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SHARE CAPITAL
 12 Months Ended
Dec. 31, 2024
Equity [Abstract]  
SHARE CAPITAL

NOTE 10 - SHARE CAPITAL

 

A. Preferred investment options inducement

 

On December 29, 2023, the Company entered into a preferred investment option exercise inducement offer letter with certain holders of existing (i) Series A preferred investment options to purchase 1,022,495 shares of the Company’s common stock at an exercise price of $2.20 per share, issued on October 25, 2022, as amended on May 24, 2023, (ii) Series C preferred investment options to purchase 350,878 shares of the Company’s common stock at an exercise price of $2.075 per share, issued on June 6, 2023, and (iii) Series D preferred investment options to purchase 312,309 shares of the Company’s common stock at an exercise price of $3.19 per share issued on June 26, 2023 (clauses (i) through (iii) collectively, the “Existing Preferred Investment Options”), pursuant to which the holders agreed to exercise for cash their Existing Preferred Investment Options to purchase an aggregate of 1,685,682 shares of the Company’s common stock, at a reduced exercised price of $1.62 per share, in consideration for the Company’s agreement to issue new series E preferred investment options having terms to purchase up to 1,685,682 shares of the Company’s common stock (the “Inducement Investment Options”). Each Inducement Investment Option will have an exercise price equal to $1.50 per share, and will be exercisable from the date of the issuance until five and one-half (5.5) years following the date of the issuance. The Company estimated the fair value of the Inducement Investment Options using a Black-Scholes options pricing model and concluded it is approximately $1,853. At the closing on January 3, 2024, the Company received aggregate gross proceeds of approximately $2,730 from the exercise of the Existing Preferred Investment Options by the Holders and the sale of the Inducement Investment Options, before deducting placement agent fees and other offering expenses of approximately $333. The Company also issued to Wainwright or its designees preferred investment options to purchase up to 84,284 shares of common stock which have the same terms as the Inducement Investment Options except for an exercise price equal to $2.025 per share. The Company estimated the fair value of the preferred investment options using a Black-Scholes options pricing model and concluded it is approximately $89.

 

B. Registered direct and private placement offerings:

 

On May 22, 2023, the Company entered into a securities purchase agreement with an institutional investor, pursuant to which it agreed to issue and sell in a registered direct offering an aggregate of 655,569 shares of common stock, at an offering price of $2.20 per share, for aggregate gross proceeds of $1,442 before deducting the placement agent fee and related offering expenses of approximately $222 (the “First May Offering”). The Company also issued to Wainwright or its designees preferred investment options to purchase 32,778 shares of common stock, which have a term of three and one-half years from the commencement of sales in the First May Offering, and have an exercise price of $2.75 per share. The First May Offering was consummated on May 23, 2023. The Company estimated the fair value of the warrants using a Black-Scholes options pricing model and concluded it is approximately $46.

 

On May 23, 2023, the Company entered into a securities purchase agreement with an institutional investor, pursuant to which it agreed to issue and sell in a registered direct offering (i) an aggregate of 975,000 shares of common stock, at an offering price of $2.20 per share and (ii) pre-funded warrants exercisable for up to 234,500 shares of the Company’s common stock, at an offering price of $2.1999 per pre-funded warrant, for aggregate gross proceeds of $2,661 before deducting the placement agent fee and related offering expenses of approximately $345 (the “Second May Offering”). The pre-funded warrants are exercisable immediately and may be exercised at any time until the pre-funded warrants are exercised in full. The Second May Offering was consummated on May 24, 2023. All of such pre-funded warrants were subsequently immediately exercised in accordance with their terms at an exercise price per share of $0.0001 into an equivalent number of shares of common stock.

 

The Company also issued to Wainwright or its designees preferred investment options to purchase 60,476 shares of common stock, which have a term of three and one-half years from the closing of the Second May Offering, and have an exercise price of $2.75 per share. The Company estimated the fair value of the warrants using a Black-Scholes options pricing model and concluded it is approximately $72.

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)

 

NOTE 10 - SHARE CAPITAL

 

Registered direct and private placement offerings:

 

On June 2, 2023, the Company entered into a securities purchase agreement with institutional investors, pursuant to which it agreed to issue and sell in a registered direct offering an aggregate of 701,756 shares of common stock, at an offering price of $2.1375 per share, for aggregate gross proceeds, with the concurrent private placement described below, of $1,500 before deducting the placement agent fee and related offering expenses of approximately $227 (the “First June Offering”). The Company also issued to Wainwright or its designees preferred investment options to purchase 35,088 shares of its common stock, which have a term of five years from the commencement of sales in the First June Offering, and have an exercise price of $2.6719 per share. The Company estimated the fair value of the warrants using a Black-Scholes options pricing model and concluded it is approximately $58. The registered direct offering was consummated on June 6, 2023. In a concurrent private placement, the Company also issued to the purchasers of shares of common stock in the First June Offering, series C preferred investment options to purchase up to 350,878 shares of common stock. Each series C preferred investment option is exercisable for one share of common stock at an exercise price of $2.075 commencing on the date of issuance and expiring five and one-half years from the issuance date.

 

On June 26, 2023, the Company entered into a securities purchase agreement with institutional investors, pursuant to which it agreed to issue and sell in a registered direct offering an aggregate of 624,618 shares of its common stock, at an offering price of $3.25 per share, for aggregate gross proceeds, with the concurrent private placement described below, of $2,030 before deducting the placement agent fee and related offering expenses of approximately $281 (the “Second June Offering”). The Company also issued to Wainwright or its designees preferred investment options to purchase 31,231 shares of its common stock, which have a term of five years from the commencement of sales in the Second June Offering, and have an exercise price of $4.0625 per share. The Company estimated the fair value of the warrants using a Black-Scholes options pricing model and concluded it is approximately $68. The registered direct offering was consummated on June 28, 2023. In a concurrent private placement, the Company also issued to the purchasers of shares of common stock in the Second June Offering, series D preferred investment options to purchase up to 312,309 shares of the Company’s common stock. Each series D preferred investment option is exercisable for one share of common stock at an exercise price of $3.19 commencing on the date of issuance and expiring five and one-half years from the issuance date.

 

On June 3, 2024, the Company entered into Securities Purchase Agreements with institutional investors, pursuant to which the Company agreed to issue and sell, in a registered direct offering priced at-the-market under the rules of The Nasdaq Stock Market, an aggregate of 1,566,669 shares of the Company’s common stock, par value $0.01 per share, at an offering price of $1.50 per share, for aggregate gross proceeds from the Offerings of approximately $2,350 before deducting the placement agent fee and related offering expenses of approximately $328. In a concurrent private placement, the Company agreed to issue to the investors series F preferred investment options to purchase up to 3,133,338 shares of common stock at an exercise price of $1.50 per share. Each Series F preferred investment option is exercisable immediately and will expire two years from the initial exercise date. The Company estimated the fair value of the preferred investment options using a Black-Scholes options pricing model and concluded it is approximately $1,893.

 

The Company also issued to Wainwright or its designees preferred investment options to purchase up to 78,333 shares of common stock which have the same terms as investors’ preferred investment options except for an exercise price equal to $1.875 per share. The Company estimated the fair value of the preferred investment options using a Black-Scholes options pricing model and concluded it is approximately $43.

 

C. Equity Classification:

 

The common stock of the Company are recognized as equity under the requirements of ASC Topic 505 Equity.

 

The Company analyzed the accounting treatment for the series A, C, D, E and F preferred investment option, and all of the pre-funded warrants issued to investors. Based on the Company’s analysis all such warrants were classified as equity.

 

The Company analyzed the accounting treatment for all of the preferred investment options issued to Wainwright in the aforementioned offerings. Since the Company did not identify any features causing liability classification according to ASC 718, it concluded that all such preferred investment options are equity-classified awards.

 

D. At-the-market offerings:

 

On July 1, 2024, the Company filed with the SEC a prospectus supplement relating to the offer, issuance and sale of up to $4,820 of the Company’s shares of common stock pursuant to the ATM Agreement. During the year 2024, the Company issued 3,433,880 shares of the Company’s common stock pursuant to the ATM Agreement, for total gross proceeds of approximately $3,756 before deducting sales agent commissions and other offering expenses of $239.

 

E. Preferred investment options amendment:

 

In the Second May Offering, the Company amended the terms of (i) the Series A preferred investment options to purchase 1,022,495 shares of its common stock for an exercise price of $4.64 per share which are scheduled to expire on October 25, 2027 and (ii) the Series B preferred investment options to purchase 1,022,495 shares of its common stock for an exercise price of $4.64 per share which were initially scheduled to expire on October 25, 2024 (the “Series B Preferred Investment Options”), in each case previously issued to the investor in October 2022 under the securities purchase agreement dated October 21, 2022 (collectively, the “Existing Preferred Investment Options”), which investor also participated in the Second May Offering, such that effective upon the closing of the Second May Offering, the Existing Preferred Investment Options have a reduced exercise price of $2.20 per share and the Series B Preferred Investment Options expire on October 25, 2027. These modifications to the Existing Preferred Investment Options represent issuance costs associated with the Second May Offering. The Company estimated the amount of the effect of the modifications using a Black-Scholes option pricing model and concluded that is approximately $1,230. On June 16, 2023, the holder of the Series B Preferred Investment Options exercised all of such Series B Preferred Investment Options pursuant to its cashless exercise provision into 385,246 shares of common stock.

 

The grant date fair values of preferred investment options issued to Wainwright and preferred investment options issued to investors including those that were modified in the years ended December 31, 2024 and 2023 were estimated using the Black-Scholes valuation model with the following:

 

    

For the Years Ended

December 31,

 
    2024    2023 
Expected volatility   103.6%-111.4%   101.3%-122.4%
Risk-free interest   3.9%- 4.8%   3.9%- 4.9%
Dividend yield   -    - 
Expected terms (years)   2.0-5.5    1.4-5.0 

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)

 

NOTE 10 - SHARE CAPITAL

 

F. Employee stock option grants:

 

During the year ended December 31, 2023, the Company granted to the CEO, options to purchase an aggregate of 80,000 shares of the Company’s common stock, at an exercise price per share of $2.43. The stock options vest over a period of three years as outlined in the option agreements evidencing such grants.

 

During the year ended December 31, 2023, the Company granted stock option awards to certain officers, directors and employees to purchase an aggregate of 631,308 shares of the Company’s common stock, at an exercise price per share ranging from $1.16-$3.48 with a vesting period of three years.

 

During the year ended December 31, 2024:

 

  ○The Company granted the CEO, its executives and management, fully vested options to purchase an aggregate of 80,000 and 50,000 shares of the Company’s common stock, respectively, at an exercise price per share of $1.2684.
    
  ○The Company granted the CEO and certain executives, options to purchase an aggregate of 80,000 and 52,500 shares of the Company’s common stock, respectively, at an exercise price per share of $1.25. The vesting of these options is subject to the achievement of specified performance conditions. For the year ended December 31, 2024, the Company recorded an expense of $38, reflecting management’s assessment that the specified performance milestones for 35,625 of the 132,500 options were achieved by their due date. Refer to Note 17C.
    
  ○The Company granted the CEO, its executives, and certain employees, options to purchase an aggregate of 80,000 and 115,000 shares of the Company’s common stock, respectively, at an exercise price per share of $1.2684, with a vesting period of three years.
    
  ○The Company granted an advisor options to purchase an aggregate of 25,000 shares of the Company’s common stock, at an exercise price per share of $0.881, with a vesting period of three years.

 

With respect to the CEO’s 2023 annual bonus, during February 2024, the Company paid 25% of the CEO’s total 2023 bonus – amounting to approximately $99, through the grant of fully vested options to purchase an aggregate of 79,567 shares of the Company’s common stock with an exercise price per share of $1.25.

 

A summary of the Company’s option activity related to options to employees and directors, and related information is as follows:

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)

 

NOTE 10 - SHARE CAPITAL

 

Employee stock option grants:

 

  

For the Year Ended

December 31, 2024

 
   Number of stock options   Weighted average exercise price 
         
Outstanding as of December 31, 2023   2,095,362   $5.51 
Granted   562,067    1.24 
Forfeitures   (160,063)   3.23 
Outstanding as of December 31, 2024   2,497,366   $4.70 
           
Vested as of December 31, 2024   1,866,523   $5.63 

 

  

For the Year Ended

December 31, 2023

 
   Number of stock options   Weighted average exercise price 
         
Outstanding as of December 31, 2022   1,507,137   $7.31 
Granted   711,308    1.75 
Forfeitures   (123,083)   5.78 
Outstanding as of December 31, 2023   2,095,362   $5.51 
           
Vested as of December 31, 2023   1,176,118   $7.74 

 

The Company recognizes forfeitures of outstanding options as they occur.

 

The intrinsic value is calculated as the difference between the fair market value of the common stock and the exercise price, multiplied by the number of in-the-money stock options on those dates that would have been received by the stock option holders had all stock option holders exercised their stock options on those dates as of December 31, 2024 and 2023, respectively.

 

As of December 31, 2024, and 2023, the aggregate intrinsic value of the outstanding options is $75 and $277, respectively, and the aggregate intrinsic value of the exercisable options is $69 and $102, respectively.

 

The weighted average grant date fair value of options granted during the years ended December 31, 2024 and 2023 was $0.99 and $1.40, respectively.

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)

 

NOTE 10 - SHARE CAPITAL

 

Employee stock option grants:

 

As of December 31, 2024, there were approximately $921 of total unrecognized compensation costs related to unvested share-based compensation awards granted under the Share Incentive Plan. The costs are expected to be recognized over a weighted average period of 1.48 years.

 

The stock options outstanding as of December 31, 2024 and 2023, summarized by exercise prices, are as follows:

 

Exercise price $  Stock options outstanding as of
December 31, 2024		   Stock options outstanding as of
December 31, 2023		   Weighted average remaining contractual life – years as of
December 31, 2024		   Weighted average remaining contractual life – years as of
December 31, 2023		   Stock options exercisable as of
December 31, 2024		   Stock options exercisable as of
December 31, 2023		 
0.00-0.99   86,577    61,577    3.8    2.3    61,577    61,577 
1.00-3.73   1,299,562    860,808    8.7    9.6    731,559    95,925 
4.2-7.26   577,482    639,232    5.9    6.3    539,642    484,871 
8.16-9.64   380,872    380,872    5.6    6.6    380,872    380,872 
15.3-15.75   152,873    152,873    2.7    3.7    152,873    152,873 
    2,497,366    2,095,362              1,866,523    1,176,118 

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)

 

NOTE 10 - SHARE CAPITAL

 

Employee stock option grants:

 

The grant date fair values of employee stock options granted in the years ended December 31, 2024 and 2023 were estimated using the Black-Scholes valuation model with the following:

 

  

For the Years Ended

December 31,

 
   2024   2023 
Expected volatility   90.4%-100.7%    86.5%-98.2% 
Risk-free interest   3.5%- 4.3%    3.3%- 4.7% 
Dividend yield   -%    -% 
Expected terms (years)   5-10    5.8 

 

E. Warrants:

 

The remaining outstanding warrants and terms as of December 31, 2024 and 2023 are as follows:

 

Issuance date  Outstanding and exercisable as of December 31, 2024   Outstanding and exercisable as of December 31, 2023   Exercise Price  

Exercisable

Through

Series A October 2022   -    1,022,495   $2.20   (*)
Warrant to underwriters October 2022   51,125    51,125   $6.11   October 21, 2027
Warrant to underwriters May 2023   32,778    32,778   $2.75   November 23, 2026
Warrant to underwriters May 2023   60,476    60,476   $2.75   November 24, 2026
Warrant to underwriters June 2023   35,088    35,088   $2.67   June 2, 2028
Warrant series C June 2023   -    350,878   $2.08   (*)
Warrant to underwriters June 2023   31,231    31,231   $4.06   June 28, 2028
Warrant series D June 2023   -    312,309   $3.19   (*)
Warrant series E January 2024   

1,685,682

  

-

   $1.50   July 3, 2029
Warrant to underwriters January 2024   

84,284

    

-

   $2.03   July 3, 2029
Warrant series F June 2024   

3,133,338

    

-

   $1.50   June 3, 2026
Warrant to underwriters June 2024   

78,333

    

-

   $1.88   June 3, 2026

 

(*)   Exercised during 2024. Refer to Note 10A.

 

 

MICROBOT MEDICAL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands

(Except share and per share data)