Following the same process as last year, we will be using the “Notice and Access” method of providing proxy materials to you via the Internet instead of mailing printed copies. We believe that this process will provide you with a convenient and quick way to access the proxy materials, including the accompanying Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2017 (the “Annual Report”), while also allowing us to conserve natural resources and reduce the costs of printing and distributing the proxy materials. Accordingly, unless otherwise specifically requested by a particular shareholder, shareholders of record at the close of business on April 3, 2018, will receive a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) with details on accessing the proxy materials for the Annual Meeting. Beneficial holders of the Common Shares at the close of business on the Record Date will receive separate notices on behalf of their brokers, banks or other intermediaries through which they hold our Common Shares.

If your shares are registered in your name, even if you plan to attend the Annual Meeting or any postponement or adjournment of the Annual Meeting in person, we request that you vote by telephone, over the Internet, or if you requested to receive printed proxy materials, complete, sign and mail your proxy card to ensure that your shares will be represented at the Annual Meeting.

If your shares are held in the name of a broker, trust, bank or other nominee, and you receive notice of the Annual Meeting through your broker or through another intermediary, please vote or complete and return the materials in accordance with the instructions provided to you by such broker or other intermediary or contact your broker directly in order to obtain a proxy issued to you by your nominee holder to attend the Annual Meeting and vote in person. Failure to do so may result in your shares not being eligible to be voted by proxy at the Annual Meeting.

Your vote is very important. Whether or not you plan to attend the Annual Meeting, we encourage you to read the Proxy Statement and vote as soon as possible.

Cambridge, MA

April 10, 201829, 2019

PROXY STATEMENT

FOR THE 20182019 ANNUAL GENERAL MEETING OF SHAREHOLDERS

TABLE OF CONTENTS

VBI Vaccines Inc.

222 Third Street, Suite 2241

Cambridge, MA 02142

PROXY STATEMENT

FOR THE 20182019 ANNUAL GENERAL MEETING OF SHAREHOLDERS

TO BE HELD May 24, 2018JUNE 13, 2019

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

Our official Notice of Annual Meeting of Shareholders, proxy statement (the “Proxy Statement”), and our Annual Report on Form 10-K for the year ended December 31, 20172018 (the “Annual Report”) are available at www.materials.proxyvote.com/91822J

This Proxy Statement is being furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of VBI Vaccines Inc. (which may be referred to in this Proxy Statement as the “Company,” “VBI,” “we,” “us”“us,” or “our”) to be voted at the 20182019 annual general meeting (the “Annual Meeting”) of the holders of the common shares of the Company (the “Common Shares”) to be held on May 24, 2018,June 13, 2019, at 1:00 p.m., Eastern Time, at the offices of the Company, located at 222 Third St., Suite 2240, Cambridge, MA 02142.

Our Board has fixed the close of business on April 3, 201823, 2019 (the “Record Date”) as the record date for determining the shareholders entitled to notice of and to vote at the Annual Meeting and any adjournment or postponements thereof. This Proxy Statement and accompanying form of proxy are expected to be first sent or given to Shareholders on or about April 12, 2018.29, 2019.

In accordance with the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), unless otherwise requested by a particular shareholder, we are mailing to our shareholders a Notice of Internet Availability of Proxy Materials (the “Notice of Internet Availability”) instead of a paper copy of the proxy materials and providing shareholders access to the proxy materials for the Annual Meeting over the Internet, which we believe allows us to provide our shareholders with the information they need in a timely manner while reducing the environmental impact and costs associated with our Annual Meeting.

Accordingly, if you are a shareholder of record (meaning those persons whose names appear on the records of the Company as a registered holder of Common Shares, each a “Registered Shareholder”), and you did not previously request proxy materials be sent to you via e-mail, a one-page Notice of Internet Availability has been mailed to you on or about April 12, 2018.29, 2019. Registered Shareholders may access the proxy materials on the website www.materials.proxy.com/91822J or request a printed set of the proxy materials be sent to them by following the instructions in the Notice of Internet Availability. The Notice of Internet Availability also explains how you may request that we send future proxy materials to you by e-mail or in printed form by mail. If you choose the e-mail option, you will receive an e-mail next year with links to those materials and to the proxy voting site.site should you remain a shareholder of record at that time. We encourage you to choose this e-mail option, which will allow us to provide you with the information you need in a more timelymore-timely manner while also helping us to conserve natural resources and save the cost of printing and mailing documents to you. Your election to receive proxy materials by e-mail or in printed form by mail will remain in effect until you terminate it.

In this Proxy Statement, references to “Beneficial Shareholders” means shareholders who do not hold Common Shares in their own name; “Intermediaries” refers to brokers, investment firms, clearing houses and similar entities that hold securities on behalf of Beneficial Shareholders. For more information, please refer to the question 10 in the “About the Meeting: Questions and Answers and Procedural Matters” section below.

If you are a Beneficial Shareholder and received Annual Meeting materials, you did not receive these materials directly from us; instead, your Intermediary forwarded you a notice with instructions on accessing our proxy materials and directing that Intermediary on how to vote your Common Shares, as well as other options that may be available to you for receiving our proxy materials.

About The Meeting: Questions and Answers AND PROCEDURAL MATTERS

1. What is a proxy?

A proxy is a person you appoint to vote, or withhold a vote, on your behalf in accordance with your instructions as a Registered Shareholder or a Beneficial Shareholder. If you specify a choice with respect to any matter to be acted upon, the proxy will vote accordingly. If you are a Registered Shareholder and you submit your proxy to us by using any of the methods described below in question 13, “How can I vote my Common Shares without attending the Annual Meeting?”, you will be appointing JeffJeffrey Baxter, our President and Chief Executive Officer, or, failing him, Nell Beattie, our Chief Business Officer, as your proxy (together, the “Management Proxyholders”). The Management Proxyholders will have the authority to appoint a substitute to act as proxy. If you are unable to attend the Annual Meeting, please vote by proxy so that your Common Shares may be voted.

You also have the right to appoint a person other than the Management Proxyholders to represent you at the Annual Meeting by striking out the names of the Management Proxyholders in the accompanying form of proxy and by inserting the desired proxyholder’s name in the blank space provided. A proxyholder need not be a shareholder.

2. What is a proxy statement?

A proxy statement is a document provided by the Company to you, as required by SEC regulations, when we ask you to sign a proxy card to vote your stock at the Annual Meeting.

3. Why am I receiving these proxy materials?

As of the Record Date, April 3, 2018,23, 2019, you were a registered shareholder or beneficial owner of VBI Vaccines Inc. We have made the proxy materials available, either on the Internet or in printed form, to all shareholders on record. We do this in order to solicit voting proxies for use at our Annual Meeting to be held on May 24, 2018,June 13, 2019, at 1:00 p.m., Eastern Time, and at any adjournment or postponement thereof. If you are a Registered Shareholder and you submit your proxy to us, you direct the Management Proxyholders to vote your Common Shares in accordance with the voting instructions in your proxy. If you are a Beneficial Shareholder and received Annual Meeting materials through your Intermediary and you follow the voting instructions provided in the notice you receive from your Intermediary, you direct such Intermediary to vote your Common Shares in accordance with your instructions. These proxy materials are being made available or distributed to you on or about April 12, 2018.29, 2019. As a Registered Shareholder,shareholder, you are invited to attend the Annual Meeting and we request that you vote on the proposals described in this Proxy Statement.

4. What proposals will be voted on at the Annual Meeting?

The proposals to be voted on by the holders of our common shares as of the Record Date at the Annual Meeting are:

5. What is the record date and what does it mean?

The record date is a date identified by the Board such that only registered holders of Common Shares on that date are entitled to notice of and to vote at the Annual Meeting. The record date for our 20182019 Annual Meeting is the close of business on April 3, 201823, 2019 (the “Record Date”). The Record Date was established by the Board as required by theBusiness Corporations Act(British Columbia) (the “BCBCA”“BCBCA”). On the Record Date, 64,215,72797,661,887 Common Shares were issued and outstanding.

6. Who is entitled to vote at the Annual Meeting?

Holders of Common Shares at the close of business on the Record Date may vote at the Annual Meeting.

7. Can I attend the Annual Meeting?

You may attend the Annual Meeting if you were a Registered Shareholder or a Beneficial Shareholder as of the Record Date. You will be asked to show photo identification and the following:

We will not be able to accommodate guests without proper evidence of Common Share ownership as of the Record Date at the Annual Meeting, including guests of our shareholders.

8. When is the Annual Meeting?

This year, the Annual Meeting will be held on May 24, 2018.June 13, 2019. Check-in and seating for the Annual Meeting starts at 12:45 p.m., Eastern Time. The Annual Meeting will begin promptly at 1:00 p.m., Eastern Time. Please leave ample time for the check-in procedures.

9. Where is the Annual Meeting?

This year, the Annual Meeting will be held at the offices of the Company, located at 222 Third St., Suite 2240, Cambridge, MA 02142.

10. What is the difference between holding Common Shares as a Registered Shareholder or as a Beneficial Shareholder?

IfYou are aRegistered Shareholder if: Common Shares are registered directly in your name on the share register of the Company, which is maintained and kept by the Company’s transfer agent, Computershare Trust Company of Canada, you are aRegistered Shareholder.Canada. If you are a Registered Shareholder, we have sent the Notice of Internet Availability directly to you. As a Registered Shareholder, you may grant your voting proxy directly to the Company or to a third party, or you may vote in person at the Annual Meeting.

IfYou are aBeneficialShareholder if: Common Shares are listed in an account statement provided to you by an Intermediary, thenwhere in almost all cases those Common Shares will not be registered in your name on the share register of the Company. Such Common Shares will more likely be registered in the name of your Intermediary or an agent of your Intermediary. In this case, you are considered to be aBeneficial Shareholder.

If you are a Beneficial Shareholder, you did not receive a Notice of Internet Availability directly from the Company, but your Intermediary forwarded you a notice together with voting instructions (a “VIF”) for directing the Intermediary on how to vote your Common Shares.As a Beneficial Shareholder, you may also attend the Annual Meeting, but because a Beneficial Shareholder is not a Registered Shareholder, you may not vote in person at the Annual Meeting unless you obtain a “legal proxy” as set forth in the VIF from your Intermediary, which will grant you or your nominee the right to attend and vote at the Annual Meeting.

Beneficial Shareholders who have not objected to their intermediary disclosing certain ownership information about themselves to the Company are referred to as “non-objecting beneficial owners” (“NOBOs”). Those non-registered holders who have objected to their intermediary disclosing ownership information about themselves to the Company are referred to as “objecting beneficial owners” (“OBOs”).

TheFor NOBOs, the Company is not sending the Notice of Internet Availability directly to NOBOs in connection with the Annual Meeting, but rather has distributed copies of the Notice of Internet Availability (and where specifically requested, the printed proxy materials) to Intermediaries for distribution to NOBOs.

TheFor OBOs,the Company does not intend to pay for Intermediaries to deliver the Notice of Internet Availability (and where specifically requested, the printed proxy materials) and Form 54-101F7 –Request for Voting Instructions Made by Intermediaryto OBOs. As a result, OBOs will not receive the Annual Meeting materials unless their Intermediary assumes the costs of delivery.

11. How many votes do I have?

IfEach Common Share of VBI has one vote. The number of votes you owned yourhave corresponds to the number of Common Shares of VBI you owned at the close of business on the Record Date, pursuant to the rights of our shareholders contained in our organizational documents, each Common Share has one vote. Thisdocuments. Each vote may be voted on each matter to be voted upon at the Annual Meeting. VBI’s Common Shares are its only outstanding class of shares.

12. How can I vote my Common Shares in person at the Annual Meeting?

If you are aRegistered Shareholder, you may vote your Common Shares in person at the Annual Meeting.

If you are aBeneficial Shareholder, you may vote your Common Shares in person at the Annual Meetingonly if you obtain a “legal proxy” from your Intermediary, giving you the right to vote the Common Shares.Even if you plan to attend the Annual Meeting, we recommend that you also direct the voting of your Common Shares by proxy as described below in the question 13, so that your vote will be counted even if you later decide not to attend the Annual Meeting.

13. How can I vote my Common Shares without attending the Annual Meeting?

If you are aRegistered Shareholder,you may vote your Common Shares without attending the Annual Meeting. Registered Shareholders may vote in any of the three ways listed below, but in each case,your vote must be received by the Company by 1:4:00 p.m., Eastern Time, on May 22, 2018,June 11, 2019, being two business days before the Annual Meeting:

If you are aBeneficial Shareholder, you should carefully follow the specific instructions noted on the VIF in order to ensure that your Common Shares are voted at the Annual Meeting.

If you complete all of the proxy card except one or more of the voting instructions, then the designated proxies will vote your shares as to which you provide no voting instructions in the manner described under “What is the effect of not casting a vote or if I submit a proxy but do not specify how my Common Shares are to be voted?” below.

14. How many Common Shares mustWhat is the quorum requirement for the business to be present or represented to conduct businessconducted at the Annual Meeting?

TheA quorum of shareholders is necessary to hold a valid Annual Meeting. Under the Company’s Articles, the quorum for the transaction of business at a meeting of shareholders is two shareholders, or one or more proxyholders representing two members, or one member and a proxyholder representing another member. Notwithstanding the quorum provisions of the Company’s Articles, pursuant to the rules of the NASDAQ Stock Market LLC (“NASDAQ”), the Company is required to have a minimum quorum of at least one third of the outstanding shares represented by shareholders present at the Annual Meeting or by proxy. On the Record Date, there were 97,661,887 shares outstanding and entitled to vote. Thus 32,553,962 shares must be represented by shareholders present at the Annual Meeting or by proxy to have a quorum.

Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker) or you vote in person at the Annual Meeting. Abstentions and broker non-votes will be counted towards the quorum requirement.

If within one-half hour from the time set for the Annual Meeting, a quorum is not present, the Annual Meeting stands adjourned to the same day in the next week at the same place.

15. What vote is required to approve each proposal?

Proposal 1: Fix the number of directors at seven. The affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented by proxy and voting on such matter will be required to approve the fixing of the number of directors of the Company at seven. The Company currently has seven directors and seven directors are nominated for the ensuing year.

Proposal 2:1: Election of Directors. For an uncontested election, the affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented by proxy and voting on such matter will be required to elect each nominee as a director. The Majority Voting Policy (as discussed in the section below titled “Proposal 21 – Election of Directors”) provides that, at a meeting for the uncontested election of directors (being an election where the number of nominees for director is not greater than the number of directors to be elected), each director of the Company that is not elected by the affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented and voting on such matter must promptly tender his resignation. You may choose to vote, or withhold your vote, separately for each nominee. A properly executed proxy or voting instructions marked “WITHHOLD” with respect to the election of one or more directors will not be voted in favor of the director or directors indicated although it will be counted for the purposes of determining whether there is a quorum.

Proposal 3:2: Approval of the Appointment of EisnerAmper LLP as the independent registered public accounting firm of the Company until the next annual meeting of shareholders, and authorization of the Audit Committee to set EisnerAmper LLP’s remuneration. The affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented and voting on such matter will be required to approve the appointment of the Company’s independent registered public accounting firm until the next annual meeting of shareholders and to authorize the Audit Committee to set EisnerAmper LLP’s remuneration. Under the BCBCA, unless waived unanimously by shareholders, the shareholders of a company must, by ordinary resolution, appoint an authorized person as auditor to hold office until the next annual meeting of shareholders.

Other Proposals. Any other proposal that might properly come before the Annual Meetingmeeting will require the affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented by proxy and voting on such matter at the Annual Meetingmeeting in order to be approved, except when a different vote is required by law, or the Company’s articles (i.e., the British Columbia equivalent of a U.S. corporation’s bylaws), as amended from time to time (the “Articles”).

16. What votes will be counted?

All Common Shares entitled to vote and that are voted in person at the Annual Meeting will be counted, and all Common Shares represented by properly executed and unrevoked proxies received by 1:4:00 p.m., Eastern Time, on May 22, 2018,June 11, 2019, being two business days before the Annual Meeting, will be voted at the Annual Meeting as indicated in such proxies. You may vote “FOR” or “AGAINST” to fix the number of directors at seven (7) (Proposal 1). You may vote “FOR” or “WITHHOLD” on each of the nominees for election as director (Proposal 2)1) and on the appointment of EisnerAmper LLP as auditor for the ensuing year and authorizing the Audit Committee of the Board to set EisnerAmper LLP’s remuneration (Proposal 3)2).

The Common Shares represented by your proxy will be voted or withheld from voting in accordance with your instructions on any ballot that may be called for and, if you specify a choice with respect to any matter to be acted upon, your Common Shares will be voted accordingly.

17. What are the recommendations of our Board on how I should vote my shares?

The recommendations of our Board are set forth together with the description of each proposal in this Proxy Statement. In summary, however, the Board recommends a vote:

18. What is the effect of not casting a vote or of submitting a proxy that does not specify how my Common Shares are to be voted?

If you are aRegistered Shareholder and you do not vote by proxy card, by telephone, via the Internet, or in person at the Annual Meeting, your Common Shareswill not be voted at the Annual Meeting. If you submit a proxy, but you do not provide voting instructions, your Common Shareswill be voted as recommended by the Board.

If you are aBeneficial Shareholder and you do not provide your Intermediary with voting instructions, the Intermediary will determine if it has the discretionary authority to vote on the particular matter.

19. What is the effect of an Intermediary non-vote?

An Intermediary will have the discretion to vote on routine proposals if it has not received voting instructions from a Beneficial Shareholderat least 10 calendar days prior to the Annual Meeting.Meeting. An Intermediary non-vote occurs when an Intermediary that is otherwise counted as present or represented by proxy does not receive voting instructions from the Beneficial Shareholder and does not have the discretion to vote the Common Shares. An Intermediary non-vote will not impact our ability to obtain a quorum for the Annual Meeting and will not otherwise affect the approval of a majority of the votes present in person or represented by proxy and entitled to vote for any Proposals.

20. What happens if additional matters are presented at the Annual Meeting?

If any other matters are properly presented for consideration at the Annual Meeting, including, among other things, consideration of a motion to adjourn the Annual Meeting to another time or place, the named proxyholders will vote the proxies held by them as recommended by the Board or, if no recommendation is given, in their own discretion. We do not intend to bring any other matter for a vote at the Annual Meeting, and we do not know of anyone else who intends to do so.

21. Can I change my vote?

If you are aRegistered Shareholder, you may change your vote by:

However, please note that merely attending the Annual Meeting will not cause your previously granted proxy to be revoked unless you specifically request it.

If you are aBeneficial Shareholder and you wish to change your vote, you should do the following:

However, in either case, please consult your Intermediary for any specific rules it may have regarding your ability to change your voting instructions.

22. What is “householding” and how does it affect me?

We and some US brokers have adopted “householding,” a procedure under which shareholders who have the same address will receive a single Notice of Internet Availability or set of proxy materials, unless one or more of these shareholders provides notice that they wish to continue receiving individual copies. If you participate in householding and wish to receive a separate Notice of Internet Availability or set of proxy materials, or if you wish to receive separate copies of future notices, annual reports, and proxy statements, please contact your broker directly, or VBI Vaccines Inc., 222 Third Street, Suite 2241, Cambridge, MA 02142, Attn: Chief Business Officer, telephone number 617-830-3031 x128.

We hereby undertake to deliver promptly, upon written or oral request, a copy of the Notice of Internet Availability to a shareholder at a shared address to which a single copy of the document was delivered. Requests should be directed to the address or phone number set forth above.

SEC rules permit companies to send you a notice that proxy information is available on the Internet, instead of mailing you a complete set of materials. As such, we have elected to distribute proxy information in this manner.

23. Why am I receiving more than one Notice of Internet Availability, notice from my Intermediary, or set of proxy materials, and what should I do?

You may receive more than one Notice of Internet Availability, notice from your Intermediary, or set of proxy materials, including multiple copies of proxy cards or VIFs.

For example, if you are a Beneficial Shareholder with Common Shares in more than one brokerage account, you may receive a separate notice or VIF for each brokerage account in which your Common Shares are held. If you are a Registered Shareholder and your Common Shares are registered in more than one name, you will receive more than one Notice of Internet Availability or proxy card. example:

Please complete, sign, date and return each proxy card or VIF that you receive, and follow the voting instructions on each Notice of Internet Availability or other notice you receive to ensure that all your Common Shares are voted.

24. Who is our Independent Registered Public Accounting Firm and will they be represented at the Annual Meeting?

VBI’s shareholders approved the appointment of EisnerAmper LLP as the independent registered public accounting firm of the Company on June 22, 2017,May 24, 2018, to serve for the ensuing year. Accordingly, EisnerAmper LLP served as the independent registered public accounting firm auditing and reporting on our financial statements for the fiscal year ended December 31, 2017.2018. We expect that representatives of EisnerAmper LLP will be present telephonically at the Annual Meeting. They will have an opportunity to make a statement, if they desire, and will be available to answer appropriate questions at the Annual Meeting.

25. Who will serve as inspector of election at the Annual Meeting?

A representative from Computershare Trust Company of Canada will act as the inspector of election (scrutineer) and count the votes at the Annual Meeting.

26. Where can I find the voting results of the Annual Meeting?

We will publish final voting results in our Current Report on Form 8-K, which will be filed with the SEC and made available on its website at www.sec.gov within four business days following the Annual Meeting, and an equivalent “Report of Voting Results,” which will be filed with an accompanying news release with the Canadian Securities Administrators (the “CSA”) and made available on SEDAR.com, promptly after the Annual Meeting.

27. Who will bear the cost of soliciting votes for the Annual Meeting?

VBI will pay the entire cost of preparing, assembling, printing, mailing and distributing these proxy materials and soliciting votes. We may reimburse brokerage firms, custodians, nominees, fiduciaries and other persons representing Beneficial Shareholders for their reasonable expenses in forwarding solicitation material to NOBOs. Our directors, officers, and employees may also solicit proxies in person or by other means. These directors, officers, and employees will not be additionally compensated but may be reimbursed for reasonable out-of-pocket expenses incurred in doing so.

28. What percentage of our Common Shares do our directors and executive officers own?

As of the Record Date, our director-nominees and executive officers beneficially owned approximately 16.3%10.5% of our outstanding Common Shares. See the discussion under the heading “Security Ownership of Certain Beneficial Owners and Management” on page 33 for more details.

29. Do I have any dissenters’ or appraisal rights with respect to any of the matters to be voted on at the Annual Meeting?

No. None of our shareholders hashave any dissenters’ or appraisal rights with respect to the matters to be voted on at the Annual Meeting.

30. I have additional questions, who can help answer them?

The information provided above in this “Question and Answer” format is for your convenience only and is merely a summary of the information contained in this Proxy Statement. We urge you to carefully read this entire Proxy Statement, including the documents we refer to in this Proxy Statement. If you have any questions, or need additional material, please feel free to email IR@vbivaccines.com.

The proxy card gives the persons named as proxyholders discretionary authority regarding amendments or variations to matters identified in the Notice of Meeting, this Proxy Statement and any other matter that may properly come before the Annual Meeting. As of the date of this Proxy Statement, management is not aware of any such amendment, variation, or other matter proposed or likely to come before the Annual Meeting.However, if any amendment, variation, or other matter properly comes before the Annual Meeting, it is the intention of the persons named in the accompanying form of proxy to vote the shares represented by the proxies held by them in accordance with applicable law and their judgment on such matters.

IF YOU DO NOT SPECIFY A VOTE ON YOUR PROXY CARD OR YOU VOTE FOR BOTH CHOICES, YOUR COMMON SHARES WILL BE VOTEDIN FAVOR OF THE MOTIONS PROPOSED TO BE MADE AT THE ANNUAL MEETING AS SET OUT IN THE NOTICE OF MEETING AND THIS PROXY STATEMENT.

Governance of the Company

Our business, property and affairs are managed by, or under the direction of, our Board, in accordance with the BCBCA and the Articles of the Company. Members of the Board are kept informed of our business through discussions with the Chief Executive Officer and other key members of management, by reviewing materials provided to them by management, and by participating in meetings of the Board and its committees. There are no family relationships among any of our director,directors, executive officerofficers or persons nominated to become a director.

We continue to review our corporate governance policies and practices by comparing our policies and practices with those suggested by various groups or authorities active in evaluating or setting best practices for corporate governance of public companies. Based on this review, we have adopted, and will continue to adopt, changes that the Board believes are the appropriate corporate governance policies and practices for our Company.

Shareholder Communications

Shareholders may communicate with the members of the Board, either individually or collectively, by writing to the Board at VBI Vaccines Inc., 222 Third Street, Suite 2241, Cambridge, MA 02142. These communications will be reviewed by the office of the Chief Business Officer, as agent for the non-employee directors in facilitating direct communication to the Board. The Chief Business Officer’s office will treat communications containing complaints relating to accounting, internal accounting controls or auditing matters as reports under our Code of Business Conduct and Ethics (“Code of Ethics”). Further, the Chief Business Officer’s office will disregard communications that are bulk mail, solicitations to purchase products or services not directly related either to us or the non-employee directors’ roles as members of the Board, sent other than by shareholders in their capacities as such or from particular authors or regarding particular subjects that the non-employee directors may specify from time to time, and all other communications which do not meet the applicable requirements or criteria described below, consistent with the instructions of the non-employee directors.

General Communications. The Chief Business Officer’s office will review all shareholder communications directly relating to our business operations, the Board, our officers, our activities or other matters and opportunities closely related to us. From time to time, the Chief Business Officer will circulate summaries of shareholder communications and copies of the actual shareholder communications to the Chairman of our Nominating and Governance Committee (the “Governance Committee”).Committee.

Shareholder Proposals and Director Nominations and Recommendations. Shareholder proposals are reviewed by the Chief Business Officer’s office for compliance with the requirements for such proposals set forth in our Articles, the BCBCA, and Regulation 14a-8 promulgated under theSecurities Exchange Act of 1934, as amended (the “Exchange Act”). Shareholder proposals that meet these requirements will be summarized by the Chief Business Officer’s office. Summaries and copies of the shareholder proposals are circulated to the Chairman of the Nominating and Governance Committee.

Shareholder nominations for directors are reviewed by the Board for compliance with the requirements for director nominations that are set forth in our Articles. Shareholder nominations for directors that meet these requirements are then circulated to the Chairman of the Nominating and Governance Committee for consideration and evaluation by the Nominating and Governance Committee consisting entirely of independent directors.

The Nominating and Governance Committee will consider director candidates recommended by shareholders. If a director candidate is recommended by a shareholder, the Nominating and Governance Committee expects to evaluate such candidate in the same manner it evaluates director candidates it identifies. Shareholders desiring to make a recommendation to the Nominating and Governance Committee should follow the procedures set forth herein and in the Company’s Articles regarding shareholder nominations for directors.

Retention of Shareholder Communications. Any shareholder communications that are not circulated to the Chairman of the Nominating and Governance Committee because they do not meet the applicable requirements or criteria described above will be retained by the Chief Business Officer’s office for at least 90 calendar days from the date on which they are received, so that these communications may be reviewed by the directors generally if such information relates to the Board as a whole, or by any individual to whom the communication was addressed, should any director elect to do so.

Distribution of Shareholder Communications. Except as otherwise required by law or upon the request of a non-employee director, the Chairman of the Nominating and Governance Committee will determine when and whether a shareholder communication should be circulated among one or more members of the Board and/or Company management.

Independence of Directors

In determining the independence of our directors, we apply the definition of “independent director” provided under the listing rules of The NASDAQ Stock Market LLC (“NASDAQ”) and National Instrument 58-101 –Disclosure of Corporate Governance Practicesof the CSA. Pursuant to these rules, the Nominating and Governance Committee concluded its review of director independence on November 30, 2017 and March 23, 2018.April 17, 2019. The Board affirmatively determined that each of Dr.Drs. Gillis (the Chairman) and Messrs., De Wilde and McKee, Mr. Kariv Requadt, Rubin and LogalMs. Cordeiro, (being the majority of the Board) andis independent under these rules, since none of these directors have a direct or indirect material relationship with the Company or its subsidiaries. Each of our former directordirectors Mr. Requadt, who resigned from the Board effective as of March 31, 2019, Mr. Nussbaum, who resigned from the Board effective as of January 23, 2018 areand Mr. Rubin and Mr. Logal who resigned from the Board effective as of October 17, 2018 were, while they served on the Board, independent under these rules, since none of these former directors hashad a direct or indirect material relationship with the Company or its subsidiaries. In making its independence determinations, the Nominating and Governance Committee sought to identify and analyze all of the facts and circumstances relating to any relationship between a director, hishis/her immediate family or affiliates and VBI and its affiliates and did not rely on categorical standards other than those contained in the NASDAQ rule referenced above.

Mr. Baxter is not an independent member of the Board because he is the Chief Executive Officer and President of the Company and thus has a material interest in the Company. Mr. McNulty is not an independent member of the Board because he is the Chief Financial Officer and Head of Business Development and thus has a material interest in the Company. Our former director, Mr. Chawla who resigned from the Board effective as of January 23, 2018, was not independent as he was a representative of Perceptive Credit Holdings, LP (“Perceptive Credit”) on our Board pursuant to our existing credit facility with Perceptive Credit.

The independent directors are not expected to hold regularly scheduled meetings at which non-independent directors and members of management are not in attendance. Where deemed necessary by the independent directors, the independent directors will hold in-camera sessions exclusive of the non-independent director and members of management, which process will facilitatefacilitates open and candid discussion amongst the independent directors. At the end of each Board call or meeting, the independent directors have the option to hold executive sessions, as needed, where non-independent directors and members of management are not in attendance. In 2017,2018, such executive sessions were held at the end of 6 Board Meetings. In 2018 and to date 3To-date in 2019, one such sessions weresession has been held.

Meetings and Attendance

Since January 1, 2017, theThe Board held 14 meetings.11 meetings during the year ended December 31, 2018. Attendance was as follows: Dr. Gillis (14)(11); Mr. Baxter (14)(11); Mr. Requadt (10); Dr. De Wilde (13)(9); Mr. Logal (9); Mr. Kariv (8); Mr. Rubin (7); Mr. Chawla (12)(1); Mr. Logal (13);and Mr. Nussbaum (3); Mr. Requadt (11); Mr. Rubin (11) and Mr. Kariv (2)(1). Mr. Nussbaum joined the Board on October 30, 2017 and resigned from the Board on January 23, 2018, Mr. Chawla resigned from the Board on January 23, 2018, and Mr. Kariv joined the Board on January 23, 2018. Mr. Logal and Mr. Rubin resigned from the Board on October 17, 2018. Mr. Requadt resigned from the Board effective March 31, 2019. Ms. Cordeiro joined the Board on April 15, 2019, and Mr. McNulty joined the Board on April 26, 2019.

The Board held eleven meetings during the year ended December 31, 2017. Each member of our Board other than Mr. Rubin attended at least 75% of the aggregate of (i) the total number of meetings of the Board (held during the period for which he or she was a director) and (ii) the total number of meetings held by all committees of the Board on which such director served (held during the period that such director served).

We encourage our Board members to attend the annual meeting each year. One of the seven directors attended our 20172018 Annual General Meeting of Shareholders.

Mandate of our Board

A copy of the Board Mandate, adopted as of September 23, 2016, can be viewed on our website at www.vbivaccines.com (under the “Investors” section).

Committees of our Board

The Board has three standing committees, the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee,Committee. The following table provides the current membership, for each of which has the composition and responsibilities described below.committee:

Below is a description of each committee of the Board.

Audit Committee

Our Audit Committee is comprised of Adam Logal, Steven Gillis and Steven D. Rubin, with Mr. Logal serving as Chairman. Our Governance Committee has determined each of Dr. Gillis, Mr. Logal and Mr. Rubin to be financially literate and qualify as an independent director under Section 5605(a)(2) and Section 5605(c)(2)(A) of the NASDAQ rules. Further, each member of our Audit Committee is also considered independent under SEC Rule 10A-3. In addition, Mr. Logal qualifies as the audit committee financial expert, within the meaning of Item 407(d)(5) of Regulation S-K. The Audit Committee operates pursuant to a charter, the current copy of which can be viewed on our website at www.vbivaccines.com (under the “Investors” section). During 2017, the Audit Committee met in person or by telephone, or acted by unanimous written consent, four times.

The role of the Audit Committee is to:

CompensationOur Audit Committee is comprised of Steven Gillis, Tomer Kariv and Blaine McKee, with Dr. McKee serving as Chairman.

Our CompensationNominating and Governance Committee was comprised of Michel De Wilde and Scott Requadt, with Mr. Requadt serving as Chairman, for the year ended December 31, 2017. On March 23, 2018, Dr. De Wilde, Steven Gillis and Tomer Kariv were appointed to the Compensation Committee, with Dr. De Wilde serving as Chairman. Eachhas determined each of Dr. De Wilde, Mr. Gillis, Dr. McKee, and Mr. Kariv, andas well as each of Mr. Requadt, Mr. Logal, and Mr. De Wilde is considered independent in accordance with the NASDAQ rules, an “outside director” for purposesRubin, during their time of Section 162(m) of the Internal Revenue Code of 1986, as amended, and a “non-employee director” for purposes of Section 16b-3 under the Exchange Act, and does not have a relationship to us which is material to his abilityservice, to be financially literate and qualify as independent from management in connection with the duties of a compensation committee member, as described indirectors under Section 5605(d)5605(a)(2) and Section 5605(c)(2)(A) of the NASDAQ rules. Further, each member of our Audit Committee is also considered independent under SEC Rule 10A-3. In addition, Dr. McKee qualifies, and Dr. Gillis and Mr. Logal, the former chairmen of the Audit Committee, qualified during the time of their service, as the audit committee financial expert within the meaning of Item 407(d)(5) of Regulation S-K. The Audit Committee operates pursuant to a charter, the current copy of which can be viewed on our website at www.vbivaccines.com (under the “Investors” section).

During 2017,2018, the CompensationAudit Committee met in person or by telephone, or acted by unanimous written consent, one time.four times.

Report of the Audit Committee of the Board of Directors

The Audit committee has reviewed and discussed the Company’s audited consolidated financial statements and related footnotes for the year ended December 31, 2018, and the independent auditor’s report on those financial statements, with management and with our independent auditor, EisnerAmper LLP. The Audit Committee has also discussed with EisnerAmper LLP the matters required to be discussed by the statement on Auditing Standards No. 61, as amended, as adopted by the Public Company Accounting Oversight Board in Rule 3200T. The Audit Committee has also received the written disclosures and the letter from EisnerAmper LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding EisnerAmper LLP‘s communications with the audit committee concerning independence, and has discussed with EisnerAmper LLP that firm’s independence.

Based on the review and discussions referred to in the preceding paragraph, the Audit Committee recommended to the Board that the consolidated financial statements audited by EisnerAmper LLP for the fiscal year ended December 31, 2018 be included in its Annual Report on Form 10-K for such fiscal year that was filed with the SEC.

VBI Vaccines Inc.

Audit Committee of the Board

Blaine McKee, Chairman

Tomer Kariv

Steven Gillis

Compensation Committee

The purpose of the Compensation Committee is to aid the Board in meeting its responsibilities with regard to oversight and determination of executive compensation. Among other things, the Compensation Committee reviews, recommends and approves salaries and other compensation of the Company’s executive officers, and will administer the Company’s equity incentive plans (including reviewing, recommending and approving stock option and other equity incentive grants to executive officers). A copy of the current charter of the Compensation Committee is available on our website at www.vbivaccines.com (under the “Investors” section).

The Compensation Committee may form and delegate a subcommittee consisting of one or more members to perform the functions of the Compensation Committee. The Compensation Committee may engage outside advisers, including outside auditors, attorneys and consultants, as it deems necessary to discharge its responsibilities. The Compensation Committee has sole authority to retain and terminate any compensation expert or consultant to be used to provide advice on compensation levels, including sole authority to approve the fees of any expert or consultant and other retention terms. In addition, the Compensation Committee considers, but is not bound by, the recommendations of our Chief Executive Officer with respect to the compensation packages of our other executive officers.

Governance Committee

Our GovernanceCompensation Committee is comprised of Steven D. Rubin,Gillis, Michel De Wilde, and Steven Gillis,Joanne Cordeiro, with Mr. GillisMs. Cordeiro serving as Chairman. The Board has determined that all members

Each of Dr. Gillis, Dr. De Wilde, and Ms. Cardeiro are, and each of Mr. Kariv and our Governanceformer director Mr. Requadt, during the time of their service on the Compensation Committee, arewere, considered independent in accordance with the NASDAQ rules, an “outside director” for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended, and a “non-employee director” for purposes of Section 16b-3 under the Exchange Act, and do not, or did not, as applicable, during the time of their service, have a relationship with us which is material to their ability to be independent from management in connection with the duties of a compensation committee member, as described in Section 5605(d)(2) of the NASDAQ rules.

During 2017,2018, the GovernanceCompensation Committee met in person or by telephone, or acted by unanimous written consent, one time.

Compensation Committee Interlocks and Insider Participation

None of our executive officers currently serve, or in the past year have served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board or Compensation Committee.

Nominating and Governance Committee

The role of the Nominating and Governance Committee is, among other things, to:

A copy of the current charter of the Nominating and Governance Committee is available on our website at www.vbivaccines.com (under the “Investors” section).

Our Nominating and Governance Committee is comprised of Steven Gillis, Michel De Wilde, and Joanne Cordeiro, with Dr. Gillis serving as committee Chairman.

The Board has determined that all members of our Nominating and Governance Committee are independent under the NASDAQ rules.

During 2018, the Nominating and Governance Committee met in person or by telephone, or acted by unanimous written consent, one time.

Assessments

The Board and each individual director are periodically assessed regarding its or histheir effectiveness and contribution. The assessment considers: (i) in the case of the Board, its mandate; and (ii) in the case of an individual director, the competencies and skills hehe/she is expected to possess in the context of the current composition of the Board. This process is done informally by the Chairman of the Board and other Directors on an as-needed basis, and done formally each year as part of the Nominating and Governance Committee meetingmeeting.

Orientation of New Directors

Orientation for new Directors includes meetings with the Chief Executive Officer, and other members of senior management, as well as with existing Directors, including and notably the Chairman of the Board. As needed, further documentation regarding VBI or the industry is offered, as are invitations to visit any of the three Company sites.

Director Qualifications and Diversity

The Nominating and Governance Committee is responsible for identifying candidates for Board positions as well as nominating such candidates for election to our Board. In the event that a Director position is included as part of an agreement, the Nominating and Governance Committee is responsible for vetting the proposed candidate and ensuring the competencies and skills possessed by the candidate meet expectations for a Director of the CompanyCompany. All of the members of the Nominating and Governance Committee are independent. Our director Tomer Kariv, and former director Ran Nussbaum, and Mr. Kariv, Mr. Nussbaum’s successor, waswere appointed to the Board by Pontifax (China) IV Limited Partnership, Pontifax (Israel) IV Limited Partnership, and Pontifax (Cayman) IV Limited Partnership (collectively, the “Pontifax Entities”) pursuant to a Subscription Agreement, dated October 26, 2017, the Company entered into with the Pontifax Entities and other investors in connection with the Company’sa registered direct offering of common shares. AllCommon Shares. Mr. Kariv was subsequently elected to the Board at the annual meeting of the members of the Governance Committee are independent.stockholders held on May 24, 2018.

The Board seeks independent directors who represent a diversity of backgrounds and experiences that will enhance the quality of the Board’s deliberations and decisions. Candidates should have substantial experience with one or more publicly traded companies or should have achieved a high level of distinction in their chosen fields. The Board is particularly interested in maintaining a mix that includes individuals who are active or retired executive officers and senior executives, particularly those with experience in immunology; research and development; finance and accounting.

There is no difference in the manner in which the Nominating and Governance Committee evaluates nominees for director based on whether the nominee is recommended by a shareholder. In evaluating nominations to the Board, the Nominating and Governance Committee also looks for certain personal attributes, such as integrity, ability and willingness to apply sound and independent business judgment, comprehensive understanding of a director’s role in corporate governance, availability for meetings and consultation on Company matters, and the willingness to assume and carry out fiduciary responsibilities. Each of the candidates nominated for election to our Board was recommended by the Nominating and Governance Committee.

In the fall of 2014, the CSA introduced policies requiring companies to either adopt or explain why they have not adopted: (a) policies with respect to term limits for directors; and (b) policies and targets designed to increase participation by women in board matters and in executive positions. The Nominating and Governance Committee continues to assess the substance of appropriate policies, but has not yet adopted formal policies or targets on either term limits or diversity. TwoOne of six (33%(17%) of the Company’s executive officers are female, whilefemale. Effective April 15, 2019 the Company currently has noone female directors.director.

The Board and the Nominating and Governance Committee recognize the valuable contributions made to board deliberations and management by people of different genders, experience, and background. Selection is made as per the criteria described above and elsewhere in this Proxy Statement (such as based on merit, skills, qualifications, needs of the Company at the time, etc.). However, the Board is mindful of the benefit of diversity in the Company’s leadership positions and the need for diversity to maximize the effectiveness of the Board and management in their decision makingdecision-making abilities.

In considering the CSA guidelines, the Nominating and Governance Committee has determined to monitor developments in this area while reviewing the Company’s own practices in order to adopt a policy that is meaningful for the Company.

Procedures by which Shareholders may Recommend Nominees to our Board of Directors

There have been no material changes to the procedures by which security holders may recommend nominees to our Board of Directors.Board.

Effective September 23, 2013, shareholders of the Company approved an amendment to the Articles of the Company and adopted advance notice provisions (the “Advance Notice Provisions”). The Advance Notice Provisions include, among other things, a provision that requires advance notice be given to the Company in circumstances where nomination of persons for election to the Board are made by shareholders of the Company. The Advance Notice Provisions set a deadline by which shareholders must submit nominations (a “Notice”) for the election of directors to the Company prior to any annual or special meeting of shareholders. The Advance Notice Provisions also set forth the information that a shareholder must include in the Notice to the Company, and establish the form in which the shareholder must submit the Notice for that notice to be in proper written form.

In the case of an annual meeting of shareholders, a notice must be provided to the Company not less than 30 days and not more than 65 days prior to the date of the annual meeting.

As of the date of this Proxy Statement, the Company has not received Notice of a nomination in compliance with the Advance Notice Provisions.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) applicable to our principal executive officer and principal financial and accounting officer and any persons performing similar functions. In addition, the Code of Ethics applies to our employees, officers, directors, agents, and representatives. The Code of Ethics requires, among other things, that our employees avoid conflicts of interest, comply with all laws and other legal requirements, conduct business in an honest and ethical manner and otherwise act with integrity and in our best interest. The Code of Ethics is available on our website at www.vbivaccines.com (under the “Investors” section).

The Code of Ethics includes procedures for reporting violations of the Code of Ethics. These include reporting violations to an immediate supervisor, the CEO, or legal counsel, as necessary. Fraud or potential fraud must be reported to the whistler-blower email account, which is forwarded to the Chair of the Audit Committee and internal counsel. The Whistleblower Policy is available on our website at www.vbivaccines.com (under the “Investors” section). In addition, the Sarbanes-Oxley Act of 2002, as amended, requires companies to have procedures to receive, retain and treat complaints received regarding accounting, internal accounting controls or auditing matters and to allow for the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters. The Code of Ethics is intended to comply with the rules of the SEC and includes these required procedures.

Risk Oversight

Our Board provides risk oversight for our entire company by receiving management presentations, including risk assessments, and discussing these assessments with management. The Board’s overall risk oversight, which focuses primarily on risks and exposures associated with current matters that may present material risk to our operations, plans, prospects or reputation, is supplemented by the various committees. The Audit Committee discusses with management and our independent registered public accounting firm our risk management guidelines and policies, our major financial risk exposures, and the steps taken to monitor and control such exposures. Our Compensation Committee oversees risks related to our compensation programs and discusses with management its annual assessment of our employee compensation policies and programs. Our Nominating and Governance Committee oversees risks related to corporate governance and management and director succession planning.

Board Leadership Structure

The Chairman of the Board presides at all meetings of the Board at which he is present. The Chairman is appointed on an annual basis by at least a majority vote of the remaining directors. The Board is committed to promoting effective, independent governance of the Company. Our Board believes it is in the best interests of the shareholders and the Company for the Board to have the flexibility to select the best director to serve as Chairman at any given time, regardless of the independence of that director. Consequently, the Company has no fixed policy with respect to the separation of the offices of the Chairman of the Board and Chief Executive Officer.

Currently, the offices of Chairman of the Board and Chief Executive Officer are held by two different people. The Chief Executive Officer is responsible for the day-to-day leadership and performance of the Company, while the Chairman of the Board provides guidance to the Chief Executive Officer and sets the agenda for board meetings and presides over meetings of the board. The Chairman of the Board plays a critical role by leading the Board in its management and supervision of the business of the Company. The Board has developed written position descriptions for the Chief Executive Officer, the Chairman of the Board, and the Chair of each of its committees. The Board believes that the separation of the offices of the Chairman of the Board and Chief Executive Officer reinforces the independence of the Board in its oversight of the business and our affairs, and creates an environment that is more conducive to objective evaluation and oversight of management’s performance, increasing management accountability and improving the ability of the Board to monitor whether management’s actions are in ourthe Company’s best interests, and in the best interest of the Company’s shareholders. The Board will review this determination from time to time.

Review, Approval, or Ratification of Transactions with Related Persons

The Board reviews issues involving potential conflicts of interest, and reviews and approves all related party transactions, including those required to be disclosed as a “related party” transaction under applicable federal securities laws. The Board has not adopted any specific procedures or a written policy for conducting reviews of potential conflicts of interest and considers each transaction in light of the specific facts and circumstances presented. However, to the extent a potential related party transaction is presented to the Board, the Company expects that the Board would become fully informed regarding the potential transaction and the interests of the related party, and would have the opportunity to deliberate outside of the presence of the related party. The Company expects that the Board would only approve a related party transaction that is in the best interests of the Company, and further would seek to ensure that any completed related party transaction was on terms no less favorable to the Company than could be obtained in a transaction with an unaffiliated third party. Other than as described under the section titled, “Certain Relationships and Related Transactions,” no transaction, that required disclosure under applicable federal securities laws and that occurred since the beginning of the fiscal year 2017,2018, was submitted to the Board for approval as a “related party” transaction.

Compliance with Section 16 of the Exchange Act

Section 16(a) of the Exchange Act requires our directors, executive officers, and persons who own more than 10% of a registered class of our equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of our common shares and other equity securities. Officers, directors, and greater-than-10% Shareholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file.

The Company transitioned to domestic reporting beginning with the December 31, 2016, 10-K. During 2017, we noticed that all of the initial reports of ownership on Form 3 and a number of awards granted to our directors or executive officers during the fiscal year ended December 31, 2017, that were required to be reported on Section 16(a) reports were not filed, and as these reports were identified, we undertook to file the missed forms. Most of the late reports were initial reports of ownership which were inadvertently omitted at the time of our transition to domestic reporting status, and none of these cases involved purchase or sale, but rather non-market transactions such as grant or exercise of stock options.

The following is the number of late reports filed since the beginning of the fiscal year ended December 31, 2017,2018, under Section 16(a) and the number of transactions reflected therein as not reported on a timely basis during such fiscal year by such executive officers and directors:

PROPOSALProposal 1 – FIXING THE NUMBER OF DIRECTORS

As seven individuals are being nominated to serve as directors of the Company until the next Annual Meeting or until the appointment or election and qualification of their successors, shareholders are being asked to vote in favor of fixing the number of directors of the Company at seven in accordance with the Company’s Articles.

Vote and Recommendation

The affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present or represented by proxy and voting on such matter will be required for approval of this proposal.

The Board recommends that shareholders vote “FOR” fixing the number of directors of the Company at seven, as described in this Proposal 1.

Proposal 2 — Election Of Directors

Majority Voting Policy

In accordance with good corporate governance practices and procedures, the Board adopted a majority voting policy on August 28, 2015 (the “Majority Voting Policy”). The Majority Voting Policy provides that, at a meeting for the uncontested election of directors (being an election where the number of nominees for director is not greater than the number of directors to be elected), each director of the Company must be elected by the vote of a majority of the Company’s Common Shares represented in person or by proxy at such meeting. The proxy card permits a shareholder to vote in favourfavor of, or to withhold from voting, separately for each director nominee.

If, in an uncontested election of directors, the number of Common Shares withheld for a nominee exceeds the number of Common Shares voted for that nominee at the meeting, either in person or by proxy, that director must immediately tender his or her resignation. The Nominating and Governance Committee will expeditiously consider whether to recommend to the Board whether or not to accept the resignation. The Board will accept the resignation absent exceptional circumstances and such resignation will be effective when accepted by the Board. In its deliberations, the Nominating and Governance Committee may consider such extenuating circumstances as it deems appropriate.

The Board shall determine whether or not to accept the resignation within 90 days of the relevant shareholders’ meeting. A director who tenders a resignation pursuant to the Majority Voting Policy will not participate in any meeting of the Board or meetings of the Nominating and Governance Committee of the Board at which the resignation is considered. The Company shall promptly issue a news release with the Board’s decision, which must fully state the reasons for that decision.

The Majority Voting Policy can be viewed on our website at http://www.vbivaccines.com (under the “Investors” section).

Nominees for Election

The Board currently hasis comprised of seven members. Our Board, upon the recommendation of the Governance Committee, has nominated seven individuals to serve as directors, includingdirectors. If elected, each of our seven incumbent directors. Each nominee has agreed, if elected,agrees to serve until the next Annual Meeting or until the appointment or election and qualification of his or her successor. If any nominee is unable to stand for election, which circumstance we do not anticipate, the Board may provide for a lesser number of directors or designate a substitute. In the latter event, Common Shares represented by proxies may be voted for a substitute nominee.

On October 26, 2017, the Company entered into a subscription agreement (the “Subscription Agreement”) with certain investors relating to the Company’s registered direct offering of 7,475,410 common shares. The Pontifax Entities purchased an aggregate of 2,295,083 common shares in the registered direct offering for a purchase price of US$7.0 million. Pursuant to the terms of the Subscription Agreement, immediately upon closing of the registered direct offering and effective as of October 30, 2017, the Company appointed Ran Nussbaum to the Company’s Board to serve until his successor has been duly elected or appointed and qualified or until his earlier death, resignation or removal in accordance with the Company’s Articles. Effective as of January 23, 2018, Mr. Nussbaum resigned from the Board, and Mr. Kariv was appointed to the Board as Mr. Nussbaum’s successor.

If a quorum is present at the Annual Meeting, the nominees will be elected by the vote of a majority of the Company’s Common Shares, represented in person or by proxy, at such meeting. There is no cumulative voting in the election of directors.

Our Board, upon the recommendation of the Nominating and Governance Committee, has nominated the 7 individuals, including each of our seven incumbent directors, listed in the table below for election to serve as directors. The following table sets forth information with respect to each directornominee as of April 3, 2018.23, 2019:

(1)NOTE : The information as to the province and country of residence, principal occupation and shares beneficially owned or over which a director exercises control or direction, not being within the knowledge of the Company, has been furnished by the respective directors individually as of April 3, 2018,23, 2019, being the Record Date of this Information Circular.

(1) Common shares beneficially owned or controlled

(2)Member of the Audit Committee

(3)Member of the Compensation Committee

(4)Member of the Nominating and Governance Committee

Vote Required

Our Recommendation

OUR BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES SET FORTH ABOVE.

Information about our Board of Directors Nominees

Biographical information with respect to our executive officers and directorsthe director nominees is provided below. There are no family relationships among any

Steven Gillis, Ph.D. – Chairman of the Board (State of Residence – Washington)

Dr. Gillis has served as our Chairman and as a member of our Board since May 2016. Dr. Gillis has served as a member of the board of directors of VBI DE and VBI US since July 2014 and December 2006, respectively. Since 2006, he has been a Managing Director of ARCH Venture Partners, or ARCH, a firm he joined in 2005. Dr. Gillis is focused on the evaluation of new life science technologies and also on the development and growth of ARCH’s biotechnology portfolio companies. In addition to serving on our Board, Dr. Gillis currently serves as a director executiveof Takeda Pharmaceutical Co. Ltd. (NYSE: TAK), Homology Medicines, Inc. (NASDAQ: FIXX) and Pulmatrix, Inc. (NASDAQ: PULM). Dr. Gillis represents ARCH as a director and serves as Chairman of a number of ARCH’s private biotechnology portfolio companies. Dr. Gillis was a founder and director of Corixa Corporation and served as Chief Executive Officer from its inception and as its Chairman from 1999 until its acquisition in 2005 by GSK. Prior to Corixa, Dr. Gillis was a founder and director of Immunex Corp. From 1981 until his departure in 1994, Dr. Gillis served as Immunex’s Director of Research and Development, Chief Scientific Officer, and as Chief Executive Officer of Immunex’s R&D subsidiary. Dr. Gillis was interim Chief Executive Officer of Immunex Corp. following its majority purchase by American Cyanamid Company and remained a member of the board until 1997. Amgen, Inc. acquired Immunex in 2002.

Dr. Gillis is an immunologist by training with over 300 peer-reviewed publications in the areas of molecular and tumor immunology. He is credited as being a pioneer in the field of cytokines and cytokine receptors, directing the development of multiple marketed products including Leukine, (GM-CSF), Prokine (IL-2) and Enbrel (soluble TNF receptor-Fc fusion protein) as well as the regulatory approval of Bexxar (radiolabeled anti- CD20). Dr. Gillis received a B.A. from Williams College and a Ph.D. from Dartmouth College.

Dr. Gillis’ education and professional achievements, notably his experience as a founder, officer, or persons nominateddirector, and investor of life science and biotechnology companies, led us to becomethe conclusion that he should serve as a director.

JeffJeffrey R. Baxter, FCMA - President, Chief Executive Officer and Director (State of Residence – Pennsylvania)

Mr. Baxter has served as our President, Chief Executive Officer and as a member of our Board since May 2016. Since July 2014, he has served as the President, Chief Executive Officer and a director of VBI Vaccines (Delaware) Inc. (formerly Paulson Capital (Delaware) Corp.), a Delaware corporation and a wholly-owned subsidiary of the Company (“VBI DE”). Since September 2009, Mr. Baxter has also served as Chief Executive Officer and a member of the board of directors of VBI DE’s wholly-owned subsidiary, Variation Biotechnologies (US), Inc., a Delaware corporation and a wholly-owned subsidiary of the Company (“VBI US”). Previously, he was a managing partner for the venture capital firm, The Column Group. Until July of 2006, Mr. Baxter was Senior Vice President, R&D Finance and Operations, of GlaxoSmithKline Biologicals SA, a company registered in the UK (“GSK”). In addition to serving on our Board, Mr. Baxter currently serves as a director of ChromaDex Corporation (NASDAQ: CDXC), which serves dietary supplement, food, beverage, skin care and pharmaceutical markets. In his 19 years of pharma experience, he has held line management roles in finance, commercial, manufacturing and IT and the office of the CEO. His most recent position in R&D included responsibility for finance, pipeline resource planning and allocation, business development, deal structuring and SROne (GSK’s in-house $125 million venture capital fund). He also chaired GSK’s R&D Operating Board. Prior to GSK, he worked at Unilever and British American Tobacco. Mr. Baxter was educated at Thames Valley University and is a Fellow of the Chartered Institute of Management Accountants (“FCMA”).

Mr. Baxter’s education, professional achievements, and experience, including his management experience with GSK and his experience at The Column Group, and his knowledge of finance, led us to the conclusion that he should serve as a director.

Steven Gillis, Ph.D. – Chairman of the Board (State of Residence – Washington)

Dr. Gillis has served as our Chairman and as a member of our Board since May 2016. Dr. Gillis has served as a member of the board of directors of VBI DE and VBI US since July 2014 and December 2006, respectively. Since 2006, he has been a Managing Director of ARCH Venture Partners, or ARCH, a firm he joined in 2005. Dr. Gillis is focused on the evaluation of new life science technologies and also on the development and growth of ARCH’s biotechnology portfolio companies. In addition to serving on our Board, Dr. Gillis currently serves as a director of Shire PLC (NASDAQ: SHPG), and Pulmatrix, Inc. (NASDAQ: PULM). Dr. Gillis represents ARCH as a director and serves as Chairman of a number of ARCH’s private biotechnology portfolio companies. Dr. Gillis was a founder and director of Corixa Corporation and served as Chief Executive Officer from its inception and as its Chairman from 1999 until its acquisition in 2005 by GSK. Prior to Corixa, Dr. Gillis was a founder and director of Immunex Corp. From 1981 until his departure in 1994, Dr. Gillis served as Immunex’s Director of Research and Development, Chief Scientific Officer, and as Chief Executive Officer of Immunex’s R&D subsidiary. Dr. Gillis was interim Chief Executive Officer of Immunex Corp. following its majority purchase by American Cyanamid Company and remained a member of the board until 1997. Amgen, Inc. acquired Immunex in 2002.

Dr. Gillis is an immunologist by training with over 300 peer-reviewed publications in the areas of molecular and tumor immunology. He is credited as being a pioneer in the field of cytokines and cytokine receptors, directing the development of multiple marketed products including Leukine, (GM-CSF), Prokine (IL-2) and Enbrel (soluble TNF receptor-Fc fusion protein) as well as the regulatory approval of Bexxar (radiolabeled anti- CD20). Dr. Gillis received a B.A. from Williams College and a Ph.D. from Dartmouth College.

Dr. Gillis’ education and professional achievements, notably his experience as a founder, officer, director, and investor of life science and biotechnology companies, led us to the conclusion that he should serve as a director.

Michel De Wilde, Ph.D. – Director (State of Residence – New Jersey)

Dr. De Wilde has served as a member of our Board since May 2016 and has served as a member of the board of directors of VBI DE since July 2014. Dr. De Wilde was Senior Vice President, Research & Development, at Sanofi Pasteur, the human vaccines division of Sanofi from 2001 until June 2013. In this position, he was responsible for managing approximately 1,500 employees and a broad portfolio of approximately 20 development projects.

Prior to joining Sanofi Pasteur in January 2000, Dr. De Wilde was at SmithKline Beecham Biologicals (now GSK Vaccines) in Rixensart, Belgium. Dr. De Wilde joined the group in 1978 as a research scientist upon formation of a unit focusing on the application of recombinant DNA technology to vaccine development. He subsequently held positions of increasing responsibility and, as Vice President, Research & Development at Sanofi Pasteur, headed a team of approximately 400 specialists, active in all aspects of preclinical vaccine development.

Dr. De Wilde is also independent directora Board member at the Infectious Disease Research Institute.

Institute and is a member of a number of scientific and strategy advisory boards. Dr. De Wilde received his degree in Chemistry from the Free University of Brussels in 1971, followed by a Ph.D. in Biochemistry in 1976. He carried out postdoctoral work at the University of Wisconsin, Madison (U.S.) and the University of Ghent (Belgium). Dr. De Wilde authored over 50 publications during the early part of his career.

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Dr. De Wilde’s educational background and his extensive experience in biopharmaceutical development, particularly with vaccinesledvaccines, led us to the conclusion that he should serve as a director.

Adam LogalBlaine McKee, Ph.D. – Director (State of Residence – Florida)Massachusetts)

Mr. LogalDr. McKee has served as a member of our Board since April 2014. Mr. LogalJanuary 11, 2019. Dr. McKee has 25 years of experience in building biotechnology companies and has extensive strategic, transactional, and market access expertise. Dr. McKee has served as OPKO’s Sr.Executive Vice President and Chief FinancialBusiness Officer at ImmunoGen, Inc. since MarchApril 2018. Prior to joining ImmunoGen, Dr. McKee served in various executive capacities at Shire PLC, a pharmaceutical company, from 2014 to 2018, including as Senior Vice President, Head of Corporate Development, from 2016 to 2018, and as Senior Vice President, Head of Transactions, from 2014 to 2016.

Prior to joining Shire PLC, from 2011 to 2014, Dr. McKee was Executive Vice President and Chief Business Officer at 480 Biomedical, a venture capital-backed medical device company. Prior to that he served for 15 years at Genzyme Corporation, a biopharmaceutical company, most recently serving as OPKO’sSenior Vice President of Finance, Chief Accounting OfficerStrategic Development for the Oncology, Transplant, and Treasurer from July 2012 until March 2014 and as OPKO’s Executive Director of finance, Chief Accounting Officier and Treasurer from March 2007 until July 2012. Mr. Logal serves as Chairmen of Xenetic Biosciences, Inc. (NASDAQ:XBIO) a clinical-stage biopharmaceutical company focusedMultiple Sclerosis divisions.

Dr. McKee served on the discovery, researchboard of the New York Pharma Forum from 2007 to 2011 and development2014 to 2019.  He also served on the Board of next-generation biologic drugsBioStage, Inc from 2016 to 2018 and novel orphan oncology therapeutics. From 2002ArmaGen from 2015 to 2007, Mr. Logal served2017. He received a Bachelor of Science in senior managementChemistry from Colorado State University, a Ph.D. in Organic Chemistry from the Massachusetts Institute of Nabi Biopharmaceuticals, a publicly traded, biopharmaceutical company engagedTechnology (MIT), and an MBA in Finance from the development and commercializationMIT Sloan School of proprietary products. Mr. Logal held various positions of increasing responsibility at Nabi Biopharmaceuticals, last serving as Senior Director of Accounting and Reporting.Management.

Mr. Logal’sDr. McKee’s education and professional achievements, including his financialbusiness experience in life science and biotechnology companies, led us to the conclusion that he should be a director.

Tomer Kariv – Director (Country of Residence – Israel)

Mr. Kariv ishas served as a member of our Board since January 2018. Mr. Kariv has served as co-founder and managing partner of the Pontifax Group, a venture capital firm, since December 2004. He also currently serves as a director of VBI since January 2018, is the co-founderEloxx Pharmaceuticals, Inc. (Nasdaq: ELOX) and Chief Executive OfficerLogicBio Therapeutics, Inc. (Nasdaq: LOGC). He previously served as a director of Pontifax, a groupCollPlant Holdings Ltd. (Nasdaq: CLGN) and Check-Cap Ltd. (Nasdaq: CHEK), and as an independent director of Israeli based life sciences venture funds focusing on investments in development stage bio-pharmaceutical and med-tech technologies.Arno Therapeutics, Inc. Mr. Kariv serves as an active board member of many of the funds’ portfolio companies, assuming a special responsibility for strategic planning. During the 13 years prior to establishing Pontifax in 2004, Mr. Kariv played a key role in investing, managing and nurturing technology driven companies and startups and has held senior management positions at top Israeli financial institutions. Mr. Kariv practiced law with Sullivan & Cromwell, a leading corporate law firm in New York, and holdsreceived a B.A. in Economics from Harvard University and a J.D. from Harvard Law School.

We believe Mr. Kariv’s extensive experience as a venture capital investor, financial executive and board member qualifies him to serve on our board of directors.

Joanne Cordeiro – Director (State of Residence – Massachusetts)

Ms. Cordeiro has served as a member of our Board since April 2019. Ms. Cordeiro most recently served as Chief Human Resources Officer and Executive Vice President of Human Resources at Shire PLC, where she served as the strategic partner and advisor to the CEO, Executive Team, and Board of Directors on matters of organizational vision, human capital strategies, total rewards, ethics, and cultural topics with a focus on shareholder value. Ms. Cordeiro was also a member of the Shire Steering Committee responsible for leading the strategic direction and integration for mergers, acquisitions, and divestitures.

Prior to joining Shire in 2011, she was Head of Human Resources for Covansys Corporation (a CSC Company), Clam/Availant, and Elliason Group, and served in various human resources management roles at Teradyne Inc., Avid Technology, Inc., and Sybase Inc. (an SAP company).

Ms. Cordeiro received her Bachelor of Science in Business Administration from Northeastern University.

Mr. Kariv has served as a member of the board of directors of Eloxx Pharmaceuticals Inc. since December 2017 and as a member of the board of directors of Eloxx Pharmaceuticals Ltd. since September 2016. Mr. Kariv serves on the boards of Medical Compression Systems Ltd, a public company (August 2012 until April 2015), Insuline Medical Ltd, a public company (May 2012 until November 2013), Headsense Medical Ltd (since June 2013), Macrocure Ltd, a Public Company (March 2013 until January 2017), Avraham Pharmaceuticals Ltd, (since April 2010), Arno Therapeutics, a Public Company (September 2010 until August 2017) Stimatix Ltd (February 2011 until January 2016.), Applied Immune Technologies (AIT), Ltd (March 2012 until February 2016), Allium Ltd, a public company (March 2008 until March 2014), Collplant, a public company (December 2012 until January 2014), V-Wave Ltd, (since March 2015 ), EyeYon Medical Ltd, (since May 2015), Cathworks Ltd, (since July 2015), Otic Pharma Ltd, (June 2015 until May 2017), Raziel Therapeutics Ltd, (since January 2016), Observer in Entera Ltd, since (June 2016 until May 2017), Nutrinia Ltd, (since May 2017), Check-Cap Ltd, a public company (since March 2008).

Mr. Kariv’sMs. Cordeiro’s education and professional achievements, including experience in life science and biotechnology companies led us to the conclusion that she should be a director.

Christopher McNulty (State of Residence – Massachusetts)

Mr. McNulty is a director of VBI since April 2019. Mr. McNulty has served as our Chief Financial Officer and Head of Business Development since August 2018. Prior to joining the Company, Mr. McNulty served as chief financial officer from March 2017 to May 2018, at InVivo Therapeutics Holdings Corp. (“InVivo”). At InVivo, Mr. McNulty also served and as Senior Vice President, Business Development & Investor Relations, from August 2015 to March 2017, leading InVivo’s business development and partnering activities as well as corporate communications, including investor relations and public relations, as Vice President, Business Development and Investor Relations, from July 2014 to August 2015, and as Vice President, Business Development, from November 2013 to June 2014. Prior to that, Mr. McNulty served at Repligen Corporation, a pharmaceutical and bioprocessing company, from 2010 to 2013, most recently as Senior Director of Business Development, where he spearheaded the acquisition of Novozymes Biopharma Sweden in 2011. From 2009 to 2010, he was Director of Corporate Development at Seventh Sense Biosystems, Inc., a medical device company. From 2006 to 2009, Mr. McNulty served at Genzyme Corporation, a biotechnology company, most recently as Associate Director of Alliance Management and Business Development. Before joining Genzyme, Mr. McNulty held technical roles at Transform Pharmaceuticals, Inc. from 2000 to 2004 and at Cereon Genomics, LLC from 1998 to 2000. Mr. McNulty received his financial experienceB.S. and extensive boardM.Eng. degrees in electrical engineering and computer science from the Massachusetts Institute of Technology. He also holds an M.B.A. from Harvard Business School.

Mr. McNulty’s education and professional achievements, including experience in life science and biotechnology companies led us to the conclusion that he should be a director.

Scott Requadt, JD, MBA. – Director (State of Residence – Massachusetts)Corporate Cease Trade Orders or Bankruptcies

Mr. Requadt has served as a member of our Board since May 2016 and has served as a memberNo proposed director of the boardCompany is, as of directorsthe date hereof or was within 10 years before the date of VBI DE since December 2015. He is alsothis Proxy Statement, a Managing Director at Clarus, a leading life sciences investment fund. Mr. Requadt has over 15 yearsdirector, chief executive officer or chief financial officer of operating and investment experience inany company (including the pharmaceutical industry. Prior to joining Clarus in 2005, Mr. Requadt was Director, Business DevelopmentCompany) that:

The foregoing, not being within the knowledge of TransForm Pharmaceuticals until it was acquired by Johnson & Johnson, and previously practiced for several years as a mergers and acquisitions attorney at the law firm of Davis Polk & Wardwell. Before that, Mr. Requadt was a law clerk for a senior judge at the Supreme Court of Canada. Mr. Requadt holds a B.Com (Economics & Finance) from McGill University (First Class Honors), an LL.B from University of Toronto and an MBA from Harvard Business School (Baker Scholar). Mr. RequadtCompany, has been involved in multiple Clarus investments spanning both therapeutics and medtech, as well as several R&D risk-sharing collaborations with large pharma partners. In addition to VBI, he currently serves onfurnished by the Boards of ESSA Pharmaceuticals (NASDAQ: EPIX), AvroBio and Edev S.a.r.l. He has previously been active on the boards of TyRx, Catabasis (NASDAQ: CATB), Oxford Immunotec (NASDAQ: OXFD), Link Medicine, and Biolex Therapeutics.respective directors.

Penalties or Sanctions

Mr. Requadt’s education and extensive business experience inNo proposed director of the pharmaceutical industry led usCompany has been subject to:

The foregoing, not being within the conclusion that he should serve as a director.knowledge of the Company, has been furnished by the respective directors.

Steven D. Rubin – Director (StateIndebtedness of Residence – Florida)Directors and Executive Officers

Mr. RubinAs at the date of this Proxy Statement, no executive officer, director, employee, former executive officer, director or employee of the Company or any of its subsidiaries, has served as a memberbeen indebted to the Company or any of our Board since October 2012. Mr. Rubin serves as OPKO Health, Inc.’s (NASDAQ: OPK) Executive Vice President – Administration since May 2007 and as aits subsidiaries, either in connection with the purchase of securities or otherwise. No director, of since February 2007. Mr. Rubin currently serves on the board of directorsexecutive officer, proposed nominee for the following companies: Chromadex, Inc. (NASDAQ:CDXC), a science-based, integrated nutraceutical company devoted to improving the way people age; Kidville, Inc. (OTCBB:KVIL), an operator of large, upscale facilities, catering to newborns through five-year-old children and their families and offers a wide range of developmental classes for newborns to five-year-olds; Non-Invasive Monitoring Systems, Inc. (OTCBB:NIMU), a medical device company; Cocrystal Pharma, Inc. (OTCBB:COCP), a biotechnology company developing new treatments for viral diseases; Eloxx Pharmaceuticals  (OTCMKTS:ELOX) a clinical-stage biopharmaceutical company dedicated to treating patients suffering from rare and ultra-rare diseases caused by premature termination codon (PTC) nonsense mutations,; Castle Brands, Inc. (NYSE:ROX), a developer and marketer of premium brand spirits; and Neovasc, Inc. (NASDAQ:NVCN), a company developing and marketing medical specialty vascular devices.

Mr. Rubin previously served as the Senior Vice President, General Counsel and Secretary of IVAX Corporation from August 2001 until September 2006. Mr. Rubin previously servedelection as a director of the following companies: Dreams, Inc. (NYSE MKT: DRJ),Company, or an associate of any such director, executive officer or proposed nominee has been indebted to the Company or any of its subsidiaries or any other entity which indebtedness is or has been the subject of a vertically integrated sports licensing and products company; Safestitch Medical, Inc. prior toguarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Company or any of its merger with TransEnterix, Inc. in September 2013; and, PROLOR Biotech, Inc., prior to its acquisition by OPKO Health in August 2013; and Cognit, Inc. (NASDAQ:COGT), a data and analytics company providing cloud-based mission-critical information and performance marketing solutions.

subsidiaries.

Mr. Rubin’s education and professional achievements, including his extensive board experience in life science and biotechnology companies, led usExcept as disclosed herein, to the conclusion that he should be a director.best of our knowledge, none of our directors or executive officers has, during the past ten years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K.

Proposal 2

approval of Appointment of INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM, and AUTHORIZATION OF the AUDIT COMMITTEE to set the remuneration OF THE iNDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

General

VBI’s shareholders approved the appointment of EisnerAmper LLP (“EisnerAmper”) as the independent registered public accounting firm of the Company May 24, 2018 to serve for the ensuing year. EisnerAmper has served as our independent registered public accounting firm since June 7, 2016.

The Board requests that shareholders appoint EisnerAmper as the independent registered public accounting firm to conduct the audit of our financial statements for the fiscal year ending December 31, 2019 and to authorize the audit committee to set the remuneration of the independent registered public accounting firm. Even if the selection is approved, the Board, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the fiscal year if the Board determines that such a change would be in the best interest of our shareholders.

In making its recommendation to the Board that shareholders approve the appointment of EisnerAmper as our independent registered public accounting firm until the next annual meeting of shareholders and remuneration to be set by the Audit Committee, the Audit Committee considered whether EisnerAmper’s provision of non-audit services is compatible with maintaining the independence of our independent registered public accounting firm. The Audit Committee pre-approved the audit fees, audit-related fees, tax fees and all other fees described below in accordance with our pre-approval policy and believes such fees are compatible with the independence of EisnerAmper.

Vote and RecommendationRequired

The affirmative vote of the holders of Common Shares having a majority of the votes cast by the holders of all Common Shares present in person or represented by proxy and entitled to votevoting on the nomineessuch matter will be required to approve each nominee. If, in an uncontested electionfor approval of directors, the number of shares withheld for a nominee exceeds the number of shares voted for that nominee at the Annual Meeting, either in person or by proxy, that director must immediately tender his or her resignation.this proposal.

Our Board recommends a voteRecommendation

THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” eachAPPROVAL OF THE APPOINTMENT OF EISNERAMPER LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM UNTIL THE NEXT ANNUAL MEETING AND AUTHORIZE THE AUDIT COMMITTEE TO SET THE AUDITOR’S REMUNERATION AS DESCRIBED IN THIS PROPOSAL 2.

Pre-approval Policies and Procedures

The Audit Committee is required to review and approve in advance the retention of the nominees.independent auditors for the performance of all audit and lawfully permitted non-audit services and the fees for such services. The Audit Committee may delegate to one or more of its members the authority to grant pre-approvals for the performance of non-audit services, and any such Audit Committee member who pre-approves a non-audit service must report the pre-approval to the full Audit Committee at its next scheduled meeting. The Audit Committee is required to periodically notify the Board of their approvals. The required pre-approval policies and procedures were complied with during 2018, and the audit committee pre-approved all of the fees set forth in the table above.

The Audit Committee engages the Independent Registered Public Accountants to audit the financial statements of the Company. Management approves the tax services that are provided by a separate independent registered public accounting firm. Any audit-related or other services required by an independent registered public accounting firm will be discussed with, and approved by, the Audit Committee as needed. The Audit Committee has determined that this practice is compatible with maintaining the principal accountant’s independence.

Audit and Related Fees