Item
1.01 Entry into a Material Definitive Agreement.
Securities
Purchase Agreements
On March 16, 2020, Cyren Ltd. entered
into Securities Purchase Agreements, or the Purchase Agreements, with certain purchasers named therein, or the Purchasers, pursuant
to which we agreed to sell and issue $10.25 million aggregate principal amount of our 5.75% Convertible Debentures due March 2024,
or the Debentures, referred to herein as the Financing, which includes the purchase by Brett Jackson, our Chief Executive Officer,
of a Debenture in the principal amount of $250,000 pursuant to a Purchase Agreement. The Purchase Agreements contain customary
representations, warranties, covenants, closing conditions, and indemnification of the Purchasers by us. We are required to pay
certain liquidated damages to the Purchasers in the event we fail to satisfy the current public information requirements of Rule
144 under the Securities Act of 1933, as amended, or the Securities Act, until such time that satisfaction of such requirements
is no longer required for the sale of ordinary shares underlying the Debentures pursuant to Rule 144.
Craig-Hallum Capital Group LLC, or the
Placement Agent, acted as placement agent in connection with the Financing. We have agreed to pay the Placement Agent an aggregate
cash fee equal to 6% of the aggregate gross proceeds from the Financing plus reimbursement of certain expenses not to exceed $60,000
in the aggregate.
Pursuant to the Purchase Agreements, subject
to certain exempt issuances set forth in the Purchase Agreements, we and all of our subsidiaries are prohibited from issuing any
ordinary shares for ninety days after the date of the Purchase Agreements and from entering into an agreement involving variable
rate transactions (as defined in the Purchase Agreements).
The Debentures will be guaranteed on an
unsecured basis by certain existing and future subsidiaries. The Debentures rank junior in right of payment to our convertible
notes due December 2021. The Debentures will have an initial conversion price of $0.75 per share, subject to adjustments, provided
that the conversion price for the Debenture purchased by Mr. Jackson cannot be less than $0.73 per share. Interest on the Debentures
will be payable semi-annually in cash or, subject to the satisfaction of certain equity conditions set forth in the Debentures,
in ordinary shares at a rate of 5.75% per annum, calculated on the basis of a 360-day year, and will accrue daily until payment
in full of the outstanding principal, together with all accrued and unpaid interest. We must pay late fees at a rate of the lesser
of 18% per annum or the maximum rate permitted by law on overdue accrued and unpaid interest.
Registration
Rights Agreement
In
connection with the Financing, on March 16, 2020, we entered into a Registration Rights Agreement with the Purchasers, or the
Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to (i) file one or more registration statements
with the Securities and Exchange Commission, or the SEC, within sixty days of the date of the Registration Rights Agreement to
cover the resale of the shares of our ordinary shares that are issuable to the Purchasers upon any conversion of the Debentures
or as interest payments, or the Shares, (ii) use our best efforts to have all such registration statements declared effective
within the time frames set forth in the Registration Rights Agreement, and (iii) use our best efforts to keep such registration
statements effective during the time frames set forth in the Registration Rights Agreement. In the event that such registration
statements are not declared effective within the timeframes set forth in the Registration Rights Agreement, any such effective
registration statements subsequently become unavailable, or use of the prospectus contained in such registration statements is
suspended for certain periods of time, we would be required to pay certain liquidated damages to the Purchasers.