Website Notice Block
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-265203
PROSPECTUS SUPPLEMENT
(To Prospectus dated June 3, 2022)
7,575,513 Ordinary Shares
MediWound Ltd.
We are offering to certain institutional and accredited investors 7,575,513 ordinary shares (“ordinary shares”) in this offering through this prospectus supplement and the accompanying prospectus.
In a concurrent private placement to the same investors (the “concurrent private placement”), we are issuing unregistered warrants to purchase up to an aggregate of 7,575,513 ordinary shares at an exercise prices of
$1.925 per share (the “ordinary warrants”). The ordinary warrants will be exercisable only upon the approval by our shareholders of an amendment to our Articles of Association to increase the number of authorized ordinary shares from 50,000,000
to 90,000,000 (the “Authorized Share Increase Date”). Once exercisable, the ordinary warrants may be exercised only for a whole number of shares and will expire four (4) years following the Authorized Share Increase Date. No fractional shares
will be issued upon exercise of the ordinary warrants.
On September 22, 2022, we also entered into a securities purchase agreement with a number of other institutional and/or accredited investors, which included certain of our executive officers and directors, for the
purchase and sale of (i) unregistered pre-funded warrants to purchase up to an aggregate of 9,853,058 ordinary shares (the “Private Pre-Funded Warrants”) and (ii) accompanying ordinary warrants to purchase up to an aggregate of 9,853,058 ordinary
shares in a private placement (the “PIPE”) for expected gross proceeds of approximately $17.24 million, including approximately $433,000.00 from the participation of certain our executive officers and directors. Each Private Pre-Funded Warrant
will be exercisable for one ordinary share at an exercise price of $0.001 per share and will not expire until fully exercised. The Private Pre-Funded Warrants and the ordinary warrants will not be exercisable until the Authorized Share Increase
Date. The ordinary warrants issued in the PIPE have the same terms as those offered in the concurrent private placement in connection with this offering.
The Private Pre-Funded Warrants, the ordinary warrants and the ordinary shares issuable upon the exercise of the Private Pre-Funded Warrants and the ordinary warrants are
being offered pursuant to the exemptions provided in Section 4(a)(2) under the Securities Act of 1933, as amended (the “Securities Act”) and Rule 506(b) of Regulation D promulgated thereunder, and they are not being offered pursuant to this
prospectus supplement and the accompanying prospectus.
On September 21, 2022, the aggregate market value worldwide of our outstanding voting and non-voting common equity held by non-affiliates was $44,397,678.10, based on
33,159,684 ordinary shares outstanding and a per ordinary share price of $2.24 based on the closing sale price of our ordinary shares on the Nasdaq Global Market on August 16, 2022. We have not offered any securities pursuant to General
Instruction I.B.5 on Form F-3 during the prior 12 calendar month period that ends on and includes the date of this prospectus (but excluding this offering).
Our ordinary shares are listed on the Nasdaq Global Market under the symbol “MDWD.” On September 20, 2022, the last reported sales price of our ordinary shares on the Nasdaq
Global Market was $1.75 per share.
We have retained H.C. Wainwright & Co., LLC (“Wainwright” or the “placement agent”) to act as our exclusive placement agent in connection with this offering. The
placement agent has agreed to use its “reasonable best efforts” to arrange for the sale of our ordinary shares offered by this prospectus supplement and the accompanying prospectus, but the placement agent has no obligation to purchase or sell any
of such ordinary shares or to arrange for the purchase or sale of any specific number or dollar amount of such securities. There is no required minimum number of our ordinary shares that must be sold as a condition to completion of this offering.
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Per Share
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Total
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Offering Price
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$
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1.75
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$
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13,257,147.75
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Placement Agent Fees (1)
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$
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0.1225
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$
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928,000.34
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Proceeds to us before offering expenses
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$
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1.6275
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$
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12,329,147.41
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(1)
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Consists of a cash fee of 7.0% of the aggregate gross proceeds in this offering. In addition, we have agreed to pay the placement agent a non-accountable expense allowance of $85,000, to
reimburse certain expenses of the placement agent and to issue to the placement agent, or its designees, ordinary warrants. See “Plan of Distribution” beginning on page S-23 of this prospectus supplement for additional information with
respect to the compensation we will pay the placement agent.
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Investing in our ordinary shares involves a high degree of risk. Please read “Risk Factors” beginning on page S-6, and under similar headings in the other
documents that are incorporated by reference into this prospectus supplement and the accompanying prospectus.
Neither the Securities and Exchange Commission, the Israel Securities Authority, nor any state
securities commission has approved or disapproved of these securities or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
Delivery of the ordinary shares is expected to be made on or about September 26, 2022.
H.C. Wainwright & Co.
The date of this prospectus supplement is September 22, 2022
Table of Contents
Prospectus Supplement
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| PRESENTATION OF FINANCIAL INFORMATION |
S-iii |
| MARKET, INDUSTRY AND OTHER DATA | S-iii |
| CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS | S-iv |
| PROSPECTUS SUPPLEMENT SUMMARY | S-1 |
| RISK FACTORS | S-6 |
| USE OF PROCEEDS | S-9 |
| DIVIDEND POLICY | S-10 |
| CAPITALIZATION | S-11 |
| DILUTION | S-12 |
| TAXATION |
S-15 |
| PLAN OF DISTRIBUTION | S-23 |
| LEGAL MATTERS | S-24 |
| EXPERTS | S-24 |
| WHERE YOU CAN FIND MORE INFORMATION | S-25 |
| INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE | S-25 |
Prospectus
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S - i
We provide information to you about this offering of ordinary shares in two separate documents that are bound together: (1) this prospectus supplement, which describes the
specific details regarding this offering; and (2) the accompanying prospectus, dated June 3, 2022, which provides general information, some of which may not apply to this offering. Generally, when we refer to this “prospectus,” we are referring to
both documents combined. If information in this prospectus supplement is inconsistent with the accompanying prospectus, you should rely on this prospectus supplement. However, if any statement in one of these documents is inconsistent with a
statement in another document having a later date‒for example, a document incorporated by reference in this prospectus supplement‒the statement in the document having the later date modifies or supersedes the earlier statement, as our business,
financial condition, results of operations and prospects may have changed since the earlier dates.
You should rely only on the information contained in, or incorporated by reference into, this prospectus and in any free writing prospectus that we may authorize for use in
connection with this offering. We have not, and the placement agent has not, authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are
not, and the placement agent is not, making an offer to sell or soliciting an offer to buy our securities in any jurisdiction where an offer or solicitation is not authorized or in which the person making that offer or solicitation is not qualified
to do so or to anyone to whom it is unlawful to make an offer or solicitation. You should assume that the information appearing in this prospectus supplement, the accompanying prospectus, the documents incorporated by reference into this
prospectus, and in any free writing prospectus that we may authorize for use in connection with this offering, is accurate only as of the date of those respective documents. Our business, financial condition, results of operations and prospects may
have changed since those dates. You should read this prospectus supplement, the accompanying prospectus, the documents incorporated by reference into this prospectus, and any free writing prospectus that we may authorize for use in connection with
this offering, in their entirety before making an investment decision. You should also read and consider the information in the documents to which we have referred you in the section of this prospectus supplement entitled “Where You Can Find More
Information” and in the sections of the accompanying prospectus entitled “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference.”
We are offering to sell, and seeking offers to buy, ordinary shares only in jurisdictions where offers and sales are permitted. The distribution of this prospectus
supplement, the accompanying prospectus and the offering of the ordinary shares in certain jurisdictions may be restricted by law. Persons outside the United States who come into possession of this prospectus supplement and the accompanying
prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ordinary shares and the distribution of this prospectus supplement and the accompanying prospectus outside the United States. This prospectus
supplement and the accompanying prospectus do not constitute, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy, any securities offered by this prospectus by any person in any jurisdiction in which it is
unlawful for such person to make such an offer or solicitation.
When we refer to “MediWound,” “we,” “our,” “us” and the “Company” in this prospectus, we mean MediWound Ltd., and our consolidated subsidiaries unless otherwise specified.
S - ii
We maintain our books and records in U.S. dollars and report under International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards
Board. None of the consolidated financial statements incorporated by reference into this prospectus supplement or the accompanying prospectus were prepared in accordance with generally accepted accounting principles in the United States.
The term “shekels,” “Israeli shekels” and “NIS” refer to New Israeli Shekels, the lawful currency of the State of Israel, the terms “dollar,” “US$,” or “$” refer to the
United States dollars, the lawful currency of the United States and the terms “Euros” or “€” refer to Euros, the lawful currency of the Eurozone.
This prospectus supplement and the accompanying prospectus, including the information incorporated by reference into this prospectus supplement and the accompanying
prospectus, and any free writing prospectus that we have authorized for use in connection with this offering, contain estimates, projections and other information concerning our industry, our business and the markets for our product candidates,
including data regarding total sales of products, the addressable market and patient population, their projected growth rates, the perceptions and preferences of patients and physicians regarding the disease indications that we are pursuing or may
pursue, as well as data regarding market research, estimates and forecasts prepared by our senior management. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to
uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports,
research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources. In some cases, we do not expressly refer to the sources from
which this data is derived. In that regard, when we refer to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from the same sources, unless
otherwise expressly stated or the context otherwise requires. In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors. These
and other factors could cause our future performance to differ materially from our assumptions and estimates. See also “Cautionary Note Regarding Forward-Looking Statements.”
S - iii
In addition to historical facts, this prospectus supplement contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as
amended (the “Securities Act”), Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. We make forward-looking statements
in this prospectus supplement that are subject to risks and uncertainties. These forward-looking statements include information about possible or assumed future results of our business, financial condition, results of operations, liquidity, plans
and objectives. In some cases, you can identify forward looking statements by terminology such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,” “potential,” or the negative of these terms
or other similar expressions. The statements we make regarding the following matters are forward-looking by their nature:
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the timing and conduct of our trials of NexoBrid, EscharEx and our other pipeline product candidates, including statements regarding the timing, progress and results of current and future preclinical studies and clinical trials, and our
research and development programs;
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the clinical utility, potential advantages and timing or likelihood of regulatory filings and approvals of NexoBrid, EscharEx and our other pipeline products;
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our estimates regarding expenses, future revenues, capital requirements and our need for additional financing;
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anticipated funding under our contracts with the U.S. Biomedical Advanced Research and Development Authority;
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our expectations regarding future growth, including our ability to develop new products;
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our commercialization, marketing and manufacturing capabilities and strategy and the ability of our marketing team to cover regional burn centers and units;
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our ability to maintain adequate protection of our intellectual property;
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our estimates regarding the market opportunity for NexoBrid, EscharEx and our other pipeline products;
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our expectation regarding the duration of our inventory of intermediate drug substances and products;
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the impact of our research and development expenses as we continue developing product candidates; and
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the impact of government laws and regulations.
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The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. These statements may also be found in the sections of our annual report
on Form 20-F for the year ended December 31, 2021, filed with the United States Securities and Exchange Commission (“SEC”) on March 17, 2022 and incorporated by reference herein, entitled “ITEM 3.D. Risk Factors,” “ITEM 4. Information on the
Company,” “ITEM 5. Operating and Financial Review and Prospects,” “ITEM 10.E. Taxation-United States Federal Income Taxation-Passive Foreign Investment Company Considerations” and elsewhere in that annual report, including the sections entitled
“ITEM 4.B. Business Overview” and “ITEM 4.B. Business Overview—Our Focus,” which contain information obtained from independent industry sources. The forward-looking statements are based on our beliefs, assumptions and expectations of future
performance, taking into account the information currently available to us. These statements are only predictions based upon our current expectations and projections about future events. There are important factors that could cause our actual
results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including the risks discussed in the section
entitled “Risk Factors” below and in the section of our annual report on Form 20-F for the year ended December 31, 2021 entitled “ITEM 3.D. Risk Factors” and information contained in other documents we file with the SEC.
You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-looking statements will be achieved or will occur. Except as required by law, we undertake no obligation to
publicly update any forward-looking statements for any reason after the date of this prospectus supplement to conform these statements to actual results or to changes in our expectations.
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This summary does not contain all of the information you should consider before investing in our ordinary shares. You should read this summary
together with the more detailed information appearing in this prospectus supplement and the accompanying prospectus, including under the section entitled “Risk Factors,” and in the sections entitled “Risk Factors,” “Selected Consolidated
Financial Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and our consolidated financial statements and the related notes thereto in our other public filings which are incorporated by
reference herein, before making an investment in our ordinary shares.
Overview
We are a biopharmaceutical company that develops, manufactures and commercializes novel, cost effective, bio-therapeutic solutions for tissue repair and regeneration. Our
strategy leverages our breakthrough enzymatic technology platform into diversified portfolio of biotherapeutics across multiple indications to pioneer solutions for unmet medical needs. Our current portfolio is focused on next-generation
protein-based therapies for burn and wound care and tissue repair.
Our first innovative biopharmaceutical product, NexoBrid, has received marketing authorization from the European Medicines Agency (“EMA”) and other international markets
for removal of dead or damaged tissue, known as eschar, in adults with deep partial- and full-thickness thermal burns, also referred to as severe burns. NexoBrid, a concentrate of proteolytic enzymes enriched in bromelain, represents a new
paradigm in burn care management, and our clinical trials have demonstrated, with statistical significance, its ability to non-surgically and rapidly remove the eschar earlier relative to existing standard of care upon patient admission,
without harming viable tissues.
In September 2020, the U.S. Food and Drug Administration (“FDA”) accepted for review our Biologics License Application (“BLA”) for NexoBrid for severe burns. On June 29,
2021, we received a Complete Response Letter (“CRL”) from the U.S. Food and Drug Administration (“FDA”) to our Biologics License Application (“BLA”) for NexoBrid for severe burns pursuant to which the FDA communicated that it had completed its
review of the BLA, as amended, and determined that the application cannot be approved in its present form. The FDA identified issues related to the Chemistry, Manufacturing and Controls (“CMC”) section of the BLA and requested additional CMC
information. The FDA acknowledged receipt of several CMC amendments, submitted in response the CMC information requests, which were not reviewed for this action. The FDA also stated that an inspection of NexoBrid's manufacturing facilities in
Israel and Taiwan, would be required before the FDA can approve the BLA, but it was unable to conduct the required inspections during the current review cycle due to COVID-related travel restrictions. The FDA stated that it will continue to
monitor the public health situation as well as travel restrictions and is actively working to define an approach for scheduling outstanding inspections. In addition, the CRL cited certain observations identified during good clinical practice
(GCP) inspections related to the DETECT study, and requested that we provide its perspective on the potential impact, if any, of these observations on the efficacy findings in the study. The FDA also requested to provide a safety update as part
of any BLA resubmission, although there were no safety issues raised in the CRL. On August 3, 2022 we announced that the FDA has accepted for review our re-submitted BLA for NexoBrid for eschar removal (debridement) in adults with deep
partial-thickness and/or full-thickness thermal burns and assigned a Prescription Drug User Fee Act (PDUFA) target date of January 1, 2023.
S - 1
We commercialize NexoBrid globally through multiple sales channels. We sell NexoBrid to burn centers in the European Union, United Kingdom and Israel, primarily through
our direct sales force, focusing on key burn centers and Key Opinion Leaders (“KOL”) management, while establishing additional local distribution channels to extend our outreach in the European Union. In the United States, we entered into
exclusive license and supply agreements with Vericel Corporation to commercialize NexoBrid in North America upon FDA approval (if received). We have signed distribution agreements with local distributors in multiple international markets,
focusing in Asia Pacific, EMEA, CEE and LATAM, which are responsible for obtaining local marketing authorization within the relevant territory.
On September 20, 2022, we announced that that the European Medicines Agency (EMA) has validated for review the Type II Variation submitted by
MediWound to expand the current approved indication for NexoBrid (removal of eschar in adults with deep partial-and full-thickness thermal burn wounds) into the pediatric population. MediWound expects a decision from the European Commission in
the first quarter of 2023.
EscharEx, our next-generation enzymatic therapy under development, is a topical biological drug candidate for the debridement of chronic and other hard-to-heal wounds.
EscharEx active pharmaceutical ingredient (API) is a concentrate of proteolytic enzymes enriched in bromelain. In prior clinical trials, EscharEx was well tolerated and showed significantly higher incidence of complete debridement of various
chronic and other hard-to-heal wounds within a few daily applications compared with hydrogel vehicle, as well as a comparable safety profile. EscharEx is an investigational product, currently under investigation in a U.S. phase 2 adaptive
design study for the debridement of venous leg ulcers (VLUs).
On May 12, 2022, we announced positive results from our U.S. Phase 2 clinical study of EscharEx® for the debridement of venous leg ulcers (VLUs).
The study met its primary endpoint with a high degree of statistical significance, demonstrating that patients treated with EscharEx had a statistically significant higher incidence of complete debridement during the 14-day measurement period
within up to 8 applications compared to gel vehicle (EscharEx: 63% (29/46) vs. gel vehicle: 30% (13/43), p-value=0.004). EscharEx efficacy superiority remained statistically significant compared to gel vehicle after adjusting for
pre-specified covariates ascribed to patient baseline characteristics, wound size, wound age and regions.
The study met key secondary and exploratory endpoints. Patients treated with EscharEx had a statistically significant higher incidence of complete
debridement, during the same 14-day measurement period, compared to patients treated by non-surgical standard-of-care ("NSSOC") (EscharEx: 63% (29/46) vs. NSSOC: 13% (4/30)) and the time to achieve complete debridement was significantly
shorter. Estimated median time to complete debridement, was 9 days for patients treated with EscharEx and 59 days for patients treated with NSSOC (p-value=0.016). On average, complete debridement was achieved after 3.6 applications of
EscharEx compared to 12.8 applications with NSSOC. Patients treated with EscharEx demonstrated significantly higher incidence of at least 75% granulation tissue at the end of the treatment period compared to gel vehicle (p-value <0.0001).
Favorable trends were observed in wound area reduction and reduction of pain compared to gel vehicle.
In addition, the study showed that EscharEx was safe and well tolerated, and the overall safety was comparable between the arms as assessed by the
data safety monitoring board. Importantly, there were no observed deleterious effects on wound closure and no material differences in reported adverse events. Estimated time to complete wound closure was 64 days for patients treated with
EscharEx compared to 78 days for patients treated with NSSOC. meeting with the FDA to discuss the pivotal study design is targeted for the second half of 2022.
We are also evaluating EscharEx in an ongoing phase 2 pharmacology study, a prospective, open label, single-arm study, being conducted at three U.S. clinical sites. The
study is designed to evaluate the clinical performance, safety, and pharmacology effect of EscharEx in the debridement of lower leg ulcers (diabetic foot ulcers (“DFU’s”) or VLU’s) in up to fifteen patients. The study evaluates the safety and
efficacy of debridement as measured by incidence of, and time to complete debridement. In addition, the study evaluates the pharmacological effects of EscharEx as measured by the changes from baseline to end of treatment period in (1) wound
biofilm presence in wound biopsies, (2) bacterial burden measured by MolecuLight® fluorescence images, and (3) biomarkers of wound healing and inflammation in wound fluid. On July 7, 2022 we announced positive results from this study. Seventy
percent of patients achieved complete debridement during the course of treatment within up to 8 applications. On average, complete debridement was achieved after 3.9 applications of EscharEx. Additionally, an average reduction of 35% in wound
size was achieved by the end of the 2-week follow-up period. In all patients that were positive for biofilm at baseline, the biofilm was reduced substantially to single individual microorganisms or completely removed by the end of treatment.
Seven patients had positive red fluorescence (indicative of bacteria) at baseline and average red fluorescence was reduced from 1.69 cm2 pre-treatment to 0.60 cm2 post treatment. Biomarker analysis from wound fluid is
on-going and safety data shows that EscharEx is safe and well-tolerated.
S - 2
Our third innovative product candidate, MW005, is a topically applied biological drug candidate for the treatment of non-melanoma skin cancers, based on the same API of
NexoBrid and EscharEx product candidates, a concentrate of proteolytic enzymes enriched in bromelain. In July 2021 we initiated a phase I/II study of MW005 for the treatment of low-risk basal cell carcinoma (“BCC”). On July 11, 2022 we
announced positive initial data from this study. In the first cohort, eleven patients with either superficial or nodular BCC were treated. Patients enrolled into the study received seven topical applications of MW005, once every other day. At
the end of eight weeks post treatment period, all patients undergo complete excision, and the specimen is subject to an independent histological clearance examination. Based on the data generated to date, MW005 is safe, well-tolerated and an
effective treatment for BCC with a majority of patients who completed the study demonstrating a complete histological clearance of target lesions. We anticipate announcing the final data in the second half of 2022.
We manufacture NexoBrid and our product candidates in our state-of-the-art, sterile manufacturing facility at our headquarters in Yavne, Israel.
Recent Developments
PIPE
On September 22, 2022, we entered into a securities purchase agreement with several institutional and/or accredited investors, including certain of our executive officers and directors, for the purchase and sale
of 9,853,058 Private Pre-Funded Warrants and ordinary warrants to purchase up to an aggregate 9,853,058 ordinary shares in a private placement (the “PIPE”) for expected gross proceeds of approximately
$17.24 million, including approximately $433,000.00 from the investment of certain of our executive officers and directors. The purchase price for one Private Pre-Funded Warrants and one ordinary warrant to purchase one ordinary share is
$1.749.
The Private Pre-Funded Warrants will be exercisable for one ordinary share at an exercise price of $0.001 per share and will not expire until fully exercised. The
ordinary warrants have an exercise price of $1.925 per share. The Private Pre-Funded Warrants and the ordinary warrants will each only be exercisable upon the approval by our shareholders of an amendment to our Articles of Association to
increase the number of authorized ordinary shares from 50,000,000 to 90,000,000 (the “Authorized Share Increase Date”). Once exercisable, the ordinary warrants may be exercised only for a whole number of shares and will expire four (4) years
following the Authorized Share Increase Date. No fractional shares will be issued upon exercise of the Private Pre-Funded Warrants or the ordinary warrants.
The Private Pre-Funded Warrants and ordinary warrants sold in the PIPE and ordinary shares of underlying the Private Pre-Funded Warrants and the ordinary warrants are
being offered pursuant to the exemptions provided in Section 4(a)(2) under the Securities Act and Rule 506(b) of Regulation D promulgated thereunder, and they are not being offered pursuant to this prospectus supplement and the accompanying
prospectus. The ordinary warrants offered in the PIPE have the same terms as the ordinary warrants being issued to the investor in the concurrent private placement in connection with this offering.
We expect the closing of the PIPE to occur on or about October 6, 2022, subject to satisfaction of customary closing conditions.
In connection with the PIPE, the Company entered into a registration rights agreement with the institutional investors participating in the PIPE (the “Registration Rights
Agreement”). Pursuant to the Registration Rights Agreement, within 45 calendar days of the date of the closing of the PIPE, we are required to file a registration statement to register for resale of (i) the ordinary shares issuable upon
exercise of the ordinary warrants sold in the PIPE, and (ii) the ordinary shares issuable upon exercise of the Private Pre-Funded Warrants sold to the investor in this offering (the “Registrable Securities”). Pursuant to the Registration Rights
Agreement, we agreed to cause such registration statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, but in any event no later 75 days, or in the event of a full review by the SEC, 110
days, after the closing date of the PIPE, and use our best efforts to keep such registration statement continuously effective under the Securities Act until the date that all Registrable Securities covered by such registration statement have
been sold or are otherwise may be sold pursuant to Rule 144 under the Securities Act.
S - 3
Our Corporate Information
We were incorporated under the laws of the State of Israel on January 27, 2000. Our principal executive offices are located at 42 Hayarkon Street, Yavne 8122745,
Israel, and our telephone number is +972-77-971-4100. Our website is www.MediWound.com. The information contained on, or that can be accessed through, our website does not constitute a part of this prospectus and is not incorporated by
reference herein. Our agent for service of process in the United States is Puglisi & Associates, located at 850 Library Avenue, Suite 204, Newark, Delaware 19711, and its telephone number is +1 (302) 738-6680.
Throughout this prospectus, we refer to various trademarks, service marks and trade names that we use in our business. The “MediWound” design logo, “MediWound”,
“NexoBrid”, “EscharEx” and other trademarks or service marks of MediWound Ltd. appearing in this prospectus are the property of MediWound Ltd. We have several other registered trademarks, service marks and pending applications relating to
our products. Although we have omitted the “®” and “™” trademark designations for such marks in this prospectus, all rights to such trademarks are nevertheless reserved. Other trademarks and service marks appearing in this prospectus are
the property of their respective holders.
S - 4
THE OFFERING
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Ordinary shares we are offering
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7,575,513 ordinary shares.
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Concurrent private placement
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In a concurrent private placement, we are selling to the investors in this offering ordinary warrants to purchase up to an aggregate of 7,575,513 ordinary
shares. Each ordinary warrant will be exercisable for one ordinary share at an exercise price of $1.925 per share. The ordinary warrants will be exercisable only upon the Authorized Share Increase Date. Once exercisable, the ordinary
warrants may be exercised only for a whole number of shares and will expire four (4) years following the Authorized Share Increase Date. The ordinary warrants and the shares underlying the ordinary warrants are being offered pursuant
to the exemptions provided in Section 4(a)(2) under the Securities Act and Rule 506(b) promulgated thereunder, and they are not being offered pursuant to this prospectus supplement and the accompanying prospectus.
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Concurrent PIPE Offering
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Concurrent to this offering, we are selling to certain other institutional and/or accredited investors, including certain of our executive officers and directors, 9,853,058 Private Pre-Funded Warrants
and ordinary warrants to purchase up to an aggregate 9,853,058 ordinary shares in a private placement. The Private Pre-Funded Warrants will be exercisable for one ordinary share at an exercise price of $0.001 per share and will not
expire until fully exercised. The ordinary warrants have an exercise price of $1.925 per share. The Private Pre-Funded Warrants and the ordinary warrants will each only be exercisable only upon the Authorized Share Increase Date.
Once exercisable, the ordinary warrants may be exercised only for a whole number of shares and will expire four (4) years following the Authorized Share Increase Date. No fractional shares will be issued upon exercise of the
Private Pre-Funded Warrants or the ordinary warrants.
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Ordinary shares to be outstanding immediately after this offering
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40,718,920 ordinary shares.
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Use of proceeds
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We intend to use the net proceeds from this offering primarily for the development of EscharEx®, and scale up facility and in addition
for general corporate purposes. See “Use of Proceeds” for additional information.
|
|
Risk factors
|
See “Risk Factors” and other information included in this prospectus supplement for a discussion of factors that you should consider
carefully before deciding to invest in our ordinary shares.
|
|
Nasdaq Global Market symbol
|
“MDWD”
|
Unless otherwise stated, the number of ordinary shares to be outstanding after this offering is based on 33,143,407 ordinary shares outstanding as of June 30, 2022, and
excludes the following as of that date:
| • |
4,371,640 ordinary shares issuable upon the exercise of share options outstanding as of June 30, 2022, at a weighted average exercise price of $4.92 per share;
|
| • |
62,755 ordinary shares issuable upon the exercise of restricted share units (“RSUs”) outstanding as of June 30, 2022;
|
| • |
2,380,247 ordinary shares available for issuance under our 2014 Equity Incentive Plan as of June 30, 2022.
|
Unless otherwise indicated, all information in this prospectus gives no effect to:
| • |
the exercise of any ordinary warrants to be issued to the investors in the concurrent private placement and no exercise of the Private Pre-Funded Warrants and the ordinary warrants to be issued to investors in the PIPE;
|
| • |
the exercise of any ordinary warrants issued to the placement agent (or its designees) as compensation in connection with this offering and the PIPE; and
|
| • |
the issuance of 1,667 ordinary shares upon vesting of outstanding RSUs after June 30, 2022.
|
S - 5
Investing in our ordinary shares involves a high degree of risk. You should carefully consider the risks and uncertainties described below and discussed
in our Annual Report on Form 20-F for the year ended December 31, 2021, filed with the SEC on March 17, 2022, which is incorporated by reference in this prospectus supplement in its entirety, in addition to the other information set forth in this
prospectus supplement and the accompanying prospectus, or incorporated by reference herein and therein, including the consolidated financial statements and the related notes included elsewhere in this prospectus, before purchasing our ordinary
shares. If any of the following risks actually occurs, our business, financial condition, cash flows, and results of operations could be materially adversely affected. In that case, the trading price of our ordinary shares would likely decline and
you might lose all or part of your investment. The risks described below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect
our business operations.
Risks Relating to This Offering
You may experience future dilution as a result of future equity offerings.
Until such time, if ever, as we can generate substantial revenue from the sale of our products, we expect to finance our cash needs through a combination of equity offerings,
debt financings and license and development agreements. We do not currently have any committed external source of funds. To the extent that we raise additional capital through the further sale of equity securities or convertible debt securities,
your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder. Debt financing and preferred equity financing, if available, may involve
agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.
If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to
relinquish valuable rights to our research programs or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements with third
parties when needed, we may be required to delay, limit, reduce or terminate clinical development of our pipeline products or future commercialization efforts or grant rights to third parties to develop and market product candidates that we would
otherwise prefer to develop and market ourselves.
If you purchase our ordinary shares sold in this offering, you will experience immediate and substantial dilution in the net tangible
book value of your shares.
The price per share of our ordinary shares being offered may be higher than the net tangible book value per share of our outstanding ordinary shares prior to this offering.
The net tangible book value of our outstanding ordinary shares as of June 30, 2022 was $(0.08) per share. Assuming aggregate gross proceeds from this offering of approximately $13.26 million (assuming no issuance of ordinary shares upon the
exercise of any ordinary warrants issued in the concurrent private placement or the PIPE or Private Pre-Funded Warrants issued in the PIPE), those purchasing ordinary shares in this offering will incur immediate and substantial dilution of
approximately $0.29 per share, representing the difference between the offering price and our as adjusted net tangible book value as of June 30, 2022. The future exercise of outstanding warrants and options will result in further dilution of your
investment. For a more detailed discussion of the foregoing, see the section entitled “Dilution” below.
We have broad discretion as to the use of the net proceeds from this offering and may not use them effectively.
We intend to use the net proceeds from this offering for working capital and other general corporate purposes. However, our management will have broad discretion in the
application of the net proceeds. We may also use a portion of the net proceeds to in-license, invest in or acquire businesses, technologies, products or assets that we believe are complementary to our own, although we have no current plans,
commitments or agreements with respect to any acquisitions or in-licenses at this time. Our shareholders may not agree with the manner in which our management chooses to allocate the net proceeds from this offering. The failure by our management to
apply these funds effectively could have a material adverse effect on our business, financial condition and results of operation. Pending their use, we may invest the net proceeds from this offering in a manner that does not produce income.
S - 6
The significant share ownership position of Clal Biotechnology Industries Ltd. may limit your ability to influence corporate matters.
Based on our shares outstanding as of June 30, 2022, Clal Biotechnology Industries Ltd. (“CBI”) beneficially owns or controls, directly and indirectly, approximately 32.86%
of our issued and outstanding ordinary shares. Accordingly, CBI will be able to significantly influence the outcome of matters required to be submitted to our shareholders for approval, including decisions relating to the election of our board of
directors and the outcome of any proposed merger or consolidation of the company. CBI’s interests may not be consistent with those of our other shareholders. In addition, CBI’s significant interest in us may discourage third parties from seeking to
acquire control of us, which may adversely affect the market price of our ordinary shares.
Provisions of the warrants could discourage an acquisition of us by a third party.
Certain provisions of the warrants to be issued in the concurrent private placement and the PIPE could make it more difficult or expensive for a third party to acquire us.
The warrants prohibit us from engaging in certain transactions constituting “fundamental transactions” unless, among other things, the surviving entity assumes our obligations under the warrants. In addition, in certain circumstances, the holder
will have the right to receive the Black Scholes Value of the warrant calculated pursuant to a formula set forth in the warrants, payable either in cash or in the same type or form of consideration that is being offered and being paid to the
holders of our ordinary shares as described in the warrants. These and other provisions of the warrants could prevent or deter a third party from acquiring us even where the acquisition could be beneficial to our investors.
U.S. holders of our ordinary shares may suffer adverse tax consequences if we are characterized as a passive foreign investment
company.
Generally, if for any taxable year 75% or more of our gross income is passive income, or at least 50% of the average quarterly value of our assets (which may be determined in
part by the market value of our ordinary shares, which is subject to change) are held for the production of, or produce, passive income, we would be characterized as a passive foreign investment company (“PFIC”) for U.S. federal income tax
purposes. Our status as a PFIC may also depend on the amount of cash proceeds we receive in this and other offerings, including pursuant to our Open Market Sales Agreement dated February 25, 2020 with Jefferies LLC, and how quickly we use such cash
proceeds in our business. Based on our current estimates of our gross income and the estimated fair market value of our gross assets, our intended use of proceeds of this offering, and the nature of our business, we do not expect that we will be
classified as a PFIC for the taxable year ended December 31, 2022. There can be no assurance that we will not be considered a PFIC for the current or any future taxable year. PFIC status is determined as of the end of the taxable year and depends
on a number of factors, including the value of a corporation’s assets and the amount and type of its gross income. Furthermore, the value of our gross assets is likely to be determined in large part by reference to our market capitalization. As
such, a decline in the value of our ordinary shares or an increase in the value of our passive assets (including cash and short term investments), for example, may result in our becoming a PFIC. If we are characterized as a PFIC, U.S. holders of
our ordinary shares or, under proposed regulations, the ordinary warrants may suffer adverse tax consequences, including having gains realized on the sale of our ordinary shares or, under proposed regulations, the ordinary warrants treated as
ordinary income, rather than as capital gain, the loss of the preferential rate that may be applicable to dividends received on our ordinary shares by individuals who are U.S. Holders (as defined in “Taxation—U.S. Federal Income Tax Consequences”),
and having interest charges apply to distributions by us and the proceeds of sales of our ordinary shares or, under proposed regulations, the ordinary warrants. Certain elections exist that may alleviate some of the adverse consequences of PFIC
status and would result in an alternative treatment (such as mark-to-market treatment) of our ordinary shares, which elections may not be made with respect to the ordinary warrants. However, we do not intend to provide the information necessary for
U.S. holders to make qualified electing fund elections if we are classified as a PFIC. A qualified electing fund election may not be available for the ordinary warrants regardless of whether we provide such information. U.S. holders should consult
their tax advisors regarding whether we are a PFIC and the potential application of the PFIC rules.
S - 7
U.S. holders may be subject to tax if we make or fail to make certain adjustments to the exercise price of the ordinary warrants even
though they do not receive a corresponding cash distribution.
If the exercise price of the ordinary warrants is adjusted in certain circumstances (or in certain circumstances, there is a failure to make adjustments or a failure to make
adequate adjustments), that adjustment (or failure to adjust) may result in the deemed payment of a taxable dividend to a U.S. Holder of the ordinary warrants or our ordinary shares without the receipt of any cash. U.S. Holders should consult their
tax advisors regarding the proper U.S. federal income tax treatment of any adjustments to (or failure to adjust, or adjust adequately) the exercise price of the ordinary warrants. See “ Material U.S. Federal Income Tax Consequences.”
If a U.S. person is treated as owning at least 10% of our ordinary shares (including constructively through the ordinary warrants),
such holder may be subject to adverse U.S. federal income tax consequences.
If a U.S. person is treated as owning (directly, indirectly, or constructively through the ownership of the ordinary warrants) at least 10% of the value or voting power of
our ordinary shares, such person may be treated as a “U.S. shareholder” with respect to each “controlled foreign corporation” in our group (if any). Since our group includes one or more U.S. subsidiaries, certain of our non-U.S. subsidiaries will
be treated as controlled foreign corporations (regardless of whether or not we are treated as a controlled foreign corporation). A U.S. shareholder of a controlled foreign corporation may be required to report annually and include in its U.S.
taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income,” and investments in U.S. property by controlled foreign corporations, regardless of whether we make any distributions. An individual that is a U.S.
shareholder with respect to a controlled foreign corporation generally would not be allowed certain tax deductions or foreign tax credits that would be allowed to a U.S. shareholder that is a U.S. corporation. Failure to comply with these reporting
obligations may subject a U.S. shareholder to significant monetary penalties and may prevent the statute of limitations with respect to such U.S. shareholder’s U.S. federal income tax return for the year for which reporting was due from starting.
We cannot provide any assurances that we will assist holders of ordinary shares in determining whether any of our non-U.S. subsidiaries is treated as a controlled foreign corporation or whether any holder of ordinary shares is treated as a U.S.
shareholder with respect to any such controlled foreign corporation or furnish to any U.S. shareholders information that may be necessary to comply with the aforementioned reporting and tax paying obligations. The United States Internal Revenue
Service has provided limited guidance on situations in which investors may rely on publicly available information to comply with their reporting and taxpaying obligations with respect to foreign-controlled controlled foreign corporations. A U.S.
Holder should consult its tax advisors regarding the potential application of these rules to an investment in the ordinary shares or the ordinary warrants.
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We estimate that we will receive net proceeds from this offering of approximately $12.3 million, excluding the proceeds we may receive from the PIPE and the exercise of the
ordinary warrants to be issued to the investors in this offering in the concurrent private placement.
We currently intend to use the net proceeds from this offering primarily for the development of EscharEx, facility scale up, and in addition, for general corporate purposes.
We may also use a portion of the net proceeds to in-license, invest in or acquire businesses, technologies, products or assets that we believe are complementary to our own, although we have no current plans, commitments or agreements with respect
to any acquisitions or in-licenses at this time.
Our management will have broad discretion in the application of the net proceeds from this offering, and investors will be relying on the judgment of our management regarding
the application of the net proceeds from this offering. The timing and amount of our actual expenditures will be based on many factors, including cash flows from operations and the anticipated and actual growth of our business.
Pending the use of proceeds described above, we intend to invest the net proceeds in interest-bearing deposits.
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We have never declared or paid cash dividends to our shareholders and we do not intend to pay cash dividends in the foreseeable future. We intend to reinvest any earnings in
developing and expanding our business. Any future determination relating to our dividend policy will be at the discretion of our board of directors and will depend on a number of factors, including future earnings, our financial condition,
operating results, contractual restrictions, capital requirements, business prospects, our strategic goals and plans to expand our business, applicable law and other factors that our board of directors may deem relevant.
See “Risk Factors—Risks Related to an Investment in Our Ordinary Shares—We have never paid cash dividends on our share capital, and we do not anticipate paying any cash
dividends in the foreseeable future” in our Annual Report on Form 20-F for the year ended December 31, 2021, which is incorporated by reference in this prospectus supplement, and “Description of Securities— Dividend and Liquidation Rights” in
Exhibit 2.1 of our Annual Report on Form 20-F for the year ended December 31, 2021, which is incorporated by reference in this prospectus supplement, for an explanation concerning the payment of dividends under Israeli law.
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The following table presents our cash and cash equivalents and capitalization as of June 30, 2022:
| • |
on an actual basis; and
|
| • |
on an as adjusted basis to give effect to the issuance of 7,575,513 ordinary shares in this offering (but excluding, proceeds received from the PIPE, any ordinary shares issued upon the exercise of any ordinary warrants issued in the
concurrent private placement or the any ordinary shares issued upon the exercise of any Private Pre-Funded Warrants or ordinary warrants issued in the PIPE).
|
This table should be read in conjunction with our consolidated financial statements and related notes incorporated by reference in this prospectus supplement and the
accompanying prospectus.
|
As of June 30, 2022
|
||||||||
|
Actual
|
As Adjusted
|
|||||||
| (in thousands, except share data) | ||||||||
|
Cash and cash equivalents and short-term bank deposits
|
$
|
10,406
|
$
|
22,735
|
||||
|
Liabilities*
|
$
|
12,925
|
$
|
12,925
|
||||
|
Shareholders’ equity:
|
||||||||
|
Ordinary shares, NIS 0.01 par value: 50,000,000 shares authorized; 33,143,414 shares issued and outstanding (actual); 40,718,920 shares issued and outstanding (as
adjusted)
|
93
|
169
|
||||||
|
Share premium
|
154,119
|
166,372
|
||||||
|
Foreign currency translation adjustments
|
3
|
3
|
||||||
|
Accumulated deficit
|
(156,450
|
)
|
(156,450
|
)
|
||||
|
Total shareholders’ equity (deficiency)
|
(2,235
|
)
|
10,094
|
|||||
|
Total capitalization
|
$
|
10,690
|
$
|
22,938
|
||||
(*) Liabilities refers to long-term liabilities as presented in the balance sheet as of June 30, 2022. The table above excludes:
| • |
4,371,640 ordinary shares issuable upon the exercise of share options outstanding as of June 30, 2022, at a weighted average exercise price of $4.92 per share;
|
| • |
62,755 ordinary shares issuable upon the exercise of restricted share units (“RSUs”) outstanding as of June 30, 2022;
|
| • |
2,380,247 ordinary shares available for issuance under our 2014 Equity Incentive Plan as of June 30, 2022.
|
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If you invest in our ordinary shares in this offering, your interest will be diluted immediately to the extent of the difference between the offering
price per share you will pay in this offering and the as adjusted net tangible book value per share of our ordinary shares after this offering. Net tangible book value per share represents our total tangible assets less total liabilities, divided
by the number of ordinary shares outstanding.
As of June 30, 2022, our net tangible book value was $(2.5) million, or $(0.08) per share ordinary share. After giving effect to our issuance and sale of 7,575,513 ordinary
shares in this offering (but excluding, proceeds received from the PIPE, any ordinary shares issued upon the exercise of any ordinary warrants or pre-funded warrants issued in the concurrent private placement or the PIPE or the any ordinary shares
issued upon the exercise of any Private Pre-Funded Warrants or ordinary warrants issued in the PIPE), the as adjusted net tangible book value as of June 30, 2022 would have been $15.45 million, or $2.04 per share. This represents an immediate
increase in as adjusted net tangible book value to existing shareholders of $0.37 per share and an immediate dilution to those purchasing ordinary shares in this offering of $0.29 per share.
The following table illustrates this per share dilution to those purchasing ordinary shares in this offering:
|
offering price per ordinary share
|
$ | 1.75 | ||||||
|
Net tangible book value per ordinary share as of
June 30, 2022
|
$ | (0.08 | ) | |||||
|
Increase in net tangible book value per ordinary
share as of June 30, 2022 attributable to the offering
|
$ |
0.37 | ||||||
|
Dilution per ordinary share as of June 30, 2022 to those purchasing shares in this offering
|
$ | 0.29 | ||||||
| As adjusted net tangible book value per ordinary share as of June 30, 2022 after giving effect to the offering | $ | 2.04 | ||||||
The figures above are based on the number of ordinary shares outstanding as of June 30, 2022 and exclude:
| • |
4,371,640 ordinary shares issuable upon the exercise of share options outstanding as of June 30, 2022, at a weighted average exercise price of $4.92 per share;
|
| • |
62,755 ordinary shares issuable upon the exercise of restricted share units (“RSUs”) outstanding as of June 30, 2022;
|
| • |
2,380,247 ordinary shares available for issuance under our 2014 Equity Incentive Plan as of June 30, 2022.
|
To the extent that outstanding warrants or options are exercised or RSUs become vested, those purchasing ordinary shares in this offering will experience further dilution. In
addition, to the extent that we raise additional capital through the sale of equity securities or convertible debt securities, the issuance of these securities could result in further dilution.
S - 12
DESCRIPTION OF SECURITIES WE ARE OFFERING
We are offering 7,575,513 ordinary shares.
Authorized Capital Stock
Our authorized share capital consists of 50,000,000 ordinary shares, par value NIS 0.01 per share, of which 33,143,414 shares are issued and outstanding as of June 30, 2022.
All of our outstanding ordinary shares are validly issued, fully paid and non-assessable. Our ordinary shares are not redeemable and do not provide any preemptive rights.
Our registration number with the Israeli Registrar of Companies is 51-289494-0. Our purpose as set forth in our articles of association is to engage in any lawful activity.
Ordinary Shares
Our ordinary shares are listed on The Nasdaq Capital Market under the symbol “MDWD.”
The Transfer Agent and Registrar for our ordinary shares is American Stock Transfer & Trust Company, LLC.
See “Description of Securities” in our prospectus for more information regarding our ordinary shares.
S - 13
CONCURRENT PRIVATE PLACEMENT OF ORDINARY WARRANTS
Concurrently with this offering, we are also selling to the investors in this offering ordinary warrants to purchase up to an aggregate of 7,575,513 ordinary shares, at an exercise price of $1.925 per one ordinary
share, subject to certain adjustments.
Additionally, concurrent with this offering, we are selling to several institutional and/or accredited investors, including certain of our executive officers and directors, 9,853,058 Private
Pre-Funded Warrants and ordinary warrants to purchase up to an aggregate 9,853,058 ordinary shares in a private placement. See “Prospectus Supplement Summary – Recent Developments –PIPE” for more
information.
Ordinary Warrants
The following description of our ordinary warrants we are offering in the concurrent private placement is a summary and is qualified in its entirety by reference to the provisions of the pre-funded
warrant.
Duration and Exercise Price. Each ordinary warrant offered hereby has an initial exercise price per share equal to $1.925. Each ordinary warrant is
exercisable for one ordinary share. The ordinary warrants will be exercisable on the Authorized Share Increase Date. Once exercisable, the ordinary warrants may be exercised only for a whole number of shares and will expire four (4) years
following the Authorized Share Increase Date. No fractional shares will be issued upon exercise of the ordinary warrants. The exercise price and number of ordinary shares issuable upon exercise is subject to appropriate adjustment in the event of
stock dividends, stock splits, reorganizations or similar events affecting our ordinary shares and the exercise price.
Exercisability. The ordinary warrants, once exercisable, are exercisable, at the option of each holder, in whole
or in part, by delivering to us a duly-executed exercise notice of exercise accompanied by payment in full for the number of ordinary shares purchased upon such exercise (except in the case of a cashless exercise as discussed below). The purchaser
of the ordinary warrants in this offering may elect to deliver their exercise notice following the pricing of the offering and prior to the issuance of the ordinary warrants at closing to have their ordinary warrants exercised immediately upon
issuance and receive ordinary shares underlying the ordinary warrants upon closing of this offering. A holder (together with its affiliates) may not exercise any portion of the ordinary warrant to the extent that the holder would own more than
4.99% of the outstanding ordinary shares immediately after exercise. However, upon at least 61 days’ prior notice from the holder to us, the holder may increase the amount of ownership of outstanding ordinary shares after exercising the holder’s
ordinary warrants up to 9.99% of the number of ordinary shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the ordinary warrants. The purchaser of ordinary
warrants in this offering may also elect prior to the issuance of the ordinary warrants to have the initial exercise limitation set at 9.99% of our outstanding ordinary shares. No fractional shares will be issued in connection with the exercise of
an ordinary warrant. In lieu of fractional shares, we will either pay the holder an amount in cash equal to the fractional amount multiplied by the exercise price or round up to the next whole share.
Cashless Exercise. In lieu of making the cash payment otherwise contemplated to be made to us upon a holder’s exercise of its ordinary warrants in payment
of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either in whole or in part) the net number of ordinary shares determined according to a formula set forth in the ordinary warrants.
Fundamental Transactions. In the event of any fundamental transaction, as described in the ordinary warrants and generally including any merger with or into
another entity, sale of all or substantially all of our assets, tender offer or exchange offer, or reclassification of our ordinary shares, then upon any subsequent exercise of an ordinary warrant, the holder will have the right to receive as
alternative consideration, for each ordinary share that would have been issuable upon such exercise immediately prior to the occurrence of such fundamental transaction, the number of ordinary shares of the successor or acquiring corporation or of
our company, if it is the surviving corporation, and any additional consideration receivable upon or as a result of such transaction by a holder of the number of ordinary shares for which the ordinary warrant is exercisable immediately prior to
such event. In certain circumstances, the holder will have the right to receive the Black Scholes Value of the warrant calculated pursuant to a formula set forth in the warrants, payable either in cash or in the same type or form of consideration
that is being offered and being paid to the holders of our ordinary shares as described in the warrants.
Transferability. Subject to applicable laws, an ordinary warrant may be transferred at the option of the holder upon surrender of the ordinary warrant to us
together with the appropriate instruments of transfer.
Exchange Listing. There is no trading market available for the ordinary warrants on any securities exchange or nationally recognized trading system. We do
not intend to list the ordinary warrants on any securities exchange or nationally recognized trading system.
Right as a Shareholder. Except as otherwise provided in the ordinary warrants or by virtue of such holder’s ownership of our ordinary shares, the holders of
the ordinary warrants do not have the rights or privileges of holders of our ordinary shares, including any voting rights, until they exercise their pre-funded warrants.
Private Placement. The ordinary warrants and the ordinary shares upon the exercise of the ordinary warrants are being offered pursuant to the exemptions
provided in Section 4(a)(2) under the Securities Act and Rule 506(b) of Regulation D promulgated thereunder, and they are not being offered pursuant to this prospectus supplement and the accompanying prospectus.
S - 14
The following is a general discussion of the material U.S. and Israeli tax consequences concerning the acquisition, ownership and disposition of our
ordinary shares or the ordinary warrants. It is not intended to constitute a complete analysis of all tax consequences relating to the acquisition, ownership and disposition of our ordinary shares. This discussion is included for general
information purposes only, does not purport to be complete, and does not constitute and is not a tax opinion or tax advice to any investor. You should consult your tax advisor concerning the tax consequences of your particular situation, as well as
any tax consequences that may arise under the laws of any state, local, foreign or other taxing jurisdiction.
Israeli Taxation
This section contains a general discussion of material Israeli tax consequences concerning the acquisition, ownership, and disposition of our ordinary
shares purchased by investors in this offering. This summary does not discuss all the aspects of Israeli tax law that may be relevant to a particular investor in light of his or her personal investment circumstances or to some types of investors
subject to special treatment under Israeli law. Examples of such investors include residents of Israel or traders in securities who are subject to special tax regimes not covered in this discussion. Because parts of this discussion are based on tax
legislation that has not yet been subject to judicial or administrative interpretation, we cannot assure you that the appropriate tax authorities or the courts will accept the views expressed in this discussion. The discussion below is subject to
change, including due to amendments under Israeli law or changes to the applicable judicial or administrative interpretations of Israeli law, which change could affect the accuracy of the tax consequences described below.
Taxation of Our Shareholders
Capital Gains Taxes Applicable to Non-Israeli Resident Shareholders. The Israeli Income Tax Ordinance [New
Version], 5721-1961 (the “Tax Ordinance”) generally imposes a capital gains tax on the disposition of capital assets by non-Israeli tax residents if those assets (i) are located in Israel, (ii) are shares or a right to shares in an Israeli resident
corporation, or (iii) represent, directly or indirectly, rights to assets located in Israel, unless a specific exemption is available or unless a tax treaty between Israel and the shareholder’s country of residence provides otherwise. The Tax
Ordinance distinguishes between real capital gain and inflationary surplus. The inflationary surplus is a portion of the total capital gain equivalent to the increase of the relevant asset’s tax basis attributable to an increase in the Israeli
consumer price index or, in certain circumstances, a foreign currency exchange rate, between the date of purchase and the date of disposition. Inflationary surplus is not currently subject to tax in Israel. The real capital gain is the excess of
the total capital gain over the inflationary surplus.
Generally, a non-Israeli resident (whether an individual or a corporation) who derives capital gains from the sale of shares in an Israeli resident
company purchased upon or after the registration of the shares on the TASE or on a regulated market outside of Israel (such as Nasdaq) should be exempt from Israeli capital gains tax unless, among others, (i) the capital gain derived from the sale
of shares was attributed to a permanent establishment that the non-Israeli resident shareholder maintains in Israel, or (ii) the Israeli resident company is classified as a real estate investment trust or ceased to be a real estate investment trust
(as defined in the Tax Ordinance). Non-Israeli “body of persons” (as defined under the Tax Ordinance, which includes corporate entities, partnerships and other entities) will not be entitled to the foregoing exemption if Israeli residents, whether
directly or indirectly: (i) have a controlling interest of more than 25% in such non-Israeli entity or (ii) are the beneficiaries of, or are entitled to, 25% or more of the revenues or profits of such non-Israeli entity. In addition, such exemption
is not applicable to a person whose gains from selling or otherwise disposing of the shares are deemed to be business income.
If not exempt, a non-Israeli resident shareholder would generally be subject to tax on capital gain at the ordinary corporate tax rate (23% in 2022), if
generated by a company, or at the rate of 25%, if generated by an individual, or 30%, if generated by an individual who is a “substantial shareholder” (as defined under the Tax Ordinance), at the time of sale or at any time during the preceding
12-month period (or if the shareholder claims a deduction for interest and linkage differences expenses in connection with the purchase and holding of such shares). A “substantial shareholder” is generally a person who alone or together with such
person’s relative or another person who collaborates with such person on a permanent basis, holds, directly or indirectly, at least 10% of any of the “means of control” of the corporation. “Means of control” generally include, among others, the
right to vote, receive profits, nominate a director or an executive officer, receive assets upon liquidation, or order someone who holds any of the aforesaid rights how to act, regardless of the source of such right. Individual and corporate
shareholders dealing in securities in Israel are taxed at the tax rates applicable to business income (a corporate tax rate for a corporation (23% in 2022) and a marginal tax rate of up to 47% for an individual in 2022 (excluding excess tax as
discussed below)) unless contrary provisions in a relevant tax treaty apply. If the individual claims a deduction of interest and linkage fluctuation expenses in connection with the purchase or holding of the shares, the gain will generally be
taxed at a fixed rate of 30% until the promulgation of regulations setting forth the rules and conditions for deduction of real interest and linkage differentials pursuant to section 101A(a)(9) and 101A(b) of the Tax Ordinance.
S - 15
Additionally, a sale of shares by a non-Israeli resident may be exempt from Israeli capital gains tax under the provisions of an applicable tax treaty
between Israel and the shareholder’s country of residence. For example, under the Convention Between the Government of the United States and the Government of the State of Israel with respect to Taxes of Income, as amended (the “the United
States-Israel Tax Treaty”), the disposition of shares by a shareholder who (i) is a U.S. resident (for purposes of the United States-Israel Tax Treaty), (ii) holds the shares as a capital asset, and (iii) is entitled to claim the benefits afforded
to such person by the United States-Israel Tax Treaty, is generally exempt from Israeli capital gains tax. Such exemption will not apply, inter alia, if (a) the capital gain arising from such sale, exchange or disposition is attributed to a
permanent establishment that the shareholder maintains in Israel, (b) the shareholder holds, directly or indirectly, shares representing 10% or more of the voting capital of the company at any time in the 12-month period preceding such sale,
exchange or disposition, subject to certain conditions, (c) such U.S. resident is an individual and was present in Israel for a period or periods aggregating to 183 days or more during the relevant taxable year, (d) the capital gains arising from
such sale, exchange or disposition is attributed to real estate located in Israel, or (e) the capital gain arising from such sale, exchange or disposition is attributed to royalties. In each case, the sale, exchange or disposition of our ordinary
shares would be subject to Israeli tax, to the extent applicable; however, under the United States-Israel Tax Treaty, the taxpayer may be permitted to claim a credit for such taxes against the U.S. federal income tax imposed with respect to such
sale, exchange or disposition, subject to the limitations under U.S. law applicable to foreign tax credits. The United States-Israel Tax Treaty does not provide such credit against any U.S. state or local taxes. Application for this exemption
requires appropriate documentation presented to and specific instruction received from the Israel Tax Authority (the “ITA”).
Regardless of whether non-Israeli shareholders may be liable for Israeli capital gains tax on the sale of our ordinary shares, the payment of the
consideration may be subject to withholding of Israeli tax at source. Shareholders may be required to demonstrate that they are exempt from tax on their capital gains in order to avoid withholding at source at the time of sale. Specifically, in
transactions involving a sale of all of the shares of an Israeli resident company, in the form of a merger or otherwise, the ITA may require from shareholders who are not liable for Israeli tax to sign declarations in forms specified by this
authority or obtain a specific exemption from the ITA to confirm their status as non-Israeli tax residents, and, in the absence of such declarations or exemptions, may require the purchaser of the shares to withhold Israeli taxes at source.
In addition, with respect to mergers involving an exchange of shares, Israeli tax law allows for tax deferral in certain circumstances but makes the
deferral contingent on the fulfillment of a number of conditions, including, in some cases, a holding period of up to two years from the date of the transaction during which sales and dispositions of shares of the participating companies are
subject to certain restrictions. Moreover, with respect to certain share swap transactions in which the sellers receive shares in the acquiring entity that are publicly traded on a stock exchange, the tax deferral is limited in time, and when such
time expires, the tax becomes payable even if no disposition of such shares has occurred. In order to benefit from the tax deferral, a pre-ruling from the ITA might be required.
Taxation of Non-Israeli Resident Shareholders on
Receipt of Dividends. Non-Israeli residents (whether individuals or corporations) are generally subject to Israeli income tax on the
receipt of dividends paid on our ordinary shares at the rate of 25%, unless relief is provided under the provisions of an applicable tax treaty between Israel and the shareholder’s country of residence (provided that a certificate from the ITA
allowing for a reduced withholding tax rate or a tax exemption is obtained in advance). With respect to a person who is a “substantial shareholder” (described above) at the time of receiving the dividend or on any time during the preceding 12
months, the applicable tax rate is 30%. Dividends paid on publicly traded shares, like our ordinary shares, to non-Israeli residents, are generally subject to Israeli withholding tax at a rate of 25%, so long as the shares are registered with a
nominee company (whether or not the recipient is a substantial shareholder), unless a lower rate is provided under an applicable tax treaty (provided that a certificate from the ITA allowing for a reduced withholding tax rate is obtained in
advance). However, a distribution of dividends to non-Israeli residents is generally subject to withholding tax at source at a rate of 15% or 20% if the dividend is distributed from income attributed to a "Benefited Enterprise," as such
term is defined in the Law for the Encouragement of Capital Investments, 5719-1959.
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For example, under the United States-Israel Tax
Treaty and subject to the eligibility to the benefits under such treaty, the maximum rate of tax withheld at source in Israel on dividends paid to a holder of our ordinary shares who is a U.S. resident (for purposes of the United States-Israel Tax
Treaty) is 25%. However, for dividends not generated by an Approved Enterprise, Benefited Enterprise or Preferred Enterprises and paid to a U.S. corporation holding 10% or more of the outstanding voting capital throughout the tax year in which the
dividend is distributed as well as during the previous tax year, the maximum rate of withholding tax is generally 12.5%, provided that not more than 25% of the gross income of the Israeli resident paying corporation for such preceding year consists
of certain types of dividends and interest. Notwithstanding the foregoing, dividends distributed from income attributed to a Benefited Enterprise are subject to withholding tax at the rate of 15% for such U.S. corporate shareholder, provided that
the conditions related to the holding of 10% of our voting capital and to our gross income for the previous year (as set forth in the previous sentence) are met. The aforementioned rates under the United States-Israel Tax Treaty would not apply if
the dividend income is derived through a permanent establishment of the U.S. resident in Israel.
If the dividend is attributable partly to
income derived from a Benefited Enterprise and partly to other sources of income, the withholding rate will be a blended rate reflecting the relative portions of the two types of income. U.S. residents (for purposes of the United States-Israel Tax
Treaty) who are subject to Israeli withholding tax on a dividend may be entitled to a credit or deduction for United States federal income tax purposes up to the amount of the taxes withheld, subject to detailed rules contained in U.S. tax law.
We cannot assure you that we will designate the profits that we may distribute in a way that will reduce shareholders’ tax liability.
A non-Israeli resident who receives dividends from which tax was withheld is generally exempt from the obligation to file tax returns in Israel in
respect of such income, provided, inter alia, that (i) such income was not derived from a business conducted in Israel by the taxpayer, (ii) the taxpayer has no other taxable sources of income in Israel with respect to which a tax return is
required to be filed and (iii) the taxpayer is not obliged to pay Excess Tax (as further explained below).
Excess Tax
Individuals who are subject to tax in Israel (whether any such individual is an Israeli resident or non-Israeli resident) are also subject to an
additional tax at a rate of 3% on annual income exceeding NIS 663,240 for 2022 (which amount is linked to the annual change in the Israeli consumer price index), including, but not limited to, dividends, interest and capital gain.
Estate and Gift Tax
Israeli tax law presently does not impose estate or gift taxes.
Material U.S. Federal Income Tax Consequences
The following is a description of the material U.S. federal income tax consequences of the acquisition, ownership and disposition of our ordinary shares or the ordinary
warrants issued pursuant to this offering, and owning and disposing of our ordinary shares received upon exercise of the ordinary warrants. This description addresses only the material U.S. federal income tax consequences of beneficial ownership of
the ordinary shares or the ordinary warrants held as capital assets. This description does not address tax considerations applicable to U.S. Holders that may be subject to special tax rules, including, without limitation:
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banks, financial institutions or insurance companies;
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real estate investment trusts, regulated investment companies or grantor trusts;
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dealers or traders in securities, commodities or currencies;
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tax-exempt entities or organizations, including an “individual retirement account” or “Roth IRA” as defined in Section 408 or 408A of the U.S. Internal Revenue Code (the “Code”), respectively;
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certain former citizens or long-term residents of the United States;
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persons that received our ordinary shares or the ordinary warrants as compensation for the performance of services;
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persons that will hold our ordinary shares or the ordinary warrants as part of a “hedging,” “integrated” or “conversion” transaction or as a position in a “straddle” for U.S. federal income tax purposes;
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persons subject to special tax accounting rules as a result of any item of gross income with respect to the ordinary shares or the ordinary warrants being taken into account in an applicable financial statement;
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partnerships (including entities or arrangements classified as partnerships for U.S. federal income tax purposes) or other pass-through entities, or holders that will hold our ordinary shares or the ordinary warrants through such an
entity;
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S corporations;
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holders that acquire ordinary shares or the ordinary warrants as a result of holding or owning our preferred shares;
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U.S. Holders (as defined below) whose “functional currency” is not the U.S. Dollar;
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persons that are residents or ordinarily resident in or have a permanent establishment in a jurisdiction outside the United States; and
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holders that own or have owned directly or indirectly or by attribution 10.0% or more of the voting power or value of our shares.
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Moreover, this description does not address any U.S. federal tax consequences other than U.S. federal income tax consequences. It does not address the U.S. federal estate,
gift or alternative minimum tax consequences, Medicare consequences, or any state, local or foreign tax consequences, of the acquisition, ownership and disposition of our ordinary shares or the ordinary warrants.
This description is based on the Internal Revenue Code of 1986, as amended (the “Code”), applicable U.S. Treasury Regulations and judicial and administrative interpretations
thereof, in each case as in effect and available on the date hereof, each of which is subject to change (possibly with retroactive effect). Any such change could affect the tax consequences described below. There can be no assurances that the U.S.
Internal Revenue Service (the “IRS”), will not take a different position concerning the tax consequences of the acquisition, ownership and disposition of our ordinary shares or the ordinary warrants or that such a position would not be sustained.
Holders should consult their tax advisors concerning the U.S. federal, state, local and foreign tax consequences of acquiring, owning and disposing of our ordinary shares or the ordinary warrants issued pursuant to this offering and owning and
disposing of our ordinary shares received upon exercise of the ordinary warrants in their particular circumstances.
For purposes of this description, a “U.S. Holder” is a beneficial owner of our ordinary shares or the ordinary warrants that, for U.S. federal income tax purposes, is:
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an individual that is a citizen or resident of the United States;
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a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any state thereof, including the District of Columbia;
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an estate the income of which is subject to U.S. federal income taxation regardless of its source; or
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a trust if such trust has validly elected to be treated as a United States person for U.S. federal income tax purposes or if (1) a court within the United States is able to exercise primary supervision over its administration and (2) one
or more U.S. persons have the authority to control all of the trust’s substantial decisions.
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If any entity or arrangement treated as a partnership for U.S. federal income tax purposes holds our ordinary shares or the ordinary warrants, the tax treatment of a partner
in such partnership will generally depend on the status of the partner and the activities of the partnership. Such a partner or partnership should consult its tax advisor as to the particular U.S. federal income tax consequences of acquiring,
owning and disposing of our ordinary shares or the ordinary warrants issued pursuant to this offering and owning and disposing of our ordinary shares received upon exercise of the ordinary warrants in its particular circumstance.
Unless otherwise indicated, this discussion assumes that the Company is not, and will not become, a “passive foreign investment company,” or PFIC, for U.S. federal income tax
purposes. See “—Passive Foreign Investment Company Considerations” below.
You should consult your tax advisor with respect to the U.S. federal, state, local and foreign tax consequences of acquiring, owning and
disposing of our ordinary shares or the ordinary warrants issued pursuant to this offering and owning and disposing of our ordinary shares received upon exercise of
the ordinary warrants.
Allocation of Basis between our Ordinary Shares and the Ordinary Warrants
In determining their tax basis for our ordinary shares and the ordinary warrants received together pursuant to this offering, U.S. Holders should allocate their purchase
price between our ordinary shares and the ordinary warrants on the basis of their relative fair market values at the time of issuance. We do not intend to advise U.S. Holders with respect to this determination, and U.S. Holders are advised to
consult their tax and financial advisors with respect to the relative fair market values of our ordinary shares and the ordinary warrants for U.S. federal income tax purposes.
Distributions on our Ordinary Shares
U.S. Holders. We do not intend to pay cash dividends in the foreseeable future. However, if any distribution of property is made on
our ordinary shares and you are a U.S. Holder, then, subject to the discussion below under “—Passive Foreign Investment Company Considerations,” the gross amount of any distribution made to you with respect to our ordinary shares (before reduction
for any Israeli taxes withheld therefrom) will generally be includible in your income as dividend income to the extent such distribution is paid out of our current or accumulated earnings and profits as determined under U.S. federal income tax
principles. To the extent such distribution exceeds our current and accumulated earnings and profits as determined under U.S. federal income tax principles, it will be treated first as a tax-free return of your adjusted tax basis in our ordinary
shares (but not below zero) and thereafter as either long-term or short-term capital gain depending upon whether your holding period for our ordinary shares exceeds one year as of the time such distribution is received. However, we do not expect to
maintain calculations of our earnings and profits under U.S. federal income tax principles. Therefore, if you are a U.S. Holder, you should expect that the entire amount of any distribution generally will be taxable as dividend income to you.
Non-corporate U.S. Holders may qualify for the lower rates of taxation with respect to dividends on ordinary shares applicable to long-term capital gains (i.e., gains from the sale of capital assets held for more than one year) if certain
conditions are met, including certain holding period requirements and the absence of certain risk reduction transactions. Such lower rate of taxation shall not apply if the Company is a PFIC with respect to the U.S. Holder for the taxable year in
which it pays a dividend, or was a PFIC for the preceding taxable year. Finally, the dividends will not be eligible for the dividends received deduction generally allowed to corporate U.S. Holders.
If you are a U.S. Holder, dividends paid to you with respect to our ordinary shares will generally be treated as foreign source income, which may be relevant in calculating
your foreign tax credit limitation. Subject to certain conditions and limitations, Israeli tax withheld on dividends may be deducted from your taxable income or credited against your U.S. federal income tax liability. The limitation on foreign
taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends that we distribute generally should constitute “passive category income.” A foreign tax credit for foreign taxes imposed on
distributions may be denied if you do not satisfy certain minimum holding period requirements. The rules relating to the determination of the foreign tax credit are complex, and recently issued U.S. Treasury regulations (“Foreign Tax Credit
Regulations”) that apply to foreign income taxes paid or accrued in taxable years beginning on or after December 28, 2021 further restrict the availability of any such credit based on the nature of the tax imposed by the non-U.S. jurisdiction. You
should consult your tax advisor to determine whether and to what extent you will be entitled to this credit.
Constructive Dividends on our Ordinary Shares or the Ordinary Warrants
If the exercise price of the ordinary warrants is adjusted in certain circumstances (or in certain circumstances, there is a failure to make adjustments or a failure to make
adequate adjustments), that adjustment (or failure to adjust) may result in the deemed payment of a taxable dividend to a U.S. Holder of the ordinary warrants or our ordinary shares. Any such constructive dividend will be taxable generally as
described above under “—Distributions on our Ordinary Shares.” Generally, a U.S. Holder’s tax basis in our ordinary shares or the ordinary warrants will be increased to the extent of any such constructive taxable dividend. It is not entirely clear
whether a constructive dividend deemed paid to a non-corporate U.S. Holder could be “qualified dividend income” as discussed above under “—Distributions on our Ordinary Shares.” U.S. Holders should consult their tax advisors regarding the proper
U.S. federal income tax treatment of any adjustments to (or failure to adjust, or adjust adequately) the exercise price of the ordinary warrants.
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Sale, Exchange or Other Taxable Disposition of Ordinary Shares or the Ordinary Warrants
U.S. Holders. Subject to the discussion below under “—Passive Foreign Investment Company Considerations,” if you are a U.S. Holder,
you generally will recognize gain or loss on the sale, exchange or other taxable disposition of our ordinary shares or the ordinary warrants equal to the difference between the amount realized on such sale, exchange or other taxable disposition and
your adjusted tax basis in such ordinary shares or ordinary warrants, and such gain or loss will generally be capital gain or loss. If any Israeli tax is imposed on the sale, exchange or other taxable disposition of our ordinary shares or the
ordinary warrants, a U.S. Holder’s amount realized will include the gross amount of the proceeds of such disposition before deduction of the Israeli tax. The adjusted tax basis in an ordinary share or the ordinary warrants generally will be equal
to the cost of such ordinary share or ordinary warrant, in each case, increased by the amount of previously taxed constructive dividend with respect to such share or ordinary warrant, if any, as described above under “ --Constructive Dividends on
our Ordinary Shares or the Ordinary Warrants.” If you are a non-corporate U.S. Holder, capital gain from the sale, exchange or other taxable disposition of our ordinary shares or the ordinary warrants will generally be eligible for a preferential
rate of taxation applicable to capital gains if your holding period for such ordinary shares or ordinary warrants exceeds one year. The deductibility of capital losses for U.S. federal income tax purposes is subject to limitations under the Code.
Any gain or loss that a U.S. Holder recognizes on the sale, exchange or other taxable disposition of our ordinary shares or the ordinary warrants generally will be treated as
U.S. source income or loss for foreign tax credit limitation purposes. Because you may use foreign tax credits to offset only the portion of U.S. federal income tax liability that is attributed to foreign source income in the same category, you may
be unable to claim a foreign tax credit with respect to Israeli tax, if any, imposed on any such U.S.-source gain. Additionally, as discussed above, the Foreign Tax Credit Regulations may further limit your ability to claim such a foreign tax
credit, depending on the nature of such Israeli tax. In addition, if you are eligible for the benefit of the income tax convention between the United States and the State of Israel and pay Israeli tax in excess of the amount applicable to you under
such convention or if the Israeli tax paid is refundable, you will not be able to claim any foreign tax credit with respect to such Israeli tax. You should consult your tax advisor as to whether the Israeli tax on gains may be creditable against
your U.S. federal income tax on foreign-source income from other sources.
Taxation of Exercise or Expiration of the Ordinary Warrants
In general, a U.S. Holder will not be required to recognize income, gain or loss upon exercise of the ordinary warrants by payment of the exercise price. A U.S. Holder’s tax
basis in our ordinary shares received upon exercise of the ordinary warrants will be equal to the sum of (1) its tax basis in the ordinary warrants exchanged therefor and (2) the exercise price of the ordinary warrants. Although there is no direct
legal authority as to the U.S. federal income tax treatment of an exercise of the ordinary warrants on a cashless basis, if required to do so, we intend to take the position that such exercise will not be taxable, either because the exercise is not
a gain realization event or because it qualifies as a tax-free recapitalization. In the former case, the holding period of our ordinary shares received upon exercise of the ordinary warrants should commence on the day after the ordinary warrants
are exercised. In the latter case, the holding period of our ordinary shares received upon exercise of the ordinary warrants would include the holding period of the exercised ordinary warrants. However, such position is not binding on the IRS, and
the IRS may treat a cashless exercise of the ordinary warrants as a taxable exchange. U.S. Holders are urged to consult their tax advisors as to the consequences of an exercise of the ordinary warrants on a cashless basis, including with respect to
their holding period and tax basis in our ordinary shares received. If the ordinary warrants expire without being exercised, a U.S. Holder will recognize a capital loss in an amount equal to its tax basis in the ordinary warrants. Such loss will be
long-term capital loss if, at the time of the expiration, the U.S. Holder’s holding period in the ordinary warrants is more than one year. The deductibility of capital losses is subject to limitations.
Passive Foreign Investment Company Considerations
If we were to be classified as a PFIC for any taxable year, a U.S. Holder of our ordinary shares (or, under proposed U.S. Treasury Regulations, the ordinary warrants) would
be subject to special rules generally intended to reduce or eliminate any benefits from the deferral of U.S. federal income tax that a U.S. Holder could derive from investing in a non-U.S. company that does not distribute all of its earnings on a
current basis.
A non-U.S. corporation will be classified as a PFIC for federal income tax purposes in any taxable year in which, after applying certain look-through rules with respect to
the income and assets of subsidiaries, either:
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at least 75% of its gross income is “passive income”; or
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at least 50% of the average quarterly value of its total gross assets (which may be determined in part by the market value of our ordinary shares, which is subject to change) is attributable to assets that produce “passive income” or are
held for the production of passive income.
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Passive income for this purpose generally includes dividends, interest, royalties, rents, gains from commodities and securities transactions, the excess of gains over losses
from the disposition of assets which produce passive income, and includes amounts derived by reason of the temporary investment of funds raised in offerings of our ordinary shares. If a non-U.S. corporation owns at least 25% by value of the stock
of another corporation, the non-U.S. corporation is treated for purposes of the PFIC tests as owning its proportionate share of the assets of the other corporation and as receiving directly its proportionate share of the other corporation’s income.
If we are classified as a PFIC for any year with respect to which a U.S. Holder owns our ordinary shares (or, under proposed U.S. Treasury Regulations, the ordinary warrants), then, in the absence of any special elections, we will generally
continue to be treated as a PFIC with respect to such U.S. Holder in all succeeding years during which the U.S. Holder owns our ordinary shares or the warrants and, although subject to uncertainty, potentially our ordinary shares received upon
exercise of such ordinary warrants. Certain elections (such as a deemed sale election) may be available under certain circumstances.
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Based on current estimates of our gross income and the estimated fair market value of our gross assets, our intended use of the proceeds of this offering and the nature of
our business, we do not expect that we will be classified as a PFIC for the taxable year ending December 31, 2022. However, because PFIC status is based on our income, assets and activities for the entire taxable year, it is not possible to
determine whether we will be characterized as a PFIC for the 2022 taxable year until after the close of the year. Moreover, we must determine our PFIC status annually based on tests which are factual in nature, and our status in future years will
depend on our income, assets and activities in those years. Further, because the value of our gross assets is likely to be determined in large part by reference to our market capitalization, a decline in the value of our ordinary shares or an
increase in the value of our passive assets (including cash and short term investments) may result in our becoming a PFIC. In addition, our status as a PFIC may depend on how quickly we utilize the cash proceeds from this offering (and any future
offerings) in our business. There can be no assurance that we will not be considered a PFIC for the current or any future taxable year.
If we are considered a PFIC for any taxable year, and you are a U.S. Holder, then unless you make one of the elections described below, a special tax regime will apply to
both (a) any “excess distribution” by us to you (generally, your ratable portion of distributions in any year which are greater than 125% of the average annual distribution received by you in the shorter of the three preceding years or your holding
period) and (b) any gain realized on the sale or other disposition of the ordinary shares or the ordinary warrants. Under this regime, any excess distribution and realized gain will be treated as ordinary income and will be subject to tax as if (i)
the excess distribution or gain had been realized ratably over your holding period, (ii) the amount deemed realized in each year had been subject to tax in each year of that holding period at the highest marginal rate for such year (other than
income allocated to the current period or any taxable period before we became a PFIC, which would be subject to tax, at the U.S. Holder’s regular ordinary income rate for the current year and would not be subject to the interest charge discussed
below), and (iii) the interest charge generally applicable to underpayments of tax had been imposed on the taxes deemed to have been payable in those years. In addition, dividend distributions made to you will not qualify for the lower rates of
taxation applicable to long-term capital gains discussed above under “Distributions.” In addition, if we are a PFIC and we own directly or indirectly equity in any company that is also a PFIC (“lower-tier PFIC”), a U.S. Holder may also be subject
to the adverse tax consequences described above with respect to any gain or “excess distribution” realized or deemed realized in respect of such lower-tier PFIC. Certain elections may be available that would result in an alternative treatment (such
as mark-to-market treatment) of our ordinary shares, which may not be available for the ordinary warrants.
If a U.S. Holder makes a valid mark-to-market election, then, in lieu of being subject to the tax and interest charge rules discussed above, the U.S. Holder generally will
recognize as ordinary income any excess of the fair market value of the ordinary shares at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss in respect of any excess of the adjusted tax basis of the
ordinary shares over their fair market value at the end of the taxable year (but only to the extent of the net amount of income previously included as a result of the mark- to-market election). If a U.S. Holder makes the election, the U.S. Holder’s
tax basis in the ordinary shares will be adjusted to reflect these income or loss amounts. Any gain recognized on the sale or other disposition of ordinary shares in a year for which we are a PFIC will be treated as ordinary income and any loss
will be treated as an ordinary loss (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). A U.S. Holder’s adjusted tax basis in the ordinary shares will be increased by the amount of
any income inclusion and decreased by the amount of any deductions under the mark-to-market rules discussed above.
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The mark-to-market election is available only if we are a PFIC and our ordinary shares are “regularly traded” on a “qualified exchange.” Our ordinary shares will be treated
as “regularly traded” in any calendar year in which more than a de minimis quantity of the ordinary shares, are traded on a qualified exchange on at least 15 days during each calendar quarter. The Nasdaq Global Market is a qualified exchange for
this purpose. Because a mark-to-market election generally cannot be made for any lower-tier PFICs , a U.S. Holder may continue to be subject to the tax and interest charge rules discussed above with respect to such holder’s indirect interest in any
investments held by us that are treated as an equity interest in a PFIC for U.S. federal income tax purposes, including stock in lower-tier PFICs. If a U.S. Holder makes a mark-to market election, it will be effective for the taxable year for which
the election is made and all subsequent taxable years unless our ordinary shares are no longer regularly traded on a qualified exchange or the IRS consents to the revocation of the election.
We do not intend to provide the information necessary for U.S. Holders to make qualified electing fund elections if we are classified as a PFIC. A qualified electing fund
election may not be available for the ordinary warrants regardless of whether we provide such information. U.S. Holders should consult their tax advisors to determine whether any of these elections would be available and if so, what the
consequences of the alternative treatments would be in their particular circumstances.
If we are determined to be a PFIC, the general tax treatment for U.S. Holders described in this section would apply to indirect distributions and gains deemed to be realized
by U.S. Holders in respect of any of our subsidiaries that also may be determined to be PFICs.
If a U.S. Holder owns ordinary shares (or, under proposed U.S. Treasury Regulations, the ordinary warrants) during any year in which we are a PFIC, the U.S. Holder generally
will be required to file an IRS Form 8621 (Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund) or successor form with respect to the company, generally with the U.S. Holder’s federal income tax
return for that year.
U.S. Holders should consult their tax advisors regarding whether we are a PFIC and the potential application of the PFIC rules.
Backup Withholding Tax and Information Reporting Requirements
United States backup withholding tax and information reporting requirements may apply to certain payments to certain holders of stock. Information reporting generally will
apply to distributions (including constructive distributions) on, and proceeds from the sale, exchange or redemption of, our ordinary shares made within the United States or by a United States payor or United States middleman, to a holder of our
ordinary shares, other than an exempt recipient (including a payee that is not a United States person that provides an appropriate certification and certain other persons). Payments made (and sales or other dispositions effected at an office)
outside the U.S. will be subject to information reporting in limited circumstances. A payor will be required to withhold backup withholding tax from any payments of dividends (including constructive dividends) on, or the proceeds from the sale or
redemption of, ordinary shares within the United States, or by a United States payor or United States middleman, to a holder, other than an exempt recipient, if such holder fails to furnish its correct taxpayer identification number and a duly
executed IRS Form W-9 or otherwise fails to comply with, or establish an exemption from, such backup withholding tax requirements or to report dividends required to be shown on the holder’s U.S. federal income tax returns. Backup withholding is not
an additional tax. Any amounts withheld under the backup withholding rules will be allowed as a credit against the beneficial owner’s United States federal income tax liability, if any, and any excess amounts withheld under the backup withholding
rules may be refunded, provided that the required information is timely furnished to the IRS.
Foreign Financial Asset Reporting
Certain U.S. Holders who are individuals (and certain entities) are required to report information relating to an interest in our ordinary shares or the
ordinary warrants, subject to certain exceptions (including an exception for ordinary shares or ordinary warrants held in accounts maintained by certain financial institutions) by filing IRS Form 8938 (Statement of Specified Foreign Financial
Assets) with their federal income tax return. U.S. Holders are urged to consult their tax advisors regarding their information reporting obligations, if any, with respect to their ownership and disposition of our ordinary shares and the ordinary
warrants.
The above description is not intended to constitute a complete analysis of all tax consequences relating to acquisition, ownership, and
disposition of our ordinary shares or the ordinary warrants issued pursuant to this offering and owning and disposing of our ordinary shares received upon exercise of the ordinary warrants. You should
consult your tax advisor concerning the tax consequences of the acquisition, ownership and disposition of our ordinary shares or the ordinary warrants issued pursuant to this offering and owning and disposing of our ordinary shares received upon
exercise of the ordinary warrants in your particular situation.
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Pursuant to an engagement letter, we have engaged H.C. Wainwright & Co., LLC, or Wainwright, as our exclusive placement agent for this offering. Wainwright is not purchasing or selling any
shares, nor are they required to arrange for the purchase and sale of any specific number or dollar amount of shares other than the use their reasonable “best efforts” to arrange for the sale of shares by us. Therefore, we may not sell the entire
amount of shares being offered. The terms of this offering were subject to market conditions and negotiations between us, Wainwright and prospective investors. The engagement letter does not give rise to any commitment by Wainwright to purchase any
of our securities, and Wainwright will have no authority to bind us by virtue of the engagement agreement. Further, Wainwright does not guarantee that it will be able to raise new capital in any prospective offering. Wainwright may engage one or
more sub-agents or selected dealers to assist with the offering.
We have entered into securities purchase agreements directly with the investors in connection with this offering, and we will only sell to the investors who have entered into the securities
purchase agreements.
We expect to deliver the ordinary shares being offered pursuant to this prospectus supplement on or about September 26, 2022.
Upon the closing of this offering and the PIPE, we will pay Wainwright a cash fee equal to 7.0% of the aggregate gross proceeds to us from the sale of the ordinary shares in the offering and the Pre-Funded Warrants
in the PIPE (to be decreased to 3.5% for certain identified investors). We have agreed to issue to Wainwright (or its designees) warrants to purchase that number of our ordinary shares equal to 5.0% of the aggregate number of ordinary shares (or
ordinary share equivalent, if applicable) placed in this offering and the PIPE, or warrants to purchase up to an aggregate of 871,429 ordinary shares. Such ordinary warrants to be issued to Wainwright will have substantially the same terms as the
ordinary warrants being sold and issued in the concurrent private placement, except that Wainwright’s ordinary warrants will have an exercise price equal to $2.1875 per share (which represents 125% of the offering price per share in this
offering) and will expire four years after the Authorized Share Increase Date but no more than five years following the commencement of the sales pursuant to this offering. We have also agreed to pay Wainwright for its role as placement agent for
this offering and the PIPE a non-accountable expense allowance of $85,000.00 and clearing expenses of $15,950.00. We estimate the total expenses of this offering, which will be payable by us, excluding the placement agent fees and expenses, will
be approximately $0.4 million.
Wainwright shall also be entitled to the foregoing cash and ordinary warrant compensation with respect to certain investors brought over-the-wall during the term of the engagement letter that
invest in any subsequent capital-raising transaction during the 12-month period following the termination or expiration of the engagement letter.
In addition, we have agreed that (i) we will not conduct any issuances of our ordinary for a period 60 days following the closing of this offering, and (ii) we will not enter into a variable rate
transaction for a period ending on the 6-month anniversary of the closing of this offering. Notwithstanding the foregoing, we may enter into and effect sales pursuant to an at–the-market
facility following the period set forth in clause (i) of this paragraph.
We have agreed to indemnify Wainwright and specified other persons against certain liabilities relating to or arising out of Wainwright’s activities under the engagement letter and to contribute to
payments that Wainwright may be required to make in respect of such liabilities.
Wainwright may be deemed to be an underwriter within the meaning of Section 2(a)(11) of the Securities Act, and any commissions received by it and any profit realized on the resale of the
securities sold by it while acting as principal might be deemed to be underwriting discounts or commissions under the Securities Act. As an underwriter, Wainwright would be required to comply with the requirements of the Securities Act and the
Exchange Act, including, without limitation, Rule 415(a)(4) under the Securities Act and Rule 10b-5 and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales of ordinary shares by Wainwright
acting as principal. Under these rules and regulations, Wainwright:
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may not engage in any stabilization activity in connection with our securities; and
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may not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities, other than as permitted under the Exchange Act of 1934, as amended,
until it has completed its participation in the distribution.
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The form of securities purchase agreement will be filed as an exhibit to our Report on Form 6-K with the SEC and that will be incorporated by reference into the registration statement of which this
prospectus supplement forms a part.
From time to time, Wainwright may provide in the future various advisory, investment and commercial banking and other services to us in the ordinary course of business, for which they may receive
customary fees and commissions. We currently have no other present arrangements with Wainwright for any further services.
The Transfer Agent and Registrar for our ordinary shares is American Stock Transfer & Trust Company, LLC.
Our ordinary shares are traded on The Nasdaq Global Market under the symbol “MDWD.”
S - 23
The validity of the ordinary shares and other legal matters concerning this offering relating to Israeli law will be passed upon for us by Meitar | Law Offices, Ramat Gan,
Israel. Certain legal matters in connection with this offering relating to U.S. law will be passed upon for us by Latham & Watkins LLP.
The consolidated financial statements of MediWound Ltd. incorporated by reference in this prospectus supplement by reference to MediWound Ltd.’s annual
report on Form 20-F for the year ended December 31, 2021 have been audited by Kost Forer Gabbay & Kasierer, a member of Ernst & Young Global, an independent registered public accounting firm, as set forth in their report therein, included
therein and incorporated herein by reference. Such consolidated financial statements are incorporated by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
S - 24
Available Information
We are subject to the periodic reporting and other informational requirements of the Exchange Act. Under the Exchange Act, we file annual reports and other information with
the SEC. As a foreign private issuer, we are exempt from, among other things, the rules under the Exchange Act prescribing the furnishing and content of proxy statements and our officers, directors and principal shareholders are exempt from the
reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act.
The SEC maintains a web site that contains reports and information statements and other information about issuers, such as us, who file electronically with the SEC. The
address of that website is www.sec.gov.
We maintain a corporate website at www.MediWound.com. Information contained on, or that can be accessed through, our website does
not constitute a part of this prospectus.
This prospectus supplement and the accompanying prospectus are part of a registration statement that we filed with the SEC and do not contain all of the information in the
registration statement. The full registration statement may be obtained from the SEC or us, as provided below. Statements in this prospectus supplement and the accompanying prospectus about the registration statement are summaries and each
statement is qualified in all respects by reference to the registration statement. You should refer to the registration statement for a more complete description of the relevant matters.
The SEC’s rules allow us to “incorporate by reference” information into this prospectus supplement and accompanying prospectus, which means that we can disclose important
information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus supplement and accompanying prospectus, and subsequent information that is
incorporated by reference herein will automatically update and supersede that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus
supplement to the extent that a statement contained in this prospectus supplement modifies or replaces that statement.
This prospectus supplement incorporates by reference the documents set forth below that have previously been filed with the SEC:
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Our Annual Report on Form 20-F for the year ended December 31, 2021, filed with the SEC on March 17, 2022 (File No.
001-36349); and
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Our Reports on Form 6-K furnished to the SEC on March 22, 2022, May 12, 2022, May
17, 2022, June 9, 2022, June 30, 2022, July
1, 2022, July 11, 2022, July 12, 2022, July
19, 2022, August 3, 2022, August 8, 2022 and August
9, 2022 (each, solely with respect to the portions specified therein).
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We are also incorporating by reference all subsequent annual reports on Form 20-F that we file with the SEC and certain reports on Form 6-K that we furnish to the SEC after
the date of this prospectus supplement (if such reports on Form 6-K expressly state that they are incorporated by reference into the registration statement on Form F-3 (Registration No. 333-230490)) prior to the termination of this offering. In all
cases, you should rely on the later information over different information included in this prospectus supplement and the accompanying prospectus.
Unless expressly incorporated by reference, nothing in this prospectus supplement shall be deemed to incorporate by reference information furnished to, but not filed with,
the SEC. Copies of all documents incorporated by reference in this prospectus supplement, other than exhibits to those documents unless such exhibits are specially incorporated by reference in this prospectus supplement, will be provided at no cost
to each person, including any beneficial owner, who receives a copy of this prospectus supplement on the written or oral request of that person made to:
MediWound Ltd.
42 Hayarkon Street
Yavne, 8122745 Israel
+972-77-971-4100
Attention: Investor Relations
S - 25
PROSPECTUS
$125,000,000 of Ordinary Shares, Warrants
Debt Securities Offered by the Company, and/or Units.
and
Up to 12,738,460 Ordinary Shares Offered by Selling Shareholders
MediWound Ltd.
We may offer from time to time in one or more series or issuances ordinary shares, warrants to purchase ordinary shares and/or debt securities consisting of debentures, notes or other evidences of
indebtedness or any combination of the above, separately or as units. We refer to the ordinary shares, warrants, debt securities and units collectively as “securities” in this prospectus.
In addition, the selling shareholders may offer up to 12,738,460 ordinary shares. We will not receive any of the proceeds from the sale of ordinary shares by the selling shareholders.
Each time we or a selling shareholder sell securities pursuant to this prospectus, we will provide a supplement to this prospectus that contains specific information about the offering and the
specific terms of the securities offered. You should read this prospectus and the applicable prospectus supplement carefully before you invest in our securities.
We may, from time to time, and selling shareholders may offer the securities through public or private transactions, directly or through underwriters, agents or dealers, on or off the Nasdaq Stock
Market at prevailing market prices or at privately negotiated prices. If any underwriters, agents or dealers are involved in the sale of any of these securities, the applicable prospectus supplement will set forth the names of the underwriter, agent
or dealer and any applicable fees, commissions or discounts.
Our ordinary shares are traded on the Nasdaq Global Market under the symbol “MDWD.” The closing price of our ordinary shares, as reported on the Nasdaq Global Market on May 20, 2022 was $1.815.
On May 20, 2022, the aggregate market value worldwide of our outstanding voting and non-voting common equity held by non-affiliates was $60,150,248.90, based on 33,140,633 ordinary shares outstanding
and a per ordinary share price of $1.815 based on the closing sale price of our ordinary shares on the Nasdaq Global Market on May 20, 2022. We have not offered any securities pursuant to General Instruction I.B.5 on Form F-3 during the prior 12
calendar month period that ends on and includes the date of this prospectus.
Investing in these securities involves certain risks. Please carefully consider the “Risk Factors” in Item 3 of our most recent annual report on Form 20-F incorporated by reference
in this prospectus, and the “Risk Factors” referenced on page 3 of this prospectus, and in any applicable supplement to this prospectus, for a discussion of the factors you should consider carefully before deciding to purchase these securities.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities being offered by this prospectus, or determined if
this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is June 3, 2022
TABLE OF CONTENTS
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This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration process. Under this process, we may offer and
sell our securities under this prospectus, and the selling shareholders referred to in this prospectus and identified in supplements to this prospectus may also offer and sell our ordinary shares under this prospectus.
Under this shelf process, we may sell the securities described in this prospectus in one or more offerings up to a total price to the public of $125 million. The selling shareholders may sell up to
12,738,460 ordinary shares in one or more offerings. The offer and sale of securities under this prospectus may be made from time to time, in one or more offerings, in any manner described under the section in this prospectus entitled “Plan of
Distribution.”
This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information
about the terms of that offering, if required. The prospectus supplement may also add, update or change information contained in this prospectus, and may also contain information about any material federal income tax considerations relating to the
securities covered by the prospectus supplement. You should read both this prospectus and any prospectus supplement together with additional information under the headings “Where You Can Find More Information” and “Incorporation of Certain Documents
by Reference.”
This summary may not contain all of the information that may be important to you. You should read this entire prospectus, including the financial data and related notes incorporated by reference in
this prospectus, before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements.
Factors that might cause or contribute to such differences include those referred to in “Risk Factors” and “Forward-Looking Statements.”
References to “we,” “us” and “our” in this prospectus, unless the context otherwise requires or as otherwise expressly stated, refer to MediWound Ltd.
1
Company Overview
We are a biopharmaceutical company that develops, manufactures and commercializes novel, cost effective, bio-therapeutic solutions for tissue repair and regeneration. Our strategy leverages our breakthrough enzymatic
technology platform into diversified portfolio of biotherapeutics across multiple indications to pioneer solutions for unmet medical needs. Our current portfolio is focused on next-generation protein-based therapies for burn and wound care and
tissue repair.
Our first innovative biopharmaceutical product, NexoBrid, has received marketing authorization from the European Medicines Agency (“EMA”) and other international markets for removal of dead or damaged tissue, known as
eschar, in adults with deep partial- and full-thickness thermal burns, also referred to as severe burns. NexoBrid, a concentrate of proteolytic enzymes enriched in bromelain, represents a new paradigm in burn care management, and our clinical
trials have demonstrated, with statistical significance, its ability to non-surgically and rapidly remove the eschar earlier relative to existing standard of care upon patient admission, without harming viable tissues.
In September 2020, the U.S. Food and Drug Administration (“FDA”) accepted for review our Biologics License Application (“BLA”) for NexoBrid for severe burns. The BLA submission included a comprehensive set of
manufacturing data and results from multiple preclinical and clinical studies, including the pivotal U.S. Phase 3 (“DETECT”) study of NexoBrid in adult patients with deep partial and/or full-thickness thermal burns up to 30% of total body surface
area. The DETECT study successfully met its primary endpoint and all secondary endpoints, and was well-tolerated in the study. On June 29, 2021, we received a Complete Response Letter (“CRL”) from the FDA pursuant to which the FDA communicated that
it had completed its review of the BLA, as amended, and determined that the application cannot be approved in its present form. The FDA identified issues related to the Chemistry, Manufacturing and Controls (“CMC”) section of the BLA and requested
additional CMC information. The FDA acknowledged receipt of several CMC amendments, submitted in response the CMC information requests, which were not reviewed for this action. The FDA also stated that an inspection of NexoBrid's manufacturing
facilities in Israel and Taiwan, would be required before the FDA can approve the BLA, but it was unable to conduct the required inspections during the current review cycle due to COVID-related travel restrictions. The FDA stated that it will
continue to monitor the public health situation as well as travel restrictions and is actively working to define an approach for scheduling outstanding inspections. In addition, the CRL cited certain observations identified during good clinical
practice (GCP) inspections related to the DETECT study, and requested that we provide its perspective on the potential impact, if any, of these observations on the efficacy findings in the study. The FDA also requested to provide a safety update as
part of any BLA resubmission, although there were no safety issues raised in the CRL. Following a productive Type A meeting with the FDA conducted in October 2021, we gained clarity on a path forward for resubmission of the BLA, which is now
anticipated in mid-2022.
In July 2021, we announced positive results from our pivotal NexoBrid phase 3 pediatric clinical study (CIDS) for eschar removal of severe thermal burns, including the 12-month safety follow-up. The study met all
three primary endpoints with a high degree of statistical significance, as well as certain secondary endpoints. NexoBrid demonstrated a significant reduction in time to achieve complete eschar removal and significant reduction in wound area
requiring surgical excision (surgical need) while demonstrating non-inferiority to standard-of-care in quality of scars. In addition, the study showed that NexoBrid was safe and well-tolerated. The long-term follow-up for cosmesis and function,
quality of life and safety measurements is ongoing, and data is expected in the first half of 2023. In November 2021, we announced that we received positive scientific advice from the Committee for Medicinal Products for Human Use (CHMP) of the
European Medicines Agency (EMA) related to the pediatric label extension for NexoBrid. EMA’s CHMP agreed to assess a potential pediatric label extension on NexoBrid for the treatment of thermal burns, based on the available safety and efficacy
results of CIDS with its 12-month follow-up, and that the long-term follow-up data are likely to be supportive data. Based on the feedback, we anticipate submitting a pediatric label extension request in the first half of 2022.
We commercialize NexoBrid globally through multiple sales channels. We sell NexoBrid to burn centers in the European Union, United Kingdom and Israel, primarily through our direct sales force, focusing on key burn
centers and Key Opinion Leaders (“KOL”) management, while establishing additional local distribution channels to extend our outreach in the European Union. In the United States, we entered into exclusive license and supply agreements with Vericel
Corporation to commercialize NexoBrid in North America upon FDA approval (if received). We have signed distribution agreements with local distributors in multiple international markets, focusing in Asia Pacific, EMEA, CEE and LATAM, which are
responsible for obtaining local marketing authorization within the relevant territory.
2
EscharEx, our next-generation enzymatic therapy under development, is a topical biological drug candidate for the debridement of chronic and other hard-to-heal wounds. EscharEx active pharmaceutical ingredient (API) is
a concentrate of proteolytic enzymes enriched in bromelain. In prior clinical trials, EscharEx was well tolerated and showed significantly higher incidence of complete debridement of various chronic and other hard-to-heal wounds within a few daily
applications compared with hydrogel vehicle, as well as a comparable safety profile. EscharEx is an investigational product, currently under investigation in a U.S. phase 2 adaptive design study for the debridement of venous leg ulcers (VLUs). In
July 2021 we announced a positive outcome from a planned interim sample size re-estimation of the study. Based on the Independent Data Monitoring Committee’s (“IDMC”) recommendation, no changes to the original enrolment target of 120 patients was
required to maintain the pre-specified statistical power of 80 percent or greater on the study’s primary endpoint of incidence of complete debridement compared with gel vehicle. In addition, the IDMC reviewed the data of all subjects treated and no
safety concerns were identified in the study population. The IDMC’s recommendations were based on the results of a pre-specified interim conditional power assessment conducted after approximately two-thirds of the originally targeted of 120
patients completed the debridement treatment.
On May 12, 2022 we announced positive results for our U.S. Phase 2 clinical study of EscharEx for the debridement of VLUs. The study met its primary endpoint with a high degree of statistical significance,
demonstrating that patients treated with EscharEx had a statistically significant higher incidence of complete debridement during the 14-day measurement period within up to 8 applications compared to gel vehicle (EscharEx: 63% (29/46) vs. gel
vehicle: 30% (13/43), p-value=0.004). EscharEx efficacy superiority remained statistically significant compared to gel vehicle after adjusting for pre-specified covariates ascribed to patient baseline characteristics, wound size, wound age and
regionsom its U.S. Phase 2 clinical study of EscharEx® for the debridement of venous leg ulcers (VLUs). The study met key secondary and exploratory endpoints. Patients treated with EscharEx had a statistically significant higher incidence of
complete debridement, during the same 14-day measurement period, compared to patients treated by non-surgical standard-of-care ("NSSOC") (EscharEx: 63% (29/46) vs. NSSOC: 13% (4/30)) and the time to achieve complete debridement was significantly
shorter. Estimated median time to complete debridement, was 9 days for patients treated with EscharEx and 59 days for patients treated with NSSOC (p-value=0.016). On average, complete debridement was achieved after 3.6 applications of EscharEx
compared to 12.8 applications with NSSOC. Patients treated with EscharEx demonstrated significantly higher incidence of at least 75% granulation tissue at the end of the treatment period compared to gel vehicle (p-value <0.0001). Favorable
trends were observed in wound area reduction and reduction of pain compared to gel vehicle. In addition, the study showed that EscharEx was safe and well tolerated, and the overall safety was comparable between the arms as assessed by the data
safety monitoring board. Importantly, there were no observed deleterious effects on wound closure and no material differences in reported adverse events. Estimated time to complete wound closure was 64 days for patients treated with EscharEx
compared to 78 days for patients treated with NSSOC.
We are also evaluating EscharEx in an ongoing phase 2 pharmacology study, a prospective, open label, single-arm study, being conducted at three U.S. clinical sites. The study is designed to evaluate the clinical
performance, safety, and pharmacology effect of EscharEx in the debridement of lower leg ulcers (diabetic foot ulcers (“DFU’s”) or VLU’s) in up to fifteen patients. The study evaluates the safety and efficacy of debridement as measured by incidence
of, and time to complete debridement. In addition, the study evaluates the pharmacological effects of EscharEx as measured by the changes from baseline to end of treatment period in (1) wound biofilm presence in wound biopsies, (2) bacterial burden
measured by MolecuLight® fluorescence images, and (3) biomarkers of wound healing and inflammation in wound fluid. In December 2021, we announced positive initial data from seven of the maximum fifteen patients in the study. Based on the data
generated to date, following treatment of seven patients with either DFU’s or VLU’s, EscharEx demonstrated safe and effective debridement of lower leg ulcer within a few daily applications. In addition, evaluation of wounds’ tissue samples
(biopsies) and fluorescence images, indicated reduction of biofilm and bacterial load following the treatment with EscharEx. We expect to share the full data set from this study in the first half of 2022.
Our third innovative product candidate, MW005, is a topically applied biological drug candidate for the treatment of non-melanoma skin cancers, based on the same API of NexoBrid and EscharEx product candidates, a
concentrate of proteolytic enzymes enriched in bromelain. In July 2021 we initiated a phase I/II study of MW005 for the treatment of low-risk basal cell carcinoma (“BCC”). The phase I/II open-label, randomized clinical study is designed to evaluate
the safety and tolerability of MW005 in BCC using different schedules of administration, as well as to provide a preliminary evaluation of its efficacy, as measured by the percentage of target lesions with complete histological clearance. The study
will enroll up to 32 patients (two cohorts of 16 patients each) with histologically confirmed superficial or nodular BCC and will be conducted at three leading clinical centers in the United States. We expect that data from this study will be
available in the first half of 2022.
3
Corporate Information
We were incorporated under the laws of the State of Israel on January 27, 2000. Our principal executive offices are located at 42 Hayarkon Street, Yavne 8122745, Israel, and our telephone number is +972-77-971-4100.
Our website is www.MediWound.com. The information contained on, or that can be accessed through, our website does not constitute a part of this prospectus and is not incorporated by reference herein. Our agent for service of process in the United
States is Puglisi & Associates, located at 850 Library Avenue, Suite 204, Newark, Delaware 19711, and its telephone number is +1 (302) 738-6680.
Throughout this prospectus, we refer to various trademarks, service marks and trade names that we use in our business. The “MediWound” design logo, “MediWound”, “NexoBrid”, “EscharEx” and other trademarks or service
marks of MediWound Ltd. appearing in this prospectus are the property of MediWound Ltd. We have several other registered trademarks, service marks and pending applications relating to our products. Although we have omitted the “®” and “™” trademark
designations for such marks in this prospectus, all rights to such trademarks are nevertheless reserved. Other trademarks and service marks appearing in this prospectus are the property of their respective holders.
4
An investment in our securities involves a high degree of risk. Our business, financial condition or results of operations could be adversely affected by any of these risks. If any of these risks
occur, the value of our ordinary shares and our other securities may decline. You should carefully consider the risk factors discussed under the caption “Risk Factors” in our Annual Report on Form 20-F for the year ended December 31, 2021, in any
other filings that we make with the SEC subsequent to the date of this prospectus which are incorporated herein by reference, and in any supplement to this prospectus, before making your investment decision.
5
This prospectus and the documents incorporated in it by reference contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities
Act, Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, that are based on our management’s beliefs and assumptions and on
information currently available to our management. Forward-looking statements include information concerning our possible or assumed future results of our business, financial condition, results of operations, liquidity, plans and objectives.
Forward-looking statements include all statements that are not historical facts and in some cases can be identified by terminology such as “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “expect,” “predict,”
“potential,” or the negative of these terms or other similar expressions that convey uncertainty of future events or outcomes.
Our ability to predict the results of our operations or the effects of various events on our operating results is inherently uncertain. Therefore, we caution you to consider carefully the matters
described under the caption “Risk Factors” and certain other matters discussed in this prospectus, the documents incorporated by reference in this prospectus, and other publicly available sources. Such factors and many other factors beyond the
control of our management could cause our actual results, level of activity, performance or achievements to differ materially from any future results, level of activity, performance or achievements that may be expressed or implied by the
forward-looking statements. Unless we are required to do so under U.S. federal securities laws or other applicable laws, we do not intend to update or revise any forward-looking statements.
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Unless otherwise indicated in the applicable prospectus supplement, we intend to use the net proceeds from the sale of securities offered by us pursuant to this prospectus for general corporate
purposes, which may include continued product development and commercialization. The timing and amount of our actual expenditures will be based on many factors, including cash flows from operations and the anticipated growth of our business. As a
result, unless otherwise indicated in the applicable prospectus supplement, our management will have broad discretion to allocate the net proceeds of the offerings.
We will not receive any proceeds from the sale of ordinary shares by the selling shareholders.
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The selling shareholders, may offer and sell from time to time pursuant to this prospectus, an aggregate of up to 12,738,460 of our ordinary shares.
The selling shareholders consist mainly of those shareholders who have the right to include their securities in a registration or offering effected by us under the terms of our Registration Rights
Agreement dated April 6, 2021, which we refer to as the Registration Rights Agreement.
Except as otherwise disclosed in the footnotes below, none of the selling shareholders has, or within the past three years has had, any position, office or other material relationship with us.
The following table sets forth the name of each selling shareholder, the number of ordinary shares beneficially owned by each of the respective selling shareholders as of the date of this prospectus,
the number of ordinary shares that may be offered under this prospectus and the number of ordinary shares beneficially owned by the selling shareholders assuming all of the shares covered hereby are sold. The number of ordinary shares in the column
“Number of Shares Being Offered” represents all of the ordinary shares that a selling shareholder may offer under this prospectus. The selling shareholders may sell some, all or none of their ordinary shares. We do not know how long
the selling shareholders will hold the ordinary shares before selling them, and we currently have no agreements, arrangements or understandings with the selling shareholders regarding the sale or other disposition of any of the ordinary shares. The
ordinary shares covered hereby may be offered from time to time by the selling shareholders.
The information set forth below is based upon information obtained from the selling shareholders and upon information in our possession regarding the original issuance of the ordinary shares. The
percentages of shares owned after the offering are based on 33,140,633 ordinary shares outstanding as of the date of the prospectus, excluding the ordinary shares covered hereby.
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Shares Beneficially Owned
Prior to Offering(1) |
Number of Shares
Being Offered |
Shares Beneficially Owned
After Offering(2) |
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Name of Selling Shareholder
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Number
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Percent
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Number
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Percent
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Entities Affiliated with Clal Biotechnology Industries(3)
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11,047,471
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33.2
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%
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10,891,638
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155,833
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0.5
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%
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Lior Rosenberg(4)
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2,003,563
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6.0
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%
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1,857,028
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146,535
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0.4
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%
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(1)
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“Beneficial ownership” is a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act and includes more than the typical form of share ownership, that is, shares held in the
person’s name. The term also includes what is referred to as “indirect ownership,” meaning ownership of shares as to which a person has or shares investment power. In computing the number of shares beneficially owned by a person and the
percentage ownership of that person, we have included shares that the person has the right to acquire within 60 days of the date of this prospectus, including through the exercise of any option, warrant or other right or the conversion of any
other security. These shares, however, are not included in the computation of the percentage ownership of any other person.
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(2)
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Assumes that all shares being registered in this prospectus are resold to third parties and that with respect to a particular selling shareholder, such selling shareholder sells all ordinary
shares registered under this prospectus held by such selling shareholder.
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(3)
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Shares beneficially owned consist of: (i) 8,208,973 ordinary shares held by Clal Life Sciences, LP, whose managing partner is Clal Application Center Ltd., a wholly-owned subsidiary of Clal
Biotechnology Industries Ltd. (“CBI”); (ii) 2,682,665 ordinary shares held by CBI and (iii) 155,833 ordinary shares issuable upon exercise of outstanding options held directly by CBI that are currently exercisable or exercisable within 60
days of May 24, 2022. As reported on a Schedule 13G/A filed on March 17, 2022 by Access Industries Holdings LLC, Access Industries Holdings LLC indirectly owns 100% of the outstanding shares of Clal Industries Ltd., which owns 47.17% of the
outstanding shares of CBI. The address of Clal Industries Ltd. is the Triangular Tower, 3 Azrieli Center, Tel Aviv 67023, Israel and the address of Access Industries Holdings LLC is c/o Access Industries Inc., 40 West 57th Street, New York,
New York 10019, United States.
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(4)
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Shares beneficially owned consist of: (i) 146,823 ordinary shares held directly by Prof. Lior Rosenberg; (ii) 146,535 ordinary shares issuable upon exercise of outstanding options held directly by Prof. Rosenberg
that are currently exercisable or exercisable within 60 days of May 24, 2022; and (iii) 1,710,205 ordinary shares held by L.R. Research and Development Ltd. in trust for the benefit of Prof. Rosenberg. Prof. Rosenberg is the sole shareholder
of L.R. Research and Development Ltd. The address of Lior Rosenberg is 42 Hayarkon Street Yavne 8122745, Israel and the address of L.R. Research and Development Ltd is 13 Harduf St. Omer 8496500, Israel.
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8
The descriptions of the securities contained in this prospectus, together with the applicable prospectus supplements, summarize the material terms and provisions of the various types of securities
that we may offer. We will describe in the applicable prospectus supplement the particular terms of any securities offered by such prospectus supplement. If we so indicate in the applicable prospectus supplement, the terms of the securities may
differ from the terms we have summarized below.
We may sell from time to time, in one or more offerings, ordinary shares, warrants, debt securities and units comprising any combination of these securities. The total dollar amount of all securities
that we may issue under this prospectus will not exceed $125,000,000.
DESCRIPTION OF ORDINARY SHARES
A description of our share capital and our ordinary shares can be found in Exhibit 2.1 to our Annual Report on Form 20-F filed with the SEC on March 17, 2022 and is incorporated by reference herein.
General
Our authorized share capital consists of 50,000,000 ordinary shares, par value NIS 0.01 per share, of which 33,140,633 shares are issued and outstanding as of March 31, 2022.
All of our outstanding ordinary shares are validly issued, fully paid and non-assessable. Our ordinary shares are not redeemable and do not provide any preemptive rights.
Our registration number with the Israeli Registrar of Companies is 51-289494-0. Our purpose as set forth in our articles of association is to engage in any lawful activity.
Transfer Agent and Registrar
The transfer agent and registrar for our ordinary shares is American Stock Transfer & Trust Company, New York, New York.
Listing
Our ordinary shares are listed on the Nasdaq Global Market under the symbol “MDWD.”
9
We may issue warrants to purchase our ordinary shares and/or debt securities in one or more series together with other securities or separately, as described in the applicable prospectus supplement.
Each series of warrants will be issued under a separate warrant agreement to be entered into between us and a warrant agent. The warrant agent will act solely as our agent and will not assume any obligation or relationship of agency for or with
holders or beneficial owners of warrants. The terms of any warrants to be issued and a description of the material provisions of the applicable warrant agreement will be set forth in the applicable prospectus supplement.
The applicable prospectus supplement will describe the following terms of any warrants in respect of which this prospectus is being delivered:
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the title of such warrants;
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the aggregate number of such warrants;
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the price or prices at which such warrants will be issued;
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the price at which, and the currency or currencies in which, the securities upon exercise of such warrants may be purchased;
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the designation, amount and terms of the securities purchasable upon exercise of such warrants;
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the date on which the right to exercise such warrants shall commence and the date on which such right shall expire;
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if applicable, the minimum or maximum amount of such warrants which may be exercised at any one time;
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if applicable, the designation and terms of the securities with which such warrants are issued and the number of such warrants issued with each such security;
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if applicable, the date on and after which such warrants and the related securities will be separately transferable;
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information with respect to book-entry procedures, if any;
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if applicable, any material Israeli and U.S. federal income tax considerations;
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the anti-dilution provisions of such warrants, if any; and
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any other terms of such warrants, including terms, procedures and limitations relating to the exchange and exercise of such warrants.
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10
We may issue debt securities together with other securities or separately, as described in the applicable prospectus supplement. The debt securities will be issued under an indenture between us and a
trustee identified in the applicable prospectus supplement, the form of which is incorporated by reference as an exhibit to the registration statement of which this prospectus forms a part. The executed indenture will be incorporated by reference
from a report of foreign private issuer on Form 6-K. We encourage you to read the indenture, because the indenture will govern your rights as a holder of debt securities. The indenture will be subject to and governed by the Trust Indenture Act of
1939, as amended.
We may issue the debt securities in one or more series with the same or various maturities, at par, at a premium, or at a discount. We will describe the particular terms of each series of debt
securities in a prospectus supplement relating to that series, which we will file with the SEC.
The applicable prospectus supplement, including any applicable pricing supplement, will set forth, to the extent required, the following terms of the debt securities in respect of which the
prospectus supplement is delivered:
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the title of the series;
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the aggregate principal amount;
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the issue price or prices, expressed as a percentage of the aggregate principal amount of the debt securities;
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any limit on the aggregate principal amount;
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the date or dates on which principal is payable;
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the interest rate or rates (which may be fixed or variable) and/or, if applicable, the method used to determine such rate or rates;
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the date or dates from which interest, if any, will be payable and any regular record date for the interest payable;
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the place or places where principal and, if applicable, premium and interest is payable;
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the terms and conditions upon which we may, or the holders may require us to, redeem or repurchase the debt securities;
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the denominations in which such debt securities may be issuable, if other than denomination of $1,000, or any integral multiple of that number;
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whether the debt securities are to be issuable in the form of certificated debt securities or global debt securities;
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the portion of principal amount that will be payable upon declaration of acceleration of the maturity date if other than the principal amount of the debt securities;
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the currency of denomination;
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the designation of the currency, currencies or currency units in which payment of principal and, if applicable, premium and interest, will be made;
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if payments of principal and, if applicable, premium or interest, on the debt securities are to be made in one or more currencies or currency units other than the currency of denominations, the manner in which
exchange rate with respect to such payments will be determined;
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if amounts of principal and, if applicable, premium and interest may be determined by reference to an index based on a currency or currencies, or by reference to a commodity, commodity index, stock exchange
index, or financial index, then the manner in which such amounts will be determined;
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the provisions, if any, relating to any collateral provided for such debt securities;
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any events of default;
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the terms and conditions, if any, for conversion into or exchange for our ordinary shares;
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any depositaries, interest rate calculation agents, exchange rate calculation agents, or other agents; and
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the terms and conditions, if any, upon which the debt securities shall be subordinated in right of payment to other indebtedness of our company.
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One or more debt securities may be sold at a substantial discount below their stated principal amount. We may also issue debt securities in bearer form, with or without coupons. If we issue discount
debt securities or debt securities in bearer form, we will describe material U.S. federal income tax considerations and other material special considerations that apply to these debt securities in the applicable prospectus supplement.
We may issue debt securities denominated in or payable in a foreign currency or currencies or a foreign currency unit or units. If we do, we will describe the restrictions, elections, and general tax
considerations relating to the debt securities and the foreign currency or currencies or foreign currency unit or units in the applicable prospectus supplement.
The debt securities of a series may be issued in whole or in part in the form of one or more global securities that will be deposited with, or on behalf of, a depositary identified in the prospectus
supplement. Global securities will be issued in registered form and in either temporary or definitive form. Unless and until it is exchanged in whole or in part for individual debt securities, a global security may not be transferred except as a
whole by the depositary for such global security to a nominee of such depositary or by a nominee of such depositary to such depositary or another nominee of such depositary or by such depositary or any such nominee to a successor of such depositary
or a nominee of such successor. The specific terms of the depositary arrangement with respect to any debt securities of a series and the rights of and limitations upon owners of beneficial interests in a global security will be described in the
applicable prospectus supplement.
11
DESCRIPTION OF UNITS
We may issue units consisting of any combination of the other types of securities offered under this prospectus in one or more series. We may evidence each series of units by unit certificates that
we will issue under a separate agreement. We may enter into unit agreements with a unit agent. Each unit agent will be a bank or trust company that we select. We will indicate the name and address of the unit agent in the applicable prospectus
supplement relating to a particular series of units.
The following description, together with the additional information included in any applicable prospectus supplement, summarizes the general features of the units that we may offer under this
prospectus. You should read any prospectus supplement and any free writing prospectus that we may authorize to be provided to you related to the series of units being offered, as well as the complete unit agreements that contain the terms of the
units. Specific unit agreements will contain additional important terms and provisions and we will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from another report that we
file with the SEC, the form of each unit agreement relating to units offered under this prospectus.
If we offer any units, certain terms of that series of units will be described in the applicable prospectus supplement, including, without limitation, the following, as applicable:
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the title of the series of units;
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identification and description of the separate constituent securities comprising the units;
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the price or prices at which the units will be issued;
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the date, if any, on and after which the constituent securities comprising the units will be separately transferable;
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a discussion of certain United States federal income tax considerations applicable to the units; and
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any other terms of the units and their constituent securities.
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12
We or the selling shareholders may sell the securities included in this prospectus from time to time in one or more transactions, including without limitation:
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through agents;
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to or through one or more underwriters on a firm commitment or agency basis;
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through put or call option transactions relating to the securities;
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through broker-dealers (acting as agent or principal);
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directly to purchasers, through a specific bidding or auction process, on a negotiated basis or otherwise;
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through any other method permitted pursuant to applicable law; or
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through a combination of any such methods of sale.
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At any time a particular offer of the securities covered by this prospectus is made, a revised prospectus or prospectus supplement, if required, will be distributed which will set forth the aggregate amount of securities
covered by this prospectus being offered and the terms of the offering, including the name or names of any underwriters, dealers, brokers or agents, any discounts, commissions, concessions and other items constituting compensation from us and any
discounts, commissions or concessions allowed or re-allowed or paid to dealers. Such prospectus supplement, and, if necessary, a post-effective amendment to the registration statement of which this prospectus is a part, will be filed with the SEC to
reflect the disclosure of additional information with respect to the distribution of the securities covered by this prospectus. In order to comply with the securities laws of certain jurisdictions, if applicable, the securities sold under this
prospectus may only be sold through registered or licensed brokers or dealers. In addition, in some states the securities may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from registration
or qualification requirements is available and is complied with.
Any public offering price and any discounts or concessions allowed or re-allowed or paid to dealers may be changed from time to time.
The distribution of securities may be effected from time to time in one or more transactions, including block transactions and transactions on NASDAQ or any other organized market where the
securities may be traded. The securities may be sold at a fixed price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices relating to the prevailing market prices or at negotiated prices. The consideration
may be cash or another form negotiated by the parties. Agents, underwriters or broker-dealers may be paid compensation for offering and selling the securities. That compensation may be in the form of discounts, concessions or commissions to be
received from us or from the purchasers of the securities. Any dealers and agents participating in the distribution of the securities may be deemed to be underwriters, and compensation received by them on resale of the securities may be deemed to be
underwriting discounts. If any such dealers or agents were deemed to be underwriters, they may be subject to statutory liabilities under the Securities Act.
Agents may from time to time solicit offers to purchase the securities. If required, we will name in the applicable prospectus supplement any agent involved in the offer or sale of the securities and
set forth any compensation payable to the agent. Unless otherwise indicated in the prospectus supplement, any agent will be acting on a best efforts basis for the period of its appointment. Any agent selling the securities covered by this prospectus
may be deemed to be an underwriter, as that term is defined in the Securities Act, of the securities.
If underwriters are used in a sale, securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined at the time of sale, or under delayed delivery contracts or other contractual commitments. Securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more firms acting as underwriters. If an underwriter or underwriters are used in the sale of securities, an underwriting agreement will be executed with the underwriter or
underwriters, as well as any other underwriter or underwriters, with respect to a particular underwritten offering of securities, and will set forth the terms of the transactions, including compensation of the underwriters and dealers and the public
offering price, if applicable. The prospectus and prospectus supplement will be used by the underwriters to resell the securities.
13
If a dealer is used in the sale of the securities, we, the selling shareholders or an underwriter will sell the securities to the dealer, as principal. The dealer may then resell the securities to
the public at varying prices to be determined by the dealer at the time of resale. To the extent required, we will set forth in the prospectus supplement the name of the dealer and the terms of the transactions.
We or the selling shareholders may directly solicit offers to purchase the securities and may make sales of securities directly to institutional investors or others. These persons may be deemed to be
underwriters within the meaning of the Securities Act with respect to any resale of the securities. To the extent required, the prospectus supplement will describe the terms of any such sales, including the terms of any bidding or auction process, if
used.
Agents, underwriters and dealers may be entitled under agreements which may be entered into with us or the selling shareholders to indemnification by us against specified liabilities, including
liabilities incurred under the Securities Act, or to contribution by us or the selling shareholders to payments they may be required to make in respect of such liabilities. If required, the prospectus supplement will describe the terms and conditions
of the indemnification or contribution. Some of the agents, underwriters or dealers, or their affiliates may be customers of, engage in transactions with or perform services for us or our subsidiaries.
Any person participating in the distribution of securities registered under the registration statement that includes this prospectus will be subject to applicable provisions of the Exchange Act, and
the applicable SEC rules and regulations, including, among others, Regulation M, which may limit the timing of purchases and sales of any of our securities by that person. Furthermore, Regulation M may restrict the ability of any person engaged in
the distribution of our securities to engage in market-making activities with respect to our securities. These restrictions may affect the marketability of our securities and the ability of any person or entity to engage in market-making activities
with respect to our securities.
Certain persons participating in an offering may engage in over-allotment, stabilizing transactions, short-covering transactions and penalty bids that stabilize, maintain or otherwise affect the
price of the offered securities. These activities may maintain the price of the offered securities at levels above those that might otherwise prevail in the open market, including by entering stabilizing bids, effecting syndicate covering
transactions or imposing penalty bids, each of which is described below.
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A stabilizing bid means the placing of any bid, or the effecting of any purchase, for the purpose of pegging, fixing or maintaining the price of a security.
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A syndicate covering transaction means the placing of any bid on behalf of the underwriting syndicate or the effecting of any purchase to reduce a short position created in connection with the offering.
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A penalty bid means an arrangement that permits the managing underwriter to reclaim a selling concession from a syndicate member in connection with the offering when offered securities originally sold by the
syndicate member are purchased in syndicate covering transactions.
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These transactions may be effected on an exchange, if the securities are listed on that exchange, or in the over-the-counter market or otherwise.
In the event that any underwriter or agent acts as principal, or broker-dealer acts as underwriter, it may engage in certain transactions that stabilize, maintain or otherwise affect the price of our
securities. We will describe any such activities in the prospectus supplement relating to the transaction.
If so indicated in the applicable prospectus supplement, we will authorize agents, underwriters or dealers to solicit offers from certain types of institutions to purchase offered securities from us
at the public offering price set forth in such prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. Such contracts will be subject only to those conditions set forth in the
prospectus supplement and the prospectus supplement will set forth the commission payable for solicitation of such contracts.
In addition, ordinary shares may be issued upon conversion of or in exchange for debt securities or other securities.
14
Any underwriters to whom offered securities are sold for public offering and sale may make a market in such offered securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. The offered securities may or may not be listed on a national securities exchange. No assurance can be given that there will be a market for the offered securities.
Any securities that qualify for sale pursuant to Rule 144 or Regulation S under the Securities Act may be sold under Rule 144 or Regulation S rather than pursuant to this prospectus.
To the extent that we or the selling shareholders make sales to or through one or more underwriters or agents in at-the-market offerings, we or the selling shareholders will do so pursuant to the
terms of a distribution agreement between us or the selling shareholders and the underwriters or agents. If we engage in at-the-market sales pursuant to a distribution agreement, we or the selling shareholders will sell our ordinary shares to or
through one or more underwriters or agents, which may act on an agency basis or on a principal basis. During the term of any such agreement, we or the selling shareholders may sell ordinary shares on a daily basis in exchange transactions or
otherwise as we agree with the underwriters or agents. The distribution agreement will provide that any ordinary shares sold will be sold at prices related to the then prevailing market prices for our ordinary shares. Therefore, exact figures
regarding proceeds that will be raised or commissions to be paid cannot be determined at this time and will be described in a prospectus supplement. Pursuant to the terms of the distribution agreement, we or the selling shareholders also may agree to
sell, and the relevant underwriters or agents may agree to solicit offers to purchase, blocks of our ordinary shares or warrants. The terms of each such distribution agreement will be set forth in more detail in a prospectus supplement to this
prospectus.
Offers to purchase the securities offered by this prospectus may be solicited, and sales of the securities may be made, by us or the selling shareholders directly to institutional investors or
others, who may be deemed to be underwriters within the meaning of the Securities Act with respect to any re-sales of the securities. The terms of any offer made in this manner will be included in the prospectus supplement relating to the offer
In connection with offerings made through underwriters or agents, we or the selling shareholders may enter into agreements with such underwriters or agents pursuant to which we receive our
outstanding securities in consideration for the securities being offered to the public for cash. In connection with these arrangements, the underwriters or agents may also sell securities covered by this prospectus to hedge their positions in these
outstanding securities, including in short sale transactions. If so, the underwriters or agents may use the securities received from us or the selling shareholders under these arrangements to close out any related open borrowings of securities.
We or the selling shareholders may enter into derivative transactions with third parties or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If
the applicable prospectus supplement indicates, in connection with those derivatives, such third parties (or affiliates of such third parties) may sell securities covered by this prospectus and the applicable prospectus supplement, including in short
sale transactions. If so, such third parties (or affiliates of such third parties) may use securities pledged by us or the selling shareholders or borrowed from us, the selling shareholders or others to settle those sales or to close out any related
open borrowings of shares, and may use securities received from us or the selling shareholders in settlement of those derivatives to close out any related open borrowings of shares. The third parties (or affiliates of such third parties) in such sale
transactions will be underwriters and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or a post-effective amendment).
We or the selling shareholders may loan or pledge securities to a financial institution or other third party that in turn may sell the securities using this prospectus. Such financial institution or
third party may transfer its short position to investors in our securities or in connection with a simultaneous offering of other securities offered by this prospectus or in connection with a simultaneous offering of other securities offered by this
prospectus.
15
The following is a statement of expenses in connection with the distribution of the securities registered. All amounts shown are estimates except the SEC registration fee and the FINRA filing fee.
The estimates do not include expenses related to offerings of particular securities. Each prospectus supplement describing an offering of securities will reflect the estimated expenses related to the offering of securities under that prospectus
supplement.
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SEC registration fee
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$
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11,587.50
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FINRA filing fee
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$
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*
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Legal fees and expenses
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*
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Accountants’ fees and expenses
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*
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Printing fees
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*
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Miscellaneous
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*
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TOTAL
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$
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*
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* These fees are calculated based on the securities offered and the number of issuances and accordingly cannot be estimated at this time.
16
Certain legal matters with respect to Israeli law and with respect to the validity of the offered securities under Israeli law will be passed upon for us by Meitar | Law Offices, Ramat Gan, Israel.
Certain legal matters with respect to U.S. law will be passed upon for us by Latham & Watkins LLP, New York, New York.
EXPERTS
The consolidated financial statements of MediWound Ltd. as of December 31, 2021, and for the year then ended, have been incorporated by reference herein in reliance upon the report of Somekh Chaikin,
a member firm of KPMG International, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.
The consolidated financial statements of MediWound Ltd. for the year ended December 31, 2020 incorporated by reference in this prospectus by reference to MediWound Ltd.’s Annual Report on Form 20-F
have been audited by Kost Forer Gabbay & Kasierer, a member of Ernst & Young Global Limited, an independent registered public accounting firm, as set forth in their report therein, included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
17
We have filed with the SEC a registration statement on Form F-3 under the Securities Act, with respect to the securities offered by this prospectus. This prospectus and any accompanying prospectus
supplement do not contain all the information contained in the registration statement, including its exhibits and schedules. You should refer to the registration statement, including its exhibits and schedules, for further information about us and
the securities we may offer. Statements we make in this prospectus and any accompanying prospectus supplement about certain contracts or other documents are not necessarily complete. When we make such statements, we refer you to the copies of the
contracts or documents that are filed as exhibits to the registration statement, because those statements are qualified in all respects by reference to those exhibits. The registration statement, including exhibits and schedules, is on file at the
office of the SEC and may be inspected without charge.
We are subject to the information reporting requirements of the Exchange Act. Under the Exchange Act, we are required to file annual and special reports and other information with the SEC. As a
foreign private issuer, we are exempt from the rules under the Exchange Act prescribing the furnishing and content of proxy statements and our officers, directors and principal shareholders are exempt from the reporting and short-swing profit
recovery provisions contained in Section 16 of the Exchange Act. In addition, we are not required under the Exchange Act to file annual, quarterly and current reports and financial statements as frequently or as promptly as U.S. companies whose
securities are registered under the Exchange Act. However, we file with the SEC, within 120 days after the end of each fiscal year, or such applicable time as required by the SEC, an annual report on Form 20-F containing financial statements audited
by an independent registered public accounting firm, and we submit to the SEC, on Form 6-K, unaudited quarterly financial information.
We file reports, proxy statements and other information with the SEC. The SEC maintains a web site that contains reports, proxy and information statements and other information about issuers, such as
us, who file electronically with the SEC. The address of that website is http://www.sec.gov.
We maintain a corporate website at www.MediWound.com. Information contained on, or that can be accessed through, our website does not constitute a part of
this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to “incorporate by reference” into this prospectus the information in documents we file with it. This means that we can disclose important information to you by referring you to
another document filed by us with the SEC. Each document incorporated by reference is current only as of the date of such document, and the incorporation by reference of such documents shall not create any implication that there has been no change in
our affairs since the date thereof or that the information contained therein is current as of any time subsequent to its date. The information incorporated by reference is considered to be a part of this prospectus and should be read with the same
care. When we update the information contained in documents that have been incorporated by reference by making future filings with the SEC, the information incorporated by reference in this prospectus is considered to be automatically updated and
superseded. In other words, in the case of a conflict or inconsistency between information contained in this prospectus and information incorporated by reference into this prospectus, you should rely on the information contained in the document that
was filed later.
We incorporate by reference into this prospectus documents listed below and any future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, and, to the extent
specifically designated therein, reports on Form 6-K we furnish to the SEC on or after the date on which this registration statement is first filed with the SEC and until the termination or completion of that offering under this prospectus:
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our Annual Report on Form 20-F for the fiscal year ended December 31, 2021, filed with the SEC on
March 17, 2022; and
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our Reports of Foreign Private Issuer on Form 6-K, furnished to the SEC on March 22, 2022; May 12,
2022 (including the information contained in Exhibit 99.1 thereto, but excluding quotes of our senior management), May 17, 2022 (including the information contained in Exhibits 99.1 and 99.2 thereto, but excluding quotes of
our senior management) and May 17, 2022 (including the information contained in Exhibit 99.1 thereto, but excluding quotes of our senior management); and
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the description of our ordinary shares contained under the heading “Item 1. Description of Registrant’s Securities to be Registered” in our registration statement on Form 8-A, as filed with the SEC on March 12, 2014, as updated by the description of our ordinary shares filed as Exhibit 2.1 to our Annual Report on Form
20-F for the fiscal year ended December 31, 2021.
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Any statement contained herein or in a document all or a portion of which is incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of
this registration statement to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this registration statement.
Unless expressly incorporated by reference, nothing in this prospectus shall be deemed to incorporate by reference information furnished to, but not filed with, the SEC. Copies of all documents
incorporated by reference in this prospectus, other than exhibits to those documents unless such exhibits are specially incorporated by reference in this prospectus, will be provided at no cost to each person, including any beneficial owner, who
receives a copy of this prospectus on the written or oral request of that person made to:
MediWound Ltd.
c/o LifeSci Advisors
Attn: Monique Kosse, Managing Director
Email: monique@lifesciadvisors.com
Tel: (212) 915-3820
18
We are incorporated under the laws of the State of Israel. Service of process upon us and upon our directors, officers and any Israeli experts named in this registration statement, substantially all
of whom reside outside of the United States, may be difficult to obtain within the United States. Furthermore, because substantially all of our assets and substantially all of our directors and officers are located outside of the United States, any
judgment obtained in the United States against us or any of our directors and officers may not be collectible within the United States.
We have been informed by our legal counsel in Israel, Meitar | Law Offices, that it may be difficult to assert U.S. securities law claims in original actions instituted in Israel. Israeli courts may
refuse to hear a claim based on an alleged violation of U.S. securities laws because Israel is not the most appropriate forum in which to bring such a claim. In addition, even if an Israeli court agrees to hear a claim, it may determine that Israeli
law and not U.S. law is applicable to the claim. If U.S. law is found to be applicable, the content of applicable U.S. law must be proven as a fact which can be a time-consuming and costly process. Certain matters of procedure will also be governed
by Israeli law.
We have irrevocably appointed Puglisi & Associates as our agent to receive service of process in any action against us in any United States federal or state court arising out of the offerings
under this prospectus or any purchase or sale of securities in connection with any such offering(s). Subject to specified time limitations and legal procedures, Israeli courts may enforce a United States judgment in a civil matter which, subject to
certain exceptions, is non-appealable, including a judgment based upon the civil liability provisions of the Securities Act or the Exchange Act and including a monetary or compensatory judgment in a non-civil matter, provided that, among other
things:
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the judgment is obtained after due process before a court of competent jurisdiction, according to the laws of the state in which the judgment is given and the rules of private international law prevailing in
Israel;
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the prevailing law of the foreign state in which the judgment is rendered allows for the enforcement of judgments of Israeli courts;
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adequate service of process has been effected and the defendant has had a reasonable opportunity to be heard and to present his or her evidence;
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the judgment is not contrary to public policy of Israel, and the enforcement of the civil liabilities set forth in the judgment is not likely to impair the security or sovereignty of Israel;
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the judgment was not obtained by fraud and does not conflict with any other valid judgment in the same matter between the same parties;
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an action between the same parties in the same matter was not pending in any Israeli court at the time at which the lawsuit was instituted in the foreign court; and
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the judgment is enforceable according to the laws of Israel and according to the law of the foreign state in which the relief was granted.
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If a foreign judgment is enforced by an Israeli court, it generally will be payable in Israeli currency, which can then be converted into non-Israeli currency and transferred out of Israel. The usual
practice in an action before an Israeli court to recover an amount in a non-Israeli currency is for the Israeli court to issue a judgment for the equivalent amount in Israeli currency at the rate of exchange in force on the date of the judgment, but
the judgment debtor may make payment in foreign currency. Pending collection, the amount of the judgment of an Israeli court stated in Israeli currency ordinarily will be linked to the Israeli consumer price index plus interest at the annual
statutory rate set by Israeli regulations prevailing at the time. Judgment creditors must bear the risk of unfavorable exchange rates.
19
7,575,513 Ordinary Shares
PROSPECTUS SUPPLEMENT
H.C. Wainwright
& Co.
September 22, 2022