Sol-Gel Technologies announced a subscription agreement of 2,000,000 ordinary shares at an issue price of $5.00 per share for gross proceeds of 22,800,000 along with unregistered PIPE warrants on January 27, 2023. The transaction will include participation from returning investor, M. Arkin Dermatology Ltd. for 2,000,000 shares. The PIPE Warrants have an initial exercise price of $5.85 to purchase up to 2,000,000 ordinary shares and will become exercisable beginning six months from the date of issuance and will expire on January 27, 2028.

. The warrants are subject to adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the ordinary shares. In the event of a fundamental transaction, the holders of the warrants are entitled to receive from the company, or any successor entity, the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of the warrants, that is being offered and paid to the holders of ordinary shares of the company in connection with the fundamental transaction.

The warrants do not entitle the holders thereof to any voting rights or any of the other rights or privileges to which holders of ordinary shares are entitled. The subscription agreement transaction is conditioned on obtaining disinterested shareholder approval. The issuance of the warrants and the ordinary shares issued in connection with the Affiliate Private Placement (subscription agreement) are not registered under the Securities Act, or any state securities laws.

The issuance of such securities was in reliance on the exemptions from registration provided by Section 4(a)(2) of the Securities Act and Regulation D promulgated thereunder. The placement agent is being reimbursed for up to $110,000 for fees and expenses of legal counsel and other out-of-pocket expenses.