UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of
1934
(Amendment No. 1)*
Ability Inc.
(Name of Issuer)
Ordinary Shares, par value $0.001 per share
(Title of Class of Securities)
G8789K124
(CUSIP Number)
Anatoly Hurgin
c/o Ability Inc.
Yad Harutzim 14
Tel Aviv, Israel, 6770007
972-3-6879777
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 16, 2018
(Date of Event which Requires Filing of
this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e),
240.13d-1(f) or 240.13d-1(g), check the following box. ☐
Note:
Schedules filed in paper format shall include a
signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a
reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”)
or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
CUSIP No.
G8789K124
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1
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NAMES OF REPORTING PERSONS.
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Anatoly Hurgin
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) ☐
(b) ☐
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (SEE INSTRUCTIONS)
OO
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5
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) ☒
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7
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SOLE VOTING POWER
832,500 shares
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8
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SHARED VOTING POWER
0 shares
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9
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SOLE DISPOSITIVE POWER
832,500 shares
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10
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SHARED DISPOSITIVE POWER
0 shares
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
832,500 shares
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12
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) ☐
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
25.2%
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14
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
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The following constitutes Amendment No.
1 (“Amendment No. 1”) to the Schedule 13D (the “Original Schedule 13D”) filed by the Reporting Person with
the Securities and Exchange Commission (“SEC”) on December 31, 2015 with respect to its ownership of Ordinary Shares,
par value $0.001 per share (the “Ordinary Shares”) in Ability Inc., a Cayman Islands corporation (the “Company”).
This Amendment No. 1 amends the Original Schedule 13D as specifically set forth herein.
On December 27, 2017, the Company
effected a 1-for-10 consolidation of Ordinary Shares (the “Consolidation”) with a market effective date of March
23, 2018. The share amounts of Ordinary Shares specified in this Amendment No. 1 have been adjusted to give effect to
the Consolidation.
Item 2.
Identity and Background.
Item 2 of the Original Schedule 13D is
hereby amended to add the following:
Except for the SEC investigation described
below, the Reporting Person has not, during the last five years (i) been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors), or (ii) been a party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violations with respect
to such laws.
SEC Investigation
As the Company disclosed in its Report
on Form 6-K furnished with the SEC on February 16, 2017, the Company, received a subpoena
from the SEC. The subpoena requested, among other things, information regarding the transaction with Cambridge Capital Acquisition
Corporation (“Cambridge”), the restatement that occurred in May 2016, and financial and business information. In furtherance
of the investigation, the SEC issued subpoenas to Alexander Aurovsky and the Reporting Person and obtained testimony from Company officers among others. The Company and its officers have been fully
cooperating with the investigation. On July 3, 2018, the SEC issued “Wells” notices to the Company and Alexander Aurovsky
and the Reporting Person, both of whom are controlling shareholders and officers and directors of the Company, in connection with
the previously disclosed ongoing investigation of the SEC into the transaction with Cambridge, the restatement that occurred in
May 2016, and financial and business information. The Wells notice indicated that the Staff of the SEC’s Division of Enforcement
has made a preliminary determination to recommend that the SEC authorize the institution of an enforcement action against the Company
and Mr. Aurovsky and the Reporting Person that would allege, among others, violations of Section 17(a) of the Securities Act of
1933, and Sections 10(b) and 14(a) of the Securities Exchange Act of 1934. A Wells notice is neither a formal allegation of wrongdoing
nor a finding that any violations of law have occurred. Rather, it provides the Company and Mr. Aurovsky and the Reporting Person
with an opportunity to respond to issues raised by the SEC and offer their perspective prior to any SEC decision to institute proceedings.
On August 10, 2018, the Company and Mr. Aurovsky and the Reporting Person made Wells submissions in response to the Wells notices.
If enforcement action is initiated, this could result in the Company and Mr. Aurovsky and/or the Reporting Person being subject
to an injunction and cease and desist order from further violations of the securities laws as well as monetary penalties of disgorgement,
pre-judgment interest, a civil penalty, and in the case of Mr. Aurovsky and the Reporting Person only, a bar from serving as an
officer or director.
Item 5.
Interests of Securities of the
Issuer
.
Item 5 of the Original Schedule 13D is
hereby amended to add the following:
(a) and (b) There were 3,304,677 Ordinary
Shares outstanding as of August 16, 2018. As of the date of this Amendment No. 1, the Reporting Person beneficially owned 832,500
shares of Ordinary Shares of the Company, which comprises 25.2% of the outstanding Ordinary Shares. All such shares
are
held through a trust of which
the Reporting Person is
beneficiary and over which
the
Reporting Person
has voting and dispositive power. Such trust was established in connection
with a pre-ruling of the Israel Tax Authority to ensure payment of any tax due to the Israel Tax Authority in connection with the
Merger Agreement (as defined in the Original Schedule 13D). The shares reported in this Amendment No. 1 do not include Ordinary
Shares which may become issuable to the
Reporting Person
pursuant to an earn-out under
the Merger Agreement
described in Item 6 below
.
(c) None.
(d) Not applicable.
(e) Not applicable.
Item 6.
Contracts, Arrangements, Undertakings
or Relationships with Respect to Securities of the Issuer
.
Item 6 of the Original Schedule 13D is
hereby amended to add the following:
Merger Agreement
Earn-Out Shares
The
Company was incorporated under the laws of the Cayman Islands under the name “Cambridge Holdco Corp.” as an exempted
company on September 1, 2015 (“Holdco”). The Company was formed as a wholly-owned subsidiary of Cambridge.
On December 23,
2015, Cambridge merged with and into Holdco with Holdco surviving the merger and becoming the public entity (the “Redomestication
Merger”), and Holdco consummated a business combination whereby it acquired Ability Computer & Software Industries Ltd.
(“Ability”), by way of a share exchange (the “Share Exchange”, and together with the Redomestication Merger,
the “Business Combination”), following which Ability became a wholly-owned subsidiary of Holdco, pursuant to Agreement
and Plan of Reorganization, dated as of September 6, 2015, or the Merger Agreement. Effective as of the closing of the Business
Combination, Holdco changed its name to “Ability Inc.”
Pursuant to the Merger Agreement and in
addition to the Ordinary Shares issued to the Reporting Person as consideration for the Business Combination, the Reporting Person
was granted the right to receive an additional number of Ordinary Shares to be issued upon and subject to the Company achieving
certain net income targets in the fiscal years ending December 31, 2015, 2016, 2017 and 2018. The net income targets for 2015,
2016 and 2017 were not achieved. In the event that the Company achieves the 2018 Net Income Target (as defined in the Merger Agreement),
the Company shall issue 47,000 shares of Ordinary Shares to the Reporting Person. In the event that the Company fails to satisfy
the 2018 Net Income Target but Net Income (as defined in the Merger Agreement) for fiscal year 2018 is ninety percent (90%) or
more of the 2018 Net Income Target but Net Income then the Company shall issue a proportional amount of shares of Ordinary Shares
to the Reporting Person.
Put Option
Pursuant to the Merger Agreement, the Reporting
Person was granted the right, on one occasion during January 1, 2018 through March 1, 2018, or the Put Option Period, to put to
the Company all or part of his pro rata portion of 117,327 shares of Ordinary Shares received by the Reporting Person in the Share
Exchange for an amount in cash equal to (1) (x) the number of shares being put multiplied by (y) $101.0 per share plus (2) the
Reporting Person’s pro rata portion of interest, if any, and subject to the pre-ruling granted by the Israel Tax Authority,
as generated in the put option escrow account that was established. Pursuant to an escrow agreement dated December 23, 2015 among
the Company, Anatoly Hurgin and Alexander Aurovsky (together as shareholders) and the Bank Leumi Le-Israel Trust Company Ltd. as
escrow agent, $11.9 million was deposited into an escrow account, referred to as the put option escrow account, by the Company
at closing of the Business Combination to fund the payment of the purchase price for the put if it is exercised. On November 13,
2017, the parties amended the escrow agreement to change the Put Option Period to the period commencing on January 1, 2019 and
ending on March 1, 2021.
Lock Up Agreement
In connection with the closing of the Company’s
registered direct offering that closed on August 16, 2018 (the “Offering”), the Reporting Person entered into a lock-up
agreement pursuant to which he agreed, subject to certain exceptions, not to offer, sell, assign, transfer, pledge, contract to
sell, or otherwise dispose of or announce the intention to otherwise dispose of, or enter into any swap, hedge or similar agreement
or arrangement that transfers, in whole or in part, the economic consequence of ownership of, directly or indirectly, or engage
in any short selling of, or make any demand or request or exercise any right with respect to the registration of, or file with
the SEC a registration statement under the Securities Act of 1933 relating to, any ordinary shares or securities convertible into
or exchangeable or exercisable for any ordinary shares without the prior written consent of the placement agent of the Offering
for a period of 90 days from August 14, 2018.
Item 7.
Material to Be Filed as Exhibits
The following documents are filed as exhibits to this Schedule:
Exhibit
Number
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Description of Exhibit
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99.1
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Form of Lock-Up Agreement between Cambridge Capital Acquisition Corp., Cambridge Holdco Corp., Ability Computer & Software Industries Ltd. and each of the Ability stockholders (incorporated by reference to Exhibit 10.14 of the Registration Statement on Form S-4 filed on September 17, 2015).
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99.2
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Share Purchase Agreement, dated as of September 6, 2015 by and among Ability Security Systems Ltd., Eyal Tzur, Ability Computer & Software Industries Ltd., Anatoly Hurgin, Alexander Aurovsky, Cambridge Capital Acquisition Corporation and Cambridge Holdco Corp (incorporated by reference to Exhibit 10.19 to the Registration Statement on Form S-4 filed on September 17, 2015).
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99.3
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Form of Indemnity Escrow Agreement among Cambridge Holdco Corp., the Representative (as described in the Agreement and Plan of Reorganization), the shareholders of Ability Company & Software Industries Ltd., and Continental Stock Transfer & Trust Company, as Escrow Agent (incorporated by reference to Annex E to the definitive Proxy Statement/Prospectus filed on December 2, 2015).
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99.4
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Agreement and Plan of Reorganization, dated as of September 6, 2015, by and among Cambridge Capital Acquisition Corporation, Cambridge Holdco Corp., Ability Computer & Software Industries Ltd., and the shareholders of Ability Computer & Software Industries Ltd. (incorporated by reference to Annex A to the definitive Proxy Statement/Prospectus filed on December 2, 2015).
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99.5
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JV Purchase Escrow Agreement, dated as of December 23, 2015 by and among Cambridge Holdco Corp., the Representative (as described in the Agreement and Plan of Reorganization), Ability Security Systems Ltd., Eyal Tzur, the former shareholders of Ability Computer & Software Industries Ltd. and Continental Stock Transfer & Trust Company, as Escrow Agent. (incorporated by reference to Exhibit 4.8 of the Annual Report on Form 20-F filed with the Securities and Exchange Commission on May 2, 2016).
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99.6
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Letter Agreement between Meitav Dash Trusts Ltd. and Anatoly Hurgin, dated March 20, 2016.
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99.7
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Amendment to Escrow Agreement between Anatoly Hurgin, Alexander Aurovsky, Ability Inc. and the Bank Leumi Le-Israel Trust Company Ltd. dated November 13, 2017 (incorporated by reference to Exhibit 99.1 of Form 6-K filed with the Securities and Exchange Commission on November 13, 2017).
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99.8
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Lock-Up Agreement between Ability Inc. and Anatoly Hurgin dated as of August 14, 2018.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true, complete and correct.
Date: August 22, 2018
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By:
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/s/ Anatoly Hurgin
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Name:
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Anatoly Hurgin
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Exhibit 99.6
Date:
March 20, 2016
To:
Meitav
Dash Trusts Ltd. (the “Trustee”)
Dear
Sir/Madam,
I
the undersigned, Mr. Anatoly Hurgin, hereby appoint you as trustee in accordance with Section 103T of the Israeli Income Tax Ordinance
[New Version], 5721-1961 (the
“Ordinance”)
and the provisions of a tax ruling obtained from the Israel Tax
Authority (the
“ITA”)
on December 17, 2015 (as may be amended form time to time, the
“Ruling”),
and request that you shall hold for me in trust 8,106,634 shares, par value $0.0001 each, of Ability Inc. (the
“Company”),
(
the
“Shares”)
subject to the following instructions, terms and conditions:
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1.
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I
agree and acknowledge, and as a trustee you hereby undertake, that you will hold the
Shares in accordance with the provisions of Section 103T of the Ordinance and the provisions
of the Ruling, including any clarifications which may be received from the ITA with respect
to the Ruling. I and you undertake to execute any document required by the Ruling.
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2.
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Exhibit
A sets forth the following details: name of shareholder, ID number, amount of shares
held by the shareholder, purchase price.
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3.
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You
shall hold the Shares in trust for my benefit, safeguard and treat the Shares as a trust
fund in accordance with the provisions of this letter agreement, separately from your
own assets and all other assets under your management. You shall not pledge or encumber
the Shares in any manner for your own account, shall not permit any person to have access
to the Shares, and shall maintain security measures in accordance with reasonable professional
standards in order to prevent unauthorized access to the Shares. Unless otherwise required
by the Ruling, you shall hold the Shares and act solely in accordance with our written
instructions.
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4.
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I
may give you instructions in writing with regard to the holding, the sale and the transfer
of the Shares you hold for my benefit, all subject to the restrictions set forth in the
Ruling. Any instructions should be provided in writing during customary business hours,
and the Trustee shall use its best efforts to process any request regarding a sale, transfer
or other disposition of the Shares as soon as practicable thereafter and in any event
within one (1) business day, and any other request within reasonable time.
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5.
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It
is my sole responsibility to send you written notification regarding any change in ownership
of the Shares and/or any change in my contact information and/or bank account information.
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6.
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I
am solely responsible for payment of any tax or other expense relating to my Shares,
their holding in trust, their sale or transfer to or from the trust.
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7.
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I
shall transfer to you any documentation that you may reasonably require in connection
with the holding, transfer or sale of my Shares. If you are required to pay any payments
in connection with any Shares, I shall transfer such payment to you within five (5) business
days from the day you requested such payment and subject to receiving from us any and
all requested documents.
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8.
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You
shall not transfer the Shares to any person or entity except as permitted under the Ruling.
In any case I provide you with a request to sell, transfer or dispose the Shares, you
shall promptly provide notice thereof to Mr. Alexander Aurovsky (the
“Beneficiary”),
and if you believe that such request may lead to a breach of the provisions of Section
103T and the terms of the Ruling, you shall notify the Beneficiary of such concern and
in any event refrain from taking any action with respect to such sale, transfer or disposition,
and in such case your sole obligation shall be to keep safely the Shares in trust until
you shall be directed otherwise in writing by an order of a competent court or by a ruling
or other determination of the ITA (a copy of which order and/or ruling shall be provided
to the Beneficiary prior to taking any action with respect to the Shares).
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9.
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In
case of a sale, transfer or other disposition of the Shares or payment of dividend on
the Shares, unless I provide you with a valid tax withholding exemption or other certificate
or ruling for a reduced tax rate obtained from the ITA with respect to the sale of my
Shares to your reasonable satisfaction, you may deduct and withhold any taxes required
under the Ruling from the proceeds of such disposition, provided that you timely transfer
such taxes to the ITA and you provide me with evidence of tax payments so made by you.
You shall not make any deductions of taxes owing to any country other than Israel.
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10.
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In
the event you shall receive, as the record holder of the Shares or otherwise, any dividends
or other distributions, in cash or in kind, on account of the Shares, you shall provide
notice thereof to me and distribute or hold such dividends in trust, as part of the Shares,
as per my instructions, in accordance with the Ruling and this letter agreement. In the
event of dividend distribution by you according to my instructions, section 3.13 of the
Ruling shall apply.
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11.
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Concurrently
with the execution of this letter agreement, you shall grant me an irrevocable proxy
and power of attorney allowing me to take any and all actions in connection with the
Shares, including (without limitation) for the purpose of receiving information and participation
in shareholder general and class meetings and voting or providing shareholders written
consents. Without derogating from the foregoing, and unless otherwise instructed by me
in advance and in writing, you hereby irrevocably confirm that you shall not be entitled
to exercise, and you hereby irrevocably and unconditionally assign to me, any rights
of a shareholder with respect to the Shares, including, without limitations, any rights
to transfer or dispose such Shares, pre-emptive, first refusal or tag along rights and
any other rights granted under applicable law or the incorporation documents of the company.
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12.
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For
your services in this trust, I shall pay you a fee as detailed in
Appendix A.
In addition, I shall pay you any reasonable out of pocket costs and expenses incurred
by you in the opening and maintaining an account in my name, and in the sale or transfer
of the Shares, in each case against receipts and valid invoices, and provided such costs
and expenses were approved in advance and in writing by me.
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13.
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You will not be obliged to act in any way that will inflict upon you any costs or expenses, unless
you receive confirmation from me that such expense will be promptly and fully reimbursed.
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14.
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In the performance of your duties according to this letter agreement you will exercise good faith.
You will not be liable for any act or omission, provided that you have acted in good faith within the scope of this letter agreement,
and unless such acts or omissions were perpetrated fraudulently or maliciously, or constitute gross negligence.
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15.
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I hereby agree to hold you harmless and to defend you against any direct claim arising from or
in connection with your actions or omissions as trustee, provided that you have acted in good faith and in accordance with the
terms of this letter agreement, and unless such acts or omissions were perpetrated fraudulently or maliciously, or constitute gross
negligence or a material breach of this letter agreement.
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16.
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I hereby agree to indemnify you for
any direct loss, demand, damage, cost or other expense (including reasonable legal fees)
(collectively “
Damages
”) that you will suffer directly as a result
of any act or omission that you will commit in the course of acting as trustee, including,
without limitation, any Damages resulting from any civil and/or criminal proceedings,
including reasonable attorney’s and any professional advisor’s fees, provided
you have acted in good faith and in accordance with this letter agreement and unless
such acts or omissions were perpetrated fraudulently or maliciously, or constitute gross
negligence or a material breach of this letter agreement.
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17.
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You shall deliver to me copies of any notice or other information or materials received by you
with respect to the Shares or in your capacity as the holder of the Shares, within reasonable time from receipt.
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18.
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You hereby acknowledge that you may be reasonably required, as the record holder of the Shares,
to execute, deliver and/or file certain forms or other filings or notices with applicable governmental authorities in the jurisdiction
in which I am resident and in the jurisdiction where the Company is incorporated; and you hereby agree to so execute, deliver and
file, at my expense and in accordance with my written instructions, such forms, filings and notices in a timely and duly manner.
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19.
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Any addition or modification to these instructions or the termination of same can be made only
by written instructions signed by me.
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20.
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You shall be entitled to assume as being genuine any written document, including any instruction,
notice, request, consent or approval purported to be given by any person or entity, which you shall believe in good faith to have
been so given.
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21.
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I may contact you at the following
email: benefit@mtds.co.il (at the attention of Leeyah Barak Abadi and Rafik Abd Alhai),
and any written notice delivered to such contact details shall be deemed delivered upon
electronic transmission.
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22.
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You may not assign or transfer this letter agreement or any right or obligation hereunder without
our prior written consent.
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23.
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No creditor of yours will have any rights’ in or to the
Shares so long as they remain subject to the terms of this letter agreement
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24.
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The Trusteeship created by this letter agreement shall remain in effect as long as the Shares
are held by you. Subject to the provisions of the Ruling, I shall be entitled to terminate this letter agreement at
such time as I see fit by giving You a fifteen (15) days prior written notice. In such case, you shall return the
Shares to me (or if a successor assumes the trust in your replacement you shall continue to hold the Shares in
trust until such successor receives delivers
,
of the Shares from you). You shall further be required to
execute and deliver any document and instrument reasonably required in connection with the transfer of the Shares (to me or
to any other person at my instruction), including, without limitation, any share transfer deed and/or notification to, or
filing with, any governmental :.authority.
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25.
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Since I and the Trustee are executing this letter agreement in connection with the Ruling, we
acknowledge that each the Beneficiary is an intended third party beneficiary of this letter agreement.
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26.
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You shall hold the ‘information you may obtain pursuant
to, or as a result of, this letter agreement, including its existence and the terms hereof, in confidence and not disclose it
to any other person.
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27.
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This letter agreement shall be governed by, and construed in accordance with, the laws of
the State of Israel. Each of us hereby
irrevocably and unconditionally submits, for itself and its assets and properties, to the
exclusive jurisdiction of the competent courts located in Tel Aviv-Jaffa, Israel.
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Anatoly Hurgin
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Signature:
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/s/ Anatoly Hurgin
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We
accept
our appointment as a trustee for the Shares and undertake to hold such Shares in trust for your benefit, and act in
accordance with the terms of this letter agreement and the terms of the Ruling and any instructions of the ITA
related thereto.
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Meitav Dash Trusts Ltd.
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Signature:
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/s/ Meitav Dash Trusts Ltd
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Appendix
A
Scope
of Services
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I.
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Trust
Services and Compliance Solution
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●
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Assuming
responsibility of a Trustee pursuant to section 103 of the Israeli Tax Ordinance
(“
Section 103
”);
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●
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Opening
a Trust bank/broker account;
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●
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Holding
in trust, shares through a Trust bank account and/or Trustee’s safe;
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●
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Performing,
supervision over tax withholdings in accordance with the provisions of Section 103;
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●
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Filing
annual individual reports to Taxpayer Forms 856/857
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●
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Filing
annual reports for the Client’s total award status
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II.
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Stock
Administration Services
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●
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Administrating
and maintaining shares,
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●
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Access
to System for all shareholders, Client’s Contact person limited to one, unless specifically
requested.
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●
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Opening
an Online Account for each shareholder.
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●
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Monitoring
and Managing all Change in Capital event such as M&A, Stock Split, dividend allocation
etc.
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●
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Periodical
transaction reports, including client’s summary report, shareholder transaction report
and tax reporting;
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III.
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Brokerage
and Clearing services.
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●
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Execution
of all sale transaction in any stock exchange worldwide,
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●
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Handling
allocation of Stocks’ rights to the current Online Account to update stocks holdings
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●
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Disbursement
of Funds for any sales proceeds,
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●
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Dividend
Distribution allocation and Disbursement,
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●
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Multiple
settlement, distribution — company, shareholder and tax authorities;
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●
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Generating
customized reports to fit all the client’s needs, to be determined upon need of service
and would vary based on complexity of report.
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Meitav
Dash Benefits Ltd.
30
Sheshet HaYamim Rd., Champion Tower, Bnei Brak, Israel 5112303 | Phone: ●3366 | www.meitavdash.co.il
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●
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Ability
to maximize net profit by performing sales for big blocks, Operation and/or Brokerage
fees would be charged as a percentage of sale, to be determined upon need of this service
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●
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Assistance
with ITA’s Ruling and share holders’ document gathering,
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Annual
Fees:
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Trust & Stock Administration Services
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6000 NIS per year
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Transfer
Fee’s:
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Sell commission:
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0.10% per execution
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Release commission:
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No Charge
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Processing
fee including wire transfer within the Israeli banking system:
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In NIS: 20 NIS
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In
USD: 20 USD
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The
annual fees will be paid in four equal installments.
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Brokerage
and Clearing Services 0.9 cent per Share.
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Please
note that the above fees do not include Israeli V.A.T.
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Since
the funds are managed in an account with Meitav Dash Group, which is a related party of the Trustee, Meitav Group may benefit
from managing the account.
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Customer
acknowledges and agrees that all information submitted to the company may be used by Meitav Dash Group for purposes of, but not
limited to, marketing and offering its products & services.
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Meitav
Dash Benefits Ltd.
30
Sheshet HaYamim Rd., Champion Tower, Bnei Brak, Israel 5112303 | Phone: ●3366 | www.meitavdash.co.il
Exhibit 99.8
ABILITY INC.
August 14, 2018
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Ability
Inc.
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Telephone:
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+972-3-6879777
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Attention:
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Avi
Levin, CFO
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E-mail:
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avi@ability.co.il
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Re:
Ability Inc. - Lock-Up
Agreement
Dear Madam/Sir:
This Lock-Up Agreement
is being delivered to you in connection with the Securities Purchase Agreement (the “
Purchase Agreement
”),
dated as of August 14, 2018 by and among Ability Inc. (the “
Company
”) and the investors party thereto (collectively,
the “
Purchasers
”), with respect to the issuance of (i) ordinary shares of the Company, par value $0.001 per
share (the “
Ordinary Shares
”) and (ii) warrants (the “
Warrants
”) which Warrants will be
exercisable to purchase Ordinary Shares. Capitalized terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Purchase Agreement.
In order to induce
the Purchasers to enter into the Purchase Agreement, the undersigned agrees that, commencing on the date hereof and ending on
90 days following the date of the Prospectus Supplement (the “
Lock-Up Period
”), the undersigned will not, and
will cause all affiliates (as defined in Rule 144 promulgated under the 1933 Act) of the undersigned or any person in privity
with the undersigned or any affiliate of the undersigned not to, (i) sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase, make any short sale or otherwise dispose of or agree to dispose of, directly or indirectly,
any Ordinary Shares or Ordinary Share Equivalents, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities and Exchange Act of 1934, as amended and the rules
and regulations of the Securities and Exchange Commission promulgated thereunder with respect to any Ordinary Shares or Ordinary
Share Equivalents owned directly by the undersigned (including holding as a custodian) or with respect to which the undersigned
has beneficial ownership within the rules and regulations of the Securities and Exchange Commission (collectively, the “
Undersigned’s
Shares
”), or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of any of the Undersigned’s Shares, whether any such transaction described in clause
(i) or (ii) above is to be settled by delivery of Ordinary Shares or other securities, in cash or otherwise, (iii) make any demand
for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with respect to the
registration of any Ordinary Shares or Ordinary Share Equivalents or (iv) publicly disclose the intention to do any of the foregoing.
The
foregoing restriction is expressly agreed to preclude the undersigned, and any affiliate of the undersigned and any person in
privity with the undersigned or any affiliate of the undersigned, from engaging in any hedging or other transaction which is designed
to or which reasonably could be expected to lead to or result in a sale or disposition of the Undersigned’s Shares even
if the Undersigned’s Shares would be disposed of by someone other than the undersigned. Such prohibited hedging or other
transactions would include, without limitation, any short sale or any purchase, sale or grant of any right (including, without
limitation, any put or call option) with respect to any of the Undersigned’s Shares or with respect to any security that
includes, relates to, or derives any significant part of its value from the Undersigned’s Shares.
Notwithstanding the
foregoing, the undersigned may transfer the Undersigned’s Shares (i) as a
bona fide
gift or gifts, provided that the
donee or donees thereof agree to be bound in writing by the restrictions set forth herein, (ii) to any trust for the direct or
indirect benefit of the undersigned or the immediate family of the undersigned, provided that the trustee of the trust agrees to
be bound in writing by the restrictions set forth herein, (iii) by will or intestate succession upon the death of the undersigned,
(iv) as a bona fide gift to a charity or educational institution, (v) if the undersigned is a corporation, partnership, limited
liability company or other business entity, any transfers to any shareholder, partner or member of, or owner of a similar equity
interest in, the undersigned, as the case may be, provided that such party agrees to be bound in writing by the restrictions set
forth herein, (vi) transfers to the Company in connection with, and to the extent necessary to fund, the payment of taxes due with
respect to the vesting of restricted stock, restricted stock units, performance stock units, equity appreciation rights or similar
rights to purchase Ordinary Shares or any securities convertible into or exercisable or exchangeable for Ordinary Shares, or (vii)
transfers of the Undersigned’s Shares by operation of law or pursuant to an order of a court or regulatory agency. For purposes
of this Lock-Up Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more
remote than first cousin. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s
transfer agent (the “
Transfer Agent
”) and registrar against the transfer of the Undersigned’s Shares except
in compliance with the foregoing restrictions.
In addition, notwithstanding
the foregoing, this lock-up letter agreement shall not restrict the delivery of Ordinary Shares to the undersigned upon (i) the
exercise of stock options pursuant to the Company’s existing equity incentive plans or (ii) the exercise of warrants existing
as of the date hereof; provided that such Ordinary Shares delivered to the undersigned in connection with such exercise are subject
to the restrictions set forth in this Lock-Up Agreement during the Lock-Up Period.
Furthermore, the undersigned
may enter into any new plan established in compliance with Rule 10b5-1 of the Securities Exchange Act of 1934; provided that (i)
such plan may only be established if no public announcement or filing with the Securities and Exchange Commission, or other applicable
regulatory authority, is made in connection with the establishment of such plan during the Lock-up Period and (ii) no sale of Ordinary
Shares are made pursuant to such plan during the Lock-up Period.
In order to enforce
this covenant, the Company shall impose irrevocable stop-transfer instructions preventing the Transfer Agent from effecting any
actions in violation of this Lock-Up Agreement.
The undersigned acknowledges
that the execution, delivery and performance of this Lock-Up Agreement is a material inducement to each Purchaser to complete the
transactions contemplated by the Purchase Agreement and that the Company shall be entitled to specific performance of the undersigned’s
obligations hereunder. The undersigned hereby represents that the undersigned has the power and authority to execute, deliver and
perform this Lock-Up Agreement, that the undersigned has received adequate consideration therefor and that the undersigned will
indirectly benefit from the closing of the transactions contemplated by the Purchase Agreement.
The undersigned understands
and agrees that this Lock-Up Agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives,
successors, and assigns. This Lock-Up Agreement shall not be amended without the prior written consent of the Purchasers and H.C.
Wainwright & Co., LLC.
This letter agreement shall automatically
terminate if (i) if the Purchase Agreement is not executed prior to August 30, 2018, or (ii) upon such termination of the Purchase
Agreement, the undersigned shall be released from all obligations under this letter agreement.
This
Lock-Up Agreement may be executed in two counterparts, each of which shall be deemed an original but both of which shall be
considered one and the same instrument.
This Lock-Up Agreement
will be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice of
law or conflicting provision or rule (whether of the State of New York, or any other jurisdiction) that would cause the laws of
any jurisdiction other than the State of New York to be applied. In furtherance of the foregoing, the internal laws of the State
of New York will control the interpretation and construction of this Lock-Up Agreement, even if under such jurisdiction’s
choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply.
[Remainder of page intentionally left
blank]
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Very truly yours,
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Anatoly
Hurgin
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Exact Name of Shareholder
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/s/ Anatoly
Hurgin
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Authorized Signature
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CEO
and Director
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Title
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Agreed to and Acknowledged:
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ABILITY INC.
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By:
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/s/ Avi Levin
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Name:
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Avi Levin
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Title:
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CFO
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