Item 5. Other Information
Item 5. Other Information.
Buyback Arrangement
In connection with the Merger, certain shareholders of Chemomab Ltd. were entitled to defer an immediate Israeli tax liability resulting from the exchange of shares that otherwise would have been deemed a sale. The deferral is set to lapse on March 16, 2023. Dr. Adi Mor, co-founder of Chemomab Ltd. and both our Chief Scientific Officer and a Class III director, and Prof. Kobi George, co-founder of Chemomab Ltd. (together with Dr. Adi Mor, the “Co-Founders”), will be required to pay a substantial tax liability to the Israeli Tax Authority upon the expiration date of the deferral period. In order to cover this tax liability, the Co-Founders will be required to sell part of their holdings in the Company.
In light of the foregoing, we elected to enter into a share purchase agreement (the “Repurchase Arrangement”) with the Co-Founders whereby we agreed, subject to the requisite court approval required under Section 303(a) of the Israeli Companies Law, 5759-1999 (the “Companies Law”), to repurchase up to an aggregate of $2,500,000 worth of American Depositary Receipts (the “ADSs”) of the Company (each representing twenty (20) ordinary shares, no par value, of the Company) owned by the Co-Founders, in order to avoid a situation in which the Co-Founders would have to execute bulk sales of their ADSs on the open market in order to be able to pay the outstanding tax liability. These repurchases will be made at market price. We believe that the Repurchase Arrangement protects the best interests of our shareholders by mitigating volatility of the market for the Company’s ADSs.
We do not expect any change in our cash runway as a result of this Repurchase Arrangement. The cash runway is expected to last through the end of 2023, consistent with the disclosure under “Liquidity and Capital Resources” in this Quarterly Report on Form 10-Q. As of the date of this Quarterly Report on Form 10-Q, we have not yet obtained court approval.
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Item 6. Exhibits.
(a) The following documents are filed as exhibits to this Quarterly Report or incorporated by reference herein.
Exhibit
Number
Description
31.1*
Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act
31.2*
Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
32.1**
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101. INS*
Inline XBRL Instance Document
101. SCH*
Inline XBRL Taxonomy Extension Schema Document
101. CAL*
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101. DEF*
Inline XBRL Taxonomy Extension Definition Linkbase Document
101. LAB*
Inline XBRL Taxonomy Extension Label Linkbase Document
101. PRE*
Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*
Filed herewith.
**
The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
CHEMOMAB THERAPEUTICS LTD.
Date: November 10, 2022
By:
/s/ Dale Pfost
Name:
Dale Pfost
Title:
Chief Executive Officer
Date: November 10, 2022
By:
/s/ Donald Marvin
Name:
Donald Marvin
Title:
Chief Financial Officer
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.