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Insights & News /  Technology

March 15, 2015
Barnea & Co. represented Athena SCS Limited
Barnea represented Athena SCS Limited, a UK based company, and its shareholders in the sale of the company to NXP Semiconductors NV, a Nasdaq listed company. Athena is an independent UK-based developer of state-of-the art smart card solutions for access, enterprise, eGovernment, transportation, payment and mobile solutions.
April 30, 2015
Joint interview – Micky Barnea and IVC CEO - Mr Koby Simana
Mickey Barnea, managing partner of Barnea, and Koby Simana, CEO of IVC Online, in a joint interview focused on the area of financial trading platforms. In the interview Micky discusses the effects of the new Israeli regulations pertaining to the activities of trading platforms. These regulations will come into effect on May 26, 2015.
May 7, 2015
Top FX figures meet venture capital firms in Tel Aviv: Is the age of funding here?
Senior industry figures from a host of FX companies met top venture capital investors in Tel Aviv, Israel today at the conference hosted by Barnea and the IVC. To read more, please click here
May 14, 2015
Is the online financial trading industry part of Israeli high-tech?
Micky Barnea, Managing Partner and Head of the Technology department published an article in the IVC annual high-tech book. In the article, Micky asserts that although online financial trading is focused on financial tools, the ability to innovate is a key ingredient in the success of online financial trading companies. As such, they should be treated as high-tech companies.
May 21, 2015
Barnea & Co. hosted a delegation from Peru
As part of our collaboration with Startau, Tel Aviv University's Entrepreneurship Center, our firm hosted today a student delegation from Peru. The event included lectures by Adv. Micky Barnea, managing partner and by Lior Weizman, Eco System development Manager Cloud, Start ups and Academia, From IBM.
June 3, 2015
StartUp Open Israel is underway
Global Entrepreneurship Network Israel, Barnea Co Law firm, The Jerusalem Development Authority, JNext, The Jerusalem Municipality, The MIT Enterprise Forum - Israel,  Israel advanced technology industries, Made In Jerusalem and more leading hi-tech entities have organized for the 2nd time  a competition for early stage startups. The Israeli Company which wins StartUp Open will receive a package of services worth thousands of shekels and will automatically be entered into the list of the World's Top 50 Most Promising Startups, also known as the GEW50. Registration for StartUp Open Israel 2015 will be open until July 13th , 2015. After a thorough process of judging, the final round of the StartUp Open competition in Israel will be held at Jerusalem on September 7th, 2015 in front of an audience consisting of entrepreneurs, managers, investors, researchers, and government representatives.
July 12, 2015
How to sprinkle star dust of the high-tech industry on the TASE?
The Israeli corporate governance rules discourage technology companies from listing on the TASE. However, with some simple steps this all can be changed. Israel's position as the Startup Nation is reflected in the fact that multiple local technology companies are listed on the US and London Stock Exchanges. However, the TASE has never managed to make itself an attractive  target for Israeli high-tech companies. Thus, while many technology companies today prefer the purchase option of an initial public offering, such companies seeking to issue shares do not regard the TASE as an attractive or even relevant option. They prefer to turn to international exchanges.
May 29, 2014
How the JOBS Act Changed the Rules of the IPO Game
In April, 2012, a new law came into effect in the United States that made significant changes to how small companies can raise money.  The Jumpstart Our Business Startups Act (better known by its nickname, the “JOBS Act”) was intended to ease the process for startups to seek investments, with a potentially dramatic effect. Now, two years after the JOBS Act became law, we can look back and see just what effect these changes have had on the process of taking startups through initial public offerings (IPOs), and how this affects Israeli startups. The JOBS Act deals with regulation of both private and public offerings.  While the private offering provisions provide for significant loosening of the regulatory process, important administrative rules still have not come into effect so it is still too early to assess the impact of these changes.  The IPO rules, however, took effect very quickly so we have two full years of post-JOBS Act IPO trends. The JOBS Act created a new category of companies, called Emerging Growth Companies (EGCs), that enjoy a lighter regulatory burden so that they will have an easier “on-ramp” to an IPO. The American idea of an “emerging” company is any company that has less than $1 billion in revenues per year. As a practical matter, all but the very largest Israeli companies qualify as EGCs. The special lighter IPO rules that apply to EGCs include: Confidential submission of early drafts of the prospectus to the SEC An opportunity to “test the waters” by holding meetings with sophisticated investors in order to gauge the interest of potential participants in the IPO Scaled financial disclosure, which allows companies to go public based on two years (rather than three) of audited financial results and two years (rather than five) of “selected financial data” Extended time to comply with the internal controls provisions of the Sarbanes-Oxley Act, allowing up to five years to come into full compliance (rather than two years) Confidential submission is a luxury that was available to non-US companies for many years.  Curiously, the old “silent filing” rules that applied to non-US companies were curtailed significantly only a few months before the JOBS Act came into effect.  The JOBS Act restored and even enhanced the confidentiality provisions, and extended them to all EGCs, whether US-based or not.  This allows a company to begin the process of obtaining comments from the SEC without publicizing competitive information too far in advance of the IPO.  Also, if the IPO process fails, whether for market conditions or other factors, a confidential filing can be abandoned quietly and without embarrassment. The “test the waters” provisions are completely new and are a significant liberalization of the rules.  Prior to JOBS, early contacts with potential investors were forbidden.  Now, by allowing an EGC to contact potential IPO investors very early in the process, a company can get a reality check to help it gauge the potential for success of the IPO. The scaled financial disclosure provisions and the extended compliance time for Sarbanes-Oxley controls can significantly decrease IPO accounting expenses and compliance costs in the first few years following an IPO. There are many factors that that have contributed to today’s very hot IPO market.  Certainly, favorable economic conditions, particularly in certain industries have played a role.  There can be no doubt, though, that the removal of hurdles in the post-JOBS Act “IPO on-ramp” have been a factor. Observers point, for example, to the successful US IPOs of “pre-revenue” companies like Energous, Flexion and Ampio. The ability to test the waters with sophisticated investors while maintaining confidentiality about the process allows these issuers to attain some confidence that they will be able to sell out their IPOs even though they have never seen a dollar of revenue.  Presumably, there are others whose names we do not – and may never – know, because their initial contacts with investors persuaded them that their IPOs would not succeed. Each year that the JOBS Act has been in effect has seen an increase in the percentage of US IPOs where the issuer was an EGC, and each year has seen an increase in the proportion of confidential submitters. The scaled financial disclosures have been adopted by a majority of EGCs, and the extended time to comply with Sarbanes-Oxley financial controls has been adopted in nearly all EGC IPOs. For Israeli startups, these changes should mean easier access to capital markets.  In the past, smaller Israeli companies have turned to secondary stock markets in Europe and Asia where the financial regulations are less demanding and the IPO process less cumbersome.  By moving closer to the reduced regulatory burden of these markets, the US has removed much of the friction in accessing America’s robust capital markets.
June 28, 2014
Setting the Record Straight – Limiting Employees' Rights to Compensation for Service Inventions
In 2010, the Committee for Compensation and Royalties made a “revolutionary” ruling regarding the assignment by employees to their employers of rights to "service inventions" – i.e. inventions created in the course of employment. The Committee held that the assignment of an invention does not automatically amount to a waiver of the employee's right to receive compensation for such invention under section 134 of the Patents Law (1967). Although the employer would be the owner of a patent invented by an employee, it may still be compelled to pay the employee royalties for their contribution to the company's technology. This ruling sent proverbial shockwaves through the Israeli high tech industry. Companies, potential acquirers and investors struggled with assessing the risk as to whether employees, both past and present, would now seek compensation for the work they had performed for their employers. In a recent decision the situation appears to have been clarified. On 4 May 2014, the same Committee appears to have revised its position, when it rejected a claim for royalties by a former employee. The Committee ruled that an employee's right to compensation for "service inventions" is not absolute and such right may be waived. The Committee also found that a general waiver signed by the employee upon his termination was sufficient to relieve the employer from the requirement to pay royalties – even if such waiver did not make specific reference to inventions or to section 134 of the Patents Law. According to this latest decision by the Committee, an assignment of rights of "service inventions" together with a general release upon termination would now be sufficient to ensure that the employer will have no further liability to employees who have contributed to inventions. Nevertheless, it would still be prudent to include an express waiver of rights to royalties for "service inventions" in all employment agreements.
July 1, 2014
Barnea & Co. represented Dune Medical Devices Ltd.
Following the successful launch of MarginProbe System, which received Pre-Market Approval (PMA) from the FDA early last year, Dune Medical Devices Ltd. has successfully completed the first of a two stage USD21 million equity financing. The initial closing was completed for USD14 million with a second tranche of USD7 million to be completed by October 2014. Dune Medical Devices develops surgical devices and techniques for real-time, intra-operative optimization of excisions in surgical oncology procedures.Dune Medical Devices has offices in the U.S. and in Israel.
July 6, 2014
StartUp Open at Start-Up Nation
Barnea together with the Enterprise Forum, Israel Advanced Technology Industries,  is pleased to sponsor the 2014 StartUp Open Competition to be held on 22 September in Jerusalem. StartUp Open is a competition featured during Global Entreperneurship Week. The competition was originally launched as part of the Kauffman Foundation Global Entrepreneurship Week in 2010 and has since been a leader in the promotion and nourishment of aspiring entrepreneurs. StartUp Open is one of the world's largest competitions for startup companies and boasts participation from 37 countries. The start-up competition focuses on companies that made significant progress between November 25, 2013 (Global Entrepreneurship Week 2013) and November 16, 2014 (Global Entrepreneurship Week 2014). For further information, please contact: Gil Shourka, National Coordinator GEW – Israel. Email: gew.israel@gmail.com
August 7, 2014
The Next Big Thing from the Start-Up Nation
StartUp Open competition for start-ups is underway and companies are narrowing down. From near to hundred companies, which entered the competition, the judges have selected seven finalists to move forward and partake in the final event of the national competition that will take place on September 22nd , 2014 in Jerusalem. Michael Barnea, Managing Partner from Barnea Co, said, "As part of our long standing relationship with the Israeli entrepreneurial community, Barnea is proud to be a part of this  StartUp Open competition.  At the semi-final we identified a number of promising and innovative ventures and I am looking forward to pick out the winning start up at the finals. The wide spectrum of business ideas and industries represented by the final candidates are the talented and creative Israel start-up and hi-tech industry."
August 14, 2014
Is the Israeli High Tech Industry Indeed Impervious to Cannon Thunder?
There is no doubt that the Protective Edge Operation has had a material adverse impact on economic activities in Israel. The rocket attacks on communities in southern and central Israel reduced dramatically the revenues of businesses, hurt the tourism and vacation industries, and forced many companies to cope with absences of employees who were called up for active reserve duty. Business as usual? Nevertheless, it appears that the Israeli high-tech industry proceeded more or less with business as usual, as if high-tech is the “steadfast cliff” of the local economy. Even during last month, when the inferno in Gaza was at its worst and Israel found itself subject to venomous criticism throughout the world, the robust international activities in the Israel technological sector continued. International merger and acquisition transactions of Israeli technology companies did not stop and public offerings of Israeli high-tech companies on NASDAQ continued. One should not misconstrue the continuing global activities by Israeli high-tech companies as a reflection of support of the Israeli government’s policy in Gaza or as recognition of its right to protect itself from the barrage of Hamas rockets. The factor driving this activity is, first and foremost, the robust demand for Israeli technology, a demand that is hardly affected by political considerations. There are two additional factors that contribute to the Israeli high-tech industry’s imperviousness to the impact of the events of the Protective Edge Operation. One factor is the fact that the majority of the commercial activities by Israeli high-tech companies is not in the local market. Though, in many instances, the development is located in Israel, the target markets and the vast majority of the sales are global. Therefore, the drop in the local demands has no material impact on the business activities of Israeli technology companies. The second factor, which is more complex and fragile, is the sense that the fighting in Gaza is not creating a substantive threat to Israel’s security. As long as it is evident that the threat to personal safety in central Israel is marginal, if not negligible, the technology sector can project a sense of “business as usual”. The operation of the Iron Dome systems reinforces this sense of security. Nevertheless, one must take into account that this sense of security could be extremely fragile. The temporary halting of flights to Israel by foreign companies, as a result of a rocket falling in Yehud, provided clear evidence as to how quickly the situation could change. There was a good reason for the intensive political efforts to resume flights. Were it not for the decision to resume air travel with Israel within 24 hours, it is doubtful whether the atmosphere of normalcy could have been sustained. For anyone who needs a reminder of the possible correlation between personal safety and routine activity in the technology sector, one merely needs to recall the period of the Second Intifada. At the beginning of the 2000s, the suicide attacks caused visitors from overseas to stay away from Israel. Even though the technology sector was also suffering from the impact of the technology bubble burst during those same years, one cannot disregard the impact of the security threat on the recession that also hit the Israeli high-tech industry at that time. In light of this, while we can look with pride and some amazement at the continuing business activity in the Israeli technology sector, we must keep in mind that it is never impervious. The continuation of the Protective Edge Operation or an expansion of the military operations into central Israel is liable to have a material adverse impact on the high-tech industry as well. The author, Michael Barnea, is the Managing partner at Barnea Co.
August 19, 2014
Barnea & Co. represented Spirent Communications PLC
Barnea represented Spirent Communications PLC., a leading communications technology company, traded on the London Stock Exchange, and its Israel subsidiary, in the purchase of Radvision’s and Avaya’s Technology Business Unit for approximately USD 25 million. 
August 21, 2014
No significant influence on the Israeli High – Tech by recent events
In the last interviews on the radio given by Micky Barnea, he stated that the Israeli high tech hasn't been influenced significantly by the recent event. Listen to the full interview at Galatz.
September 7, 2014
StartUp Open- Final event
Start up open final event will take place on September 22nd , 2014 in Jerusalem.  This competition provided start-ups, in their early stages, a chance to develop their ideas and present them to entrepreneurs and judges.
September 9, 2014
Ezra Katzen spoke at a seminar on Equity Based Plans
The seminar, organized by ESOP-Excellence and Startau, included in depth lectures on employee options plans. Ezra lectured on practical problems in administering options plans based on his many years of experience as general counsel to technology companies.
September 23, 2014
BreezoMeter won the StartUp Open Israel competition
The Israeli winner of the competition, BreezoMeter, was invented to make air pollution visible. Using real time big data analysis BreezoMeter presents air quality information at street level resolution. (Picture) BreezoMeter ran in the finals in front of six other companies, and will automatically enter the list of the World's Top 50 Most Promising Startups, known as the GEW50. The final competition was held in Jerusalem, in the presence of Jerusalem MayorNir Barkat, investment entities, entrepreneurs, startups, high-tech executives. Michael Barnea, Managing Partner from Barnea Co, said, "I am delighted at the opportunity Barnea has had to take part in this special event. With our experience in working with entrepreneurs in all phases of incorporation, raising capital and launching technology and life science startups, we were able to contribute is considering and selecting the contestants in the competition. Thus we were able to allow the next generation of entrepreneurs theopportunity to present their ideas and receive international exposure". StartUp Open was originally launched as part of the Kauffman Foundation in 2010 and is part of Global Entrepreneurship Week. It is the world's largest competitions for startup companies, boosting participation from over 30 countries.
September 24, 2014
Barnea & Co. represented Global Invacom Group Ltd.
Global Invacom Group Ltd.  of the United Kingdom entered into an agreement to acquire OnePath Networks Ltd. of Bet Shemesh, Israel. Barnea represented Global Invacom in the transaction.
October 14, 2014
Are Facebook, Apple and Google’s Israel based R&D Centers a Blessing in Disguise?
This has not gone unnoticed by foreign multinational companies. A study by the Israeli Central Bureau of Statistics shows that 63% of all investments in RD centers in Israel come from international technology companies operating in Israel. More than 67% of all employees in RD centers in Israel are employed by foreign companies who have established research centers, such as Facebook, Google, Apple, Microsoft, IBM, Intel, HP and more. Such companies employ no less than 34.3 thousand employees in RD, with an annual increase of 2%. The presence of these corporate giants in Israel is growing, as many more companies understand the benefits and success they could have by placing their RD centers in the hotbed of innovation and invention. These outstanding figures are irritating to some, as the growth in the RD centers gives the foreign companies firstbid at breakthrough technologies. Science, Technology, and Space Minister Yaakov Peri went as far as saying that “Israel’s economy relies heavily on funding from other countriesfor research and development…this is a fragile situation…in which the main beneficiaries of Israeli creativity are the multinational companies.” But there’s another way to look at it. These centers are effectively nurturing the best and the brightest, training them and serving as incubators for budding entrepreneurs. Many of these employees leave the multinational companies ready to start their own start-ups, armed with the considerable skillset, knowledge, and experience acquired at these RD centers. Furthermore, having foreign RD centers and multinationals in Israel has proven to be a source for creating jobs, spawning new business and contributing to economic output.
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