NOTE 8: - STOCKHOLDERS' EQUITY

The Company's authorized common stock consists of 200,000,000 shares with a par value of $0.00001 per share. All shares have equal voting rights and are entitled to one vote per share in all matters to be voted upon by stockholders. The shares have no pre-emptive, subscription, conversion or redemption rights and may be issued only as fully paid and non-assessable shares. Holders of the common stock are entitled to equal ratable rights to dividends and distributions with respect to the common stock, as may be declared by the Board of Directors out of funds legally available.

The Company's authorized preferred stock consists of 10,000,000 shares of preferred stock, par value $0.00001 per share, with series, rights, preferences, privileges and restrictions as may be designated from time to time by the Company's Board of Directors. No shares of preferred stock have been issued.

From July 2011 through June 2012, a total of 406,783 warrants were exercised via "cashless" exercise, resulting in the issuance of 168,424 shares of common stock to investors of the Company. In addition 355,411 warrants were exercised for cash and resulted in the issuance of 355,411 shares of common stock to investors of the Company. The aggregate cash consideration received was $556.

From July 2012 through June 2013, a total of 682,213 warrants were exercised via "cashless" exercise, resulting in the issuance of 420,199 shares of common stock to investors of the Company. In addition 1,201,160 warrants were exercised for cash and resulted in the issuance of 1,201,160 shares of common stock to investors of the Company. The aggregate cash consideration received was $2,009. In August, 2012, a total of 36,000 warrants were exercised via a "cashless" exercise, resulting in the issuance of 26,299 shares of common stock to consultants of the Company.

From July 2013 through June 2014, a total of 2,517,907 warrants were exercised via "cashless" exercise, resulting in the issuance of 1,469,584 shares of common stock to investors of the Company. In addition, 1,432,584 warrants were exercised for cash and resulted in the issuance of 1,432,584 shares of common stock to investors of the Company. The aggregate cash consideration received was $1,968. From July 2013 through June 2014, a total of 65,000 warrants were exercised via a "cashless" exercise, resulting in the issuance of 36,970 shares of common stock to a consultant of the Company.

d.	As part of the agreement for building the new Company's facility with Biopharmax Group Ltd. ("Biopharmax"), the Company issued 1,500,000 shares of common stock to Biopharmax during fiscal year 2012.

In December 2013, as part of the CHA Agreement, Pluristem and CHA executed the mutual investment pursuant to which Pluristem issued 2,500,000 shares of its common stock in consideration for 1,011,504 shares of CHA, which reflects total consideration to each of Pluristem and CHA of approximately $10,414 (see Note 1d).

On September 19, 2012, the Company closed a firm commitment underwritten public offering of 8,000,000 units, at a purchase price of $4.00 per unit, with each unit consisting of one share of the Company's common stock and one warrant to purchase 0.35 shares of common stock, at a purchase price of $5.00 per share. The warrants sold in the offering became exercisable on March 19, 2013 and expire on September 19, 2017. The Company has also granted the underwriters a 30-day option to purchase up to 1,200,000 shares of common stock and/or warrants to purchase up to 420,000 shares of common stock. As of September 24, 2012 the underwriters fully exercised their option. The aggregate net proceeds to the Company from the offering, including from the exercise in full of the option, were $34,106, before the exercise of any warrants and after deducting underwriting commissions and discounts and offering expenses of the Company. The warrants can be exercised only for full shares of common stock. As to any fraction of a share which the warrant holder would otherwise be entitled to purchase upon such exercise, the Company shall pay a cash adjustment in respect of such fraction in an amount equal to such fraction multiplied by the fair market value less the exercise price.

Following a shelf registration on Form S-3 filed and declared effective in October 2011, the Company entered in December 2012 into an At Market Issuance Sales Agreement ("ATM Agreement") with an underwriter, which provides that, upon the terms and subject to the conditions and limitations set forth in the ATM Agreement, the Company may elect, from time to time, to issue and sell shares of common stock having an aggregate offering price of up to $95,000 through the underwriter as a sales agent. The Company is not obligated to make any sales of common stock under the ATM Agreement.

During the year ended June 30, 2014, the Company issued 2,596,032 shares of common stock for aggregate consideration of approximately $ 10,644, net of issuance costs of $195, under the ATM Agreement.

On September 11, 2014, the Company notified the underwriter of the termination of the ATM Agreement.

Options, warrants and restricted stock units to employees, directors and consultants:

The Company has approved incentive option plan from 2005 (the "Plan"). Under the Plan, options, restricted stock and restricted stock units (the "Awards") may be granted to the Company's officers, directors, employees and consultants. Any Awards that are cancelled or forfeited before expiration become available for future grants.

As of June 30, 2014, the number of shares of common stock authorized for issuance under the Plan amounted to 13,256,713. As of June 30, 2014, 1,205,080 shares are available for future grant under the Plan.

Options, warrants and restricted stock units to employees, directors and consultants:

a.	Options to employees and directors:

The Company accounted for its options to employees and directors under the fair value method in accordance with ASC 718. A summary of the Company's share option activity for options granted to employees and directors under the Plans is as follows:

	Year ended June 30, 2014
	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Terms (in years)		Aggregate Intrinsic Value Price
Options outstanding at beginning of period		1,958,156		$	4.03
Options exercised		(15,000	)	$	0.83
Options forfeited		(81,057	)	$	11.59
Options outstanding at end of the period		1,862,099		$	3.73		3.13	$	1,046
Options exercisable at the end of the period		1,862,099		$	3.73		3.13	$	1,046
Options vested		1,862,099		$	3.73		3.13	$	1,046

Intrinsic value of exercisable options (the difference between the Company's closing stock price on the last trading day in the period and the exercise price, multiplied by the number of in-the-money options) represents the amount that would have been received by the employees and directors option holders had all option holders exercised their options on June 30, 2014. This amount changes based on the fair market value of the Company's common stock.

b.	Options and warrants to non-employees:

A summary of the Company's activity related to options and warrants to consultants is as follows:

	Year ended June 30, 2014
	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Terms (in years)		Aggregate Intrinsic Value Price
Options and warrants outstanding at beginning of period		315,500		$	4.44
Options granted		3,000		$	0.00
Options and warrants exercised		(66,500	)	$	1.39
Options and warrants outstanding at end of the period		252,000		$	5.19		3.96	$	331
Options and warrants exercisable at the end of the period		251,000		$	5.21		3.93	$	328
Options and warrants vested and expected to vest		252,000		$	5.19		3.96	$	331

Options, warrants and restricted stock units to employees, directors and consultants:

Compensation expenses related to options and warrants granted to consultants were recorded as follows:

	Year ended June 30,
	2014		2013		2012

Research and development expenses	$	11	$	26	$	19
General and administrative expenses				-		37
	$	11	$	26	$	56

Future expenses related to options and warrants granted to consultants for an average time of approximately 3 months are $1.

c.	Restricted stock units to employees and directors:

The following table summarizes the activities for unvested restricted stock units granted to employees and directors for the year ended June 30, 2014:

	Number

Unvested at the beginning of period		1,660,525
Granted		1,256,940
Forfeited		(44,183	)
Vested		(1,283,850	)
Unvested at the end of the period		1,589,432
Expected to vest after June 30, 2014		1,522,024

Compensation expenses related to restricted stock units granted to employees and directors were recorded as follows:

	Year ended June 30,
	2014		2013		2012
Research and development expenses	$	1,172	$	711	$	1,163
General and administrative expenses		4,390		1,529		3,487
	$	5,562	$	2,240	$	4,650

Future expenses related to restricted stock units granted to employees and directors for an average time of approximately two years is $2,447.

d.	Restricted stock units to consultants:

The following table summarizes the activities for unvested restricted stock units and restricted stock granted to consultants for the year ended June 30, 2014:

	Number
Unvested at the beginning of period		-
Granted		84,565
Vested		(69,315	)
Unvested at the end of the period		15,250

Compensation expenses related to restricted stock units granted to consultants were recorded as follows:

	Year ended June 30,
	2014		2013		2012
Research and development expenses	$	201	$	255	$	201
General and administrative expenses		77		278		20
	$	278	$	533	$	221

Summary of warrants and options:

The following table sets forth a summary of all the warrants and options outstanding as of June 30, 2014:

Warrants / Options	Exercise Price per Share		Options and Warrants for Common Stock		Options and Warrants Exercisable		Weighted Average Remaining Contractual Terms(in years)
Warrants:	$	1.40		474,322		474,322		0.82
	$	1.50		878,174		878,174		0.06
	$	1.60		131,221		131,221		0.78
	$	1.80		727,401		727,401		0.30
	$	1.90		43,103		43,103		0.08
	$	4.20		5,060,000		5,060,000		2.09
	$	5.00		3,219,983		3,219,983		3.22
Total warrants				10,534,204		10,534,204

Options:	$	0.00		101,000		100,000		5.19
	$	0.62		398,500		398,500		4.25
	$	1.04		30,000		30,000		4.16
	$	2.97		20,000		20,000		3.86
	$	3.50		900,000		900,000		2.58
	$	3.72		15,000		15,000		2.49
	$	3.80		16,050		16,050		2.53
	$	4.00		42,500		42,500		2.30
	$	4.38 - $ 4.40		417,299		417,299		3.28
	$	6.80		36,250		36,250		3.37
	$	8.20		30,000		30,000		2.40
	$	20.00		107,500		107,500		2.88
Total options				2,114,099		2,113,099
Total warrants and options				12,648,303		12,647,303

This summary does not include 1,604,682 restricted stock units that are not vested as of June 30, 2014.