Quarterly report pursuant to Section 13 or 15(d)

Stockholders Equity

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Stockholders Equity
 9 Months Ended
Sep. 30, 2021
Stockholders' Equity Note [Abstract]  
STOCKHOLDERS EQUITY

NOTE 5 – STOCKHOLDERS EQUITY

 

  A. Share Capital:

 

At-the-market Sales Agreement:

 

In December 2020, pursuant to a registration statement on Form S-3 declared effective by the Securities and Exchange Commission on December 11, 2020, the Company entered into an Open Market Sales Agreement (“ATM Agreement”) with Jefferies LLC. (“Jefferies”), which provides that, upon the terms and subject to the conditions and limitations in the ATM Agreement, the Company may elect, from time to time, to offer and sell shares of Common Stock with an aggregate offering price of up to $50,000, with Jefferies acting as sales agent. During the nine months ended September 30, 2021, the Company sold 743,964 shares of Common Stock under the ATM Agreement, at an average price of $7.19 per share, raising aggregate net proceeds of approximately $5,188, after deducting an aggregate commission of $160.

 

Securities Purchase Agreement:

 

On July 26, 2021, the Company entered into a Securities Purchase Agreement with institutional investors, all of the Company’s directors and certain executive officers for the sale of an aggregate of 3,750,000 shares of the Company’s Common Stock and warrants to purchase an aggregate of 2,812,501 shares of the Company’s Common Stock in a registered direct offering, for gross proceeds of $15,000 before deducting placement agent fees and offering expenses and assuming that none of the warrants are exercised. The securities were sold at price of $4.00 per share and an accompanying warrant to purchase 0.75 of a share of the Company’s Common Stock at an exercise price of $5.00 per share. The warrants will be exercisable six months after the date of issuance and will expire five years from the date such warrant first becomes exercisable. The warrants issued were classified as equity in accordance with ASC 815-40. The securities were offered pursuant to the Company’s effective registration statement on Form S-3. All proceeds were received as of July 28, 2021. 125,000 shares of Common Stock and 93,750 warrants were sold to related parties.

 

Warrants:

 

As of September 30, 2021, the Company had the following outstanding warrants to purchase Common Stock issued to stockholders:

 

Warrant   Issuance Date   Expiration
Date		   Exercise
Price
Per Share		     Number of
Shares of
Common Stock
Underlying
Warrants		  
Private Placement Warrants   IPO (December 13, 2018)   December 13, 2023     11.50       2,900,000  
Public Warrants   IPO (December 13, 2018)   October 28, 2024     11.50       3,500,000  
 2021 Registered Direct Offering Warrants   SPA (July 28, 2021)   January 28, 2027     5.00       2,812,501  
                      9,212,501  

 

  B. Stock-based Compensation:

  

On March 30, 2021, the Board of Directors approved the grant of 985,530 options to 94 employees, including five senior officers, one consultant, and six directors under the Company’s 2019 Equity Incentive Plan, without consideration. Options were granted at an exercise price of $7.02 per share with a vesting period of four years. Directors and senior officers are entitled to full acceleration of their unvested options upon the occurrence of both a change in control of the Company and the end of their engagement with the Company.

 

The fair value of each option was estimated as of the date of grant or reporting period using the Black-Scholes option-pricing model, using the following assumptions:

 

    Nine Months Ended
September 30,		  
    2021     2020  
Underlying value of Common Stock ($)     7.02       5.59-6.21  
Exercise price ($)     7.02       5.59-6.21  
Expected volatility (%)     85.0       85.0  
Expected terms of the option (years)     6.11       6.25  
Risk-free interest rate (%)     1.17       0.37-0.52  

 

The cost of the benefit embodied in the options granted during the nine months ended September 30, 2021, based on their fair value as at the grant date, is estimated to be approximately $5,138. These amounts will be recognized in statements of operations over the vesting period.

 

  (1) A summary of options granted to purchase the Company’s Common Stock under the Company’s share option plans is as follows:

 

    For the Nine Months Ended
September 30, 2021		  
    Number of
Options		     Weighted
Average
Exercise Price		     Aggregate
Intrinsic
Value		  
Outstanding at the beginning of period     3,569,766       3.12       12,338  
Granted     985,530       7.02          
Forfeited     (116,235 )     4.72          
Exercised     (79,545 )     1.52          
Outstanding at the end of period     4,359,516       3.99       9,380  
Exercisable at the end of period     2,354,505                  
Weighted average remaining contractual life of outstanding options – years as of September 30, 2021     7.43                  

  

Warrants:

 

As of September 30, 2021, the Company had the following outstanding stock-based compensation warrants to purchase Common Stock:

 

Warrant   Issuance Date     Expiration
Date		   Exercise
Price
Per Share  		     Number of
Shares of
Common Stock
Underlying
Warrants  		  
Private Warrants issued to Yeda (see 1 below)    May 11, 2017   May 11, 2025    
  (*
 )    
-
  
Private Warrants issued to scientific founders (see 2 below)    November 27, 2017        
-
       2,974  
                      2,974  

  

(*) less than $0.001.

 

  1.

In May 2017, in accordance with a license agreement, the Company issued to Yeda Research and Development Company Limited (“Yeda”), for nominal consideration, 591,382 warrants to purchase Common Stock at $0.0001 nominal value, for nominal consideration. Yeda had the option to exercise the warrants on a cashless basis. In 2020, the license agreement was terminated.

 

On March 10, 2021, Yeda exercised 362,444 warrants on a cashless basis, resulting in the issuance of 362,383 shares of Common Stock. The remainder of the warrants were cancelled as part of the termination of the license agreement.

 

Expenses and income are included in R&D expenses, net in the condensed consolidated statements of operations. For the nine months ended September 30, 2021 and 2020, the Company did not record any expenses.

 

  2. In November 2017, BiomX Israel issued 7,615 warrants to Yeda and 2,974 warrants to its scientific founders. All the warrants were fully vested at their grant date and will expire immediately prior to a consummation of an M&A transaction. The warrants did not expire as a result of the Recapitalization Transaction and have no exercise price.

 

  (2) The following table sets forth the total stock-based payment expenses resulting from options granted, included in the statements of operations:

 

    Nine Months Ended
September  30,		  
    2021     2020  
Research and development expenses, net     1,539       1,345  
General and administrative     1,113       783  
      2,652       2,128  

 

    Three Months Ended
September  30,		  
    2021     2020  
Research and development expenses, net     581       843  
General and administrative     446       271  
      1,027       1,114