Full Press Release Details
SCINAI IMMUNOTHERAPEUTICS
Jerusalem BioPark, 2nd
Hadassah Ein Kerem Campus
NOTICE TO SHAREHOLDERS
RE. SUPPLEMENTAL CHANGES TO
PROXY STATEMENT FOR EXTRAORDINARY
To Be Held on August
On July 8, 2024, Scinai Immunotherapeutics
Ltd. (the "Company") the Company furnished on Form 6-K ("Original Form 6-K")
to the Securities and Exchange Commission containing a Notice and Proxy Statement in connection with the Company's Extraordinary
Meeting of Shareholders scheduled for Monday, August 12, 2024, at 11:00 a.m. Israel time at the offices of Goldfarb Gross Seligman &
Co., One Azrieli Center, Round Tower, Tel Aviv, Israel (the "Meeting"). As set forth in the Proxy Statement, one of
the proposals to be considered and voted upon at the Meeting is the approval of amendments to the Company's articles of association
(the "Amended Articles") to authorize the creation of preferred shares, no par value per share, of the Company ("Preferred
Shares"), and to approve the issuance of Preferred Shares in connection with a debt-to-equity conversion transaction with the
European Investment Bank ("EIB", and such transaction the "EIB Transaction"), all subject to the
consummation of the EIB Transaction.
Following further discussions
with EIB, the Company and EIB have agreed to make a few clarifications to the terms of the EIB Transaction as described below:
1. The section entitled "Limit
on Holdings of 4.99% of the Outstanding ADSs at any time" on page 6 of the Proxy Statement is hereby amended as follows (additions
are underscored, deletions are struck through):
"Limit on Holdings and
Conversion of 4.99% of the Outstanding ADSsOrdinary
Shares at any time. The Preferred Shares would contain a provision preventing the holder from converting such number of
Preferred Shares into Ordinary Shares ADSs to
the extent that if, as a result of such conversion, (i) the holder and
its affiliates would become the beneficial owner of more than 4.99% of the Company's outstanding shares as determined
under the rules promulgated in the Securities Exchange Act of 1934, as amended, and (ii)
the holder and its affiliates will receive, or would have been entitled to receive, upon such conversion, together with all other conversions
made by such holder and its affiliates within the twelve (12)-month period prior to such conversion, an aggregate number of Ordinary
Shares (including Ordinary Shares underlying ADSs) in excess of 4.99% of the then issued and outstanding at the time of such conversion.
In addition, a holder of Preferred Shares may not convert such shares for a period of twelve (12) months commencing on the original issuance
date of the Preferred Shares."
2. The section entitled "Veto
Rights" on page 6 of the Proxy Statement is hereby amended as follows (additions are underscored, deletions are struck through):
RightsRedemption in Certain Events. The holders
of a majority of the Preferred Shares would also have veto rights over the ability of the Company to Company
shall not take any of the following actions without either first redeeming all then-outstanding Preferred Shares by making a redemption
payment in respect of each Preferred Share in an amount equal to the preferred redemption amount ($34,000 per Preferred Share) or obtaining
the written consent or affirmative vote of the holders of a majority of the Preferred Shares in order to proceed without making such
a redemption (it being understood that the foregoing shall not apply if any of the following occurs and is not in the control of the
Company) (i) incurs Indebtedness (as defined in the Amended Articles),
subject to certain exceptions, (ii) enter into an consummating
any M&A Event (as defined in the Amended Articles), (iii) voluntarily delist the
trading taking any action or step in relation to the delisting of the Company's
securities on Nasdaq andor (iv) authorizes
the creation of any security having rights, preferences andor
privileges equal to or greater than those of the Preferred Shares, including the issuance of additional Preferred Shares.
The definitions of "Indebtedness" and "M&A Event" in the Amended Articles would be identical to the definitions
of such terms in the Finance Contract."
Attached as Appendix A are the updated
Articles 168 (Conversion of Preferred Shares) and Article 172 (Redemption in Certain Events) to the
proposed Amended Articles to reflect the changes above and marked to show the changes from the proposed
Amended Articles submitted with the Original Form 6-K
forth above, the Proxy Statement and the Amended Articles remain unchanged.
COMPANIES LAW, 5759 - 1999
LIMITED SHARES COMPANY
Amended and Restated Articles of Association
SCINAI IMMUNOTHERAPEUTICSLTD.
CONVERSION OF PREFERRED SHARES
the payment in full of the Preferred Redemption Amount for any Preferred Shares, such shares shall immediately be deemed redeemed and
cancelled without any further action required on the part of the Preferred Shareholders or the Company. For the avoidance of doubt, no
dividends or distributions shall be made to holders of Ordinary Shares until an amount equal to the full Preferred Redemption Amount
has been distributed on account of each Preferred Share.