at the Closing shall
be deemed to have occurred simultaneously on the Closing Date. Any Securities for which payment has not been received by the Company,
to the extent they have been delivered to the Placement Agent, shall be returned to the Company.

 

No
Shares which the Company has agreed to sell pursuant to this Agreement shall be deemed to have been purchased and paid for, or
issued and sold by the Company, until the appropriate corresponding number of Shares shall have been delivered to the Purchasers
or the Placement Agent via DTC against payment therefor. If the Company shall default in its obligations to deliver the Shares
to the Purchasers or the Placement Agent on behalf of the Purchasers as per such instructions, the Company shall indemnify and
hold the Placement Agent harmless against any loss, claim, damage or liability directly or indirectly arising from or as a result
of such default by the Company.

 

(f)
Placement Fee. As compensation for services rendered, on the Closing Date, the Placement Agent shall deduct a cash fee
(the “Cash Fee”) in an aggregate amount equal to seven percent (7%) of the gross proceeds received from the
sale of the Securities on the Closing Date. The Cash Fee is hereinafter referred to herein as the “Placement Fee”.
The Placement Agent may retain other brokers or dealers to act as sub-agents on its behalf in connection with the Offering, subject
to the Company’s prior consent, which consent shall not be unreasonably withheld, the fees of which shall be paid out of
the Placement Fee. Each broker or dealer retained by the Placement Agent to act as a sub-agent in the Offering shall be entitled
to rely on the representations, warranties and agreements of the Company contained in this Agreement as of such sub-agent was
a party hereto.

 

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(g)
Purchase Warrants. The Company hereby agrees to issue and sell to the Placement Agent (and/or its designees) at the Closing
Date an option (“Placement Agent’s Warrant”) for the purchase of up to an aggregate of 240,000
shares of Common Stock, representing 1.5% of the Conversion Shares underlying the Shares sold in the Offering (assuming the sale
of 8,000 shares of Series B Preferred Stock in the Offering), for an aggregate purchase price of $100.00. The Placement Agent’s
Warrant agreement, in the form attached hereto as Exhibit A (the “Placement Agent’s Warrant Agreement”),
shall be exercisable, in whole or in part, commencing on a date which is one (1) year after the Closing Date and expiring on the
five-year anniversary of the Closing Date at an initial exercise price per share of Common Stock of $0.75, which is equal to 150%
of the initial conversion price of the Shares. The Placement Agent’s Warrant Agreement and the shares of Common Stock issuable
upon exercise thereof are hereinafter referred to together as the “Placement Agent’s Securities,”
and the shares of Common Stock included in the Placement Agent’s Securities are sometimes referred to as the “Warrant
Shares.” The Placement Agent understands and agrees that there are significant restrictions pursuant to FINRA Rule
5110 against transferring the Placement Agent’s Warrant Agreement and the Warrant Shares during the one (1) year period
following the Closing Date and by its acceptance thereof shall agree that it will not sell, transfer, assign, pledge or hypothecate
the Placement Agent’s Warrant Agreement, or any portion thereof, or be the subject of any hedging, short sale, derivative,
put or call transaction that would result in the effective economic disposition of such securities for a period of one (1) year
following the Closing Date to anyone other than (i) an selling agent or a selected dealer in connection with the Offering, or
(ii) a bona fide officer or partner of the Placement Agent or of any such selling agent or selected dealer; and only if any such
transferee agrees to the foregoing lock-up restrictions.

 

SECTION
2. Representations and Warranties.

 

(a)
Representations and Warranties by the Company. The Company meets the requirements for use of Form S-3 under the 1933 Act,
including General Instruction I.B.1 of such Form S-3. The Company represents and warrants to the Placement Agent and the Purchasers
as of the date hereof, the Applicable Time (as defined in Section 2(a)(iii)) and the Closing Date, and agrees with the Placement
Agent and the Purchasers, as follows:

 

(i)
Registration Statement and Prospectuses. The Registration Statement has been declared effective under the 1933 Act. No
stop order suspending the effectiveness of the Registration Statement has been issued under the 1933 Act, no order preventing
or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes
have been instituted or are pending or, to the Company’s knowledge, contemplated. The Company has complied with each request
(if any) from the Commission for additional information.

 

The
Registration Statement, at the time it became effective, complied in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations. Each preliminary prospectus, the Prospectus and any amendment or supplement thereto, at the time
each was filed with the Commission, complied in all material respects with the requirements of the 1933 Act and the 1933 Act Regulations.
Each preliminary prospectus delivered by the Company to the Placement Agent for use in connection with the Offering and the Prospectus
was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.

 

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The
documents incorporated or deemed to be incorporated by reference in the Registration Statement, any preliminary prospectus and
the Prospectus, when they became effective or at the time they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the Securities Exchange Act of 1934, as amended (the “1934
Act”) and the rules and regulations of the Commission under the 1934 Act (the “1934 Act Regulations”).

 

(ii)
Accurate Disclosure. Neither the Registration Statement nor any amendment thereto, at its effective time, or at the Closing
Date, contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material
fact required to be stated therein or necessary to make the statements therein not misleading. As of the Applicable Time, neither
(A) the General Disclosure Package nor (B) any individual Issuer Limited Use Free Writing Prospectus, when considered together
with the General Disclosure Package, included an untrue statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither
the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its date, at the time of any
filing with the Commission pursuant to Rule 424(b), or at the Closing Date, included, includes or will include an untrue statement
of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The documents incorporated or deemed to be incorporated
by reference in the Registration Statement, the General Disclosure Package and the Prospectus, at the time the Registration Statement
became effective or when such documents incorporated by reference were filed with the Commission, as the case may be, when read
together with the other information in the Registration Statement, the General Disclosure Package, any Limited Use Free Writing
Prospectus or the Prospectus, as the case may be, did not and will not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the statements therein not misleading.

 

The
representations and warranties in this Section 2(a)(ii) shall not apply to statements in or omissions from the Registration Statement
(or any amendment thereto), the General Disclosure Package, the Prospectus (or any amendment or supplement thereto) or any Issuer
Free Writing Prospectus made in reliance upon and in conformity with written information furnished to the Company by the Placement
Agent expressly for use therein. For purposes of this Agreement, the only information so furnished shall be the statements contained
in the paragraph under the heading “Plan of Distribution” in the section of the Prospectus (collectively, the “Placement
Agent’s Information”).

 

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(iii)
Issuer Free Writing Prospectuses. No Issuer Free Writing Prospectus will be used in connection with the Offering.

 

As
used in this Section 2 and elsewhere in this Agreement:

 

“Applicable
Time” means 8:00 a.m., New York City time, on the date of this Agreement or such other time as agreed by the Company
and the Placement Agent.

 

“General
Disclosure Package” means any Issuer General Use Free Writing Prospectuses issued at or prior to the Applicable
Time, the most recent preliminary prospectus that is distributed to prospective purchasers prior to the Applicable Time and the
information included on Schedule A hereto, all considered together.

 

“Issuer
Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the 1933
Act Regulations (“Rule 433”), including, without limitation, any “free writing prospectus”
(as defined in Rule 405 of the 1933 Act Regulations (“Rule 405”)) relating to the Securities that is
(i) required to be filed with the Commission by the Company, (ii) a “road show that is a written communication” within
the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) exempt from filing with the
Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Securities or of the Offering that does not
reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be
filed, in the form retained in the Company’s records pursuant to Rule 433(g).

 

“Issuer
General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is intended for general distribution
to prospective purchasers (other than a “bona fide electronic road show,” as defined in Rule 433 (the “Bona
Fide Electronic Road Show”)), as evidenced by its being specified in Schedule B hereto.

 

“Issuer
Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not an Issuer General Use
Free Writing Prospectus.

 

All
references in this Agreement to financial statements and schedules and other information which is “contained,” “included”
or “stated” (or other references of like import) in the Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to include all such financial statements and schedules and other information incorporated or deemed
incorporated by reference in the Registration Statement, any preliminary prospectus or the Prospectus, as the case may be, prior
to the execution and delivery of this Agreement; and all references in this Agreement to amendments or supplements to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to include the filing of any document under the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “1934 Act”),
incorporated or deemed to be incorporated by reference in the Registration Statement, any preliminary prospectus or the Prospectus,
as the case may be, at or after the execution and delivery of this Agreement.

 

(iv)
Intentionally omitted.

 

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(v)
Independent Accountants. EisnerAmper LLP, who certified financial statements and supporting schedules incorporated by reference
in the Registration Statement, the General Disclosure Package and the Prospectus, are independent public accountants as required
by the 1933 Act, the 1933 Act Regulations and the Public Company Accounting Oversight Board.

 

(vi)
Financial Statements; Non-GAAP Financial Measures. The financial statements included in the Registration Statement, the
General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly, in all material
respects, the financial position of the Company and its subsidiaries, at the dates indicated and its results of operations, stockholders’
equity and cash flows for the periods specified; said financial statements have been prepared in conformity with U.S. generally
accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods involved
(except for any preparation of non-GAAP measures). The supporting schedules, if any, present fairly, in all material respects,
in accordance with GAAP the information required to be stated therein. The pro forma financial information and the related notes
thereto included or incorporated by reference in each of the Registration Statement, the General Disclosure Package and the Prospectus
has been prepared in accordance with the Commission’s rules and guidance with respect to pro forma financial information,
and the assumptions underlying such pro forma financial information are reasonable and are set forth in each of the Registration
Statement, the General Disclosure Package and the Prospectus. Except as included therein, no other historical or pro forma financial
statements or supporting schedules are required to be included in the Registration Statement, the General Disclosure Package or
the Prospectus under the 1933 Act or the 1933 Act Regulations.

 

(vii)
No Material Adverse Change in Business. Except as otherwise stated therein, since the respective dates as of which information
is given in the Registration Statement, the General Disclosure Package or the Prospectus, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company or
any of its subsidiaries, whether or not arising in the ordinary course of business (a “Material Adverse Effect”),
(B) there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the ordinary course
of business, which are material to the Company, and (C) there has been no dividend or distribution of any kind declared, paid
or made by the Company or any of its subsidiaries on any class of its capital stock.

 

(viii)
Good Standing of the Company. The Company is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware. The Company has requisite corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and
to enter into and perform its obligations under this Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing
would not result in a Material Adverse Effect.

 

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(ix)
Subsidiaries. Each of the Company’s subsidiaries has been duly organized and is validly existing as a corporation
or other entity in good standing under the laws of its jurisdiction of organization, with requisite power and authority to own
or lease its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and
the Prospectus. Each of the Company’s subsidiaries is duly qualified to transact business in all jurisdictions in which
the conduct of its business requires such qualification, except where the failure to be so qualified would not have a Material
Adverse Effect. All of the issued shares of capital stock or other ownership interest of each of the subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims, except for such liens, encumbrances, equities or claims as would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than the subsidiaries listed in Schedule D hereto (each,
a “subsidiary,” and collectively, the “subsidiaries”).

 

(x)
Contracts Affecting Capital. There are no transactions, arrangements or other relationships between and/or among the Company,
any of its affiliates (as such term is defined in Rule 405 of the 1933 Act Regulations) and any unconsolidated entity, including,
but not limited to, any structured finance, special purpose or limited purpose entity that could reasonably be expected to materially
affect the Company’s or its subsidiaries’ liquidity or the availability of or requirements for their capital resources
required to be described or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus
which have not been described or incorporated by reference as required.

 

(xi)
Loans to Directors or Officers. There are no outstanding loans, advances (except normal advances for business expenses
in the ordinary course of business) or guarantees or indebtedness by the Company or its subsidiaries to or for the benefit of
any of the officers or directors of the Company, its subsidiaries or any of their respective family members, except as disclosed
in the Registration Statement, the General Disclosure Package and the Prospectus.

 

(xii)
Smaller Reporting Company; Emerging Growth Company. As of the time of the initial filing of the Registration Statement,
the Company was a “smaller reporting company,” as defined in Rule 12b-2 of the 1934 Act Regulations. As of the date
of this Agreement, the Company is an “emerging growth company,” as defined in Rule 12b-2 of the 1934 Act Regulations.

 

(xiii)
Capitalization. The Company has an authorized capitalization as set forth in the Registration Statement, the General Disclosure
Package and the Prospectus as of the date or dates set forth therein. The outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable. None of the outstanding shares of capital stock
of the Company were issued in violation of the preemptive or other similar rights of any securityholder of the Company. Except
as described in or expressly contemplated by the Registration Statement, the General Disclosure Package and the Prospectus, there
are no outstanding rights (including, without limitation, pre-emptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock or other equity interest in the Company, or any contract, commitment,
agreement, understanding or arrangement of any kind relating to the issuance of any capital stock of the Company, any such convertible
or exchangeable securities or any such rights, warrants or options.

 

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(xiv)
Stock Options. With respect to the outstanding stock options (the “Stock Options”)
granted pursuant to the stock-based compensation plans of the Company (the “Company Stock Plans”), (i)
each Stock Option intended to qualify as an “incentive stock option” under Section 422 of the Internal Revenue Code
of 1986, as amended (the “Code”), so qualified, (ii) each grant of a Stock Option was duly authorized
no later than the date on which the grant of such Stock Option was by its terms to be effective (the “Grant Date”)
by all necessary corporate action, including, as applicable, approval by the board of directors of the Company (or a duly constituted
and authorized committee thereof) and any required stockholder approval by the necessary number of votes or written consents,
and the award agreement governing such grant (if any) was duly executed and delivered by each party thereto, (iii) each such grant
was made in accordance with the terms of the Company Stock Plans and all other applicable laws and regulatory rules or requirements,
except where the failure to comply with such laws, regulatory rules or requirements would not result in a Material Adverse Effect,
and (iv) each such grant was properly accounted for in accordance with GAAP in the financial statements (including the related
notes) of the Company included in the Registration Statement, the General Disclosure Package and the Prospectus, to the extent
required under GAAP to be accounted for in such financial statements.

 

(xv)
Authorization of Agreements. This Agreement and the Placement Agent’s Warrant Agreement have been duly authorized,
executed and delivered by the Company.

 

(xvi)
Authorization of Certificate of Designation. The Certificate of Designation, the proposed form of which has been furnished
to you, has been duly authorized by the Company and will have been duly executed and delivered by the Company and duly filed with
the Secretary of State of the State of Delaware before the Closing Date. The holders of the Series B Preferred Stock will have
the rights set forth in the Certificate of Designation upon filing of the Certificate of Designation with the Secretary of State
of the State of Delaware.

 

(xvii)
Authorization and Description of Securities. The Shares to be purchased by the Purchasers from the Company and the Placement
Agent’s Securities to be purchased by the Placement Agent from the Company have been duly authorized for issuance and sale
to the Purchasers and the Placement Agent pursuant to this Agreement and, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth herein, will be duly and validly issued, fully paid and non-assessable
and will have the rights, preferences and priorities set forth in the Company’s Certificate of Incorporation (including
the Certificate of Designation). The Conversion Shares have been duly authorized and reserved for issuance pursuant to the terms
of the Shares, and when issued by the Company upon valid conversion of the Shares, will be duly and validly issued, fully paid
and nonassessable. The Dividend Shares have been duly authorized and reserved for issuance pursuant to the terms of the Shares,
and when issued by the Company in payment of dividends on the Shares, will be duly and validly issued, fully paid and nonassessable.
The Warrant Shares have been duly authorized and reserved for issuance and when issued by the Company pursuant to the terms of
the Placement Agent’s Warrant Agreement, will be duly and validly issued, fully paid and nonassessable. The issuance of
the Shares, Conversion Shares, Dividend Shares and Placement Agent’s Securities is not subject to any preemptive or other
similar rights of any securityholder of the Company other than those rights that have been disclosed in the Registration Statement,
the General Disclosure Package and the Prospectus and have been waived. The capital stock of the Company conforms in all material
respects to all statements relating thereto contained in the Registration Statement, the General Disclosure Package and the Prospectus.
No holder of Securities or the Placement Agent’s Securities will be subject to personal liability solely by reason of being
such a holder.

 

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(xviii)
Registration Rights. There are no persons with registration rights or other similar rights to have any securities registered
for sale pursuant to the Registration Statement or otherwise registered for sale or sold by the Company under the 1933 Act, other
than those rights that have been disclosed in the Registration Statement, the General Disclosure Package and the Prospectus and
have been waived or satisfied.

 

(xix)
Absence of Violations, Defaults and Conflicts. The Company and each of its subsidiaries is not (A) in violation of its
charter or by-laws or other applicable organizational or governing documents, (B) in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which
it may be bound or to which any of the properties or assets of the Company or any of its subsidiaries is subject (collectively,
“Agreements and Instruments”), except for such defaults that would not reasonably be expected to, singly
or in the aggregate, result in a Material Adverse Effect, or (C) in violation of any law, statute, rule, regulation, judgment,
order, writ or decree of any arbitrator, court, governmental body, regulatory body, administrative agency or other authority,
body or agency having jurisdiction over the Company, any of its subsidiaries or any of their respective properties, assets or
operations (each, a “Governmental Entity”), except for such violations that would not reasonably be
expected to, singly or in the aggregate, result in a Material Adverse Effect. The execution, delivery and performance of this
Agreement, the Placement Agent’s Warrant Agreement and the consummation of the transactions contemplated herein and therein
and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities
and the use of the proceeds from the sale of the Securities as described therein under the caption “Use of Proceeds”
in the Prospectus) and compliance by the Company with its obligations hereunder and under the Placement Agent’s Warrant
Agreement and the Certificate of Designation have been duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any
properties or assets of the Company or any of its subsidiaries pursuant to, the Agreements and Instruments (except for such conflicts,
breaches, defaults or Repayment Events or liens, charges or encumbrances that would not reasonably be expected to, singly or in
the aggregate, result in a Material Adverse Effect), nor will such action result in any violation of (i) the provisions of the
charter, by-laws or similar organization or governing document of the Company or any of its subsidiaries or (ii) any law, statute,
rule, regulation, judgment, order, writ or decree of any Governmental Entity, except with respect to clause (ii), such violations
as would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect. As used herein, a “Repayment
Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or any of its subsidiaries.

 

    	 	10	 

    	 

    

 

(xx)
Absence of Labor Dispute. No labor dispute with the employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is threatened, and the Company has no knowledge of any existing or imminent labor dispute by the employees
of any of its principal suppliers, manufacturers, customers or contractors.

 

(xxi)
Absence of Proceedings. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus,
there is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity now pending or, to
the knowledge of the Company, threatened against the Company or any of its subsidiaries, which would reasonably be expected to,
singly or in the aggregate, result in a Material Adverse Effect, or which would reasonably be expected to, singly or in the aggregate,
materially and adversely affect the consummation of the transactions contemplated in this Agreement or the performance by the
Company of its obligations hereunder.

 

(xxii)
Accuracy of Exhibits. There are no contracts or documents which are required to be described in the Registration Statement,
the General Disclosure Package or the Prospectus or to be filed as exhibits to the Registration Statement which have not been
so described and filed as required.

 

(xxiii)
Absence of Further Requirements. No filing with, or authorization, approval, consent, license, order, registration, qualification
or decree of, any Governmental Entity is necessary or required for the performance by the Company of its obligations hereunder,
in connection with the offering, issuance or sale of the Securities hereunder or the consummation of the transactions contemplated
by this Agreement and as contemplated in the Registration Statement, the General Disclosure Package and the Prospectus, except
such as have been already obtained or as may be required under the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934
Act Regulations, the rules of the NYSE American (the “Exchange”) or state securities laws.

 

    	 	11	 

    	 

    

 

(xxiv)
Possession of Licenses and Permits. The Company and each of its subsidiaries possesses such permits, licenses, certificates,
approvals, clearances, consents and other authorizations (collectively, “Governmental Licenses”) issued
by the appropriate Governmental Entities necessary to conduct the business now operated by them, except where the failure so to
possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect. The Company and
each of its subsidiaries is in compliance with the terms and conditions of all Governmental Licenses and, to the Company’s
knowledge, no event has occurred which allows, or after notice or lapse of time would allow, revocation or termination thereof
or result in any other material impairment of the rights of the holder of any Government License, except where the failure so
to comply would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect. All of the Governmental
Licenses are valid and in full force and effect. Neither the Company nor any of its subsidiaries (a) has received notice of any
ongoing claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any U.S. or non-U.S.
Governmental Entity or third party alleging that any product, operation or activity is in violation of any Governmental Licenses
and has no knowledge that any such Governmental Entity or third party is considering any such claim, litigation, arbitration,
action, suit, investigation or proceeding; (b) has received notice that any Governmental Entity has taken, is taking or intends
to take regulatory action, and has no knowledge that any Governmental Entity is considering such action; and (c) is a party to
any corporate integrity agreement, deferred prosecution agreement, monitoring agreement, consent decree, settlement order, or
similar agreements, or has any reporting obligations pursuant to any such agreement, plan or correction or other remedial measure
entered into with any Governmental Entity.

 

(xxv)
Title to Property. The Company and each of its subsidiaries has good and marketable title to all real property owned by
it and good title or valid leases to all personal property owned by it, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances (except for customary easements and rights of way) of any kind
except such as (A) are described in the Registration Statement, the General Disclosure Package and the Prospectus or (B) do not,
singly or in the aggregate, materially affect the value of such property and do not materially interfere with the use made and
proposed to be made of such property by the Company and its subsidiaries; and all of the leases and subleases material to the
business of the Company and that of its subsidiaries and under which the Company or any of its subsidiaries holds properties described
in the Registration Statement, the General Disclosure Package or the Prospectus, are in full force and effect, and neither the
Company nor any of its subsidiaries has received any written notice of any material claim of any sort that has been asserted by
anyone adverse to the rights of the Company or any of its subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or any of its subsidiaries to the continued possession of the leased or subleased
premises under any such lease or sublease.

 

(xxvi)
Possession of Intellectual Property. Except as would not reasonably be expected to have a Material Adverse Effect, (i)
the Company and each of its subsidiaries owns all right, title and interest in or otherwise have the right to use all patents,
inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks, trade names and other intellectual property rights (collectively,
“Intellectual Property”) that is necessary for, used or held for use in, or otherwise exploited in connection
with, the conduct of the business now operated by them and as proposed to be operated, and (ii) to the Company’s knowledge,
neither the Company nor any of its subsidiaries is infringing, misappropriating, diluting or otherwise violating the Intellectual
Property of any third party. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus
or as would not reasonably be expected to have a Material Adverse Effect, (i) no action, suit, claim, or other proceeding is pending,
or to the Company’s knowledge, is threatened, alleging that the Company or any of its subsidiaries is infringing, misappropriating,
diluting, or otherwise violating the Intellectual Property of any third party in any respect, and (ii) no action, suit, claim,
or other proceeding is pending, or to the Company’s knowledge, is threatened, challenging the validity, enforceability,
scope, registration, ownership or use of any Intellectual Property of the Company or any of its subsidiaries that is, singly or
in the aggregate, necessary to its business (with the exception of office actions in connection with applications for the registration
or issuance of such Intellectual Property).

 

    	 	12	 

    	 

    

 

(xxvii)
Environmental Laws. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus
or would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect, (A) neither the Company
nor any of its subsidiaries is in violation of any federal, state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or protection of human health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous
substances, petroleum or petroleum products, asbestos-containing materials or mold (collectively, “Hazardous Materials”)
or to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials
(collectively, “Environmental Laws”), (B) the Company and each of its subsidiaries has all permits,
authorizations and approvals required under any applicable Environmental Laws and is in compliance with their requirements, (C)
there are no pending or, to the knowledge of the Company, threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation, investigation or proceedings relating to any Environmental
Law against the Company or any of its subsidiaries and (D) to the knowledge of the Company, there are no existing events, conditions
or facts that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action, suit or proceeding
by any private party or Governmental Entity, against or affecting the Company or any of its subsidiaries relating to Hazardous
Materials or any Environmental Laws.

 

(xxviii)
Disclosure Controls. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus,
the Company maintains an effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e) of
the 1934 Act) that complies with the requirements of the 1934 Act and that has been designed to ensure that information required
to be disclosed by the Company in reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported
within the time periods specified in the Commission’s rules and forms, including controls and procedures designed to ensure
that such information is accumulated and communicated to the Company’s management as appropriate to allow timely decisions
regarding required disclosure.

 

    	 	13	 

    	 

    

 

(xxix)
Accounting Controls. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus,
the Company maintains effective internal control over financial reporting (as defined under Rule 13a-15 and 15d-15 of the 1934
Act Regulations) and a system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions
are executed in accordance with management’s general or specific authorization; (B) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management’s general or specific authorization; (D) the recorded accountability
for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences
and (E) the interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement,
the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and is prepared
in accordance with the Commission’s rules and guidelines applicable thereto. Except as described in the Registration Statement,
the General Disclosure Package and the Prospectus, since the end of the Company’s most recent audited fiscal year, there
has been (1) no material weakness in the Company’s internal control over financial reporting (whether or not remediated)
and (2) no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control over financial reporting.

 

(xxx)
Payment of Taxes. All United States federal income tax returns of the Company and each of its subsidiaries required by
law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been
paid, except assessments against which appeals have been or will be promptly taken and as to which adequate reserves have been
provided other than as would not reasonably be expected to, singly or in the aggregate, have a Material Adverse Effect. The Company
and each of its subsidiaries has filed all other tax returns that are required to have been filed by them pursuant to applicable
foreign, state, local or other law except insofar as the failure to file such returns would not result in a Material Adverse Effect,
and have paid all taxes due pursuant to such returns or pursuant to any assessment received by the Company or any such subsidiary,
except for such taxes, if any, as are being contested in good faith and as to which adequate reserves have been established by
the Company or any such subsidiary, other than as would not reasonably be expected to, singly or in the aggregate, have a Material
Adverse Effect. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the charges,
accruals and reserves on the books of the Company in respect of any income and corporation tax liability for any years not finally
determined are believed to be adequate to meet any assessments or re-assessments for additional income tax for any years not finally
determined, except to the extent of any inadequacy that would not reasonably be expected to result in a Material Adverse Effect.

 

    	 	14	 

    	 

    

 

(xxxi)
Insurance. The Company carries or is entitled to the benefits of insurance, with reputable insurers, in such amounts and
covering such risks as is reasonably prudent and customary in the businesses in which it is engaged, and all such insurance is
in full force and effect. The Company has no reason to believe that it will not be able (A) to renew its existing insurance coverage
as and when such policies expire or (B) to obtain comparable coverage from similar institutions as may be necessary or appropriate
to conduct its business as now conducted and at a cost that would not result in a Material Adverse Effect. The Company has not
been denied the issuance of any material insurance policies which it has sought or for which it has applied in the prior three
years, except for any applications still pending.

 

(xxxii)
Investment Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated
and the application of the net proceeds therefrom as described in the Registration Statement, the General Disclosure Package and
the Prospectus will not be required, to register as an “investment company” under the Investment Company Act of 1940,
as amended (the “1940 Act”).

 

(xxxiii)
Absence of Manipulation. Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate
take, directly or indirectly, any action which is designed, or would reasonably be expected, to cause or result in, or which constitutes,
the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

 

(xxxiv)
No Integration. The Company has not sold or issued any securities that would be integrated with the Offering pursuant to
the 1933 Act, the 1933 Act Regulations or the interpretations thereof by the Commission.

 

(xxxv)
ERISA. Other than as would not, singly or in the aggregate, reasonably be expected to result in a Material Adverse Effect
and except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, (i) no “employee
benefit plan” (as defined in Section 3(3) of ERISA), for which the Company would have any liability (whether absolute or
contingent) (each a “Plan”) has experienced a failure to satisfy the “minimum funding standard”
(as defined in Section 302 of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”)
or Section 412 of the Internal Revenue Code of 1986, as amended (the “Code”)), or other event of the
kind described in Section 4043(c) of ERISA (other than events with respect to which the 30-day notice requirement under Section
4043 of ERISA has been waived) or any similar minimum funding failure event with respect to any Plan (other than a Plan that under
applicable law is required to be funded by a trust or funding vehicle maintained exclusively by a governmental authority) that
is maintained outside of the United States primarily for the benefit of persons substantially all of whom are nonresident aliens
(ii) each Plan is in compliance in all respects with applicable law, including, without limitation, ERISA and the Code; (iii)
other than in the ordinary course, neither the Company nor any trade or business, whether or not incorporated, that, together
with the Company, would be deemed to be a “single employer” within the meaning of Section 4001(b)(1) of ERISA or Section
414(b), 414(c), 414(m) or 414(o) of the Code has incurred or reasonably expects to incur any liability with respect to any Plan
(A) under Title IV of ERISA or (B) in respect of any post-employment health, medical or life insurance benefits for former, current
or future employees of the Company, except as required to avoid excise tax under Section 4980B of the Code and except, on a case
by case basis, limited extensions of health insurance benefits (for a period of no more than 18 months post-employment) to former
employees receiving severance payments from the Company; and (iv) each Plan that is intended to be qualified under Section 401(a)
of the Code is so qualified and nothing has occurred, whether by action or by failure to act, which could cause the loss of such
qualification. The Company is not, nor at any time during the last three years has the Company been, a party to any collective
bargaining agreement or other labor agreement with respect to employees of the Company. There are no pending, or, to the Company’s
knowledge, threatened, activities or proceedings by any labor union or similar entity to organize any employees of the Company.
No labor dispute with, or labor strike, work stoppage or other material labor disturbance by, the employees of the Company exists
or to the Company’s knowledge is imminent.

 

    	 	15	 

    	 

    

 

(xxxvi)
Foreign Corrupt Practices Act. Neither the Company, any of its subsidiaries nor, to the knowledge of the Company, any director,
officer, agent, employee, affiliate or other person acting on behalf of the Company has taken any action, directly or indirectly,
that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations
thereunder (the “FCPA”), including, without limitation, making use of the mails or any means or instrumentality
of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money,
or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official”
(as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political
office, in contravention of the FCPA and the Company, its subsidiaries and, to the knowledge of the Company, its and their respective
affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures
designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

 

(xxxvii)
Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related
or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money
Laundering Laws”); and no action, suit or proceeding by or before any Governmental Entity involving the Company
or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

    	 	16	 

    	 

    

 

(xxxviii)
OFAC. Neither the Company, any of its subsidiaries nor, to the knowledge of the Company, its or their respective directors,
officers, agents, employees, affiliates or Placement Agents (each, a “Person” ) are currently the subject
of sanctions administered or enforced by the United States Government, including, without limitation, the U.S. Department of the
Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council, the
European Union, Her Majesty’s Treasury, or other relevant sanctions authority applicable to the Company and its subsidiaries
(collectively, “Sanctions”), nor is the Company or any of its subsidiaries located, organized or resident
in a country or territory that is the subject of Sanctions; and the Company does not intend to, directly or indirectly, use the
proceeds of the sale of the Securities, or lend, contribute or otherwise make available such proceeds to any subsidiaries, joint
venture partners or other Person, to fund any activities of or business with any Person, or in any country or territory, that,
at the time of such funding, is the subject of Sanctions or in any other manner that will result in a violation by any Person
(including any Person participating in the transaction, whether as underwriter, advisor, purchaser or otherwise) of Sanctions.

 

(xxxix)
Lending Relationship. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus,
the Company (A) does not have any material lending or other relationship with any bank or lending affiliate of any underwriter
and (B) does not intend to use any of the proceeds from the sale of the Securities to repay any outstanding debt owed to any affiliate
of any underwriter.

 

(xl)
Statistical and Market-Related Data. Any statistical and market-related data included in the Registration Statement, the
General Disclosure Package or the Prospectus are based on or derived from sources that the Company believes, after reasonable
inquiry, to be reliable and accurate in all material respects and, to the extent required, the Company has obtained the written
consent to the use of such data from such sources.

 

(xli)
Accuracy of Descriptions. The statements set forth in the Registration Statement, the General Disclosure Package and the
Prospectus under the captions “Description of the Securities We Are Offering” and “Description of Capital Stock,”
insofar as they purport to constitute a summary of the terms of the Series A Preferred Stock of the Company, the Series B Preferred
Stock and the Common Stock (including the Conversion Shares, the Dividend Shares and the Warrant Shares) are accurate, complete
and fair summaries in all material respects.

 

(xlii)
Stock Exchange Listing. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the 1934 Act and is listed
on the Exchange; the Company has taken no action designed to, or likely to have the effect of, terminating the registration of
the Common Stock under the 1934 Act or delisting the Common Stock from the Exchange; the Company has not received any notice that
it is out of compliance with the listing or maintenance requirements of the Exchange and the Company is, and will continue to
be, in material compliance with all such listing and maintenance requirements; and the Company has not received any notification
that the Commission or the Exchange is contemplating terminating the registration of the Common Stock under the 1934 Act or delisting
the Common Stock from the Exchange.

 

(xliii)
Maintenance of Rating. The Company does not have any securities rated by any “nationally recognized statistical rating
organization” (as defined for purposes of Rule 436(g) under the 1933 Act).

 

(xliv)
Related Party Transactions. There are no business relationships or related-party transactions involving the Company, any
of its subsidiaries or any other person required to be described in the Registration Statement, any preliminary prospectus, the
Prospectus and the General Disclosure Package which have not been described as required. The General Disclosure Package contains
in all material respects the same description of the matters set forth in the preceding sentence contained in the Prospectus.

 

    	 	17	 

    	 

    

 

(xlv)
Board of Directors. At least one member of the Audit Committee of the Board of Directors of the Company qualifies as an
“audit committee financial expert,” as such term is defined under Regulation S-K and the listing rules of the Exchange.
In addition, at least a majority of the persons serving on the Board of Directors qualify as “independent,” as defined
under the listing rules of the Exchange.

 

(xlvi)
Brokers. Except for the Placement Agent commissions payable to the Placement Agent as described in the Registration Statement,
the General Disclosure Package and the Prospectus, there is no broker, finder or other party that is entitled to receive from
the Company any brokerage or finder’s fee or other fee or commission as a result of any transactions contemplated by this
Agreement.

 

(xlvii)
Margin Rules and Securities. The application of the proceeds received by the Company from the issuance, sale and delivery
of the Securities as described in the Registration Statement, the General Disclosure Package and the Prospectus will not violate
Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
Further, the Company owns no “margin securities” as that term is defined in Regulation U of the Board of Governors,
and none of the proceeds of Offering will be used, directly or indirectly, for the purpose of purchasing or carrying any margin
security, for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin
security or for any other purpose which might cause any of the shares of Common Stock to be considered a “purpose credit”
within the meanings of Regulation T, U or X of the Federal Reserve Board.

 

(xlviii)
Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the 1933 Act) contained
in the Registration Statement, the General Disclosure Package or the Prospectus has been made or reaffirmed by the Company without
a reasonable basis or has been disclosed by the Company other than in good faith.

 

(xlix)
Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or, to the knowledge of the Company, any
of the Company’s directors or officers, in their capacities as such, to comply with any applicable provision of the Sarbanes-Oxley
Act and the rules and regulations promulgated in connection therewith, including Section 402 related to loans.

 

(l)
Lock-Up Agreements. Schedule C hereto contains a complete and accurate list of the Company’s officers, directors
and certain key stockholders (collectively, the “Lock-Up Parties”). The Company has caused each of the
Lock-Up Parties to deliver to the Placement Agent an executed Lock-Up Agreement, in the form attached hereto as Exhibit B
(the “Lock-Up Agreement”), prior to the execution of this Agreement.

 

    	 	18	 

    	 

    

 

(li)
Transactions Affecting Disclosure to FINRA.

 

	 	a.	FINRA
    Affiliation. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there
    are no affiliations or associations between any member of FINRA and any of the Company’s officers, directors or 5% or
    greater securityholders (“Insiders”).
	 	 	 
	 	b.	Finder’s
    Fees. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, there are
    no claims, payments, arrangements, agreements or understandings relating to the payment of a finder’s, consulting or
    origination fee by the Company or any Insider with respect to the sale of the Securities hereunder or any other arrangements,
    agreements or understandings of the Company or, to the Company’s knowledge, any of its shareholders that may affect
    the Placement Agent’s compensation, as determined by FINRA.
	 	 	 
	 	c.	Payments
    Within Twelve (12) Months. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus,
    the Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s
    fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company
    persons who raised or provided capital to the Company; (ii) any FINRA member; or (iii) any person or entity that has any direct
    or indirect affiliation or association with any FINRA member, within the twelve (12) months prior to the Closing Date, other
    than the payment to the Placement Agent as provided hereunder in connection with the Offering.
	 	 	 
	 	d.	Use
    of Proceeds. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or
    its affiliates, except as specifically authorized herein.
	 	 	 
	 	e.	Information.
    All information provided by the Company in its FINRA questionnaire to Placement Agent Counsel, as such term is defined below,
    specifically for use by Placement Agent Counsel in connection with its Public Offering System filings (and related disclosure)
    with FINRA is true, correct and complete in all material respects.

 

(b)
Officer’s Certificates. Any certificate signed by any officer of the Company delivered to the Placement Agent or
Placement Agent Counsel shall be deemed a representation and warranty by the Company (and not by such officer in his or her personal
capacity) to the Placement Agent and the Purchasers as to the matters covered thereby.

 

    	 	19	 

    	 

    

 

SECTION
3. Covenants of the Company. The Company covenants with the Placement Agent and the Purchasers as follows:

 

(a)
Compliance with Securities Regulations and Commission Requests. The Company, subject to Section 3(b) hereof, will comply
with the requirements of Rule 430B, and will notify the Placement Agent promptly, and confirm the notice in writing, (i) when
any post-effective amendment to the Registration Statement shall have been filed or been declared effective or any amendment or
supplement to the Prospectus, shall have been filed or distributed, (ii) of the receipt of any comments from the Commission, (iii)
of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus,
including any document incorporated or deemed to be incorporated by reference therein, or for additional information, including,
but not limited to, any request for information concerning any oral or written communication with potential purchasers and undertaken
in reliance on Section 5(d) of the 1933 Act, (iv) of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any preliminary
prospectus, the Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction,
or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d)
or 8(e) of the 1933 Act concerning the Registration Statement, (v) of the occurrence of any event or development at any time
when a prospectus relating to the Securities is (or, but for the exception afforded by Rule 172 of the 1933 Act Regulations (“Rule
172”), would be) required by the 1933 Act to be delivered in connection with sales of the Securities (the “Prospectus
Delivery Period”) as a result of which the Prospectus, the General Disclosure Package, as then amended or supplemented
would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing when the Prospectus, the General Disclosure Package, is delivered to a purchaser,
not misleading; and (vi) if the Company becomes the subject of a proceeding under Section 8A of the 1933 Act in connection with
the Offering. The Company will effect all filings required under Rule 424(b), in the manner and within the time period required
by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such steps as it deems necessary to ascertain promptly whether
the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that
it was not, it will promptly file such prospectus. The Company will use commercially reasonable efforts to prevent the issuance
of any such order suspending the effectiveness of the Registration Statement, preventing or suspending the use of any preliminary
prospectus, the Prospectus or suspending any such qualification of the Securities and, if any such order is issued, will use commercially
reasonable efforts to obtain as soon as possible the withdrawal thereof.

 

(b)
Continued Compliance with Securities Laws. The Company will comply with the 1933 Act and the 1933 Act Regulations during
the Prospectus Delivery Period so as to permit the completion of the distribution of the Securities as contemplated in this Agreement
and in the Registration Statement, the General Disclosure Package and the Prospectus. If at any time during the Prospectus Delivery
Period any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the
Placement Agent or for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not
include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (ii) amend or supplement the General Disclosure Package or the Prospectus in order
that the General Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the General
Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly (A) give the Placement Agent notice of such event, (B) prepare any amendment or supplement
as may be necessary to correct such statement or omission or to make the Registration Statement, the General Disclosure Package
or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish
the Placement Agent with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement;
provided that the Company shall not file or use any such amendment or supplement to which the Placement Agent or counsel
for the Placement Agent shall reasonably object unless the Company reasonably believes that the failure to file or use such amendment
or supplement would constitute a violation of law or subject it to liability. The Company will furnish to the Placement Agent
such number of copies of such amendment or supplement as the Placement Agent may reasonably request. The Company has given the
Placement Agent notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable
Time; the Company will give the Placement Agent notice of its intention to make any such filing from the Applicable Time to the
Closing Date and will furnish the Placement Agent with copies of any such documents a reasonable amount of time prior to such
proposed filing, as the case may be, and will not file or use any such document to which the Placement Agent or counsel for the
Placement Agent shall reasonably object unless the Company reasonably believes that the failure to file or use such amendment
or supplement would constitute a violation of law or subject it to liability.

 

    	 	20	 

    	 

    

 

(c)
The Company will not, and will cause its affiliated purchasers (as defined in Regulation M under the 1934 Act) not to, either
alone or with one or more other persons, bid for or purchase, for any account in which it or any of its affiliated purchasers
has a beneficial interest, any Shares, or attempt to induce any person to purchase any Shares; and not to, and to cause its affiliated
purchasers not to, make bids or purchase for the purpose of creating actual, or apparent, active trading in or of raising the
price of the Shares; provided, however, that this clause (c) shall not affect the ability of the Company’s affiliated purchasers
to purchase Shares in the Offering.

 

(d)
Delivery of Registration Statements. The Company has furnished or will deliver to the Placement Agent and to counsel for
the Placement Agent, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto
(including exhibits filed therewith) and signed copies of all consents and certificates of experts, and will also deliver to the
Placement Agent, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto
(without exhibits). The copies of the Registration Statement and each amendment thereto furnished to the Placement Agent will
be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.

 

(e)
Delivery of Prospectuses. The Company has delivered to the Placement Agent, without charge, as many copies of each preliminary
prospectus as the Placement Agent may reasonably request, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to the Placement Agent, without charge, during the Prospectus Delivery Period,
such number of copies of the Prospectus (as amended or supplemented) as the Placement Agent may reasonably request. The Prospectus
and any amendments or supplements thereto furnished to the Placement Agent will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

    	 	21	 

    	 

    

 

(f)
Blue Sky Qualifications. The Company will use its commercially reasonable efforts, in cooperation with the Placement Agent,
to qualify the Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic
or foreign) as the Placement Agent may designate and to maintain such qualifications in effect so long as required to complete
the distribution of the Securities; provided, however, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which
it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise
so subject.

 

(g)
Rule 158. The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings statement for the purposes of, and to provide to the Placement
Agent the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

 

(h)
Use of Proceeds. The Company will use the net proceeds received by it from the sale of the Securities in the manner specified
in the Registration Statement, the General Disclosure Package and the Prospectus under “Use of Proceeds.”

 

(i)
Effective Registration; Listing. The Company will use its reasonable best efforts to cause the Conversion Shares and the
Dividend Shares to continue to be registered under the 1933 Act for the periods set forth in the Certificate of Designation; provided
however that the Company shall have no obligation to register such Conversion Shares or Dividend Shares to the extent an exemption
from registration is available under Section 3(a)(9) of the Securities Act and such shares may be resold without restriction under
the Securities Act or such shares may be issued without legend and resold without restriction under Rule 144 promulgated by the
Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or
regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule (“Rule
144”). The Warrant Shares shall be included in any registration statements filed in connection with the preceding
sentence provided however that the Company shall have no obligation to register such Warrant Shares to the extent an exemption
from registration is available under Section 3(a)(9) of the Securities Act and such shares may be resold without restriction under
the Securities Act or such shares may be issued without legend and resold without restriction under Rule 144. The Company will
use its commercially reasonable efforts to cause the Conversion Shares, the Dividend Shares and the Warrant Shares to be included
on the Exchange, subject to notice of issuance, and to maintain the listing of the Common Stock on the Exchange.

 

    	 	22	 

    	 

    

 

(j)
Company Lock-Up Agreements.

 

(i)
Restrictions on Sales of Capital Stock. The Company, on behalf of itself and any successor entity, agrees that, without
the prior written consent of the Placement Agent, it will not, for a period of 90 days after the date of this Agreement (the “Lock-Up
Period”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly,
any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital
stock of the Company; (2) file or caused to be filed any registration statement with the Commission relating to the offering of
any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital
stock of the Company; (3) complete any offering of debt securities of the Company, other than entering into a line of credit with
a traditional bank or (4) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (1), (2),
(3) or (4) above is to be settled by delivery of shares of capital stock of the Company or such other securities, in cash or otherwise.

 

The
restrictions contained in this Section 3(j)(i) shall not apply to (A) the Shares to be sold in the Offering, (B) the issuance
by the Company of the Conversion Shares, the Dividend Shares or the Warrant Shares, (C) the issuance by the Company of shares
of Common Stock upon the exercise of a stock option or warrant or the conversion of, or as payment of a dividend pursuant to the
terms of, a security outstanding on the date hereof, of which the Placement Agent has been advised in writing or as have been
disclosed in the Registration Statement, General Disclosure Package or Prospectus, (D) the issuance by the Company of stock options
or shares of capital stock of the Company under any equity compensation plan of the Company, or (E) the issuance of shares of
Common Stock or other securities in connection with any acquisition, strategic partnership, joint venture or collaboration..

 

(ii)
Restriction on Continuous Offerings. The Company, on behalf of itself and any successor entity, agrees that, without the
prior written consent of the Placement Agent, it will not, for a period of 30 days after the Closing Date, directly or indirectly
in any “at-the-market” or continuous equity transaction, including, without limitation, the Controlled Equity Offering
with Cantor Fitzgerald & Co. (“Cantor”) pursuant to the Sale Agreement, dated April 28, 2017, by
and between the Company and Cantor, offer to sell, sell, contract to sell, grant any option to sell or otherwise dispose of shares
of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock
of the Company.

 

(k)
Intentionally Omitted.

 

(l)
Intentionally Omitted.

 

(m)
Reservation of Common Stock. The Company shall reserve and keep available at all times a sufficient number of shares of
Common Stock for purpose of enabling the Company to issue the Conversion Shares, the Dividend Shares and Warrant Shares.

 

    	 	23	 

    	 

    

 

(n)
Rule 462(b) Registration Statement. If the Company elects to rely upon Rule 462(b) under the 1933 Act, the Company will
file a Rule 462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 p.m., Washington, D.C. time,
on the date of this Agreement, and at the time of filing either to pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or to give irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the 1933 Act.

 

(o)
Intentionally Omitted.

 

(p)
Intentionally Omitted.

 

(q)
Intentionally Omitted. 

 

 (r) No Fiduciary Duties. The Company acknowledges and agrees that:

 

i.
the Placement Agent’s responsibility to the Company is solely contractual in nature and that neither the Placement Agent
or its affiliates or any selling agent shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty
to the Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement;

 

ii.
the price of the Securities set forth in this Agreement was established by the Company following discussions and arms-length negotiations
with the Placement Agent and the Purchasers, and the Company is capable of evaluating and understanding, and understands and accepts,
the terms, risks and conditions of the transactions contemplated by this Agreement;

 

iii.
it has been advised that the Placement Agent and its affiliates are engaged in a broad range of transactions which may involve
interests that differ from those of the Company and that the Placement Agent has no obligation to disclose such interests and
transactions to the Company by virtue of any fiduciary, advisory or agency relationship; and

 

iv.
it waives, to the fullest extent permitted by law, any claims it may have against the Placement Agent for breach of fiduciary
duty or alleged breach of fiduciary duty and agrees that the Placement Agent shall have no liability (whether direct or indirect)
to the Company in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim on behalf of or in
right of the Company, including stockholders, employees or creditors of the Company.

 

(s)
Transfer Agent. For a period of three (3) years after the date of this Agreement, the Company shall retain a Transfer Agent
and registrar for the Series B Preferred and the common stock.

 

(t)
Intentionally Omitted.

 

    	 	24	 

    	 

    

 

SECTION
4. Payment of Expenses.

 

(a)
General Expenses Related to the Offering. The Company hereby agrees to pay, or reimburse if paid by the Placement Agent:
all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to:
(a) all filing fees and communication expenses relating to the registration of the shares of Series B Preferred Stock to be sold
in the Offering with the Commission; (b) all Public Filing System filing fees associated with the review of the Offering by FINRA;
(c) all fees and expenses relating to the inclusion of the Conversion Shares, the Dividend Shares and the Warrant Shares on the
Exchange; (d) all fees, expenses and disbursements relating to background checks of the Company’s officers and directors
in an amount not to exceed $5,000 in the aggregate; (e) (g) the costs of all mailing and printing of the placement documents (including,
without limitation, the Placement Agency Agreement, any Blue Sky Surveys and, if appropriate, any Agreement Among Underwriters
and Selected Dealers’ Agreement), Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto
and as many preliminary and final Prospectuses as the Placement Agent may reasonably deem necessary; (h) the $29,500 cost associated
with the use of Ipreo’s book building, prospectus tracking and compliance software for the Offering; (i) fees and expenses
of the transfer agent for the Shares; (j) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from
the Company to the Purchasers; (l) the fees and expenses of the Company’s accountants; (m) the fees and expenses of the
Company’s legal counsel and other agents; (n) fees and expenses of Placement Agent Counsel not to exceed $75,000; and (o)
the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities to the Purchasers, and any
taxes payable in that connection.

 

(b)
Non-Accountable Expenses. The Company further agrees that, in addition to the expenses payable pursuant to Section 4(a),
on the Closing Date the Placement Agent shall deduct from the gross proceeds of the Offering contemplated herein, a non-accountable
expense allowance equal to one percent (1%) of the gross proceeds received from the sale of the Shares, less the Advance (as such
term is defined in Section 9(c) hereof), provided, however, that in the event that the Offering is terminated, the Company agrees
to reimburse the Placement Agent pursuant to Section 9(c) hereof.

 

SECTION
5. Conditions of Placement Agent’s Obligations. The obligations of the Placement Agent hereunder are subject to the
accuracy of the representations and warranties of the Company contained herein or in certificates of any officer of the Company
delivered pursuant to the provisions hereof, to the performance by the Company of the covenants and other obligations hereunder,
and to the following further conditions:

 

(a)
Effectiveness of Registration Statement; Rule 430B Information. The Registration Statement, including any Rule 462(b) Registration
Statement, has been declared effective and, at the Closing Date, no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto has been issued under the 1933 Act, no order preventing or suspending the use
of any preliminary prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted
or are pending or, to the Company’s knowledge, contemplated; and the Company has complied with each request (if any) from
the Commission for additional information to the reasonable satisfaction of counsel to the Company and counsel to the Placement
Agent. A prospectus containing the Rule 430B Information shall have been filed with the Commission in the manner and within the
time frame required by Rule 424(b) without reliance on Rule 424(b)(8) or a post-effective amendment providing such information
shall have been filed with, and declared effective by, the Commission in accordance with the requirements of Rule 430B.

 

    	 	25	 

    	 

    

 

(b)
No Untrue Statements. The Placement Agent shall not have discovered and disclosed to the Company on or prior to the Closing
Date that the Registration Statement or any amendment or supplement thereto contains an untrue statement of a fact which, in the
opinion of Placement Agent Counsel, is material or omits to state any fact which, in the opinion of such counsel, is material
and is required to be stated therein or is necessary to make the statements therein not misleading, or that the General Disclosure
Package, any Issuer Free Writing Prospectus or the Prospectus or any amendment or supplement thereto contains an untrue statement
of fact which, in the opinion of such counsel, is material or omits to state any fact which, in the opinion of such counsel, is
material and is necessary in order to make the statements, in the light of the circumstances in which they were made, not misleading.

 

(c)
No Material Adverse Change. Since the date of the latest audited financial statements included in the Registration Statement,
the General Disclosure Package and the Prospectus or incorporated or deemed to be incorporated by reference therein as of the
date hereof, (i) neither the Company nor any Subsidiary shall have sustained any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth in the Registration Statement, the General Disclosure Package and the Prospectus,
and (ii) there shall not have been any change in the capital stock or long-term debt of the Company or any Subsidiary, or any
change, or any development involving a prospective change, in or affecting the business, management, financial position, stockholders’
equity or results of operations of the Company, otherwise than as set forth in the Registration Statement, the General Disclosure
Package and the Prospectus, the effect of which, in any such case described in clause (i) or (ii) of this paragraph (c)
is, in the judgment of the Placement Agent, so material and adverse as to make it impracticable or inadvisable to proceed with
the sale or delivery of the Securities on the terms and in the manner contemplated in the General Disclosure Package.

 

(d)
Adverse Governmental Actions. No action shall have been taken and no law, statute, rule, regulation or order shall have
been enacted, adopted or issued by any governmental agency or body which would prevent the issuance or sale of the Securities
or materially and adversely affect or potentially materially and adversely affect the business or operations of the Company or
any subsidiary; and no injunction, restraining order or order of any other nature by any federal or state court of competent jurisdiction
shall have been issued which would prevent the issuance or sale of the Securities or materially and adversely affect or potentially
materially and adversely affect the business or operations of the Company or any subsidiary.

 

(e)
Market Conditions. Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the
following: (i) trading in securities generally on the New York Stock Exchange, the Exchange or the NASDAQ Stock Market or in the
over-the-counter market, or trading in any securities of the Company on any exchange or in the over-the-counter market shall have
been suspended or materially limited, or minimum or maximum prices or maximum range for prices shall have been established on
any such exchange or such market by the Commission, by such exchange or market or by any other regulatory body or governmental
authority having jurisdiction, (ii) a banking moratorium shall have been declared by Federal or state authorities or a material
disruption has occurred in commercial banking or securities settlement or clearance services in the United States, (iii) the United
States shall have become engaged in hostilities, or the subject of an act of terrorism, or there shall have been an outbreak of
or escalation in hostilities involving the United States, or there shall have been a declaration of a national emergency or war
by the United States or (iv) there shall have occurred such a material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the financial markets in the United States shall be such) as to make
it, in the judgment of the Placement Agent, impracticable or inadvisable to proceed with the sale or delivery of the Securities
on the terms and in the manner contemplated in the Registration Statement, the General Disclosure Package and the Prospectus.

 

    	 	26	 

    	 

    

 

(f)
Certificate of Designation. The Certificate of Designation shall have been filed with the Secretary of State of the State
of Delaware and become effective and the Company shall have delivered evidence of such filing and effectiveness to the Placement
Agent in form and substance satisfactory to the Placement Agent.

 

(g)
Opinion of Counsel for Company. At the Closing Date, the Placement Agent shall have received the favorable opinion and
negative assurance statement, dated as of the Closing Date, of Lowenstein Sandler LLP, counsel for the Company, in form and substance
reasonably satisfactory to the Placement Agent and its counsel.

 

(h)
Opinion of IP Counsel. At the Closing Date, the Placement Agent shall have received the favorable opinion and negative
assurances statement, dated as of the Closing Date, of MH2 Technology Law Group, LLP, as intellectual property counsel to the
Company, in form and substance reasonably satisfactory to the Placement Agent and its counsel.

 

(i)
Reliance. In rendering such opinions, such counsel may rely: (i) as to matters involving the application of laws other
than the laws of the United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to
the extent specified in such opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to
the Placement Agent) of other counsel reasonably acceptable to the Placement Agent, familiar with the applicable laws; and (ii)
as to matters of fact, to the extent they deem proper, on certificates or other written statements of officers of the Company
and officers of departments of various jurisdictions having custody of documents respecting the corporate existence or good standing
of the Company, provided that copies of any such statements or certificates shall be delivered to Placement Agent Counsel if requested.

 

(j)
Officers’ Certificate. The Company shall have furnished to the Placement Agent a certificate, dated the Closing Date
of its Chief Executive Officer, its President and its Chief Financial Officer stating that (i) such officers have carefully examined
the Registration Statement, the General Disclosure Package, and the Prospectus and, in their opinion, the Registration Statement
and each amendment thereto, as of the Applicable Time and as of the Closing Date did not include any untrue statement of a material
fact and did not omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading,
and the General Disclosure Package, as of the Applicable Time and as of the Closing Date, the Prospectus and each amendment or
supplement thereto, as of the respective date thereof and as of the Closing Date, did not include any untrue statement of a material
fact and did not omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
in which they were made, not misleading, (ii) since the effective date of the Registration Statement, no event has occurred which
should have been set forth in a supplement or amendment to the Registration Statement, the General Disclosure Package or the Prospectus,
(iii) to the best of their knowledge after reasonable investigation, as of the Closing Date, the representations and warranties
of the Company in this Agreement are true and correct and the Company has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the Closing Date, and (iv) there has not been, subsequent to
the date of the most recent audited financial statements included or incorporated or deemed to be incorporated by reference in
the General Disclosure Package, any material adverse change in the financial position or results of operations of the Company,
or any change or development that, singularly or in the aggregate, would involve a material adverse change or a prospective material
adverse change, in or affecting the condition (financial or otherwise), results of operations, business, assets or prospects of
the Company, except as set forth in the Prospectus.

 

    	 	27	 

    	 

    

 

(k)
Accountant’s Comfort Letter. At the time of the execution of this Agreement, the Placement Agent shall have received
from EisnerAmper LLP a letter, dated such date, in form and substance satisfactory to the Placement Agent, containing statements
and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect
to the financial statements and certain financial information of the Company contained in the Registration Statement, the General
Disclosure Package and the Prospectus.

 

(l)
Bring-down Comfort Letter. At the Closing Date, the Placement Agent shall have received from EisnerAmper LLP a letter,
dated as of the Closing Date, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection
(k) of this Section 5, except that the specified date referred to shall be a date not more than three Business Days prior to the
Closing Date.

 

(m)
Secretary’s Certificate. At the Closing Date, the Placement Agent shall have received a certificate of the Company
signed by the Secretary of the Company, dated the Closing Date certifying: (i) that each of the Company’s charter, bylaws
and Certificate of Designation is true and complete, has not been modified and is in full force and effect; (ii) that the resolutions
of the Company’s Board of Directors relating to the Offering are in full force and effect and have not been modified; (iii)
as to the accuracy and completeness of all correspondence between the Company or its counsel and the Commission; and (iv) as to
the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.

 

(n)
FINRA Clearance. On or before the date of this Agreement, the Placement Agent shall have received clearance from FINRA
as to the amount of compensation allowable or payable to the Placement Agent as described in the Registration Statement.

 

(o)
Lock-up Agreements. At the date of this Agreement, the Placement Agent shall have the Lock-Up Agreements substantially
in the form of Exhibit B hereto signed by each of the Lock-Up Parties.

 

(p)
Placement Agent’s Warrant Agreement. On the Closing Date, the Company shall have delivered to the Placement Agent
executed copies of the Placement Agent’s Warrant Agreement.

 

(q)
Additional Documents. At the Closing Date, the Placement Agent and Placement Agent Counsel shall have been furnished with
such documents and opinions as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale
of the Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the issuance
and sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Placement Agent
and counsel for the Placement Agent.

 

    	 	28	 

    	 

    

 

(r)
Approval of Inclusion. At the Closing Date, the Conversion Shares, the Dividend Shares and the Warrant Shares shall have
been approved for inclusion on the Exchange.

 

SECTION
6. Indemnification.

 

(a)
Indemnification of Placement Agent.

 

	 	(i)	General.
    Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Placement Agent, its affiliates
    and each of its and their respective directors, officers, members, employees, representatives, partners, shareholders, affiliates,
    counsel, agents, selected dealers and each person, if any, who controls any such Placement Agent and such selected dealers
    within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act (collectively the “Placement Agent
    Indemnified Parties,” and each an “Placement Agent Indemnified Party”), against any
    and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses
    reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim
    whatsoever, whether arising out of any action between any of the Placement Agent Indemnified Parties and the Company or between
    any of the Placement Agent Indemnified Parties and any third party, or otherwise) to which they or any of them may become
    subject under the 1933 Act, the 1934 Act or any other statute or at common law or otherwise or under the laws of foreign countries
    (a “Claim”), (i) arising out of or based upon any untrue statement or alleged untrue statement of
    a material fact contained in (A) the Registration Statement, the General Disclosure Package, any Preliminary Prospectus or
    the Prospectus (or in any amendment or supplement thereto or document incorporated or deemed to be incorporated by reference
    therein); (B) any materials or information provided to prospective purchasers by, or with the approval of, the Company in
    connection with the marketing of the Offering, including any “road show” or prospective purchaser presentations
    made to prospective purchasers by the Company (whether in person or electronically); or (C) any application or other document
    or written communication (in this Section 5, collectively called “application”) executed by the Company or based
    upon written information furnished by the Company in any jurisdiction in order to qualify the Securities under the securities
    laws thereof or filed with the Commission, any state securities commission or agency, the Exchange or any other national securities
    exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make
    the statements therein, in the light of the circumstances under which they were made, not misleading, unless such statement
    or omission was made in reliance upon, and in conformity with, the Placement Agent’s Information or (ii) otherwise arising
    in connection with or allegedly in connection with the Offering.

 

    	 	29	 

    	 

    

 

	 	(ii)	Procedure.
    If any action is brought against a Placement Agent Indemnified Party in respect of which indemnity may be sought against the
    Company pursuant to Section 6(a)(i), such Placement Agent Indemnified Party shall promptly notify the Company in writing of
    the institution of such action and the Company shall assume the defense of such action, including the employment and fees
    of counsel (subject to the approval of such Placement Agent Indemnified Party) and payment of actual expenses if a Placement
    Agent Indemnified Party requests that the Company do so. Such Placement Agent Indemnified Party shall have the right to employ
    its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of the such Placement
    Agent Indemnified Party unless (i) the employment of such counsel at the expense of the Company shall have been authorized
    in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel
    to have charge of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that
    there may be defenses available to it or them which are different from or additional to those available to the Company (in
    which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or
    parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected
    by the Placement Agent Indemnified Party (in addition to local counsel) shall be borne by the Company, and shall be advanced
    by the Company. The Company shall not be liable for any settlement of any action effected without its consent (which shall
    not be unreasonably withheld). In addition, the Company shall not, without the prior written consent of the Placement Agent
    (which shall not be unreasonably withheld), settle, compromise or consent to the entry of any judgment in or otherwise seek
    to terminate any pending or threatened action in respect of which advancement, reimbursement, indemnification or contribution
    may be sought hereunder (whether or not such Placement Agent Indemnified Party is a party thereto) unless such settlement,
    compromise, consent or termination (i) includes an unconditional release of each Placement Agent Indemnified Party, acceptable
    to such Placement Agent Indemnified Party, from all liabilities, expenses and claims arising out of such action for which
    indemnification or contribution may be sought and (ii) does not include a statement as to or an admission of fault, culpability
    or a failure to act, by or on behalf of any Placement Agent Indemnified Party.

 

	 	(iii)	Indemnification
    of the Company. The Placement Agent agrees to indemnify and hold harmless the Company, its directors, its officers who
    signed the Registration Statement and persons who control the Company within the meaning of Section 15 of the 1933 Act or
    Section 20 of the 1934 Act ((collectively the “Company Indemnified Parties,” and each a “Company
    Indemnified Party”) against any and all loss, liability, claim, damage and expense described in the foregoing
    indemnity from the Company to the Placement Agent, as incurred, but only with respect to untrue statements or omissions, or
    alleged untrue statements or omissions made in the Registration Statement, any Preliminary Prospectus, the General Disclosure
    Package or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity
    with, the Placement Agent’s Information. In case any action shall be brought against any Company Indemnified Party based
    on any Preliminary Prospectus, the Registration Statement, the General Disclosure Package or Prospectus or any amendment or
    supplement thereto or any application, and in respect of which indemnity may be sought against the Placement Agent, the Placement
    Agent shall have the rights and duties given to the Company, and the Company Indemnified Party shall have the rights and duties
    given to the Placement Agent by the provisions of Section 6(a)(ii). Each Company Indemnified Party shall promptly notify the
    Placement Agent of the commencement of any litigation or proceedings such Company Indemnified Party, in connection with the
    issuance and sale of the Securities or in connection with the Registration Statement, the General Disclosure Package, or the
    Prospectus.

 

    	 	30	 

    	 

    

 

SECTION
7. Contribution.

 

(a)
Contribution Rights. If the indemnification provided for in Section 6 shall for any reason be unavailable to or insufficient
to hold harmless an indemnified party under Section 6(a) or 6(b) in respect of any loss, claim, damage or liability, or any action
in respect thereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute
to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company, on the one hand,
and the Placement Agent, on the other, from the Offering of the Securities, or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to
in clause (i) above but also the relative fault of the Company, on the one hand, and the Placement Agent, on the other, with respect
to the statements or omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as
any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Placement Agent
on the other with respect to such Offering shall be deemed to be in the same proportion as the total net proceeds from the Offering
of the Securities purchased under this Agreement (before deducting expenses) received by the Company as set forth in the table
on the cover page of the Prospectus, on the one hand, and the total Placement Fee received by the Placement Agent in connection
with the Offering as set forth in the table on the cover page of the Prospectus on the other hand. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or the Placement Agent, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the
Placement Agent agree that it would not be just and equitable if contributions pursuant to this Section 7(a) were to be determined
by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in
respect thereof, referred to above in this Section 7(a) shall be deemed to include, for purposes of this Section 7(a), any legal
or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 7(a) in no event shall the Placement Agent be required to contribute
any amount in excess of the total Placement Fee received by the Placement Agent less the amount of any damages which the Placement
Agent has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement, omission or alleged omission,
act or alleged act or failure to act or alleged failure to act. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

    	 	31	 

    	 

    

 

(b)
Contribution Procedure. Within fifteen (15) days after receipt by any party to this Agreement (or its representative) of
notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof
is to be made against another party (“contributing party”), notify the contributing party of the commencement
thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other
party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such
party notifies a contributing party or its representative of the commencement thereof within the aforesaid 15 days, the contributing
party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any
such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action
or proceeding affected by such party seeking contribution on account of any settlement of any claim, action or proceeding affected
by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained
in this Section 7 are intended to supersede, to the extent permitted by law, any right to contribution under the 1933 Act, the
1934 Act or otherwise available

 

SECTION
8. Representations, Warranties and Agreements to Survive. The indemnities, covenants, agreements, representations, warranties
and other statements of the Company, as set forth in this Agreement or made by the Company pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation made by or on behalf of the Placement Agent, the Purchasers or any person
controlling any of them and shall survive delivery of and payment for the Securities. Notwithstanding any termination of this
Agreement, the indemnity and contribution agreements contained in Sections 6 and 7 and the covenants, representations, warranties
set forth in this Agreement shall not terminate and shall remain in full force and effect at all times.

 

SECTION
9. Effective Date of Agreement and Termination Thereof.

 

(a)
Effective Date. This Agreement shall become effective when both the Company and the Placement Agent have executed the same
and delivered counterparts of such signatures to the other party.

 

    	 	32	 

    	 

    

 

(b)
Termination. The Placement Agent shall have the right to terminate this Agreement at any time prior to any Closing Date,
(i) if any domestic or international event or act or occurrence has materially disrupted, or in your opinion will in the immediate
future materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange,
the Exchange or the Nasdaq Stock Market LLC shall have been suspended or materially limited, or minimum or maximum prices for
trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the
Commission or any other government authority having jurisdiction; or (iii) if the United States shall have become involved in
a new war or an increase in major hostilities; or (iv) if a banking moratorium has been declared by a New York State or federal
authority; or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United
States securities markets; or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake,
theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in your opinion,
make it inadvisable to proceed with the delivery of the Shares; or (vii) if the Company is in material breach of any of its representations,
warranties or covenants hereunder; or (viii) if the Placement Agent shall have become aware after the date hereof of such a material
adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as
in the Placement Agent’s judgment would make it impracticable to proceed with the offering, sale and/or delivery of the
Shares. If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party to
any other party except as provided in Section 8 above and Section 9(c) below.

 

(c)
Expenses. Notwithstanding anything to the contrary in this Agreement, in the event that this Agreement shall not be carried
out for any reason whatsoever, within the time specified herein or any extensions thereof pursuant to the terms herein, the Company
shall be obligated to pay to the Placement Agent actual and accountable out-of-pocket expenses related to the transactions contemplated
herein then due and payable (including the fees and disbursements of Placement Agent Counsel) up to $37,500, inclusive of the
$25,000 advance for non-accountable expenses previously paid by the Company to the Placement Agent (the “Advance”)
and upon demand the Company shall pay the full amount thereof to the Placement Agent; provided, however, that such expense cap
in no way limits or impairs the indemnification and contribution provisions of this Agreement. Notwithstanding the foregoing,
any advance received by the Placement Agent will be reimbursed to the Company to the extent not actually incurred in compliance
with FINRA Rule 5110(f)(2)(C).

 

SECTION
12. Miscellaneous.

 

(a)
Notices. All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall
be mailed (registered or certified mail, return receipt requested), personally delivered, sent by facsimile transmission or e-mail
and confirmed and shall be deemed given when so delivered, faxed, or e-mailed and confirmed or if mailed, two (2) days after such
mailing.

 

    	 	33	 

    	 

    

 

If
to the Placement Agent:

 

ThinkEquity

A Division of Fordham Financial Management, Inc.

17
State Street, 22nd Floor

New
York, NY 10005

Attn:
Mr. Eric Lord, Head of Investment Banking

Fax
No.: 212-349-2550

Email
address: el@think-equity.com

 

with
a copy (which shall not constitute notice) to:

 

Meister
Seelig & Fein LLP

125
Park Avenue, 7th Floor

New
York, New York 10017

Attn:
Kenneth S. Goodwin, Esq.

Fax
No.: 646-539-3663

Email
address: ksg@msf-law.com

Louis
Lombardo, Esq.

Fax
No.: 646-930-4710

Email
Address: ll@msf-law.com

 

If
to the Company:

 

Matinas
BioPharma Holdings, Inc.

1545
Route 206 South, Suite 302

Bedminster,
NJ 07921

Attn:
Mr. Jerome Jabbour, Chief Executive Officer

Fax
No.:

Email
address: jjabbour@matinasbiopharma.com

 

with
a copy (which shall not constitute notice) to:

 

Lowenstein
Sandler LLP

1251
Avenue of the Americas

New
York, NY 10020

Attn:
Steven M. Skolnick, Esq.

Fax
No.: 973-597-2477

Email
address: sskolnick@lowenstein.com

 

(b)
Headings. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any
way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.

 

(c)
Amendment. This Agreement may only be amended by a written instrument executed by each of the parties hereto.

 

    	 	34	 

    	 

    

 

(d)
Entire Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection
with this Agreement) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and thereof,
and supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.
Notwithstanding anything to the contrary set forth herein, it is understood and agreed by the parties hereto that all other terms
and conditions of that certain engagement letter between the Company and ThinkEquity, a division of Fordham Financial Management,
Inc., dated May 15, 2018, as amended, shall remain in full force and effect.

 

(e)
Successors; Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon
the Placement Agent, the Company, and their respective successors and assigns. This Agreement shall also inure to the benefit
of the Purchasers, and each of their respective successors and assigns, which shall be third party beneficiaries hereof. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to give any person, other than the persons mentioned
in the preceding sentences, any legal or equitable right, remedy or claim under or in respect of this Agreement, or any provisions
herein contained, this Agreement and all conditions and provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person; except that the representations, warranties, covenants, agreements
and indemnities of the Company contained in this Agreement shall also be for the benefit of the Placement Agent Indemnified Parties
and the indemnities of the Placement Agent shall be for the benefit of the Company Indemnified Parties.

 

(f)
Governing Law; Consent to Jurisdiction; Trial by Jury. This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York, without giving effect to conflict of laws principles thereof. The Company hereby
agrees that any action, proceeding or claim against it arising out of, or relating in any way to this Agreement shall be brought
and enforced in the New York Supreme Court, County of New York, or in the United States District Court for the Southern District
of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any
objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any such process or summons to
be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested,
postage prepaid, addressed to it at the address set forth in Section 12(a) hereof. Such mailing shall be deemed personal service
and shall be legal and binding upon the Company in any action, proceeding or claim. The Company agrees that the prevailing party(ies)
in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys’ fees and expenses
relating to such action or proceeding and/or incurred in connection with the preparation therefor. The Company (on its behalf
and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and the Placement Agent hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby.

 

(g)
Execution in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto
in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one
and the same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto
and delivered to each of the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf
transmission shall constitute valid and sufficient delivery thereof.

 

    	 	35	 

    	 

    

 

(h)
Waiver, etc. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall
not be deemed or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any
provision hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No
waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set
forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and
no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent
breach, non-compliance or non-fulfillment.

 

[Remainder
of the page intentionally left blank; signature page follows]

 

    	 	36	 

    	 

    

 

If
the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding agreement between the Placement Agent and the Company
in accordance with its terms.

 

	 	Very truly yours, 
	 	 	 
	 	MATINAS BIOPHARMA HOLDINGS, INC.
	 	 	 
	 	By:	/s/
    Jerome D. Jabbour
	 	Name:	Jerome
    D. Jabbour
	 	Title:	Chief
    Executive Officer

 

Confirmed
and Accepted:

 

THINKEQUITY

 

	A Division of Fordham Financial Management, Inc.	 
	 	 	 
	By:	/s/
    Eric Lord	 
	Name:	Eric
    Lord	 
	Title:	Head
    of Investment Banking	 

 

    	 	37	 

    	 

    

 

SCHEDULE
A

 

General
Use Free Writing Prospectuses

 

None

 

    	 	 	 

    	 

    

 

SCHEDULE
B

 

Issuer
Free Writing Prospectuses

 

None.

 

    	 	 	 

    	 

    

 

SCHEDULE
C

 

Lock-Up
Parties

 

	Herbert
    Conrad	 
	 	 
	Jerome
    D. Jabbour	 
	 	 
	Dominick
    M. DiPaolo	 
	 	 
	Raphael
    J. Mannino	 
	 	 
	Gary
    Gaglione	 
	 	 
	Eric
    Ende	 
	 	 
	James
    S. Scibetta	 
	 	 
	Adam
    K. Stern	 
	 	 
	Matthew
    Wikler	 
	 	 
	Roelof
    Rongen	 

 

    	 	 	 

    	 

    

 

SCHEDULE
D

 

Subsidiaries

 

	Name	 	State
    of Incorporation
	 	 	 
	Matinas
    BioPharma, Inc.	 	Delaware
	 	 	 
	Matinas
    BioPharma Nanotechnologies, Inc.	 	Delaware

 

    	 	 	 

    	 

    

 

EXHIBIT
A

 

Form
of Placement Agent’s Warrant Agreement

 

THE
REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE
WARRANT EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN,
PLEDGE OR HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE YEAR FOLLOWING THE CLOSING DATE (DEFINED BELOW) TO ANYONE OTHER
THAN (I) THINKEQUITY, A DIVISION OF FORDHAM FINANCIAL MANAGEMENT, INC., OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH
THE OFFERING, OR (II) A BONA FIDE OFFICER OR PARTNER OF THINKEQUITY, A DIVISION OF FORDHAM FINANCIAL MANAGEMENT, INC., OR OF ANY
SUCH UNDERWRITER OR SELECTED DEALER.

 

THIS
PURCHASE WARRANT IS NOT EXERCISABLE PRIOR TO JUNE 21, 2019. VOID AFTER 5:00 P.M., EASTERN TIME, JUNE 21, 2023.

 

WARRANT
TO PURCHASE COMMON STOCK 

 

MATINAS BIOPHARMA HOLDINGS,
INC.

 

Warrant
Shares: _______

 

Initial
Exercise Date: June 21, 2019

 

THIS
WARRANT TO PURCHASE COMMON STOCK (the “Warrant”) certifies that, for value received, ThinkEquity, a Division
of Fordham Financial Management, Inc. or its assigns (the “Holder”) is entitled, upon the terms and subject
to the limitations on exercise and the conditions hereinafter set forth, at any time on or after June 21, 2019 (the “Initial
Exercise Date”) and, in accordance with FINRA Rule 5110(f)(2)(G)(i), prior to at 5:00 p.m. (New York time) on the date
that is five (5) years following the Closing Date (the “Termination Date”) but not thereafter, to subscribe
for and purchase from Matinas BioPharma Holdings, Inc., a Delaware corporation (the “Company”), up to ______
shares (the “Warrant Shares”) of common stock, par value $0.0001 per share, of the Company (the “Common
Stock”), as subject to adjustment hereunder. The purchase price of one share of Common Stock under this Warrant shall
be equal to the Exercise Price, as defined in Section 2(b).

 

    	 	1	 

    	 

    

 

This
Warrant is issued in connection with an offering (the “Offering”) of Series B Convertible Preferred Stock,
par value $0.0001 per share, of the Company.

 

Section
1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings
indicated in this Section 1:

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

 

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action
to close.

 

“Closing
Date” means the initial closing date of the Offering.

 

“Commission”
means the United States Securities and Exchange Commission.

 

“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

    	 	2	 

    	 

    

 

“Trading
Day” means a day on which the NYSE American is open for trading.

 

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE American Market, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select
Market, or the New York Stock Exchange (or any successors to any of the foregoing).

 

“Transfer
Agent” means V Stock Transfer, LLC, the current transfer agent of the Company, with a mailing address of 18 Lafayette
Place, Woodmere, New York 11598 and a facsimile number of (646) 536-3179, and any successor transfer agent of the Company.

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the
volume weighted average price of a share of Common Stock for such date (or the nearest preceding date) on the OTCQB or OTCQX as
applicable, (c) if Common Stock is not then listed or quoted for trading on the OTCQB or OTCQX and if prices for Common Stock
are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding
to its functions of reporting prices), the most recent bid price per share of Common Stock so reported, or (d) in all other cases,
the fair market value of the Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably
acceptable to the Company, the fees and expenses of which shall be paid by the Company.

 

Section
2. Exercise.

 

a)
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after
the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of
the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books
of the Company) of a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise Form annexed hereto. Within
two (2) Trading Days following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the
shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank
unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original
Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice
of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically
surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant
has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within five
(5) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting
in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding
number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder
and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company
shall deliver any objection to any Notice of Exercise Form within two (2) Business Days of receipt of such notice. The Holder
and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following
the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any
given time may be less than the amount stated on the face hereof.

 

    	 	3	 

    	 

    

 

b)
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $0.75, subject to adjustment
hereunder (the “Exercise Price”).

 

c)
Cashless Exercise. If at any time on or after the Initial Exercise Date, there is no effective registration statement registering,
or the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may
also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be
entitled to receive the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

	 	(A)
    = 	the
    VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless
    exercise,” as set forth in the applicable Notice of Exercise;
	 	 	 
	 	(B)
    = 	the
    Exercise Price of this Warrant, as adjusted hereunder; and
	 	 	 
	 	(C)
    = 	the
    number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant
    if such exercise were by means of a cash exercise rather than a cashless exercise.

 

If
Warrant Shares are issued in such a “cashless exercise,” the parties acknowledge and agree that in accordance with
Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised,
and the holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares. The Company
agrees not to take any position contrary to this Section 2(c).

 

Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2(c).

 

    	 	4	 

    	 

    

 

d)
Mechanics of Exercise.

 

i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted
by its Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with
The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company
is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the
Warrant Shares to or resale of the Warrant Shares by Holder, or (B) the Warrant Shares are eligible for resale by the Holder without
volume or manner-of-sale limitations pursuant to Rule 144 and, in either case, the Warrant Shares have been sold by the Holder
prior to the Warrant Share Delivery Date (as defined below), and otherwise by physical delivery of a certificate, registered in
the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder
is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is two
(2) Trading Days after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery
Date”). If the Warrant Shares can be delivered via DWAC, the transfer agent shall have received from the Company, at
the expense of the Company, any legal opinions or other documentation required by it to deliver such Warrant Shares without legend
(subject to receipt by the Company of reasonable back up documentation from the Holder, including with respect to affiliate status)
and, if applicable and requested by the Company prior to the Warrant Share Delivery Date, the transfer agent shall have received
from the Holder a confirmation of sale of the Warrant Shares (provided the requirement of the Holder to provide a confirmation
as to the sale of Warrant Shares shall not be applicable to the issuance of unlegended Warrant Shares upon a cashless exercise
of this Warrant if the Warrant Shares are then eligible for resale pursuant to Rule 144(b)(1)). The Warrant Shares shall be deemed
to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder
of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise
Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi)
prior to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Warrant
Shares subject to a Notice of Exercise by the second Trading Day following the Warrant Share Delivery Date, the Company shall
pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise
(based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20
per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after the second
Trading Day following such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise.

 

ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request
of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder
a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which
new Warrant shall in all other respects be identical with this Warrant.

 

iii.
Rescission Rights. If the Company fails to cause its Transfer Agent to deliver to the Holder the Warrant Shares pursuant
to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise; provided,
however, that the Holder shall be required to return any Warrant Shares or Common Stock subject to any such rescinded exercise
notice concurrently with the return to Holder of the aggregate Exercise Price paid to the Company for such Warrant Shares and
the restoration of Holder’s right to acquire such Warrant Shares pursuant to this Warrant (including, issuance of a replacement
warrant certificate evidencing such restored right).

 

    	 	5	 

    	 

    

 

iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available
to the Holder, if the Company fails to cause its Transfer Agent to transmit to the Holder the Warrant Shares pursuant to an exercise
on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open
market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in
satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price
(including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue
times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the
Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored
(in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would
have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder
purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares
of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice
indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount
of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.

 

    	 	6	 

    	 

    

 

vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer
tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid
by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the
name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly
executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for
any transfer tax incidental thereto. The Company shall pay all transfer agent fees required for same-day processing of any Notice
of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions)
required for same-day electronic delivery of the Warrant Shares.

 

vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.

 

viii.
Signature. This Section 2 and the exercise form attached hereto set forth the totality of the procedures required of the
Holder in order to exercise this Warrant. Without limiting the preceding sentences, no ink-original exercise form shall be required,
nor shall any medallion guarantee (or other type of guarantee or notarization) of any exercise form be required in order to exercise
this Warrant. No additional legal opinion, other information or instructions shall be required of the Holder to exercise this
Warrant. The Company shall honor exercises of this Warrant and shall deliver Shares underlying this Purchase Warrant in accordance
with the terms, conditions and time periods set forth herein.

 

    	 	7	 

    	 

    

 

e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not
have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect
to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s
Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially
own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of
shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock
issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of
shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially
owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or nonconverted portion of any
other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on
conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates.
Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged
by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of
the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall
be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination
of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and
of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a
Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a
more recent written notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common Stock
outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing
to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by
the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial
Ownership Limitation” shall be 9.99% of the number of shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to
the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e)
shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day
after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which
may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to
a successor holder of this Warrant.

 

Section
3. Certain Adjustments.

 

a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or
otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares,
if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
For the purposes of clarification, the Exercise Price of this Warrant will not be adjusted in the event that the Company or any
Subsidiary thereof, as applicable, sells or grants any option to purchase, or sells or grants any right to reprice, or otherwise
disposes of or issues (or announces any offer, sale, grant or any option to purchase or other disposition) any Common Stock or
Common Stock Equivalents, at an effective price per share less than the Exercise Price then in effect.

 

    	 	8	 

    	 

    

 

b)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata
to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will
be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could
have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without
regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before
the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result
in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase
Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto
would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

c)
During such time as this Warrant is outstanding, if the Company shall declare or make any dividend (other than cash dividends)
or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of
capital or otherwise (including, without limitation, any distribution of shares or other securities, property or options by way
of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock
acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation
in such Distribution (provided, however, to the extent that the Holder’s right to participate in any such
Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to
participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such
Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). To the
extent that this Warrant has not been partially or completely exercised at the time of such Distribution, such portion of the
Distribution shall be held in abeyance for the benefit of the Holder until the Holder has exercised this Warrant.

 

    	 	9	 

    	 

    

 

d)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in
one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of
the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would
have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the
Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock
of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration
(the “Alternate Consideration”) receivable by holders of Common Stock as a result of such Fundamental Transaction
for each share of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination
of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion
the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components
of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the
obligations of the Company under this Warrant in accordance with the provisions of this Section 3(d) pursuant to written agreements
in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is
exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to
the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise
of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder
to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental
Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being
for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction),
and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction,
the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction,
the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect
as if such Successor Entity had been named as the Company herein.

 

e)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share,
as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

    	 	10	 

    	 

    

 

f)
Notice to Holder.

 

i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the
Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall
be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a
party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby
the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed
a notice to the Holder at its last address as it shall appear upon the Warrant Register (as defined below) of the Company, at
least 20 calendar days prior to the applicable record or effective date hereinafter specified, stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to
be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common
Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to provide such
notice or any defect therein shall not affect the validity of the corporate action required to be specified in such notice. To
the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company
or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice
to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

Section
4. Transfer of Warrant.

 

a)
Transferability. Pursuant to FINRA Rule 5110(g)(1), neither this Warrant nor any Warrant Shares issued upon exercise of
this Warrant shall be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative,
put, or call transaction that would result in the effective economic disposition of the securities by any person for a period
of 180 days immediately following the date of effectiveness or commencement of sales of the offering pursuant to which this Warrant
is being issued, except the transfer of any security:

 

i.
by operation of law or by reason of reorganization of the Company;

 

ii.
to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred
remain subject to the lock-up restriction in this Section 4(a) for the remainder of the time period;

 

iii.
if the aggregate amount of securities of the Company held by the Holder or related person do not exceed 1% of the securities being
offered;

 

iv.
that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member
manages or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10% of the
equity in the fund; or

 

v.
the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction in this Section
4(a) for the remainder of the time period.

 

    	 	11	 

    	 

    

 

Subject
to the foregoing restriction, any applicable securities laws and the conditions set forth in Section 4(d), this Warrant and all
rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender
of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination
or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant
in full, in which case, the Holder shall surrender this Warrant to the Company within three Trading Days of the date the Holder
delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly assigned in accordance herewith,
may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

 

b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office
of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved
in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or
Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated
the initial issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable
pursuant thereto.

 

c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose
(the “Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and
treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the contrary.

 

d)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a
view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable
state securities law, except pursuant to sales registered or exempted under the Securities Act.

 

Section
5. Miscellaneous.

 

a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other
rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i).

 

    	 	12	 

    	 

    

 

b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any certificate relating to the Warrant Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant,
shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated,
the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu
of such Warrant or stock certificate.

 

c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next
succeeding Trading Day.

 

d)
Authorized Shares.

 

The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights
under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may
be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market
upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise
of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and
payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free
from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).

 

Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation,
amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the
terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all
such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.
Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above
the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may
be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares
upon the exercise of this Warrant, and (iii) shall, so long as any of the Warrants are outstanding, take all action necessary
to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the
exercise of the Warrants, the number of shares of Common Stock as shall from time to time be necessary to effect the exercise
of the Warrants then outstanding (without regard to any limitations on exercise).

 

    	 	13	 

    	 

    

 

e)
Governing Law. This Warrant shall be governed by and construed and enforced in accordance with, and all questions concerning
the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws of the State
of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York
or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.

 

f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered,
and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities
laws.

 

g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder
shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting
any other provision of this Warrant or the Placement Agency Agreement, if the Company willfully and knowingly fails to comply
with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such
amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees,
including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.

 

h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company
shall be delivered in accordance with the notice provisions of the Placement Agency Agreement.

 

i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability
of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.

 

j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not
be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees
to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate. Notwithstanding
the foregoing or anything else herein to the contrary, if the Company is for any reason unable to issue and deliver Warrant Shares
upon exercise of this Warrant as required pursuant to the terms hereof, the Company shall have no obligation to “net cash
settle” this Warrant.

 

k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby
shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted
assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant
and shall be enforceable by the Holder or holder of Warrant Shares.

 

    	 	14	 

    	 

    

 

l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company
and the Holder.

 

m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Warrant.

 

n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant.

 

(Signature
Page Follows)

 

    	 	15	 

    	 

    

 

IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first
above indicated.

 

	 	MATINAS BIOPHARMA HOLDINGS, INC.
	 	 	 
	 	By:	 
	 	Name:	Jerome
    D. Jabbour
	 	Title:	Chief
    Executive Officer

 

    	 	16	 

    	 

    

 

NOTICE
OF EXERCISE

 

TO:
MATINAS BIOPHARMA HOLDINGS, INC.

 

(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant
(only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer
taxes, if any.

 

	 	(2)	Payment
    shall take the form of (check applicable box):

 

	 	-	in
    lawful money of the United States; or
	 	 	 
	 	-	if
    permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
    2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
    procedure set forth in subsection 2(c).

 

(3)
Please register and issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

______________________________

 

The
Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to:

 

______________________________

 

______________________________

 

______________________________

 

[SIGNATURE
OF HOLDER]

 

Name
of Investing Entity: _______________________________________________________

 

Signature
of Authorized Signatory of Investing Entity: _________________________________

 

Name
of Authorized Signatory: ___________________________________________________

 

Title
of Authorized Signatory: ____________________________________________________

 

Date:
________________________________________________________________________

 

    	 	17	 

    	 

    

 

ASSIGNMENT
FORM

 

(To
assign the foregoing warrant, execute this form and supply required information. Do not use this form to exercise the warrant.)

 

FOR
VALUE RECEIVED, [____] all of or [_______] Warrant Shares of the foregoing Warrant and all rights evidenced thereby are hereby
assigned to

 

_______________________________________________
whose address is

 

_______________________________________________________________.

 

_______________________________________________________________

 

Dated:
___________________, _______

 

Holder’s
Signature: _____________________________

 

Holder’s
Address: ______________________________

 

NOTE:
The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration
or enlargement or any change whatsoever. Officers of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.

 

    	 	18	 

    	 

    

 

EXHIBIT
B

 

Form
of Lock-Up Agreement

 

LOCK-UP
LETTER AGREEMENT

 

ThinkEquity

A
Division of Fordham Financial Management, Inc.

17
State St., 22nd Fl

New
York, NY 10004

 

As
Placement Agent

 

Ladies
and Gentlemen:

 

The
undersigned understands that you (the “Placement Agent”) propose to enter into a Placement Agency Agreement
(the “Agreement”) pursuant to which the Placement Agent will offer, as agent, the shares (the “Stock”)
of Series B Convertible Preferred Stock, par value $0.0001 per share (the “Series B Preferred Stock”),
of Matinas BioPharma Holdings, Inc., a Delaware corporation (the “Company”), to the public (the “Offering”).

 

In
consideration of the execution of the Agreement by the Placement Agent, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of the Placement Agent, the undersigned will not, directly or
indirectly, (1) offer for sale, sell, pledge, or otherwise transfer or dispose of (or enter into any transaction or device that
is designed to, or could be expected to, result in the transfer or disposition by any person at any time in the future of) any
shares of capital stock of the Company (including, without limitation, shares of common stock, par value $0.0001 per share, of
the Company (“Common Stock”) that may be deemed to be beneficially owned by the undersigned in accordance
with the rules and regulations of the Securities and Exchange Commission and shares of Common Stock that may be issued upon exercise
of any options or warrants) or securities convertible into or exercisable or exchangeable for Common Stock, (2) enter into any
swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of
ownership of shares of capital stock of the Company, whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of capital stock of the Company or other securities, in cash or otherwise, (3) except as provided for below,
make any demand for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with
respect to the registration of any shares of Common Stock or securities convertible into or exercisable or exchangeable for Common
Stock or any other securities of the Company, or (4) publicly disclose the intention to do any of the foregoing for a period commencing
on the date hereof and ending on the 90th day after the date of the Prospectus relating to the Offering (such 90-day period, the
“Lock-Up Period”).

 

    	 	1	 

    	 

    

 

The
foregoing paragraph shall not apply to (a) transactions relating to shares of Common Stock or other securities acquired in the
open market after the completion of the Offering, provided that no filing under Section 16(a) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), shall be required or shall be voluntarily made in connection
with such transfers; (b) bona fide gifts of shares of any class of the Company’s capital stock or any security convertible
into Common Stock, in each case that are made exclusively between and among the undersigned or members of the undersigned’s
family, or affiliates of the undersigned, including its partners (if a partnership) or members (if a limited liability company);
(c) any transfer of shares of Common Stock or any security convertible into Common Stock by will or intestate succession upon
the death of the undersigned; (d) transfer of shares of Common Stock or any security convertible into Common Stock to an immediate
family member (for purposes of this Lock-Up Letter Agreement, “immediate family” shall mean any relationship by blood,
marriage or adoption, not more remote than first cousin) or any trust, limited partnership, limited liability company or other
entity for the direct or indirect benefit of the undersigned or any immediate family member of the undersigned; provided that,
in the case of clauses (b)- (d) above, it shall be a condition to any such transfer that (i) the transferee/donee agrees to be
bound by the terms of this Lock-Up Letter Agreement (including, without limitation, the restrictions set forth in the preceding
sentence) to the same extent as if the transferee/donee were a party hereto, (ii) each party (donor, donee, transferor or transferee)
shall not be required by law (including without limitation the disclosure requirements of the Securities Act of 1933, as amended,
(the “Securities Act”) and the Exchange Act) to make, and shall agree to not voluntarily make, any filing
or public announcement of the transfer or disposition prior to the expiration of the 90-day period referred to above, and (iii)
the undersigned notifies the Placement Agent at least two business days prior to the proposed transfer or disposition; (e) the
transfer of shares to the Company to satisfy withholding obligations for any equity award granted pursuant to the terms of the
Company’s stock option/incentive plans, such as upon exercise, vesting, lapse of substantial risk of forfeiture, or other
similar taxable event, in each case on a “cashless” or “net exercise” basis (which, for the avoidance
of doubt shall not include “cashless” exercise programs involving a broker or other third party), provided
that as a condition of any transfer pursuant to this clause (e), that if the undersigned is required to file a report under Section
16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock during the Lock-Up Period, the undersigned shall include a statement in such
report, and if applicable an appropriate disposition transaction code, to the effect that such transfer is being made as a share
delivery or forfeiture in connection with a net value exercise, or as a forfeiture or sale of shares solely to cover required
tax withholding, as the case may be; (f) transfers of shares of Common Stock or any security convertible into or exercisable or
exchangeable for Common Stock pursuant to a bona fide third party tender offer made to all holders of the Common Stock, merger,
consolidation or other similar transaction involving a change of control (as defined below) of the Company, including voting in
favor of any such transaction or taking any other action in connection with such transaction, provided that in the event
that such merger, tender offer or other transaction is not completed, the Common Stock and any security convertible into or exercisable
or exchangeable for Common Stock shall remain subject to the restrictions set forth herein; (g) the exercise of warrants or the
exercise of stock options granted pursuant to the Company’s stock option/incentive plans or otherwise outstanding on the
date hereof; provided, that the restrictions shall apply to shares of Common Stock issued upon such exercise or conversion;
(h) the establishment of any contract, instruction or plan that satisfies all of the requirements of Rule 10b5-1 (a “Rule
10b5-1 Plan”) under the Exchange Act; provided, however, that no sales of Common Stock or securities
convertible into, or exchangeable or exercisable for, Common Stock, shall be made pursuant to a Rule 10b5-1 Plan prior to the
expiration of the Lock-Up Period; provided further, that the Company is not required to report the establishment of such
Rule 10b5-1 Plan in any public report or filing with the Commission under the Exchange Act during the lock-up period and does
not otherwise voluntarily effect any such public filing or report regarding such Rule 10b5-1 Plan; and (i) any demands or requests
for, exercise any right with respect to, or take any action in preparation of, the registration by the Company under the Act of
the undersigned’s shares of Common Stock, provided that no transfer of the undersigned’s shares of Common Stock
registered pursuant to the exercise of any such right and no registration statement shall be filed under the Act with respect
to any of the undersigned’s shares of Common Stock during the Lock-Up Period. For purposes of clause (f) above, “change
of control” shall mean the consummation of any bona fide third party tender offer, merger, purchase, consolidation or other
similar transaction the result of which is that any “person” (as defined in Section 13(d)(3) of the Exchange Act),
or group of persons, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 of the Exchange Act) of a majority of total
voting power of the voting stock of the Company.

 

    	 	2	 

    	 

    

 

The
undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar
against the transfer of the undersigned’s securities subject to this Lock-Up Letter Agreement except in compliance with
this Lock-Up Letter Agreement.

 

It
is understood that, if the Company notifies the Placement Agent that it does not intend to proceed with the Offering, if the Agreement
does not become effective, or if the Agreement (other than the provisions thereof which survive termination) shall terminate or
be terminated prior to the Offering, the undersigned will be released from its obligations under this Lock-Up Letter Agreement.

 

The
undersigned understands that the Company and the Placement Agent will proceed with the Offering in reliance on this Lock-Up Letter
Agreement.

 

Whether
or not the Offering actually occurs depends on a number of factors, including market conditions. Any Offering will only be made
pursuant to a Placement Agency Agreement, the terms of which are subject to negotiation between the Company and the Placement
Agent.

 

This
Lock-Up Letter Agreement shall automatically terminate upon the earliest to occur, if any, of (1) the termination of the Agreement
before the Offering or (2) [DATE], in the event that the Agreement has not been executed by that date.

 

[Signature
page follows]

 

    	 	3	 

    	 

    

 

The
undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Lock-Up Letter
Agreement and that, upon request, the undersigned will execute any additional documents necessary in connection with the enforcement
hereof. Any obligations of the undersigned shall be binding upon the heirs, personal representative, successors and assigns of
the undersigned.

 

	 	Very truly yours,
	 	 	 
	 	By:	 
	 	Name:
    	 
	 	Title:	 

 

Dated:
_______________ex_110030.htm

Exhibit 10.1

 

 

LOAN AGREEMENT

 

 

Dated March 22, 2018

 

 

$100,000,000

 

LOAN AGREEMENT

 

for

 

 

Ormat Technologies, Inc.

as Borrower

 

with

 

 The Lenders Listed in Part II of Schedule 1

 

 

 

 

1

 

 

Contents

 

	1.	Definitions and Interpretation	4
	 	 	 
	2.	The Loan	12
	 	 	 
	3.	Purpose	12
	 	 	 
	4.	Conditions of Utilisation	13
	 	 	 
	5.	Utilisation of the loan	13
	 	 	 
	6.	Repayment of loan	14
	 	 	 
	7.	Prepayment	14
	 	 	 
	8.	Interest	15
	 	 	 
	9.	Interest Periods	17
	 	 	 
	10.	Fees	17
	 	 	 
	11.	Tax Gross Up and Indemnities	17
	 	 	 
	12.	Increased Costs	20
	 	 	 
	13.	Other Indemnities	21
	 	 	 
	14.	Costs and Expenses	22
	 	 	 
	15.	Representations	23
	 	 	 
	16.	Information Undertakings	28
	 	 	 
	17.	Financial Covenants	30
	 	 	 
	18.	General Undertakings	33
	 	 	 
	19.	Events of Default	36
	 	 	 
	20.	Changes to the Lenders	41
	 	 	 
	21.	Changes to the Borrower	43
	 	 	 
	22.	Conduct of business by the Finance Parties	43

 

2

 

 

	23.	Payment Mechanics	44
	 	 	 
	24.	Set-Off	45
	 	 	 
	25.	Notices	46
	 	 	 
	26.	Calculations and Certificates	48
	 	 	 
	27.	Partial Invalidity	48
	 	 	 
	28.	Remedies and Waivers	48
	 	 	 
	29.	Amendments and Waivers	48
	 	 	 
	30.	Confidential Information	48
	 	 	 
	31.	Counterparts	51
	 	 	 
	32.	Governing Law	51
	 	 	 
	33.	Enforcement	51

 

 

 

 

Schedules

 

 

	
			SCHEDULE 1

				
			THE PARTIES

			
	 	 
	
			SCHEDULE 2

				
			FORM OF ASSIGNMENT AGREEMENT

			
	 	 
	
			SCHEDULE 3

				
			FORM OF COMPLIANCE CERTIFICATE

			
	 	 
	
			SCHEDULE 4

				
			SUBORDINATED SHAREHOLDER LOANS CONDITIONS

			
	 	 
	
			SCHEDULE 5

				
			REPAYMENT SCHEDULE

			
	 	 
	
			SCHEDULE 6

				
			PREPAYMENT FEE

			
	 	 
	
			SCHEDULE 7 

				
			FORM OF TRANSFER CERTIFICATE

			
	 	 
	
			SCHEDULE 8

				
			UTILISATION REQUEST

			
	 	 
	
			SCHEDULE 9 

				
			CONDITIONS PRECEDENT

			

 

3

 

 

THIS AGREEMENT is dated March 22, 2018, and made between:

 

Ormat Technologies, Inc. a Delaware corporation (as Borrower); and

 

The entities listed in part II of Schedule 1 (The Parties) (as Lenders).

 

IT IS AGREED as follows:

 

	
			1.

				
			Definitions and Interpretation

			

 

	 	
			1.1

				
			Definitions

			

 

In this Agreement:

 

Accounting Principles means generally accepted accounting principles in the United States of America, and the requirements of any applicable securities law.

 

Affiliate means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company.

 

Assignment Agreement means an agreement substantially in the form set out in Schedule 2 (Form of Assignment Agreement) or any other form agreed between the relevant assignor and assignee.

 

Auditors means PWC or any other "Big 4" accounting firm selected by the Borrower or any other accounting firm approved in advance by the Lenders (which approval shall not be unreasonably withheld or delayed).

 

Authorisation means an authorisation, permit, consent, approval, resolution, licence, exemption, filing, notarisation or registration.

 

Bankruptcy Code means Title 11 of the United States Code entitled "Bankruptcy," as now and hereafter in effect, or any successor statute or any similar statute in any other Relevant Jurisdiction.

 

Basel III means:

 

	 	
			(a)

				
			the agreements on capital requirements, a leverage ratio and liquidity standards contained in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III: International framework for liquidity risk measurement, standards and monitoring" and "Guidance for national authorities operating the countercyclical capital buffer" published by the Basel Committee in December 2010, each as amended;

			

 

	 	
			(b)

				
			the rules for global systemically important banks contained in "Global systemically important banks: assessment methodology and the additional loss absorbency requirement – Rules text" published by the Basel Committee in November 2011, as amended; and

			

 

	 	
			(c)

				
			any further guidance or standards published by the Basel Committee relating to paragraph (a) or (b) above.

			

 

Basel Committee means the Basel Committee on Banking Supervision.

 

Borrower means Ormat Technologies, Inc.

 

4

 

 

Business Day means a day (other than a Saturday or Sunday) on which banks are open for general business in both New York and Tel Aviv.

 

Code means the US Internal Revenue Code of 1986, as amended.

 

Compliance Certificate means a certificate substantially in the form set out in Schedule 3 (Form of Compliance Certificate).

 

Confidential Information means all information that was identified in writing at the time of delivery as confidential, or that by the nature of the circumstances surrounding the disclosure or receipt ought to be treated as confidential relating to the Borrower and its Affiliates or the Loan of which a Finance Party becomes aware in its capacity as, or for the purpose of becoming, a Finance Party or which is received by a Finance Party in relation to, or for the purpose of becoming a Finance Party under or the Loan from the Borrower or its Affiliates or any of its advisers but excludes information that:

 

	 	
			(a)

				
			is or becomes public information other than as a direct result of any breach by that Finance Party of Clause 30 (Confidential Information); or

			

 

	 	
			(b)

				
			is known by that Finance Party before the date the information is disclosed to it or is obtained by that Finance Party from a third party (other than the Borrower or any of its Affiliates) after that date and which, as far as that Finance Party is aware after clarifying with such third party, does not have confidentiality obligations to the Borrower and/or its Affiliates with respect to the information disclosed.

			

 

CRD IV means: 

 

	 	
			(a)

				
			Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU No 648/2012); and

			

 

	 	
			(b)

				
			Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87EC and repealing Directives 2006/48/EC and 2006/49/EC.

			

 

Credit Rating Agency means any credit agency, whether in Israel or outside of Israel, including Standard & Poor's (S&P), Moody's, and Fitch Group.

 

Default means an Event of Default or any event or circumstance specified in Clause 19 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of any of the foregoing) be an Event of Default.

 

Delegate means any delegate, agent or attorney appointed by any Finance Party.

 

Discharge Date means the date on which all of the Total Obligations have been unconditionally and irrevocably paid and discharged in full.

 

Dispute means any dispute arising out of or in connection with this Agreement or any other Finance Document (including relating to the existence, validity or termination of this Agreement or any non-contractual obligation arising out of or in connection with the Finance Documents).

 

5

 

 

Disruption Event means either or both of:

 

	 	
			(a)

				
			a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Loan (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties; or

			

 

	 	
			(b)

				
			the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party preventing that, or any other Party:

			

 

	 	
			(i)

				
			from performing its payment obligations under the Finance Documents; or

			

 

	 	
			(ii)

				
			from communicating with other Parties in accordance with the terms of the Finance Documents,

			

 

and which (in either such case) is not caused by, and is beyond the control of, the Party whose operations are disrupted.

 

Environmental Claim means any claim, proceeding, formal notice or investigation alleging liability pursuant to Environmental Law.

 

Environmental Law means any applicable law which relates to pollution or protection of the environment, or hazardous substances, or harm to or the protection of human health, or the living of any organism, or compensation relating to any harm referred to above.

 

Environmental Permits means any Authorisation required under any Environmental Law for the operation of the business

 

Event of Default means any event or circumstance specified as such in Clause 19 (Events of Default).

 

Fair Spread means Fair Spread Ltd. ('Mirvah Hogen'), or any substitute entity thereof appointed by law as provider of quotation services to Israeli institutional investors with respect to non-traded debt.

 

Finance Document means:

 

	 	
			(a)

				
			this Agreement;

			

 

	 	
			(b)

				
			a Transfer Certificate;

			

 

	 	
			(c)

				
			the Utilization Request; and

			

 

	 	
			(d)

				
			any other document designated as such by the Lenders and the Borrower.

			

 

Finance Party means each Lender.

 

Financial Indebtedness means the Borrower's short-term and long-term debt to Financial Institutions (including current maturities of long-term debts to such bodies) including debts to bondholders, and deducting cash, cash equivalents. marketable securities and debt service reserve accounts, as determined according to U.S. GAAP according to which the Borrower’s financial statements shall be prepared and all according to their value in the financial statements.

 

6

 

 

It is hereby clarified that: (i) shareholder loans provided to the Borrower by any of its shareholders that are subordinated to the Borrower's obligation to the Lenders under the Finance Documents, pursuant to a subordinated shareholder loan agreement which meets the conditions set forth in Schedule 4 (Subordinated Shareholder Loans Conditions) (unless otherwise was agreed in advance and in writing by the Lenders) shall not be included in the scope of Financial Indebtedness; and (ii) obligations in relation to a sale of rights of ownership in connection with a transaction the substance of which is the sale of tax benefits (tax monetization transaction) shall not be deemed to be a Financial Indebtedness.

 

In the event of the introduction of a New Accounting Treatment (as such term is defined in paragraph 17.4(a) below), the provisions of Clause 17.4(b) below will apply.

 

Financial Institutions means third parties that are banks, insurance companies, investment houses, mezzanine funds, and any other entity whose main business is extending of loans and/or making investments.

 

Governmental Authority means any government and/or governmental department, ministry, cabinet, commission, board, bureau, agency, tribunal, regulatory authority, instrumentality, judicial legislative or administrative body or entity, domestic or foreign, regional, provincial or local, having or exercising jurisdiction over the matter or matters in question.

 

Group means the Borrower and any entity controlled by it for the time being, and “member of the Group” shall be construed accordingly.

 

Holding Company means, in relation to a person, any other person in respect of which it is a Subsidiary.

 

Interest Payment Date means (i) September 15, 2018, and (ii) the 15th day of each March and September thereafter until the Last Repayment Date, and all as set forth in Schedule 5 (Repayment Schedule).

 

Interest Period means, in relation to the Loan and any Unpaid Sum (including with respect to any increased interest pursuant to the provisions of this Agreement), each period determined in accordance with Clause 9.1 (Interest Period).

 

Last Repayment Date has the meaning given to it in Clause 6 (Repayment of Loan).

 

Lender means:

 

	 	
			(a)

				
			any Original Lender; and

			

 

	 	
			(b)

				
			any bank, financial institution, trust, fund or other entity which has become a Party in accordance with Clause 20 (Changes to the Lenders).

			

 

which in each case has not ceased to be a Party in accordance with the terms of this Agreement.

 

Loan means the term loan made available under this Agreement as described in Clause 2.1 (The Loan), or the principal amount outstanding for the time being of that loan.

 

7

 

 

Loan Amount means:

 

	 	
			(a)

				
			in relation to an Original Lender, the amount set opposite its name under the heading "Loan Amount" in Part II of Schedule 1 (The Parties) and any other Loan Amount transferred to it under this Agreement; and

			

 

	 	
			(b)

				
			in relation to any other Lender, the Loan Amount transferred to it under this Agreement,

			

 

to the extent not cancelled, reduced or transferred by it under this Agreement.

 

Material Adverse Effect means a change, effect, event or circumstances or development, which, at the reasonable discretion of the Lenders has or is reasonably likely to have, individually or in the aggregate, a material adverse effect on either:

 

	 	
			(a)

				
			the business, prospects, assets (whether tangible or intangible), properties, results of operations (including cash flows) or financial condition (including its liabilities (including contingent liabilities)), of the Group, taken as a whole; or

			

 

	 	
			(b)

				
			the ability of the Borrower to conduct its business in the manner in which it is currently operated; or

			

 

	 	
			(c)

				
			the ability of the Borrower to perform its obligations under the Finance Documents; or

			

 

	 	
			(d)

				
			the rights or remedies of any Finance Party under any of the Finance Documents.

			

 

Material Group Company means, any member of the Group, that either: (a) its turnover for any period set forth in the recent annual audited consolidated financial statements or quarterly reviewed financial statements of the Borrower, was at least 10% (ten percent) of the consolidated turnover of the Borrower as per such financial statements; or (b) its EBITDA for any period set forth in the recent annual consolidated audited financial statements or quarterly reviewed financial statements of the Borrower was at least 10% (ten percent) of the consolidated EBITDA of the Borrower as per such relevant financial statements.

 

Money Laundering Laws has the meaning given to that term in Clause 15.18 (Anti-corruption law).

 

Month means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that:

 

	 	
			(a)

				
			subject to paragraph (c) below if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day;

			

 

	 	
			(b)

				
			if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and

			

 

	 	
			(c)

				
			if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.

			

 

8

 

 

The above rules will only apply to the last Month of any period.

 

New Lender has the meaning given to that term in Clause 20 (Changes to the Lenders).

 

Original Financial Statements means the Borrower's quarterly reviewed consolidated financial statements for September 30, 2017.

 

Original Lenders means (a) Migdal Insurance Company Ltd. (reg. number 52-000489-6); (b) Migdal's Makefet Pension and Provident Funds Ltd. (reg. number 51-223774-4); and (c) Yozma Pension Fund of Self Employed Ltd. (reg. number 52-003256-6).

 

Party means a party to this Agreement.

 

Permitted Liens means (a) any lien arising by operation of law; and (b) any security interest created directly by the Borrower in accordance with the provisions of Clause 18.3 (Negative pledge) below.

 

Prepayment Fee shall have the meaning set out in Schedule 6 (Prepayment Fee).

 

Quarter means a calendar quarter (January 1- March 31; April 1- June 30; July 1- September 30; and October 1- December 31).

 

Relevant Jurisdiction means: in relation to any entity:

 

	 	
			(a)

				
			its jurisdiction of incorporation; and

			

 

	 	
			(b)

				
			any jurisdiction where it conducts its business.

			

 

Repayment Date means each date set out in paragraph (a) of Clause 6.1 (Repayment of Loans).

 

Repeating Representations means each of the representations set out in Clauses 15.1 (Status), 15.2 (Binding Obligations), 15.3 (Non-conflict with other obligations), 15.4 (Power and Authority), 15.5 (Validity and admissibility in evidence), 15.6 (Security Interests), 15.7 (No requirements with respect to the Lenders), 15.8 (Solvency), 15.9 (No filing stamp taxes), 15.10 (No Default), 15.11 (No Misleading information), 15.14 (Pari passu ranking), 15.15 (No proceedings pending or threatened), 15.17 (Immunity), 15.18 (Anti-corruption law), 15.19 (Sanctioned Persons), 15.20 )Environmental Matters) and 15.21 (Environmental Laws).

 

Representative means any delegate, agent, manager, administrator, nominee, attorney, trustee or custodian.

 

"Solvency II" means the Solvency II Directive (Directive 2009/138/EC) on the taking-up and pursuit of the business of Insurance and Reinsurance, as amended by the Omnibus II Directive (Direction 2014/51/EC).

 

Securities Law means the Israeli Securities Law, 1968.

 

Subsidiary has the same meaning as that which is assigned to a “subsidiary” under the Securities Law. For the avoidance of doubt, a company in which a limited partnership holds 50% (fifty percent) or more of the nominal value of its issued share capital (or its foreign equivalent) or of the voting power therein or is entitled to appoint half or more of its directors or its general manager shall be deemed a Subsidiary of such limited partnership.

 

9

 

 

Tax means any present or future tax, levy, impost, duty (including, stamp duty, registration tax and capital duties) or other deductions, charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).

 

Total Obligations means all present and future obligations and liabilities (whether actual or contingent, whether owed jointly or severally or in any capacity whatsoever), of the Borrower under the Finance Documents, including all costs, charges and expenses (including legal and other advisors fees) incurred by any Finance Party, pursuant to, or in connection with, the Finance Documents in connection with the protection, preservation or enforcement of their rights under the Finance Documents.

 

Transfer Certificate means a certificate substantially in the form set out in Schedule 7 (Form of Transfer Certificate) or any other form agreed between the Lenders and the Borrower.

 

Transfer Date means, in relation to an assignment or a transfer, the later of:

 

	 	
			(a)

				
			the proposed Transfer Date specified in the relevant Assignment Agreement or Transfer Certificate; and

			

 

	 	
			(b)

				
			the date on which a Lender executes the relevant Assignment Agreement or Transfer Certificate.

			

 

Unpaid Sum means any sum due and payable but unpaid by the Borrower under the Finance Documents.

 

US means the United States of America.

 

Utilisation Date means the date on which the Loan is made.

 

Utilisation Request means a notice substantially in the form set out in Schedule 8 (Utilisation Request).

 

VAT means value added tax as provided for in the Israeli VAT Law 1975 or any other tax of a similar nature in jurisdiction of incorporation of the Borrower.

 

	 	
			1.2

				
			Construction

			

 

	 	
			(a)

				
			Unless a contrary indication appears, any reference in this Agreement to:

			

 

	 	
			(i)

				
			any Finance Party, any Lender, the Borrower or any Party shall be construed so as to include its successors in title, permitted assigns and permitted transferees to, or of, its rights and/or obligations under the Finance Documents.

			

 

	 	
			(ii)

				
			assets includes present and future properties, revenues and rights of every description.

			

 

	 	
			(iii)

				
			control shall bear the meaning ascribed to such term in Section 1 of the Securities Law and, without derogating from the generality of the foregoing, a general partner of a limited partnership shall be deemed to control such partnership.

			

 

10

 

 

	 	
			(iv)

				
			a Finance Document or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as amended, novated, supplemented, extended or restated.

			

 

	 	
			(v)

				
			indebtedness includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent.

			

 

	 	
			(vi)

				
			a person includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium, partnership or other entity (whether or not having separate legal personality).

			

 

	 	
			(vii)

				
			a regulation includes any Israeli or US regulation, treaty, rule, official directive, request or guideline (whether or not having the force of law) of any governmental or regulatory body, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation, including, the guidelines of the Israeli Supervisor of Banks with respect to proper conduct of banking affairs (“Hora’ot Nihul Bankai Takin”) as well as any guidelines (“Hozrim”) of the Israeli Commissioner of the Capital Markets, Insurance and Savings Division, or any other request or guideline of any such banking or capital markets, insurance and savings authority.

			

 

	 	
			(viii)

				
			a law includes any Israeli or US statute, law and regulation.

			

 

	 	
			(ix)

				
			means of control shall bear the meaning assigned to such term in Section 1 of the Israeli Banking (Licensing) Law, 1981.

			

 

	 	
			(x)

				
			Any reference to a certain rating by a Credit Rating Agency in a Finance Document is stated in accordance with Standard & Poors Maalot's rating scale as at the date of this Agreement. However, (A) such reference will be changed to conform to any change in Standard & Poors Maalot's rating scale; and (B) without derogating from the above, any such reference shall also be construed, as a reference to any equivalent rating received by any other Credit Rating Agency (at the applicable time).

			

 

	 	
			(xi)

				
			a provision of law is a reference to that provision as amended or re-enacted. and

			

 

	 	
			(xii)

				
			a time of day is a reference Tel-Aviv time.

			

 

	 	
			(b)

				
			Section, Clause and Schedule headings are for ease of reference only.

			

 

	 	
			(c)

				
			Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.

			

 

	 	
			(d)

				
			A Default (other than an Event of Default) is continuing if it has not been remedied or waived and an Event of Default is continuing if it has not been remedied or waived.

			

 

	 	
			1.3

				
			Currency symbols and definitions

			

 

$, USD and dollars denote the lawful currency of the United States of America.

 

11

 

 

	 	
			1.4

				
			Third party rights

			

 

	 	
			(a)

				
			Unless expressly provided to the contrary in a Finance Document a person who is not a Party is not intended to, and shall not have any rights to enforce or to enjoy the benefit of any term of this Agreement.

			

 

	 	
			(b)

				
			Notwithstanding any term of any Finance Document the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.

			

 

	
			2.

				
			The Loan

			

 

	 	
			2.1

				
			The Loan

			

 

Subject to the terms of this Agreement, the Lenders shall make to the Borrower a Loan in an aggregate amount of USD 100,000,000 (one hundred million US dollars).

 

	 	
			2.2

				
			Finance Parties' rights and obligations 

			

 

	 	
			(a)

				
			The obligations of each Finance Party under the Finance Documents are several. Failure by a Finance Party to perform its obligations under the Finance Documents does not affect the obligations of any other Party under the Finance Documents. No Finance Party is responsible for the obligations of any other Finance Party under the Finance Documents.

			

 

	 	
			(b)

				
			The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from the Borrower is a separate and independent debt in respect of which a Finance Party shall be entitled to enforce its rights in accordance with paragraph (c) below. The rights of each Finance Party include any debt owing to that Finance Party under the Finance Documents and, for the avoidance of doubt, any part of the Loan or any other amount owed by the Borrower which relates to a Finance Party's participation in the Loan or its role under a Finance Document, is a debt owing to that Finance Party by the Borrower.

			

 

	 	
			(c)

				
			A Finance Party may, except as specifically provided otherwise in the Finance Documents, separately enforce its rights under or in connection with the Finance Documents (but subject to any law and regulation, they will cooperate to enforce such rights together).

			

 

	
			3.

				
			Purpose 

			

 

	 	
			3.1

				
			Purpose

			

 

Amounts borrowed by the Borrower under the loan shall be used for ongoing activities and general purposes of the Borrower.

 

	 	
			3.2

				
			Monitoring 

			

 

No Finance Party is bound to monitor or verify the application of any amount borrowed pursuant to this Agreement.

 

12

 

 

	
			4.

				
			Conditions of Utilisation 

			

 

Initial conditions precedent 

 

	 	
			4.1

				
			The Lenders will only be obliged to make the Loan if, on the date of the Utilization Request and on the proposed Utilization Date:

			

 

	 	
			(a)

				
			the Lenders have received:

			

 

	 	
			(i)

				
			all of the documents and other evidence listed in Schedule 9 (Conditions Precedent) in form and substance satisfactory to the Lenders; and

			

 

	 	
			(ii)

				
			a duly completed Utilization Request, in accordance with the provisions of Clause 5.1 (Delivery of a Utilisation Request) below.

			

 

	 	
			(b)

				
			no Default is continuing or would result from the Loan; and

			

 

	 	
			(c)

				
			all representations made by the Borrower under the Finance Documents are true.

			

 

In the event that any of the conditions precedent set forth above are not fulfilled on the date of the execution of this Agreement and on the Utilisation, then, save for clauses 11, 14, 30, 32 and 33 this Agreement shall no longer be of any force or effect, and save as aforesaid, no Party shall have any claim against the other Party arising out of or in connection with this Agreement.

 

	 	
			4.2

				
			The Lenders shall be entitled to waive any of the Conditions Precedent set out in Clause 4.1(a) above.

			

 

	
			5.

				
			Utilisation of the loan

			

 

	 	
			5.1

				
			Delivery of a Utilisation Request

			

 

The Utilisation Request is irrevocable and will not be regarded as having been duly completed unless:

 

	 	
			(a)

				
			the Utilisation Request is delivered to lenders on the date of the execution of this Agreement.

			

 

	 	
			(b)

				
			the amount of the requested loan is the total amount of the Loan (USD 100,000,000).

			

 

	 	
			(c)

				
			The currency specified in the Utilisation Request is US dollars.

			

 

	 	
			(d)

				
			The proposed Utilisation Date specified in the Utilisation Request will be 3 (three) Business days following the date hereof.

			

 

	 	
			5.2

				
			Advancing the Loan

			

 

Subject to the terms and conditions of this Agreement, on the Utilisation date, the Lenders shall advance the Loan to account number 78556092 in branch number 10 (Tel Aviv main branch) of Israel Discount Bank Ltd, in the name of the Borrower (Swift code: IDBLILIT; IBAN (USD): IL39-0110-1000-0007-8556-092).

 

13

 

 

	
			6.

				
			Repayment of loan

			

 

The Borrower shall repay the principal of the Loan in instalments, as follows:

 

	 	
			6.1

				
			a principal amount of USD 63,000,000 (sixty three million) of the Loan shall be repaid in 15 (fifteen) equal semi-annual instalments, every March 15 and September 15, with the first payment being on September 15, 2021 and the last repayment date being September 15, 2028.

			

 

	 	
			6.2

				
			a principal amount of USD 37,000,000 (thirty seven million) of the Loan shall be repaid in one bullet payment on March 15, 2029 (the "Last Repayment Date"),

			

 

and all as set forth in Schedule 5 (Repayment Schedule).

 

	
			7.

				
			Prepayment 

			

 

	 	
			7.1

				
			Illegality

			

 

If, in the applicable jurisdiction, (i) it becomes unlawful for any Lender to perform any of its obligations as contemplated by this Agreement; or (ii) it becomes unlawful to fund or maintain its participation in the Loan in a manner requiring termination of the Loan (in whole or in part); or (iii) it turns out that the choice of the Israeli law as the governing law of the Finance Documents will not be recognised and enforced in any of the Borrower's Relevant Jurisdictions with respect to any Dispute, or it turns out that a judgment obtained in relation to a Finance Document in Israel will not be recognised and enforced in any of the Borrower's Relevant Jurisdictions with respect to any Dispute:

 

	 	
			(a)

				
			that Lender shall promptly notify the Borrower upon becoming aware of that event;

			

 

	 	
			(b)

				
			Upon that Lender notifying the Borrower, the Borrower shall repay without any Prepayment Fee, penalty or premium all of the Lender's participation in the outstanding amounts of the Loan (but without derogating from any other obligations (including financial obligation from any kind) of the Borrower to such Lender under the Finance Documents), on (A) with respect to events specified in paragraphs (i)-(ii) of the opening paragraph of this clause 7.1 (Illegality) - the last day of the Interest Period occurring after that Lender has notified the Borrower or, if earlier, the date specified by that Lender in the notice delivered to the Borrower (being no earlier than 30 days after notice of the Lender is delivered to the Borrower); and (B) with respect to events specified in paragraphs (iii) of the opening paragraph of this clause 7.1 (Illegality) - the date specified by that Lender in the notice delivered to the Borrower.

			

 

	 	
			7.2

				
			Voluntary prepayment of the Loan 

			

 

	 	
			(a)

				
			The Borrower may, if it gives the Lenders not less than thirty (30) Business Days' (or such shorter period as the Lenders may agree) prior notice, prepay the whole or any part of the principal amount of the Loan, together with Prepayment Fee as set forth in Clause 10 (fees). Any partial prepayment shall be made on an Interest Payment Date.

			

 

	 	
			(b)

				
			A prepayment of part of the principal amount of the Loan pursuant to this Clause 7.2 must be in a minimum amount of USD 10,000,000 (ten million US Dollars) and an integral multiple of USD 5,000,000 (five million US Dollars).

			

 

14

 

 

	 	
			7.3

				
			Restrictions

			

 

	 	
			(a)

				
			Any notice of prepayment given by any Party under this Clause 7 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the prepayment is to be made and the amount of that prepayment.

			

 

	 	
			(b)

				
			Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid, and (if applicable) any Prepayment Fee payable under this Agreement, without any additional premium or penalty.

			

 

	 	
			(c)

				
			The Borrowers shall not repay or prepay all or any part of the Loan except at the times and in the manner expressly provided for in this Agreement.

			

 

	 	
			(d)

				
			The Lenders may agree on a shorter notice period for a voluntary prepayment in respect of the Loan.

			

 

	 	
			(e)

				
			The Borrower shall not be entitled to re-borrow any amount prepaid on account of the Loan.

			

 

	 	
			7.4

				
			Application of prepayments

			

 

	 	
			(a)

				
			All prepayments of the Loan under this Clause 7 or Clause 12.4, other than a prepayment of a specific Lender's participation in the Loan pursuant to Clause 7.1(b) above or Clause 12.4 (Increased Costs) below, shall be applied pro rata to each Lender's participation in the Loan.

			

 

	 	
			(b)

				
			All prepayments of the Loan under this Clause 7 and Clause 12.4, other than a prepayment of a specific Lender's participation in the Loan pursuant to Clause 7.1(b) above shall be applied on a pro rata basis from each payment of the Loan.

			

 

	
			8.

				
			Interest

			

 

	 	
			8.1

				
			Interest rate

			

 

The rate of interest of the Loan is a fixed rate of 4.8% per annum.

 

	 	
			8.2

				
			Payment of interest

			

 

The Borrower shall pay the accrued interest on the Loan on each Interest Payment Date.

 

	 	
			8.3

				
			Default interest and Increased Interest

			

 

	 	
			(a)

				
			Increased Interest 

			

 

	 	
			(i)

				
			If at any time during the term of this Agreement, the Financial Indebtedness to EBITDA Ratio (as defined in Clause 17.1 below) is equal to or higher than 4.5, then, as of the date at which the relevant financial statements tested pursuant to Clause 17.3 (Testing) below were drawn up and so long as no consolidated financial statements of the Borrower evidencing that such deviation is cured have been published, the interest rate on all the sums then outstanding on account of the Loan shall be increased by 0.5% per annum over the then applicable interest rate on the Loan.

			

 

15

 

 

	 	
			(ii)

				
			If at any time during the term of this Agreement, the rating of the Borrower drops below ilA, then, so long as the rating remains below ilA, the interest rate on all principal amounts outstanding of the Loan shall be increased by the Additional Rate Key (as defined below) and this for the period commencing on the date of publishing of such rating by the relevant Credit Rating Agency and until the full repayment of the Loan or until the relevant Credit Rating Agency updates the rating of the Borrower to ilA or higher, according to the earlier. Any change in the rating outlook of the Borrower or any change in rating of the Borrower due to a change in the methodology or rating scales of the applicable Credit Rating Agency shall not be deemed a change in the rating and shall not have any effect on (either by way of increase or decrease of) the then applicable interest rate applicable on the Loan.

			

 

Additional Rate Key means, (a) 0.5% per annum if a rating of ilA- has been received from any Credit Rating Agency (and so long as the rating remains ilA-); (b) 0.75% per annum if a rating of ilBBB+ has been received from any Credit Rating Agency (and so long as the rating remains ilBBB+); or (c) 1% per annum if a rating of ilBBB or lower has been received from any Credit Rating Agency (and so long as the rating remains ilBBB or lower); For the avoidance of doubt, the Additional Rate Key shall apply during any down grade and also during any upgrade (i.e., if the rating is improved from ilBBB to IlA-, then the then interest rate applicable on the Loan shall be decreased by 0.5% per annum, provided that in any event, the interest rate shall not be lower than the original interest rate specified in Clause 8.1 (Interest rate) above).

 

	 	
			(iii)

				
			In any case where more than one of paragraphs (i)-(ii) above has been triggered (and only as long as such paragraphs are applied together), there will be no aggregation of Increased interests and only the provisions of the paragraph that entails the highest increased interest will apply.

			

 

	 	
			(b)

				
			Default Interest

			

 

	 	
			(i)

				
			If the Borrower fails to pay any amount payable by it under the Finance Documents on its due date (whether such amount constitutes a Loan or any other amount payable under this Agreement), interest shall accrue on the overdue amount from the due date up to the date of actual payment (both before and after judgment) at a rate which is equal to the rate of the interest of the Loan at such time plus 2% per annum.

			

 

	 	
			(ii)

				
			Default interest (if unpaid) arising on an overdue amount will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

			

 

	 	
			(c)

				
			Any increased interest under paragraph (a) above (subject to the provisions of paragraph (a)(iii) above) and any default interest under paragraph (b) above shall be calculated cumulatively.

			

 

	 	
			(d)

				
			Any default interest or increased interest arising under paragraph (b) above shall be immediately payable by the Borrower on demand by the Lenders.

			

 

16

 

 

	
			9.

				
			Interest Periods 

			

 

	 	
			9.1

				
			Interest Period 

			

 

	 	
			(a)

				
			The Interest Periods for the Loan shall be (i) from the Utilization Date until the first Interest Payment Date and (ii) thereafter, from one Interest Payment Date to the next, until the Last Repayment Date.

			

 

	 	
			(b)

				
			An Interest Period shall not extend beyond the Discharge Date.

			

 

	 	
			9.2

				
			Non-Business Days

			

 

If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

 

	
			10.

				
			Fees 

			

 

	 	
			10.1

				
			Prepayment Fee 

			

 

The Borrower shall pay the Lenders Prepayment Fee with respect to any amount prepaid under Clause 7.2 (Voluntary prepayment of the Loan) above and under clause 19.21 (Acceleration) below (except for Clause 19.10 (Unlawfulness)).

 

	 	
			10.2

				
			Non-Refundable Fees

			

 

All fees and commissions payable under this Agreement are non-refundable.

 

	
			11.

				
			Tax Gross Up and Indemnities 

			

 

	 	
			11.1

				
			Definitions 

			

 

	 	
			(a)

				
			In this Agreement:

			

 

FATCA means

 

	 	
			(i)

				
			sections 1471 to 1474 of the Code or any associated regulations;

			

 

	 	
			(ii)

				
			any treaty, law of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law referred to in paragraph (i) above; or

			

 

	 	
			(iii)

				
			any agreement pursuant to the implementation of any treaty, law referred to in paragraph (i) or (ii) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.

			

 

Protected Party means a Finance Party which is or will be subject to any liability, or required to make any payment, for or on account of Tax in relation to a sum received or receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a Finance Document.

 

Tax Deduction means a deduction or withholding for or on account of Tax from any payment under a Finance Document.

 

17

 

 

	 	
			(b)

				
			Unless a contrary indication appears, in this Clause 11 a reference to "determines" or "determined" means a determination made in the absolute discretion of the person making the determination.

			

 

	 	
			11.2

				
			Tax gross-up 

			

 

	 	
			(a)

				
			The Borrower shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law.

			

 

	 	
			(b)

				
			The Borrower shall promptly upon becoming aware that it must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Lenders accordingly. Similarly, a Lender shall notify the Borrower on becoming so aware in respect of a payment payable to that Lender.

			

 

	 	
			(c)

				
			If a Tax Deduction is required by law to be made by the Borrower, the amount of the payment due from the Borrower shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required. The Borrower is not required to pay any increase under this Clause 11.2(c) to the extent the relevant Tax Deduction is in respect of a (i) Tax imposed as a result of a present or former connection between the relevant Lender and the jurisdiction imposing such Tax (other than connections arising solely from such Lender having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Finance Document, or sold or assigned an interest in the Loan), Tax imposed on or measured by net income (however denominated), franchise Tax, or branch profits Tax, (ii) Tax imposed on amounts payable to or for the account of the relevant Lender with respect to an applicable interest in the Loan pursuant to a law in effect on the date on which (x) such Lender acquires such interest in the Loan (other than pursuant to an assignment request by the Borrower) or (y) such Lender changes its lending office, except in either case, to the extent that such Taxes gave rise to increased payment under the first sentence of this Clause 11.2(c) to such Lender's assignor immediately before such Lender became an assignee thereof or to such Lender immediately before it changed its lending office, (iii) Tax attributable to such Lender’s failure to provide the Borrower with an accurate, current and complete executed copy of IRS Form W-8 or W-9 (or other applicable Tax documentation, as applicable) claiming the maximum available exemption from US withholding Tax and FATCA, (iv) Tax imposed under FATCA or (v) Tax imposed on income under Israeli Law.

			

 

	 	
			(d)

				
			If the Borrower is required to make a Tax Deduction, it shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.

			

 

	 	
			(e)

				
			Within thirty days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Borrower shall deliver to the Finance Party entitled to the payment a statement or other evidence reasonably satisfactory to that Finance Party that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

			

 

18

 

 

	 	
			11.3

				
			Tax indemnity 

			

 

	 	
			(a)

				
			The Borrower shall (within three Business Days of demand by the relevant Protected Party) pay to that Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of a Finance Document.

			

 

	 	
			(b)

				
			A Protected Party making, or intending to make a claim under paragraph (a) above shall promptly notify the Borrower of the event which will give, or has given, rise to the claim.

			

 

	 	
			(c)

				
			A Protected Party shall, on receiving a payment from the Borrower under this Clause 11.3, notify the other Finance Parties.

			

 

	 	
			(d)

				
			Clause 11.3(a) above shall not apply to the extent a loss, liability or cost (i) is compensated for by an increased payment made under Clause 11.2 (Tax gross-up), or (ii) is in respect of one of the exclusions in Clause 11.2(c) (Tax gross-up).

			

 

	 	
			11.4

				
			Stamp taxes

			

 

Except for Tax imposed with respect to a transfer described in Clause 21 (other than a transfer requested by the Borrower), the Borrower shall pay and, within three Business Days of demand delivered to the Borrower, indemnify each Finance Party against any cost, loss or liability that Finance Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document.

 

	 	
			11.5

				
			VAT 

			

 

Except to the extent otherwise required by law, the Borrower shall pay to each Finance Party all VAT, if any, payable in respect of any payment to be made by the Borrower to any such Finance Party (including, any fees and expenses to be paid pursuant to clause 10 (Fees) above or clause 14 (Costs and Expenses) below) under this Agreement or under any other Finance Document, such VAT to be paid by the Borrower at the same time it makes the relevant payment (and such Finance Party must promptly provide an appropriate VAT invoice to the Borrower).

 

	 	
			11.6

				
			Tax Credit 

			

 

If any Lender determines, in its sole discretion, that it has actually received a refund of any Taxes as to which it has been indemnified pursuant to Clause 11, it shall pay to the Borrower an amount equal to such refund (but only to the extent of indemnity payments made under this Clause 11 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). The Borrower, upon the request of such Lender, shall repay to such Lender the amount paid over pursuant to this Clause 11.6 (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such Lender is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Clause 11.6, in no event will such Lender be required to pay any amount to the Borrower pursuant to this Clause 11.6 the payment of which would place such Lender in a less favorable net after-Tax position than the Lender would have been in if the Tax subject to indemnification had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts in respect of such Tax had never been paid. This paragraph shall not be construed to require any Lender to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the Borrower or any other person.

 

19

 

 

	
			12.

				
			Increased Costs 

			

 

	 	
			12.1

				
			Increased costs

			

 

	 	
			(a)

				
			The Borrower shall, within 30 Days of a demand delivered by a Finance Party to the Borrower, pay for the account of that Finance Party the amount of any Increased Costs incurred directly by that Finance Party as a result of:

			

 

	 	
			(i)

				
			the introduction of or any change in (or in the interpretation, administration or application by any Government Authority having jurisdiction over such Finance Party of) any applicable law after the date of this Agreement;

			

 

	 	
			(ii)

				
			the implementation or application of or compliance with Basel III, Solvency II or CRD IV or any other law which implements Basel III, Solvency II or CRD IV (whether such implementation, application or compliance is required by a government, or regulator of a Finance Party).

			

 

	 	
			(b)

				
			In this Agreement Increased Costs means:

			

 

	 	
			(iii)

				
			a reduction in the rate of return from the Loan;

			

 

	 	
			(iv)

				
			additional or increased costs; or

			

 

	 	
			(v)

				
			a reduction of any amount due and payable by the Borrower under any Finance Document,

			

 

which is actually incurred or suffered by a Finance Party but only to the extent that it is directly attributable to that Finance Party having entered into the Finance Document or funding or performing its obligations under any Finance Document.

 

	 	
			(c)

				
			Clause 12.1 (Increased costs) does not apply to the extent any Increased Cost:

			

 

	 	
			(i)

				
			is attributable to a Tax Deduction required by law to be made by the Borrower;

			

 

	 	
			(ii)

				
			is compensated for in accordance with the provisions of Clause 11.3 (Tax indemnity) or would have been compensated for under Clause 11.3 (Tax indemnity) but was not so compensated solely because of any of the exclusions in paragraph (d) of Clause 11.3 (Tax indemnity); or

			

 

	 	
			12.2

				
			Increased cost claims

			

 

	 	
			(a)

				
			A Finance Party intending to make a claim pursuant to Clause 12.1 (Increased costs) shall notify the Borrower of the event giving rise to the claim and the amount of the claim.

			

 

	 	
			(b)

				
			Each Finance Party shall, as soon as practicable after a demand by the Borrower, provide a certificate and relevant details confirming the amount of its Increased Costs.

			

 

	 	
			12.3

				
			Mitigation

			

 

	 	
			(a)

				
			Each Finance Party shall take reasonable steps to mitigate any circumstances which arise and which result or would result in any Increased Cost being payable to that Finance Party. The foregoing does not in any way limit the obligations of the Borrower under the Finance Documents.

			

 

20

 

 

	 	
			(b)

				
			The Borrower shall indemnify each Finance Party for all costs and expenses reasonably incurred by that Finance Party as a result of any direct step taken by it under this Clause.

			

 

	 	
			(c)

				
			A Finance Party is not obliged to take any step under this Clause, if to do so will be prejudicial to it.

			

 

	 	
			12.4

				
			Prepayment

			

 

In the event that a Finance Party claims for Increased Costs according to this Clause 12, the Borrower will be entitled to notify the Lenders of its request to perform prepayment of the relevant Finance Party's participation in the Loan, together with accrued and unpaid interest (from any kind) thereon, and all other amounts owed to such Lender under the Finance Documents, provided that such prepayment shall be made within 30 Days of a demand delivered in accordance with the provisions of Clause 0 (Notices) below by a Finance Party to the Borrower to pay the Increased Costs. A prepayment under this Clause 12.4 shall not be subject to any Prepayment Fee, nor any other penalty or additional payment. If the Borrower has made a prepayment in accordance with the provisions of this Clause 12.4, it shall not be required to pay the Increased Costs demanded by such Finance Party.

 

	
			13.

				
			Other Indemnities

			

 

	 	
			13.1

				
			The Borrower shall within 30 Days of demand delivered by a Finance Party to the Borrower, indemnify each Finance Party against any direct cost, loss or liability incurred by that Finance Party as a result of:

			

 

	 	
			(a)

				
			the occurrence of any Event of Default;

			

 

	 	
			(b)

				
			a failure by the Borrower to pay any amount due under a Finance Document on its due date;

			

 

	 	
			(c)

				
			a Loan (or part of a Loan) not being prepaid in accordance with a notice of prepayment given by the Borrower.

			

 

	 	
			13.2

				
			The Borrower shall indemnify (within 10 Days of demand delivered by a Finance Party to the Borrower), defend and hold harmless the Finance Parties and the Indemnified Parties from and against any and all direct liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature whatsoever (including, without limitation, the reasonable fees and disbursements of counsel in connection with any investigative, administrative or judicial proceeding commenced or threatened), that may be imposed on, incurred by, or asserted against any Finance Party or the Indemnified Parties in any manner relating to or arising out of (i) any breach by an the Borrower of its obligations under, or any misrepresentation by the Borrower as contained in the Finance Documents, (ii) the use or intended use of the proceeds of the Loan in a manner which constitutes a violation of any law, or (iii) the past, present or future violation of any Environmental Laws by or related to the Borrower or any member of the Group whether or not caused by or within the control of such member of the Group.

			

 

“Indemnified Party” means each director of a Finance Party or its: officer, member of investment or credit committees, employee, agent, representative, advisor and successor and assign of any and all of the foregoing persons.

 

21

 

 

	 	
			13.3

				
			A Finance Party shall, as soon as reasonably practicable after receiving a claim by a third party in respect of which that Finance Party claims an indemnity under Clause 13.2 above, give notice of that third party claim to the Borrower. Without derogating from the provisions of Clauses 13.2 and 13.3 above, the Lenders will allow the Borrower, subject to any law or regulation and provided that no such permission shall cause any harm to the Lenders, to lead the defence proceedings (at the Borrower's expense) and will reasonably cooperate with the Borrower with respect to the defence.

			

 

	 	
			13.4

				
			The Borrower shall promptly indemnify the Lenders against any direct cost, loss or liability incurred by the Lenders as a result of: (a) investigating any event which they reasonably believe is a Default; or (b) acting or relying on any notice, request or instruction given by or on behalf of the Borrower or any representative of the Borrower, which it reasonably believes to be genuine, correct and appropriately authorised, if such notice, request or instruction was not genuine, correct or appropriately authorised, as applicable.

			

 

	 	
			13.5

				
			the Borrower shall promptly indemnify the Lenders and each Delegate against any loss or liability and reasonable costs incurred by any of them as a result of the exercise (or failure to exercise) of any of the rights, powers, discretions and remedies vested in each Delegate by the Finance Documents or by law.

			

 

	
			14.

				
			Costs and Expenses

			

 

	 	
			14.1

				
			Transaction expenses 

			

 

The Borrower shall promptly on demand pay the Original Lenders the amount of legal Fees (capped at NIS 130,000 plus VAT) incurred by them in connection with the negotiation, preparation, printing, execution and perfection of:

 

	 	
			(a)

				
			this Agreement and any other documents referred to in this Agreement; and

			

 

	 	
			(b)

				
			any other Finance Documents executed after the date of this Agreement.

			

 

	 	
			14.2

				
			Amendment costs

			

 

If the Borrower requests an amendment, waiver or consent, the Borrower shall, within seven Business Days of demand, reimburse the Lenders for the amount of all costs and expenses (including legal fees) reasonably incurred by the Lenders in responding to, evaluating, negotiating or complying with that request or requirement.

 

	 	
			14.3

				
			Enforcement costs

			

 

The Borrower shall, within 10 Business Days of demand delivered by a Finance Party to it, pay to each Finance Party the amount of all direct costs and expenses (including legal fees) incurred by that Finance Party in connection with the enforcement of, or the preservation of any rights under, any Finance Document and any proceedings instituted by or against the Lenders as a consequence of enforcing these rights against the Borrower.

 

22

 

 

	
			15.

				
			Representations

			

 

The Borrower makes the representations and warranties set out in this Clause 15 to each Finance Party on the date of this Agreement.

 

	 	
			15.1

				
			Status

			

 

	 	
			(a)

				
			It is a corporation, duly organised under the laws of its jurisdiction of organisation.

			

 

	 	
			(b)

				
			It and each Material Group Company has the power to own its assets and carry on its business as it is being conducted.

			

 

	 	
			(c)

				
			It and each Material Group Company is in good standing and authorized and qualified to conduct business in each jurisdiction where such authorization or qualification is required (except where an absence of a negligible authorisation which does not adversely affects the Borrower's or each of the Material Subsidiary's ongoing business, or the ability of the Borrower to perform its obligations herein).

			

 

	 	
			15.2

				
			Binding obligations

			

 

The obligations expressed to be assumed by it in each Finance Document to which it is a party are legal, valid, binding and enforceable obligations.

 

	 	
			15.3

				
			Non-conflict with other obligations

			

 

The entry into and performance by it of, and the transactions contemplated by, the Finance Documents do not and will not conflict with:

 

	 	
			(a)

				
			any law applicable to it;

			

 

	 	
			(b)

				
			its constitutional documents; or

			

 

	 	
			(c)

				
			any agreement or instrument binding upon it or any of its assets or constitute a default or termination event (however described) under any such agreement or instrument.

			

 

	 	
			15.4

				
			Power and authority 

			

 

	 	
			(a)

				
			It has the power to enter into, perform and deliver, and has taken all necessary action (including any applicable entity action) to authorise its entry into, performance and delivery of, the Finance Documents to which it is a party and the transactions contemplated by those Finance Documents.

			

 

	 	
			(b)

				
			No limit on its powers will be exceeded as a result of the borrowing, or giving of indemnities contemplated by the Finance Documents.

			

 

	 	
			15.5

				
			Validity and admissibility in evidence

			

 

	 	
			(a)

				
			All Authorisations required or desirable:

			

 

	 	
			(i)

				
			for the conduct of the business, trade and ordinary activities of the Borrower and any Material Group Company;

			

 

	 	
			(ii)

				
			to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Finance Documents; and

			

 

23

 

 

	 	
			(iii)

				
			to make the Finance Documents admissible in evidence in its Relevant Jurisdiction,

			

 

have been obtained or effected and are in full force and effect, except for the Authorisations the absence or loss of which has or is reasonably likely to have a Material Adverse Effect.

 

	 	
			(b)

				
			It is not aware of:

			

 

	 	
			(i)

				
			any steps to revoke, cancel, challenge or annul any Authorisation, the loss of which has or is reasonably likely to have a Material Adverse Effect; or

			

 

	 	
			(ii)

				
			any reason why any Authorisation, the loss of which has or is reasonably likely to have a Material Adverse Effect, will not be renewed when it expires;

			

 

	 	
			15.6

				
			Security Interests

			

 

	 	
			(a)

				
			The Borrower has not created any lien or charge over any of its assets, except for Permitted Liens.

			

 

	 	
			(b)

				
			No member of the Group has created any lien or charge over any of its assets, in any manner that is prohibited under Clause 18.3 (Negative Pledge).

			

 

	 	
			15.7

				
			No requirements with respect to the Lenders

			

 

It is not necessary under the laws of the State of Israel or the jurisdiction of incorporation of the Borrower:

 

	 	
			(a)

				
			in order to enable any Finance Party to enforce its rights under any Finance Document; or

			

 

	 	
			(b)

				
			by reason of the execution of any Finance Document or the performance by it of its obligations under any Finance Document,

			

 

that any Finance Party should be licensed, qualified or otherwise entitled to carry on business in the jurisdiction of incorporation of the Borrower.

 

	 	
			15.8

				
			Solvency

			

 

	 	
			(a)

				
			The Borrower is not "insolvent", within the meaning of the Israeli Companies Ordinance [New Version] 5743-1983 or the Bankruptcy Code, or unable to pay its debts and liabilities (including contingent, future or subordinated) when due, nor could it be deemed by a court to be insolvent or unable to pay such debts when due, nor, in any such case, will it become so as a result of entering into this Agreement, or performing any transaction contemplated by the Finance Documents.

			

 

	 	
			(b)

				
			No:

			

 

	 	
			(i)

				
			corporate action, legal proceeding or other procedure or step described in Clause 19.7 (Insolvency proceedings);

			

 

	 	
			(ii)

				
			legal proceeding for the bankruptcy, winding-up, insolvency, reorganization of or for any moratorium or other similar legal proceeding with respect to the Borrower; or

			

 

	 	
			(iii)

				
			creditors' process described in Clause 19.8 (Creditors' process),

			

 

24

 

 

has been taken or, to the knowledge of the Borrower threatened in relation to the Borrower or any Material Group Company; and none of the circumstances described in Clause 19.6 (Insolvency) applies to any the Borrower or any Material Group Company.

 

	 	
			15.9

				
			No filing or stamp taxes

			

 

Under the laws of the State of Israel and the US it is not necessary that the Finance Documents be filed, recorded or enrolled with any court or other authority in that jurisdiction, for the due execution of the Finance Documents.

 

	 	
			15.10

				
			No default

			

 

No Event of Default is continuing or might reasonably be expected to result from the making of the Loan or the entry into, the performance of, or any transaction contemplated by, any Finance Document.

 

	 	
			15.11

				
			No misleading information

			

 

	 	
			(a)

				
			All factual information provided by the Borrower in connection with the Finance Documents was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated.

			

 

	 	
			(b)

				
			All information provided by the Borrower in any of its recent financial statements was true and accurate in all material respects as at the date it was provided or as at the date (if any) at which it is stated.

			

 

	 	
			(c)

				
			There is no other fact or circumstance relating to its affairs that has not been disclosed to the Lenders where such non-disclosure renders any of that information misleading in any material respect and all expression of expectation, intention, belief and opinion contained in any of that information were made honestly on reasonable grounds after due and careful consideration.

			

 

	 	
			(d)

				
			The Borrower has not omitted to supply any information which, if disclosed, would make any other information referred to in paragraph (a) above untrue or misleading in any material respect.

			

 

	 	
			(e)

				
			At the Utilization Date, nothing has occurred since the date information referred to in paragraph (a) above was supplied which, if disclosed, would make that information untrue or misleading.

			

 

	 	
			15.12

				
			Financial statements 

			

 

	 	
			(a)

				
			The Original Financial Statements were prepared in accordance with the Accounting Principles consistently applied.

			

 

	 	
			(b)

				
			The Original Financial Statements fairly represent its financial condition as at the end of the relevant financial year and operations during the relevant financial year.

			

 

	 	
			(c)

				
			There has been no material adverse change in the assets, business or consolidated financial condition of the Group, as a whole, since the date of the Original Financial Statements.

			

 

25

 

 

	 	
			15.13

				
			Borrower's Reports 

			

 

Since December 31, 2016, the Borrower has filed or furnished all forms, reports and documents with the SEC and ISA that have been required to be filed or furnished by it under any applicable securities law in all material respects (all such forms, reports and documents, including exhibits and schedules, filed or furnished since December 31, 2016, together with any amendments thereto, the “Borrower's Reports”). As of its filing or furnishing date (or, if amended or superseded by a filing or furnishing prior to the date of this Agreement, on the date of such amended or superseded filing or furnishing), (i) the Borrower's Reports complied as to form in all material respects with the applicable requirements of (A) the Securities Act, the Exchange Act and the Sarbanes-Oxley Act; or (B) if the Borrower will at any time be listed in the Tel Aviv Stock Exchanges only - the Securities Law and the regulations promulgated thereunder, as the case may be, each as in effect on the date on which each of such Borrower's Reports was filed or furnished, and (ii) The Borrower's Reports did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

 

	 	
			15.14

				
			Pari passu ranking

			

 

The Borrower's payment obligations under the Finance Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.

 

	 	
			15.15

				
			No proceedings pending or threatened

			

 

The Borrower is not aware of any litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency which, if adversely determined, might reasonably be expected to have a Material Adverse Effect that has or have (to the best of its knowledge and belief (having made due and careful enquiry)) been started or threatened against any member of the Group.

 

	 	
			15.16

				
			Previous proceedings

			

 

None of the following events has taken place (in Israel or outside of Israel) during the Seven years that preceded the date hereof: the involuntary liquidation of or a creditor's arrangement pursuant to Section 350 of the Israeli Companies Law, 1999 (or any similar law) in relation to the Borrower or any other member of the Group.

 

	 	
			15.17

				
			Immunity

			

 

It is not entitled to claim immunity from suit, execution, attachment or any other legal process in Israel.

 

26

 

 

	 	
			15.18

				
			Anti-corruption law 

			

 

	 	
			(a)

				
			Neither the Borrower nor to the best of the Borrower's knowledge, other any member of the Group is in violation of any applicable anti-bribery or anti-corruption law enacted in any Relevant Jurisdiction. The Borrower and each other member of the Group maintain at all times adequate systems, controls and procedures to prevent its employees from engaging in bribery or making other unlawful payments prohibited under any applicable anti-bribery or anti-corruption law enacted in Relevant Jurisdiction. Neither the Borrower nor any other member of the Group, nor to the Borrower's knowledge, any employee acting in his or her capacity as such or other person acting on behalf of them has offered, promised, paid, received, requested or agreed to receive a bribe or other unlawful payment or offered, promised or given any financial or other advantage to a foreign public official (or to a third party at the request or acquiescence of the foreign public official) in an attempt to influence them in their capacity as a foreign public official to obtain or retain business, or to obtain an advantage in the conduct of business, where such offer, promise or payment is not permitted under applicable laws.

			

 

	 	
			(b)

				
			The operations of the Group are conducted in compliance with applicable financial record keeping and reporting requirements of all applicable money laundering and anti-terrorism financing laws, regulations and rules of the jurisdictions in which the Group conducts business and any related or similar applicable regulations, rules or guidelines issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”), and:

			

 

	 	
			(i)

				
			no suit, action or proceeding in respect of any Money Laundering Laws by or before any court or governmental agency, authority or body or any arbitrator involving the Borrower or any other member of the Group or any of their respective employees (in their capacity as such), is pending or threatened; and

			

 

	 	
			(ii)

				
			neither the Borrower nor any other member of the Group or any of their respective employees (in their capacity as such), has:

			

 

	 	
			(A)

				
			used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity;

			

 

	 	
			(B)

				
			made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds;

			

 

	 	
			(C)

				
			caused any of their respective Affiliates or Subsidiaries to be in violation of any provision of any supranational, national, local or other law regulating the payments of bribes to government officials or employees; or

			

 

	 	
			(D)

				
			made any bribe, rebate, pay-off, influence payment, kickback or other unlawful payment.

			

 

	 	
			15.19

				
			Sanctioned Persons 

			

 

Neither the Borrower nor any other member of the Group, nor, to the Borrower's knowledge, any director, officer, employee of any such entity is a Person subject to any means of any economic or financial sanctions, or laws and regulations providing for such sanctions, trade embargoes or similar measures enacted, administered or enforced by any Governmental Authority (or by any regulatory agency).

 

27

 

 

	 	
			15.20

				
			Environmental Matters

			

 

It is not subject to any judicial, administrative, government, regulatory or arbitration proceeding alleging a material violation of any applicable Environmental Laws.

 

For the purposes of Clauses 15.20 and 15.21 hereof, the term "material" refers to a violation or an Environmental Claim that has or is reasonably likely to result in a Material Adverse Effect.

 

	 	
			15.21

				
			Environmental Laws

			

 

	 	
			(a)

				
			The Borrower and any other members of the Group are to the best of the Borrower's knowledge in compliance with Clause 15.20 (Environmental matters), except for such non-compliance which does not have a Material Adverse Effect and, to the Borrower's knowledge, no circumstances have occurred which would prevent such compliance in a manner or to an extent which has or is reasonably likely to have a Material Adverse Effect.

			

 

	 	
			(b)

				
			No material Environmental Claim has been commenced or to the Borrower's knowledge is threatened in writing against the Borrower or any other member of the Group, where that claim has or is reasonably likely, if determined against such entity, to have a Material Adverse Effect.

			

 

	 	
			15.22

				
			Controlling shareholder 

			

 

The Borrower has no controlling shareholder.

 

For the purpose of this Clause 15.22 (Controlling shareholder), the term "Control" shall have the meaning ascribed to such term in the Control of Financial Services Law (Insurance) of 1981.

 

	 	
			15.23

				
			Repetition

			

 

The Repeating Representations are deemed to be made by the Borrower by reference to the facts and circumstances then existing on:

 

	 	
			(a)

				
			the date of the Utilisation Request; and

			

 

	 	
			(b)

				
			the first day of each Interest Period.

			

 

	
			16.

				
			Information Undertakings

			

 

The undertakings in this Clause 16 remain in force from the date of this Agreement for so long as any amount is outstanding under the Finance Documents.

 

	 	
			16.1

				
			Financial statements

			

 

The Borrower shall supply to each Lender, a copy of:

 

	 	
			(a)

				
			as soon as the same become available, but in any event within 120 days after the end of each of its financial years, the audited consolidated financial statements of the Borrower for that financial year.

			

 

	 	
			(b)

				
			as soon as the same become available, but in any event within 90 days after the end of each Quarter of each of its financial years, the consolidated reviewed financial statements of the Borrower for that Quarter.

			

 

28

 

 

	 	
			(c)

				
			Publication of the financial statements mentioned in (a) and (b) above on the Magna or the Edgar websites, shall be deemed as their delivery to the Lenders as required hereunder.

			

 

	 	
			16.2

				
			Compliance Certificate 

			

 

	 	
			(a)

				
			The Borrower shall supply to the Lenders, within 7 business days of the publication or delivery of the financial statements pursuant to paragraph (a) or (b) of Clause 16.1 (Financial statements), a Compliance Certificate setting out (in reasonable detail) computations as to compliance with Clause 17 (Financial Covenants) as at the date as at which those financial statements were drawn up.

			

 

	 	
			(b)

				
			Each Compliance Certificate shall be signed by the CFO of the Borrower.

			

 

	 	
			16.3

				
			Information: miscellaneous 

			

 

	 	
			(a)

				
			The Borrower shall supply to each Lender a copy of:

			

 

	 	
			(i)

				
			all documents dispatched by it to its shareholders (or any class of them) as such or its creditors generally, at the same time as they are dispatched;

			

 

	 	
			(ii)

				
			promptly upon becoming aware of them, the details of any litigation, arbitration or administrative proceedings which are current, threatened or pending against the Borrower or any member of the Group, and which might reasonably be expected to have a Material Adverse Effect.

			

 

	 	
			(iii)

				
			promptly, such further information regarding the financial condition (including any questions that the Lenders will see relevant with respect to any financial statements) business and operations of the Borrower as any Finance Party may reasonably request.

			

 

	 	
			(b)

				
			The Borrower shall, promptly upon receiving a rating below ilA (and thereafter, upon any additional change in rating), notify the Lenders about such event.

			

 

For the purpose of this Clause 16.3, any information published on the EDGAR/MAYA systems, shall be considered as having been duly supplied under this section.

 

	 	
			16.4

				
			Notification of default

			

 

	 	
			(a)

				
			The Borrower shall notify the Lenders of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of its occurrence.

			

 

	 	
			(b)

				
			Promptly upon a request by the Lenders, the Borrower shall supply to the Lenders a certificate signed by its CFO or any of it executive vice presidents on its behalf certifying that no Default is continuing (or if a Default is continuing, specifying the Default and the steps, if any, being taken to remedy it).

			

 

	 	
			16.5

				
			"Know your customer" checks

			

 

If:

 

	 	
			(a)

				
			the introduction of or any change in (or in the interpretation, administration or application of) any law made after the date of this Agreement;

			

 

	 	
			(b)

				
			any change in the status of the Borrower after the date of this Agreement; or

			

 

29

 

 

	 	
			(c)

				
			a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer subject to 20.1(a) (Changes to the Lenders) below,

			

 

obliges any Lender (or, in the case of paragraph (c), any prospective new Lender) to comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, the Borrower shall promptly upon the request of any Lender supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Lenders (for itself or on behalf of any Lender) or any Lender (for itself or, in the case of the event described in paragraph (c), on behalf of any prospective new Lender) in order for the Lenders, such Lender or, in the case of the event described in paragraph (c), any prospective new Lender to carry out and be satisfied it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.

 

	
			17.

				
			Financial Covenants

			

 

	 	
			17.1

				
			Definitions

			

 

In this Clause 17 the following terms shall have the meanings set forth below.

 

Adjusted EBITDA means, at any relevant time, the EBITDA, adjusted to (i) termination fees, (ii) impairment of long-lived assets, (iii) write-off of unsuccessful exploration activities, (iv) mark-to-market gains or losses from accounting of derivatives, (v) merger and acquisition transaction costs (vi) stock-based compensation, (vii) gain or losses from extinguishment of liabilities (viii) gains or losses on sale of subsidiaries and property, plant and equipment, and (ix) other unusual or non-recurring items, as set forth in the Discussion and Financial Analysis item in the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be), or any other parallel item if the location of presenting such data changes.

 

EBITDA means, at any relevant time, the net income before interest, taxes, depreciation and amortization, during the last four successive Quarters at such time, according to the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be).

 

Equity means, the equity in the Borrower’s consolidated balance sheet, according to the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be).

 

Equity to Total Assets Ratio means, the ratio of (a) Equity to (b) Total Assets.

 

“Examination period” - Any period of two Quarters for which two consecutive and successive financial statements (annual audited or quarterly reviewed, as the case may be) are published.

 

Financial Indebtedness means, the Financial Indebtedness (as defined in Clause 1 above) in the end of the relevant period, to be determined in accordance with the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be).

 

Financial Indebtedness to EBITDA Ratio means, the ratio of (a) Financial Indebtedness to (b) Adjusted EBITDA.

 

30

 

 

Total Assets means the total assets of the Borrower on the last day of the relevant period, as set forth in the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be).

 

	 	
			17.2

				
			Financial covenants

			

 

	 	
			(a)

				
			During the period commencing from the date hereof and ending on the Discharge Date, the Borrower hereby undertakes that:

			

 

	 	
			(i)

				
			The Equity to Total Assets Ratio (after neutralizing cash and cash equivalents from both the Equity and the Total Assets) for a period exceeding the Examination Period shall not be less than 25%.

			

 

	 	
			(ii)

				
			The Equity (excluding minority rights and including shareholder loans provided to the Borrower by any of its shareholders that are subordinated to the Borrower's obligation to the Lenders under the Finance Documents, pursuant to a subordination shareholder loan agreement which meets the conditions set forth in Schedule 4 (Subordinated Shareholder Loans Conditions) (unless otherwise was agreed in advance and in writing by the Lenders)) during a period exceeding the Examination Period, shall not be lower than USD 650,000,000.

			

 

	 	
			(iii)

				
			The Financial Indebtedness to EBITDA Ratio as set forth in the Managenent's Discussion and Analysis of Financial Condition and Results of Operations item in the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be), or any other parallel item if the location of presenting such data changes, shall not exceed 5 unless such exceeding is cured within twelve months after the occurrence of such event, and provided that the Financial Indebtedness to EBITDA Ratio shall not exceed 6 at any time during such twelve months (and it is being clarified that during such twelve months in which the Financial Indebtedness to the EBITDA ratio exceeds 5 but not exceeds 6, such event shall not constitute an Event of Default).

			

 

	 	
			(iv)

				
			The Financial Indebtedness to EBITDA Ratio as set forth in the Managenent's Discussion and Analysis of Financial Condition and Results of Operations item in the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be), or any other parallel item if the location of presenting such data changes, shall not exceed 6.

			

 

	 	
			(b)

				
			Additional Financial Covenants

			

 

	 	
			(i)

				
			The Borrower confirms that on the date hereof it has no obligation to any of its other creditors, to comply with any financial covenant that is not included in this Clause 17 (Financial Covenants) or Clause 18.7 (Distributions) , or that is containing terms that are more onerous to such creditor than the terms of this Clause 17 (Financial Covenants) or Clause 18.7 (Distributions) (including any financial covenant with respect to distributions or any other types of payments to any of the shareholders of the Borrower) ("Additional Financial Covenant").

			

 

	 	
			(ii)

				
			Any Additional Financial Covenant (whether exists now or will be existed in the future) is or will be, as the case may be, automatically applied to this Agreement and form an integral part of this Clause 18 (Financial Covenants) or Clause 18.7 (Distributions), as the case may be.

			

 

31

 

 

	 	
			(iii)

				
			Without derogating from the provisions of Clause 17.2(b)(ii) above, the Borrower shall inform the Lenders in any case in which it undertakes to comply with any Additional Financial Covenant.

			

 

	 	
			(iv)

				
			Notwithstanding the above, the provisions of Clause 17.2(b)(ii) above shall not be applied to any Additional Financial Covenant that (a) was made prior to the date hereof with respect to a certain loan or an ongoing facility, or was renewed thereafter for the purpose of extending the maturity date of such loan or ongoing facility; and (b) is referring to an identical financial covenant as set forth in Clause 18.7(b)(i) below.

			

 

	 	
			(v)

				
			The Borrower will inform the Lenders reasonably time in advance, regarding the expiration date of any Additional Financial Covenant, and as of such expiration date, such relevant Additional Financial Covenant shall no longer form an integral part of this Agreement.

			

 

	 	
			(c)

				
			The calculation of each financial covenant included in Clause 17.2(a) or 17.2(b) above will be performed consistently with the calculation of such financial covenant under the agreements with other creditors of the Borrower.

			

 

	 	
			17.3

				
			Testing

			

 

The financial covenants set out in this Clause 17 shall be tested by reference to the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be).

 

	 	
			17.4

				
			New Accounting Treatment

			

 

	 	
			(a)

				
			The Borrower shall inform the Lenders on any change in its accounting principles or policies (any such change, to be referred to hereinafter as the “New Accounting Treatment”), that caused and/or may cause any change to its relevant financial statements which may materially and adversely affect the financial covenants set forth in Clause 17.2 above.

			

 

	 	
			(b)

				
			In the event of the introduction of a New Accounting Treatment (as such term is defined in paragraph (a) above), that in the view of any of the Parties, caused and/or may cause any change to the relevant financial statements which may affect the financial covenants set forth above, the Lenders and the Borrower shall negotiate any amendments to the financial covenants set out above required, if at all, in order to revise the relevant financial covenants contained therein, to take into account such New Accounting Treatment with the intention of adjusting such financial covenants to preserve the original commercial and economic effect which such financial covenants were intended to achieve. In case no agreement is reached with respect to such revisions in the financial covenants within 30 (thirty) days of the commencement of such negotiations, the Lenders shall be entitled (without derogating from any other rights they may have under this Agreement) to nominate any of the managing partners of any of the Auditors to perform (at the Borrower's expense) such revisions to this Clause 17 (including any changes to the definitions or any defined terms used herein) required in his opinion in order to revise the relevant financial covenants contained herein to adjust such financial covenants to preserve the original commercial and economic effect which such financial covenants were intended to achieve. Any such revisions shall be binding from the end of the Quarter in which such revisions were made.

			

 

32

 

 

	
			18.

				
			General Undertakings

			

 

The undertakings in this Clause 18 shall remain in force from the date of this Agreement until the Discharge Date.

 

	 	
			18.1

				
			Authorisations

			

 

The Borrower shall promptly obtain, comply with and do all that is necessary to maintain in full force and effect; and supply certified copies to each Lender of, any Authorisation required under any law of its Relevant Jurisdiction to:

 

	 	
			(a)

				
			enable it to perform its obligations under the Finance Documents;

			

 

	 	
			(b)

				
			ensure the legality, validity, enforceability or admissibility in evidence of any Finance Document in the State of Israel and the jurisdiction of incorporation of the Borrower; and

			

 

	 	
			(c)

				
			carry on its business where failure to do so has or is reasonably likely to have a Material Adverse Effect.

			

 

	 	
			18.2

				
			Compliance with laws

			

 

The Borrower shall comply in all respects with all laws to which it may be subject, if failure so to comply would materially impair its ability to perform its obligations under the Finance Documents.

 

	 	
			18.3

				
			Negative pledge

			

 

The Borrower shall not create a floating charge over all of its direct assets in favour of any third party to secure its debts to it, nor will it create a fixed charge over any of its direct holdings in any Subsidiary in favour of any third party (each such charge floating or first charge, a "Charge"), unless all of the following conditions were met: (i) the Charge is registered, concurrently with the registration of an identical fixed or floating charge (as the case may be) in favour of the Lenders, and each such charge in favour of the Lenders shall be ranked at any time pari passu with each other Charge, in accordance with the portion of each creditor (to whom the Borrower has granted a Charge) out of the total Borrower's Financial Indebtedness; (ii) the creation of the Charge shall be made in collaboration with the Lenders, and in a form approved by them; (iii) notwithstanding the provisions of paragraph (ii) above, the Borrower shall be entitled to create a fixed and floating Charges over any of its direct holdings in any direct Subsidiary, without the need to obtain the consent of the Lenders, provided that such Charge is created to secure Financial Indebtedness incurred by it for the sole purpose of (A) execution of a project finance; or (B) financing or refinancing the acquisition by the Borrower of the asset that will be secured under such Charge.

 

The above does not limit: (a) any corporation controlled by the Borrower from creating floating or fixed charges on all and/or part of their assets (provided that such charge shall not secure any Financial Indebtedness of the Borrower); (b) the Borrower to create fixed and floating charges over specific asset of the Borrower (except for direct holdings of the Borrower in any Subsidiary of it) in favour of any third party.

 

33

 

 

	 	
			18.4

				
			Disposals

			

 

	 	
			(a)

				
			The Borrower (and the Borrower shall procure that any entity controlled by it whether directly or indirectly) shall not enter into a single transaction or a series of transactions (whether related or not) to sell, lease, transfer or otherwise dispose of any asset (including by way of amalgamation, demerger, merger or corporate reconstruction) in the aggregate, amounts to Most of the Borrower's Assets, during any financial year (a "Trigger Event"), without the Lenders' consent.

			

 

	 	
			(b)

				
			"Most of the Borrower's Assets" - Shall mean any asset (including number of assets cumulatively) owned by the Borrower's or any entity controlled by it (whether directly or indirectly), whose total value, as per the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be), constitutes at least 50.01% of the Borrower's total assets (consolidated, including cash and cash equivalents, deposits and marketable securities).

			

 

	 	
			18.5

				
			Merger 

			

 

The Borrower will not enter into any amalgamation, demerger, merger or corporate reconstruction ("Merger"), except where the Borrower remains the surviving entity after the Merger and such Merger has not prejudiced its obligations herein and has no adverse effect on the rights of the Lenders under any Finance Document.

 

	 	
			18.6

				
			Activities

			

 

The Borrower shall procure that no substantial change is made to the general nature of the business of the Group from that carried on at the date of this Agreement. Without derogating from the generality of this Clause 18.6, the Borrower shall continue to be a reporting company, and its common stock shall continue to be listed and traded on the New York Stock Exchange or the Tel Aviv Stock Exchange (and/or may replace any of the foregoing with the listing of its common stock on Nasdaq), provided however, that the Borrower may delist its securities from both these stock exchanges subject to reaching prior written approval with the Lenders as to the reports and corporate governance that shall apply thereto for the full satisfactions of the Lenders in their sole discretion.

 

	 	
			18.7

				
			Distributions 

			

 

	 	
			(a)

				
			Except as permitted under paragraph (b) below, the Borrower shall not declare, make or pay any dividend, charge, fee or other distribution (or interest on any unpaid dividend, charge, fee or other distribution) (whether in cash or in any kind) on or in respect of its share capital (or any class of its share capital) (a "Distribution").

			

 

	 	
			(b)

				
			Notwithstanding the Provisions of paragraph (a) above, the Borrower will be entitled to make, commit to make or declare, Distributions with respect to an applicable financial year, which, if relevant, comply with the provisions of any law and any contractual limitation applicable thereto, and provided that all the following conditions were met:

			

 

34

 

 

	 	
			(i)

				
			The amount of Distribution shall not exceed 50% of the net profit of that financial year, as reflected under the audited consolidated financial statements of the Borrower for that financial year. It is being clarified that this condition shall be expired on the date on which all outstanding amounts under all the Israeli bonds issued by the Borrower prior to the date hereof will be repaid in full. The above clarification shall not derogate from any right of the Lenders under Clause 17.2(b) above in accordance with its terms (including with respect to any Additional Financial Covenant (as defined in such Clause), from any kind, relating to Distributions).

			

 

	 	
			(ii)

				
			The equity of the Borrower immediately after giving effect to such Distribution shall be at least equal to USD 800,000,000 (excluding minority rights).

			

 

	 	
			(iii)

				
			No Default has occurred and is continuing at the date of such Distribution and no Default shall occur as a result of such Distribution.

			

 

	 	
			18.8

				
			Related party transactions 

			

 

The Borrower (and the Borrower shall procure the no member of the Group) shall not enter into any agreement or transaction or make any payment or incurrence of any liability or obligation for the benefit of, any entity that holds at the date of such agreement or transaction 20% (twenty percent) of any means of control in the Borrower, unless (a) it is made on an arms' length basis; and (b) the Borrower has approved it as required by applicable law including NYSE rules, if applicable.

 

	 	
			18.9

				
			Pari Passu ranking

			

 

The Borrower shall ensure that at all times any unsecured and unsubordinated claims of a Finance Party against it under the Finance Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors except those creditors whose claims are mandatorily preferred by laws of general application to companies.

 

	 	
			18.10

				
			Environmental matters 

			

 

	 	
			(a)

				
			The Borrower (and the Borrower shall procure that each member of the Group) will:

			

 

	 	
			(i)

				
			comply with all Environmental Laws applicable thereto in all material respects;

			

 

	 	
			(ii)

				
			obtain, maintain and ensure compliance in all material respects with all requisite Environmental Permits applicable to it and its operations; and

			

 

	 	
			(iii)

				
			implement procedures to monitor compliance with any Environmental Law applicable to it or its operations,

			

 

	 	
			(b)

				
			The Borrower must, promptly upon becoming aware, notify the Lenders of:

			

 

	 	
			(i)

				
			any material Environmental Claim started against the Borrower or any other member of the Group, or to its knowledge, threatened;

			

 

	 	
			(ii)

				
			any circumstances reasonably likely to result in a material Environmental Claim against the Borrower or any other member of the Group; or any suspension, cancellation or revocation of any material Environmental Permit of the Borrower or any other member of the Group.

			

 

35

 

 

For the purposes of this Clause 18.10, the term "material" shall have the meaning ascribed to such term in Clause 15.20 above.

 

	 	
			18.11

				
			Borrower's Reports 

			

 

The Borrower shall timely file and furnish all forms, reports and documents with the SEC and ISA which shall comply in all material respects with the applicable requirements of (A) the Securities Act, the Exchange Act and the Sarbanes-Oxley Act and any other similar law (and if applicable. the Securities Law and the regulations promulgated thereunder and any other similar law); or (B) if the Borrower will at any time be listed in the Tel Aviv Stock Exchanges only - the Securities Law and the regulations promulgated thereunder and any other similar law; as the case may be. Each such form, report and document shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading.

 

	 	
			18.12

				
			Rating

			

 

If at any time the Lenders will require so, the Borrower shall maintain a rating by a Credit Rating Agency, at its own expense.

 

	 	
			18.13

				
			Governing law and enforcement 

			

 

	 	
			(a)

				
			The Borrower shall not object to the application of the Israeli law to any Dispute with the Lenders, or to the exclusive jurisdiction of the courts of Tel-Aviv-Jaffa to settle any Dispute.

			

 

	 	
			(b)

				
			If any of the events specified in paragraph (iii) of the opening paragraph of Clause 7.1 (Illegality) above has occurred, the Borrower shall cooperate actively with the Finance Party's, for applying the Israeli law and the exclusivity of the jurisdiction of the courts of Tel-Aviv-Jaffa with respect to any Dispute.

			

 

	
			19.

				
			Events of Default

			

 

Each of the events or circumstances set out in this Clause 19 is an Event of Default (save for Clause 19.20 (Reduction of Period) and 19.21 (Acceleration).

 

	 	
			19.1

				
			Non-payment

			

 

The Borrower does not pay on the due date any amount payable pursuant to a Finance Document at the place and in the currency in which it is expressed to be payable, unless the non-payment is remedied within five Business Days of the due date of such payment.

 

	 	
			19.2

				
			Financial covenants

			

 

Any requirement of Clause 17.2 (Financial Covenants) is not satisfied.

 

	 	
			19.3

				
			Other obligations

			

 

The Borrower does not comply with any of its obligations under the Finance Documents (other than those referred to in Clause 19.1 (Non-payment) and Clause 19.2 (Financial covenants), unless the non-compliance is: (i) capable of remedy and is remedied within 30 days of the earlier of (a) the Lenders giving notice to the Borrower; and (b) the Borrower is becoming aware of the failure to comply.

 

36

 

 

	 	
			19.4

				
			Misrepresentation

			

 

Any representation or statement made or deemed to be made by the Borrower in the Finance Documents or any other document delivered by or on behalf of the Borrower under or in connection with any Finance Document is or proves to have been incorrect or misleading in any material respect when made or deemed to be made or repeated, unless such failure to comply:

 

	 	
			(a)

				
			is capable of remedy; and

			

 

	 	
			(b)

				
			is remedied within 14 days of the earlier of (i) the Lenders giving notice to the Borrower; and (ii) the Borrower is becoming aware of such failure to comply.

			

 

	 	
			19.5

				
			Cross default 

			

 

	 	
			(a)

				
			Any Financial Indebtedness of the Borrower or any single Material Group Company is not paid when due (after the expiry of any originally applicable grace period), in (i) an amount exceeding USD 50,000,000 (fifty million US dollars) in any single event; or (ii) an aggregated amount exceeding USD 75,000,000 (seventy five million US dollars), for any several events that occurred during any nine (9) months.

			

 

	 	
			(b)

				
			Financial Indebtedness of the Borrower or any single Material Group Company in (i) an amount exceeding USD 50,000,000 (fifty million US dollars) in any single event; or (ii) the aggregate amount exceeding USD 75,000,000 (seventy five million US dollars), for any several events that occurred during any nine (9) months:

			

 

	 	
			(i)

				
			is declared to be or otherwise becomes due and payable prior to its specified maturity; or

			

 

	 	
			(ii)

				
			is capable of being declared by a creditor to be due and payable prior to its specified maturity or being placed on demand,

			

 

in each case, as a result of an event of default (howsoever described) that is continuing;

 

	 	
			(c)

				
			Any commitment for any Financial Indebtedness of the Borrower or any of its Material Group Company, in an amount exceeding USD 50,000,000 (fifty million US dollars), is cancelled or suspended by a creditor of such entity as a result of an event of default (however described) that is continuing.

			

 

Paragraphs (a)-(c) above do not apply to an event in respect of which all of the following conditions are met: (a) such event has occurred with respect to Financial Indebtedness that is part of a non-recourse project finance of a Material Group Company; and (b) the value of such project as per the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be) constitute less than 15% (fifteen percent) of the total assets of the Borrower, as set forth in the relevant financial statements of the Borrower.

 

	 	
			19.6

				
			Insolvency 

			

 

Any of the following occurs in respect of any the Borrower or any Material Group Company:

 

	 	
			(a)

				
			it is, or is deemed for the purposes of any applicable law to be, unable to pay its debts as they fall due or insolvent;

			

 

	 	
			(b)

				
			it admits its inability to pay its debts as they fall due;

			

 

37

 

 

	 	
			(c)

				
			it declares an insolvency under any applicable law under its Relevant Jurisdiction;

			

 

	 	
			(d)

				
			it suspends making payments on any of its debts when due for payment, or announces an intention to do so;

			

 

	 	
			(e)

				
			by reason of actual or anticipated financial difficulties, it (A) begins negotiations with any of its creditor for the rescheduling of its indebtedness; or (B) enters into a compromise, arrangement, assignment or composition with one or more of its creditors; or

			

 

	 	
			(f)

				
			A moratorium is declared in respect of its indebtedness. If a moratorium occurs, the ending of the moratorium will not remedy any Event of Default caused by that moratorium.

			

 

	 	
			19.7

				
			Insolvency proceedings

			

 

	 	
			(a)

				
			Except as provided below, any of the following occurs in respect of the Borrower or any Material Group Company:

			

 

	 	
			(i)

				
			any step is taken with a view to a moratorium or a composition, compromise, assignment or similar arrangement with any of its creditors (including proceedings under or in connection with sections 350 or 350A of the Israeli Companies Law, 1999);

			

 

	 	
			(ii)

				
			any person presents a petition, or files documents with a court or any registrar for its winding-up, liquidation, administration or dissolution (including on a temporary basis);

			

 

	 	
			(iii)

				
			any involuntary case shall be commenced against it under the Bankruptcy Code, Companies Law, Companies Ordinance [New Version] 5743-1983, Bankruptcy Ordinance 1980 or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect (excluding the actions specified in paragraph (ii) above);

			

 

	 	
			(iv)

				
			the suspension of payments on any of its debts when due, a moratorium of any indebtedness, winding-up, bankruptcy, liquidation, dissolution, administration or reorganisation (by way of voluntary arrangement, scheme of arrangement or otherwise) (including on a temporary basis); or a court of competent jurisdiction enters a decree, freeze order (Hakpaat Halichim) or order for relief in respect of it in an involuntary case under the Bankruptcy Code, Companies Law, Companies Ordinance [New Version] 5743-1983, Bankruptcy Ordinance 1980 or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect; or any other similar relief shall be granted under any applicable federal or state law or Israeli law;

			

 

	 	
			(v)

				
			any liquidator, trustee in bankruptcy, judicial custodian, compulsory manager, receiver, sequestrator, administrative receiver, administrator or similar officer is appointed in respect of it or any of its assets (including on a temporary basis); or

			

 

38

 

 

	 	
			(vi)

				
			enforcement of any Security over any asset or assets owned (directly or indirectly) by the Borrower, in an aggregated value exceeding USD 50,000,000 (fifty million US dollars) in any period of 12 (twelve) consecutive months.

			

 

	 	
			(vii)

				
			its partners, shareholders, directors or other officers request the appointment of, or give notice of their intention to appoint a liquidator, trustee in bankruptcy, judicial custodian, compulsory manager, receiver, administrative receiver, administrator or similar officer (including on a temporary basis);

			

 

including, in each of the above cases, without limitation any decision, application or order relating to a reorganisation application (‘bakashat havra’a’) or any other application or remedy under the third chapter (‘perek shlishi’) of the ninth part (‘helek tshi’i’) of the Companies Law – 1999 or any relevant provision of the Partnership Ordinance 1975 or the Bankruptcy Ordinance 1980.

 

	 	
			(b)

				
			Paragraph (a) above does not apply to:

			

 

	 	
			(i)

				
			any step or procedure which is taken with the prior consent of the Lenders; or

			

 

	 	
			(ii)

				
			any of the steps specified in paragraph (a)(ii) above which:

			

 

	 	
			(A)

				
			is being contested in good faith and with due diligence; and

			

 

	 	
			(B)

				
			is discharged or struck out within 45 days;

			

 

	 	
			(c)

				
			Paragraphs (a)(iv)-(a)(vi) above, do not apply to an event in respect of which all of the following conditions are met: (a) such event has occurred only with respect to Financial Indebtedness that is part of a non-recourse project finance of a Material Group Company; and (b) the value of such project as per the Borrower's recent consolidated financial statements (annual audited or quarterly reviewed, as the case may be) constitute less than 15% (fifteen percent) of the total assets of the Borrower, as set forth in the relevant financial statements of the Borrower.

			

 

	 	
			19.8

				
			Creditors' process 

			

 

Any expropriation, attachment, sequestration, distress or execution affects any asset or assets owned (directly or indirectly) by the Borrower, in an aggregate value exceeding USD 50,000,000 (fifty million US dollars) in any period of 12 (twelve) consecutive months, except where all of the following conditions have been fulfilled: (i) the entity that owns such asset or assets is in good faith and on reasonable grounds contesting the expropriation, attachment, sequestration or distress by appropriate Proceedings diligently pursued; (ii) the Lenders are satisfied that the ability of the Borrower to comply with its obligations under the Finance Documents will not be adversely affected whilst such expropriation, attachment, sequestration or distress is being so contested; and (iii) such processes are cancelled or withdrawn not later 45 (forty five) days after the institution thereof. 

 

39

 

 

	 	
			19.9

				
			Voluntary Bankruptcy; Appointment of Receiver, etc. 

			

 

The Borrower or any Material Group Company shall have an order for relief entered with respect to it or shall commence a voluntary case under the Bankruptcy Code, Companies Law, Companies Ordinance [New Version] 5743-1983, Bankruptcy Ordinance 1980 or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a substantial part of its property; or the Borrower or any Material Group Company shall make any assignment for the benefit of creditors.

 

	 	
			19.10

				
			Unlawfulness

			

 

	 	
			(a)

				
			It is or becomes unlawful for the Borrower to perform any of its obligations under any Finance Document.

			

 

	 	
			(b)

				
			Any obligation or obligations of the Borrower under any Finance Documents are not or cease to be legal, valid, binding or enforceable for any reason.

			

 

	 	
			19.11

				
			Going concern qualification

			

 

If a going concern qualification has been noted in any of the Borrower's financial statements.

 

	 	
			19.12

				
			Activities

			

 

If the Borrower fails to comply with the provisions of Clause 18.6 (Activities) above.

 

	 	
			19.13

				
			Litigation

			

 

Any litigation, arbitration, administrative, governmental, regulatory or other investigations, proceedings or disputes are commenced or threatened in writing against the Borrower or any other member of the Group which has or is reasonably likely to have a Material Adverse Effect, if adversely determined.

 

	 	
			19.14

				
			Disposals 

			

 

If the Borrower fails to comply with the provisions of Clause 18.4 (Disposals) above.

 

	 	
			19.15

				
			Merger

			

 

If the Borrower fails to comply with the provisions of Clause 18.5 (Merger) above.

 

	 	
			19.16

				
			Ownership of the Borrower

			

 

If any Person will hold (alone or together with others) 50% or more of the issued and paid up share capital (on a fully diluted basis) of the Borrower, without the prior written consent of the Lender to such change.

 

	 	
			19.17

				
			Rating 

			

 

If at any time during the term of this Agreement, any Credit Rating Agency has rated the Borrower or any of its Financial Indebtedness below ilBBB. In the case where the Borrower is ranked by more than one rating agency, then, the rating to be examined for the purpose of this Clause 19.17, shall be the lowest rating received.

 

40

 

 

	 	
			19.18

				
			Negative Pledge

			

 

If the Borrower or any member of the Group fails to comply with the provisions of Clause 18.3 (Negative Pledge) above.

 

	 	
			19.19

				
			Material Adverse Effect

			

 

Any event or circumstance occurs which, has or is reasonably likely to have a Material Adverse Effect.

 

	 	
			19.20

				
			Reduction of cure period

			

 

Notwithstanding anything to the contrary in this Clause 19, in the event that the Lenders believe that delay in acting pursuant to Clause 19.21 below due to the operation of any cure period specified under the Finance Documents is likely to materially prejudice the ability of the Finance Parties to receive full payment in accordance with the terms of the Finance Documents of all of the Total Obligations such that an urgent action is required to preserve the Finance Parties' rights, the Lenders may, by written notice to such effect to the Borrower, shorten or cancel any such cure period.

 

	 	
			19.21

				
			Acceleration

			

 

On and at any time after the occurrence of an Event of Default which is continuing the Lenders may:

 

	 	
			(a)

				
			declare that all or part of the Loan, together with accrued interest and all other amounts accrued or outstanding under the Finance Documents be immediately due and payable, whereupon they shall become immediately due and payable; and/or

			

 

	 	
			(b)

				
			declare that all or part of the Loan and the other Total Obligations be payable on demand, whereupon it shall immediately become payable on demand by the Lenders.

			

 

	 	
			(c)

				
			exercise any or all of their rights, remedies, powers or discretions under the Finance Documents, including enforcing their rights with respect to any of the Collateral, or against any Guarantor in the discretion of the Lenders.

			

 

	
			20.

				
			Changes to the Lenders

			

 

	 	
			20.1

				
			Assignments and participations by the Lenders

			

 

Subject to this clause 20 below, a Lender (the “Existing Lender”) may transfer or assign any of its rights and obligations in connection with the Loan, directly or by way of participation, without the consent of the Borrower, subject to the terms set forth below (the “New Lender”):

 

41

 

 

	 	
			(a)

				
			Notwithstanding anything to the contrary herein, no transfer or assignment shall be made unless The New Lender is (a) any entity included in sections (2) to (4) to the first supplement to the Israeli Securities Law (b) foreign bank ("bank hutz") according to the Israeli Banking (Licensing) Law, 5741-1981 (subject to the receipt of the Borrower's confirmation that no litigation proceedings are pending against the Borrower by such foreign bank, and the Borrower shall provide such confirmation no later than 10 Days after a written demand by the Lenders); (c) any affiliate of any Lender (and with respect to the Original Lenders, only entities which are controlled, directly or indirectly by Migdal Insurance & Financial Holding Ltd.); (d) any wholly owned SPV of the entities specified in sub-clauses (a)-(c) above specifically formed for the purpose of acquiring debt under a securitization or any similar transaction; or (e) any investment basket (Sal Hashkaot) comprising the activities of entities included in sub-clauses (a)-(c) above to consolidate investment activity "financial".

			

 

	 	
			(b)

				
			Any other assignments or transfers are subject to the receipt of the prior written consent of the Borrower.

			

 

	 	
			(c)

				
			Each New Lender, by executing the relevant Transfer Certificate or Assignment Agreement, confirms, for the avoidance of doubt, that the Lenders have authority to execute on its behalf any amendment or waiver that has been approved by or on behalf of the requisite Lender or Lenders in accordance with this Agreement on or prior to the date on which the transfer or assignment becomes effective in accordance with this Agreement and that it is bound by that decision to the same extent as the Existing Lender would have been had it remained a Lender.

			

 

	 	
			(d)

				
			If:

			

 

	 	
			(i)

				
			a Lender assigns or transfers any of its rights or obligations under the Finance Documents; and

			

 

	 	
			(ii)

				
			as a result of circumstances existing at the date the assignment, transfer or change occurs, the Borrower would be obliged to make a payment to the New Lender under Clause 11 or 12 above,

			

 

then, in the event that the New Lender seeks to receive payments under those clauses in excess of payments to which the Existing Lender would have been entitled if the assignment, transfer or change had not occurred, Borrower, may, not later the 5 Business Days after receiving New Lender's request to receive such excess payments, prepay that part of the Loan on which the New Lender wishes to receive such excess payments, without any Prepayment Fee, penalty or premium. This Clause 20.1(d) applies without prejudice to Clause 11.2(c)(ii) above.

 

42

 

 

	 	
			20.2

				
			Notice to the Borrower

			

 

The Lenders shall, as soon as reasonably practicable after they have executed an Assignment Agreement, send to the Borrower notification that an assignment has become effective setting forth details of the relevant obligations that have been assigned and the identity of the New Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each participant and the principal amounts (and stated interest) of each participant’s interest in the Loans or other obligations under the Finance Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any participant or any information relating to a participant's interest in any commitments, loans, letters of credit or its other obligations under any Finance Document) to any person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

 

	 	
			20.3

				
			Security over Lenders' rights 

			

 

In addition to the other rights provided to Lenders under this Clause 20, each Lender may without consulting with or obtaining consent from the Borrower, at any time charge, assign or otherwise create Security in or over (whether by way of collateral or otherwise) all or any of its rights under any Finance Document to secure obligations of that Lender to a federal reserve or central bank except that no such charge, assignment or Security shall:

 

	 	
			(a)

				
			release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security for the Lender as a party to any of the Finance Documents; or

			

 

	 	
			(b)

				
			require any payments to be made by the Borrower other than or in excess of, or grant to any person any more extensive rights than, those required to be made or granted to the relevant Lender under the Finance Documents.

			

 

	
			21.

				
			Changes to the Borrower

			

 

The Borrower shall not assign any of its rights or transfer any of its rights or obligations under the Finance Documents without the prior consent of the Lenders.

 

	
			22.

				
			Conduct of business by the Finance Parties

			

 

No provision of this Agreement will:

 

	 	
			(a)

				
			interfere with the right of any Finance Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;

			

 

	 	
			(b)

				
			oblige any Finance Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or

			

 

	 	
			(c)

				
			except as otherwise provided in Clauses 11 and 12 above, oblige any Finance Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of Tax.

			

 

43

 

 

	
			23.

				
			Payment Mechanics

			

 

	 	
			23.1

				
			Payments to the Lenders

			

 

All payments to be made by the Borrower under the Finance Documents shall be made in USD, directly to the accounts specified in the table appearing in Part III of Schedule 1 (The Parties), pro rata between such accounts, in accordance with the respective rate specified with respect to each account in such table.

 

	 	
			23.2

				
			Distributions to the Borrower

			

 

The Lenders may (with the consent of the Borrower or in accordance with Clause 24 (Set-Off)) apply any amount received by them for the Borrower in or towards payment (on the date and in the currency and funds of receipt) of any amount due from the Borrower under the Finance Documents.

 

	 	
			23.3

				
			Partial payments

			

 

	 	
			(a)

				
			If the Lenders receive a payment that is insufficient to discharge all the amounts then due and payable by the Borrower under the Finance Documents, the Lenders shall apply that payment towards the obligations of the Borrower under the Finance Documents in the following order:

			

 

	 	
			(i)

				
			first, in or towards payment, pro rata, of any fee or commission due but unpaid under this Agreement;

			

 

	 	
			(ii)

				
			second, in or towards discharge of all costs and expenses incurred and which may be incurred in connection with the collection of the Total Obligations, the above in such order and applied in such proportion between such amounts due but unpaid under the Finance Documents as the Lenders shall deem fit;

			

 

	 	
			(iii)

				
			third, in or towards payment, pro rata, of any other amount due, but unpaid, under the Finance Documents (other than principal), including interest, default interest, additional interest and all other costs;

			

 

	 	
			(iv)

				
			fourth, in or towards payment, pro rata, on account of the due and unpaid principal of the Loan; and

			

 

	 	
			(b)

				
			The Lenders may after the occurrence and continuation of an Event of Default vary the order set out in paragraphs (i)-(iv) above.

			

 

	 	
			(c)

				
			Paragraphs (a) and (b) above will override any appropriation made by the Borrower.

			

 

	 	
			23.4

				
			No set-off by the Borrower

			

 

All payments to be made by the Borrower under the Finance Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.

 

	 	
			23.5

				
			Business Days

			

 

	 	
			(a)

				
			Any payment under the Finance Documents which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).

			

 

44

 

 

	 	
			(b)

				
			During any extension of the due date for payment of any principal or Unpaid Sum under this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on the original due date.

			

 

	 	
			23.6

				
			Currency of account

			

 

	 	
			(a)

				
			Subject to paragraphs (b) and (c) below, USD is the currency of account and payment for any sum due from the Borrower under any Finance Document.

			

 

	 	
			(b)

				
			Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred.

			

 

	 	
			(c)

				
			Any amount expressed to be payable in a currency other than euro shall be paid in that other currency.

			

 

	 	
			23.7

				
			Disruption to payment systems etc

			

 

If either the Lenders determine (in their discretion) that a Disruption Event has occurred or the Lenders are notified by the Borrower that a Disruption Event has occurred:

 

	 	
			(a)

				
			the Lenders may, and shall if requested to do so by the Borrower, consult with the Borrower with a view to agreeing with the Borrower such changes to the operation or administration of the Loan as the Lenders may reasonably deem necessary in the circumstances;

			

 

	 	
			(b)

				
			the Lenders shall not be obliged to consult with the Borrower in relation to any changes mentioned in paragraph (a) if, in their opinion, it is not practicable to do so in the circumstances and, in any event, shall have no obligation to agree to such changes;

			

 

	 	
			(c)

				
			any such changes agreed upon by the Lenders and the Borrower shall (whether or not it is finally determined that a Disruption Event has occurred) be binding upon the Parties as an amendment to (or, as the case may be, waiver of) the terms of the Finance Documents notwithstanding the provisions of Clause 29 (Amendments and Waivers);

			

 

	 	
			(d)

				
			the Lenders shall not be liable for any damages, costs or losses to any person, any diminution in value or any liability whatsoever (including, without limitation for negligence, gross negligence or any other category of liability whatsoever but not including any claim based on the fraud of the Lenders) arising as a result of their taking, or failing to take, any actions pursuant to or in connection with this Clause 23.7.

			

 

	
			24.

				
			Set-Off

			

 

A Finance Party may set off any matured obligation due from the Borrower under the Finance Documents (to the extent beneficially owned by that Finance Party) against any matured obligation owed by that Finance Party to the Borrower under the Finance Documents, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Finance Party may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off.

 

45

 

 

	
			25.

				
			Notices 

			

 

	 	
			25.1

				
			Communications in writing

			

 

Any communication to be made under or in connection with the Finance Documents shall be made in writing and, unless otherwise stated, may be made by fax or letter.

 

	 	
			25.2

				
			Addresses

			

 

The address (and the department or officer, if any, for whose attention the communication is to be made) of each Party for any communication or document to be made or delivered under or in connection with the Finance Documents is:

 

	 	
			(a)

				
			in the case of the Borrower at:

			
	 	 	 
	 	 	
			Ormat Technologies, Inc.

			
	 	 	 
	 	 	
			Address: 6225 Neil Road, Reno 895111136, Nevada, USA

			
	 	 	 
	 	 	
			Attention: Doron Blachar, CFO, Tel: 00-1-775-3569029, Email: dBlachar@ormat.com

			

 

	 	
			(b)

				
			in the case of any Lender at:

			
	 	 	 
	 	 	
			Migdal Insurance Company Ltd.

			
	 	 	 
	 	 	
			Address: 4 Efal st. Petah Tikva, 4951104, Israel

			

 

	 	
			Attention:

				
			Lior Sosonkin, Head of Infrastructure and project finance Department, Tel: +972-76-8868682, Email: liors@migdal.co.il; and

			
	 	 	 
	 	 	
			Sarit Finkel, Manager of Credit Array Operation Department, Tel: +972-76-8868625, Email: saritfe@migdal.co.il.

			

 

or any substitute address or department or officer as the Party may notify to all other parties by not less than five Business Days' notice.

 

	 	
			25.3

				
			Delivery

			

 

	 	
			(a)

				
			Any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective:

			

 

	 	
			(i)

				
			if by way of fax, when received in legible form; or

			

 

	 	
			(ii)

				
			if by way of letter, when it has been left at the relevant address or five Business Days after being deposited in the post postage prepaid in an envelope addressed to it at that address;

			

 

and, if a particular department or officer is specified as part of its address details provided under Clause 25.2 (Addresses), if addressed to that department or officer.

 

46

 

 

	 	
			(b)

				
			All the Lenders confirm that all notices from or to the Borrower shall be sent through Migdal Insurance Company Ltd. (or in any case where the Lenders have transferred or assigned more the 50% of their rights and obligations under the Finance Documents to a New Lender (as defined in Clause 20.1 above) - any other entity which will replace Migdal Insurance Company Ltd. according to a written notification sent to the Borrower by all the Lenders), and any such notice will be deemed as received or sent (as the case may be) by all the Lenders.

			

 

	 	
			(c)

				
			Any communication or document which becomes effective, in accordance with paragraphs (a) to (b) above, after 4pm in the place of receipt shall be deemed only to become effective on the following day.

			

 

	 	
			25.4

				
			Notification of address and fax number

			

 

Promptly upon changing its address or fax number, Migdal Insurance Company Ltd. or the Borrower, as the case may be shall notify the other Parties.

 

	 	
			25.5

				
			Electronic communication

			

 

	 	
			(a)

				
			Any communication to be made between any two Parties under or in connection with the Finance Documents may be made by electronic mail or other electronic means (including, without limitation, by way of posting to a secure website) if those two Parties:

			

 

	 	
			(i)

				
			notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and

			

 

	 	
			(ii)

				
			notify each other of any change to their address or any other such information supplied by them by not less than five Business Days' notice.

			

 

	 	
			(b)

				
			Any such electronic communication as specified in paragraph (a) above to be made between the Borrower and a Finance Party may only be made in that way to the extent that those two Parties agree that, unless and until notified to the contrary, this is to be an accepted form of communication.

			

 

	 	
			(c)

				
			Any such electronic communication as specified in paragraph (a) made between any two Parties will be effective only when actually received (or made available) in readable form and in the case of any electronic communication made by a Party to Migdal Insurance Company Ltd. only if it is addressed in such a manner as Migdal Insurance Company Ltd. shall specify for this purpose.

			

 

	 	
			(d)

				
			Any electronic communication which becomes effective, in accordance with paragraph (c) above, after 4 pm in the place in which the Party to whom the relevant communication is sent or made available has its address for the purpose of this Agreement shall be deemed only to become effective on the following day.

			

 

	 	
			(e)

				
			Any reference in a Finance Document to a communication being sent or received shall be construed to include that communication being made available in accordance with this Clause 25.5.

			

 

	 	
			25.6

				
			Language

			

 

	 	
			(a)

				
			Any notice given under or in connection with any Finance Document must be in English or Hebrew.

			

 

47

 

 

	 	
			(b)

				
			All other documents provided under or in connection with any Finance Document must be in English or Hebrew.

			

 

	
			26.

				
			Calculations and Certificates

			

 

	 	
			26.1

				
			Accounts

			

 

In any litigation or arbitration proceedings arising out of or in connection with a Finance Document, the entries made in the accounts maintained by a Finance Party are prima facie evidence of the matters to which they relate.

 

	 	
			26.2

				
			Certificates and Determinations

			

 

Any certification or determination by a Finance Party of a rate or amount under any Finance Document is, in the absence of manifest error, conclusive evidence of the matters to which it relates.

 

	 	
			26.3

				
			Day count convention

			

 

Any interest, commission or fee accruing under a Finance Document will accrue from day to day and is calculated on the basis of the actual number of days elapsed and a year of 365 or 366 days.

 

	
			27.

				
			Partial Invalidity

			

 

If, at any time, any provision of a Finance Document is or becomes illegal, invalid or unenforceable in any respect under any law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions nor the legality, validity or enforceability of such provision under the law of any other jurisdiction will in any way be affected or impaired.

 

	
			28.

				
			Remedies and Waivers

			

 

No failure to exercise, nor any delay in exercising, on the part of any Finance Party, any right or remedy under a Finance Document shall operate as a waiver of any such right or remedy or constitute an election to affirm any of the Finance Documents. No election to affirm any Finance Document on the part of any Finance Party shall be effective unless it is in writing. No single or partial exercise of any right or remedy shall prevent any further or other exercise or the exercise of any other right or remedy. The rights and remedies provided in each Finance Document are cumulative and not exclusive of any rights or remedies provided by law.

 

	
			29.

				
			Amendments and Waivers

			

 

Required consents

 

Any term of the Finance Documents may be amended or waived only with the written consent of all the Lenders and the Borrower and any such amendment or waiver will be binding on all Parties.

 

	
			30.

				
			Confidential Information

			

 

	 	
			30.1

				
			Confidentiality

			

 

Each Finance Party agrees to keep all Confidential Information confidential and not to disclose it to anyone, save to the extent permitted by Clause 30.2 (Disclosure of Confidential Information) and to ensure that all Confidential Information is protected with security measures and a degree of care that would apply to its own confidential information.

 

48

 

 

	 	
			30.2

				
			Disclosure of Confidential Information

			

 

Any Finance Party may disclose: 

 

	 	
			(a)

				
			to any of its Affiliates and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives such Confidential Information as that Finance Party shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (a) is informed in writing of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information;

			

 

	 	
			(b)

				
			to any person:

			

 

	 	
			(i)

				
			to (or through) whom it assigns or transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents or which succeeds (or which may potentially succeed) it as agent and, in each case, to any of that person's Affiliates, Representatives and professional advisers;

			

 

	 	
			(ii)

				
			with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may be made by reference to, one or more Finance Documents and/or the Borrower and to any of that person's Affiliates, Representatives and professional advisers;

			

 

	 	
			(iii)

				
			appointed by any Finance Party or by a person to whom paragraph (b)(i) or (b)(ii) above applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents on its behalf;

			

 

	 	
			(iv)

				
			who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in paragraph (b)(i) or (b)(ii) above;

			

 

	 	
			(v)

				
			to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law;

			

 

	 	
			(vi)

				
			to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes;

			

 

	 	
			(vii)

				
			to whom or for whose benefit that Finance Party charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 20.3 (Security over Lenders' rights).

			

 

	 	
			(viii)

				
			who is a Party; or

			

 

	 	
			(ix)

				
			with the consent of the Borrower;

			

 

49

 

 

In each case, such Confidential Information as that Finance Party shall consider appropriate if:

 

	 	
			(A)

				
			in relation to paragraphs (b)(i), (b)(ii) and (b)(iii), the person to whom the Confidential Information is to be given has entered into a confidentiality undertaking except that there shall be no requirement for a confidentiality undertaking if the recipient is a professional adviser and is subject to professional obligations to maintain the confidentiality of the Confidential Information;

			

 

	 	
			(B)

				
			in relation to paragraph (b)(iv) above the person to whom the Confidential Information is to be given has entered into a confidentiality undertaking or is otherwise bound by requirements of confidentiality in relation to the Confidential Information they receive and is informed that some or all of such Confidential Information may be price-sensitive information;

			

 

	 	
			(C)

				
			in relation to paragraphs (b)(v), (b)(vi) and (b)(vii) above, the person to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of that Finance Party, it is not practicable so to do in the circumstances; and

			

 

	 	
			(c)

				
			to any rating agency (including its professional advisers) such Confidential Information as may be required to be disclosed to enable such rating agency to carry out its normal rating activities in relation to the Finance Documents and/or the Borrower if the rating agency to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price-sensitive information; and

			

 

	 	
			(d)

				
			to Fair Spread, from time to time, with all data, documents and information required under law (including the regulations codex issued by the Commissioner of Capital Market, Insurance and Savings). The Borrower shall fully cooperate with the Lenders and provide all data, documents and information required thereby, including in relation to any Collateral, in order to enable the Lenders to meet their regulatory obligations, in the manner and at such times as the Lenders shall so request.

			

 

	 	
			30.3

				
			Entire agreement

			

 

This Clause 30 constitutes the entire agreement between the Parties in relation to the obligations of the Finance Parties under the Finance Documents regarding Confidential Information and supersedes any previous agreement, whether express or implied, regarding Confidential Information.

 

	 	
			30.4

				
			Inside information

			

 

Each of the Finance Parties acknowledges that some or all of the Confidential Information is or may be price-sensitive information and that the use of such information may be regulated or prohibited by applicable legislation including securities law relating to insider dealing and market abuse and each of the Finance Parties undertakes not to use any Confidential Information for any unlawful purpose.

 

50

 

 

	 	
			30.5

				
			Notification of disclosure

			

 

Each of the Finance Parties agrees (to the extent permitted by law and regulation) to inform the Borrower:

 

	 	
			(a)

				
			of the circumstances of any disclosure of Confidential Information made pursuant to paragraph (b)(v) of Clause 30.2 (Disclosure of Confidential Information) except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and

			

 

	 	
			(b)

				
			upon becoming aware that Confidential Information has been disclosed in breach of this Clause 30.

			

 

	 	
			30.6

				
			Continuing obligations

			

 

The obligations in this Clause 30 are continuing and, in particular, shall survive and remain binding on each Finance Party for a period of 12 months from the earlier of:

 

	 	
			(a)

				
			the date on which all of the Total Obligations have been paid in full; and

			

 

	 	
			(b)

				
			the date on which such Finance Party otherwise ceases to be a Finance Party.

			

 

	
			31.

				
			Counterparts

			

 

Each Finance Document may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of the Finance Document.

 

	
			32.

				
			Governing Law

			

 

This Agreement and any non-contractual obligations arising out of or in connection with it shall be governed by the laws of the State of Israel.

 

	
			33.

				
			Enforcement

			

 

Jurisdiction

 

	 	
			(a)

				
			The courts of Tel-Aviv-Jaffa shall have exclusive jurisdiction to settle any Dispute.

			

 

	 	
			(b)

				
			The Parties agree that the courts of Tel-Aviv-Jaffa are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.

			

 

	 	
			(c)

				
			This Clause 33 is for the benefit of the Finance Parties only. As a result, no Finance Party shall be prevented from taking proceedings relating to any Dispute in any other court in which the assets of any Obligor are located or in any other Relevant Jurisdiction for any purpose. To the extent allowed by law, the Finance Parties may take concurrent proceedings in any number of jurisdictions.

			

 

 

 

IN WITNESS WHEREOF, the parties have signed this agreement on the date first mentioned above.

 

 

(Signature pages follow)

 

51

 

 

Signatories 

 

Ormat Technologies, Inc.

As Borrower

 

	By:	 	 
	 	Name:	 
	 	Title:	 
	By:	 	 
	 	Name:	 
	 	Title	 

 

Attorney Confirmation

I, the undersigned, legal counsel of Ormat Technologies, Inc., hereby confirm that ______________ [is/are] duly authorized to sign this Loan Agreement for and on behalf of Ormat Technologies, Inc. and that [his/their] signature on the printed name of Ormat Technologies, Inc. binds Ormat Technologies, Inc. in this Loan Agreement.

 

	 	 	Date: March 22, 2018
	Adv.	 	 

                 

Migdal Insurance Company Ltd. 

As Original Lender

 

	By:	 	 
	 	Name:	 
	 	Title:	 
	By:	 	 
	 	Name:	 
	 	Title:	 

 

Migdal's Makefet Pension and Provident Funds Ltd.

As Original Lender

 

	By:	 	 
	 	Name:	 
	 	Title:	 
	By:	 	 
	 	Name:	 
	 	Title:	 

 

Yozma Pension Fund of Self Employed Ltd.

As Original Lender

 

	By:	 	 
	 	Name:	 
	 	Title:	 
	By:	 	 
	 	Name:	 
	 	Title:	 

 

 

 

Signature page for the Loan Agreement dated March 22, 2018

 

 

52

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