(***) Share data has been adjusted based on the equivalent number of shares received by the accounting acquirer as a result of the reverse recapitalization
|
A.
|
New York Global Innovations Inc. (the "Predecessor Company") was originally incorporated under the laws of the State of Nevada, on April 22, 1997. On July 8, 2003, the Predecessor Company effected a reincorporation from Nevada to Delaware through a merger with and into its wholly-owned subsidiary, Inksure Technologies (Delaware) Inc., which was incorporated on September 30, 2003. The surviving corporation in the merger was Inksure Technologies (Delaware) Inc., which thereupon renamed itself Inksure Technologies Inc. In 2014, following the sale of its assets to Spectra Systems Corporation, the Predecessor Company changed its name to New York Global Innovations Inc.
On August 23, 2016, the Predecessor Company consummated an agreement and plan of merger (the “Merger Agreement”) with Artemis Pharma Inc. (formerly, Artemis Therapeutics Inc.), a Delaware corporation (“Artemis”). Pursuant to the terms of the Merger Agreement, in exchange for the outstanding shares of Artemis, the Company issued to Artemis shareholders a total of 460,000 shares (as adjusted to reflect the reverse stock split) of the Predecessor Company's common stock and series B convertible preferred stock convertible into 3,426,384 shares (as adjusted to reflect the reverse stock split) (the “Merger”). All series B preferred shares were converted to common shares prior to December 31, 2016. Immediately following the consummation of the Merger Agreement, Artemis stockholders owned approximately 82% of the Company’s common stock, on a fully diluted basis. Following the issuance and sale of the Company’s Series A Preferred Stock and common stock to an investor, ownership was reduced, after which Artemis stockholders owned approximately 70% of the Company’s common stock, on a fully diluted basis. (refer to note
7
).
|
As a result of the Merger, Artemis became a wholly owned subsidiary of the Company. Artemis’ fiscal year end is December 31.
NOTE 1 - GENERAL (cont.)
The Merger between the Predecessor Company and Artemis was accounted for as a reverse recapitalization and, as a result of the Merger, the Predecessor Company ceased to be a shell company. As the shareholders of Artemis received the largest ownership interest in the Predecessor Company, Artemis was determined to be the "accounting acquirer" in the reverse acquisition. As a result, the historical financial statements of the Predecessor Company were replaced with the historical financial statements of Artemis. Following the Merger, the Predecessor Company and its subsidiary, Artemis, are collectively referred to as the "Company".
|
B.
|
Establishment of Artemis (the "accounting acquirer"):
|
Artemis was incorporated in the State of Delaware on April 19, 2016. The Company is engaged in the development of agents for the prevention and treatment of severe and potentially life-threatening infectious diseases. The company's lead product candidate, Artemisone, is a clinical-stage synthetic artemisinin derivative with antiviral and antiparasitic properties. Artemis expects to advance Artemisone initially as an antiparasitic agent for the treatment of malaria and an
antiviral
agent to address unmet clinical needs in the growing population of immunocompromised patients infected with human cytomegalovirus (HCMV), and other related clinical indications.
On May 31, 2016, Artemis entered into a license agreement with Hadasit Medical Research Services & Development Ltd. (“Hadasit”), and Hong Kong University of Science and Technology R and D Corporation Limited (“RDC”), pursuant to which Artemis acquired a worldwide,
royalty
-bearing license to make any and all use of certain patents and know-how owned by the Hadasit and RDC relating to Artemisone. Artemis will rely primarily on the license agreement with respect to the development of Artemisone, its lead product candidate.
Artemis has not generated any revenues from its activities and has incurred substantial operating
losses
. Management expects the Company to continue to generate substantial operating losses and to continue to fund its operations primarily through additional raises of capital. Such conditions raise substantial doubts about the Company's ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of assets, carrying amounts or the amount and classification of liabilities that may be required should the Company be unable to continue as a going concern.
NOTE 2
|
- SIGNIFICANT ACCOUNTING POLICIES
|
The financial statements have been prepared in conformity with accounting principles generally accepted in United Sates of America ("US GAAP").
|
B.
|
Use of estimates in the preparation of financial statements:
|
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The Company’s management believes that the estimates, judgment and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect reported amounts and disclosures made. Actual results could differ from those estimates.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 2
|
- SIGNIFICANT ACCOUNTING POLICIES (Cont.)
|
|
C.
|
Cash and cash equivalents
|
Cash equivalents are short-term highly liquid investments that are readily convertible to cash with maturities of three months or less as of the date acquired.
|
D.
|
Fair value of financial instruments:
|
The carrying values of cash and cash equivalents, other receivable and other accounts payable approximate their fair value due to the short-term maturity of these instruments.
The Company measures the fair value of certain of its financial instruments (such as the derivative warrant liabilities) on a recurring basis. The method of determining the fair value of derivative warrant liabilities is discussed in Note 7B.
A fair value hierarchy is used to rank the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:
Level 1
- Quoted prices (unadjusted) in active markets for identical assets and liabilities.
Level 2
- Inputs other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets and liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3
- Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
E.
|
Financial statement in U.S. dollars:
|
The functional currency of the Company is the U.S dollar ("dollar") since the dollar is the currency of the primary economic environment in which the Company has operated and expects to continue to operate in the foreseeable future.
Transactions and balances denominated in dollars are presented at their original amounts. Transactions and balances denominated in foreign currencies have been re-measured to dollars in accordance with the provisions of ASC 830-10, "Foreign Currency Translation".
All transaction gains and losses from re-measurement of monetary balance sheet items denominated in non-dollar currencies are reflected in the statement of operations as financial income or expenses, as appropriate.
|
F.
|
Basic and diluted net loss per share:
|
Basic loss per share is computed by dividing the net loss applicable to holders of Ordinary Shares by the weighted average number of shares of Ordinary Shares outstanding during the year. Diluted loss per share is computed by dividing the net loss applicable to holders of Ordinary Shares by the weighted average number of Ordinary Shares outstanding plus the number of additional Ordinary Shares that would have been outstanding if all potentially dilutive Ordinary Shares had been issued, using the treasury stock method, in accordance with ASC 260-10 "Earnings per Share". Potentially dilutive Ordinary Shares were excluded from the diluted loss per share calculation because they were anti-dilutive.
The weighted average number of shares outstanding has been retroactively restated for the equivalent number of shares received by the accounting acquirer as a result of the reverse merger as if these shares had been outstanding as of the beginning of the earliest period presented
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)
|
G.
|
Research and development expenses, net:
|
Research and development expenses are charged to the statement of operations as incurred.
The Company accounts for income taxes in accordance with ASC 740, “Income Taxes”. This topic prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities. As such, deferred taxes are computed based on the tax rates anticipated (under applicable law as of the balance sheet date) to be in effect when the deferred taxes are expected to be paid or realized.
|
I.
|
Share-based compensation:
|
The Company applies ASC 718-10, "Share-Based Payment,” which requires the measurement and recognition of compensation expenses for all share-based payment awards made to service providers, employees and directors including stock options under the Company's stock plans based on estimated fair values.
ASC 718-10 requires companies to estimate the fair value of stock options using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's statement of operations.
The Company estimates the fair value of stock options granted as share-based payment awards using a Black-Scholes options pricing model. The option-pricing model requires a number of assumptions, of which the most significant are share price, expected volatility and the expected option term (the time from the grant date until the options are exercised or expire). Expected volatility is estimated based on volatility of similar companies in the technology sector for equity awards granted prior to the Merger and on the Company's trading share price for equity awards granted subsequent to the Merger. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term. The expected stock option term is calculated for stock options granted to employees and directors using the "simplified" method. Grants to non-employees are based on the contractual term. Changes in the determination of each of the inputs can affect the fair value of the stock options granted and the results of operations of the Company.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (Cont.)
|
J.
|
Recent Accounting Standards:
|
In May 2014, the Financial Accounting Standards Board (the “FASB”) issued a new standard to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under GAAP. Under the new model, recognition of revenue occurs when a customer obtains control of the promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The new standard is effective for us beginning in the first quarter of 2018; early adoption is prohibited. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. As the Company has not incurred revenues to date, the new standard has no impact on the financial statements at transition date.
In February 2016, the FASB issued a new lease accounting standard requiring the recognition of lease assets and liabilities on the balance sheet. This standard is effective beginning in the first quarter of 2019; early adoption is permitted.
To date, the company is not engaged in lease agreements and accordingly
does
not
expect
the standard
to have a material impact
on its financial statements.
In May 2017, the FASB issued “ASU No. 2017-09, “Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting,” which clarifies when a change to terms or conditions of a share-based payment award must be accounted for as a modification. The new guidance requires modification accounting if the vesting condition, fair value or the award classification is not the same both before and after a change to the terms and conditions of the award. The new guidance is effective on a prospective basis beginning on January 1, 2018 and early adoption is permitted. The adoption of this standard has no material impact on company's financial statements.
In July 2017, the FASB issued ASU 2017-11, which includes Part I “Accounting for Certain Financial Instruments with Down Round Features” and Part II “Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Non-controlling Interests With a Scope Exception”. The ASU makes limited changes to the Board’s guidance on classifying certain financial instruments as either liabilities or equity. The ASU’s objective is to improve (1) the accounting for instruments with “down-round” provisions and (2) the readability of the guidance in ASC 480 on distinguishing liabilities from equity by replacing the indefinite deferral of certain pending content with scope exceptions. This standard is effective beginning in the first quarter of 2019. The Company has derivative warranty liabilities as discussed in Note 7B which upon adoption of the new standard
may
be classified as equity.
The Company has derivative warranty liabilities as discussed in Note 7B which upon adoption of the new standard are expected to be classified as equity.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 3 - COMMITMENTS AND CONTINGENCIES
Agreement with Hadasit and RDC
On May 31, 2016, Artemis entered into the License Agreement with Hadasit and RDC, pursuant to which Artemis acquired a worldwide, royalty-bearing license based on net sales to make any and all use of certain patents and know-how owned by
Hadasit
and RDC relating to Artemisone. Artemis will rely primarily on the License Agreement with respect to the development of Artemisone, its lead product candidate.
In addition, Artemis agreed to certain development milestones, including the completion of Chemistry, Manufacturing and Controls (CMC) development and manufacturing for Phase I by the fourth quarter of 2017, completion of a Phase I study by the fourth quarter of 2019, completion of Phase IIa by the fourth quarter of 2022, and the first regulatory submission by the fourth quarter of 2027. Additionally, Artemis agreed to certain investment milestones, including the requirement to obtain financing of not less than $700,000 within seven months of the closing of the Merger on August 23, 2016 (such time, the “Effective Time”), $1 million within 12 months of the Effective Time and $2 million within 24 months of the Effective Time. In the event that Artemis fails to meet development or investment milestones as set forth in the License Agreement, Hadasit has the right to terminate the License Agreement. We have regular communication with representatives from Hadasit and, to date, we have received no notices from Hadasit or RDC about our development progress or the investment milestones and no indication that Hadasit or RDC intend to terminate the License Agreement for non-compliance. To date, we have not met the development and financing milestones set forth in the License Agreement. We have had discussions with Hadasit relating to amending the development and financial milestones set forth in the License Agreement but there are no guarantees that we will be successful in amending the agreement.
NOTE 4 - INCOME TAX
|
A.
|
Tax rates applicable to the income
|
US corporate tax
The maximum statutory federal tax rate in the US in 2017 and 2016 is 35%.The Company is not subject to current federal taxes, as it has incurred losses in 2016 and 2017.
On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was signed into law in the United States. The Tax Act, among other provisions, introduces changes in the U.S corporate tax rate, business related deductions and credits, and has international tax consequences for companies that operate globally. Most of the changes introduced in the Tax Act are effective beginning on January 1, 2018. As a result of the tax act the maximum statutory federal tax rate was reduced to 21% starting on January 1, 2018. The other effects of the Tax Act provisions are still being identified and evaluated by the Company.
Israel corporate tax
The Company's subsidiary in Israel is subject to income tax at a regular corporate tax of 24% in 2017 and 25% in 2016.
In December 2016, a legislation to amend the corporate income tax law was published. The legislation determined a decrease of the corporate income tax law as of January 1, 2017 to 24% (1% decrease) and as of January 1, 2018 to 23% (additional 1% decrease).
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 4 - INCOME TAX (Cont.)
As the entity is still in its development stage and has not yet generated revenues, it is more likely than not that sufficient taxable income will not be available for the tax losses to beutilized in the future. Therefore, a valuation allowance
was recorded
to reduce the deferred tax assets to its recoverable amounts.
|
|
As of December 31, 2017
|
|
|
As of December 31, 2016
|
|
|
|
|
|
|
|
|
Deferred tax assets:
|
|
|
|
|
|
|
Deferred taxes due to carryforward losses
|
|
|
2,
763
|
|
|
|
3,583
|
|
|
|
|
|
|
|
|
|
|
Valuation allowance
|
|
|
|
)
|
|
|
(3,583
|
)
|
|
|
|
|
|
|
|
|
|
Net deferred tax asset
|
|
|
-
|
|
|
|
-
|
|
|
C.
|
Tax loss carry-forwards
|
Net operating loss carry-forwards as of December 31, 2017 and 2016 are as follows:
|
|
As of December 31, 2017
|
|
|
As of December 31, 2016
|
|
Israel
|
|
|
4,684
|
|
|
|
4,518
|
|
United States (*)
|
|
|
7,988
|
|
|
|
7,011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,672
|
|
|
|
11,529
|
|
Net operating losses in Israel may be carried forward indefinitely. Net operating losses in the U.S. are available through 2027.
(*) Utilization of U.S. net operating losses may be subject to substantial annual limitation due to the “change in ownership” provisions of the Internal Revenue Code of 1986 and similar state provisions. The annual limitation may result in the expiration of net operating losses before utilization.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 5 – WARRANTS ISSUED TO INVESTORS
The Company issued warrants to purchase common stock to investors. The below table lists these warrants and their material terms.
ISSUANCE DATE
|
|
NUMBER OF WARRANTS
|
|
|
EXERCISE
PRICE
|
|
EXERCISABLE THROUGH
|
|
|
|
|
|
|
|
|
January 2010 *
|
|
|
43,069
|
|
|
$
|
0.055
|
|
April 2018
|
October 2017 **
|
|
|
275,000
|
|
|
$
|
2.00
|
|
October 2022
|
* In connection with historic financings, New York Global Innovations Inc. issued 43,069 warrants which were outstanding as of December 31 2016 & 2017. These warrants have been retroactively adjusted to reflect the 1 to 50 reverse stock split
** Warrants issued in connection with the October 2017 financing
and which
contain
a
full ratchet anti-dilution price protection (See note 7B)
NOTE 6 - Computation of Net Loss per Share
Basic loss per share is computed by dividing the net loss, as adjusted, to include the preferred shares dividend participation rights of preferred shares outstanding during the relevant fiscal year, by the weighted average number of shares of common stock outstanding during the relevant fiscal year. Diluted loss per share is computed by dividing the net loss, as adjusted, to include the dividend participation rights of preferred shares outstanding during the relevant fiscal year as well as of preferred shares that would have been outstanding if all potentially dilutive preferred shares had been issued, by the weighted average number of shares of common stock outstanding during the relevant fiscal year, plus the number of shares of common stock that would have been outstanding if all potentially dilutive common stock had been issued, using the treasury stock method, in accordance with ASC 260-10 “Earnings per Share”.
The loss and weighted average number of common stock used in the calculation of basic loss per share are as follows (in thousands, except share and per share data):
|
|
Twelve Months
Ended
December 31,
2017
|
|
|
The period from April 19 (Inception), 2016 to December 31, 2016
|
|
Net loss attributable to shareholders of the company
|
|
|
1,143
|
|
|
|
264
|
|
Net loss attributable to shareholders of preferred shares
|
|
|
171
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
Net loss used in the calculation of basic loss per share
|
|
|
972
|
|
|
|
231
|
|
|
|
|
|
|
|
|
|
|
Net loss per share
|
|
|
(0.20
|
)
|
|
|
(0.05
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average number of common stock used in the calculation of net loss per share
|
|
|
4,893,022
|
|
|
|
4,254,094
|
|
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 7 - STOCK CAPITAL
Shares of common stock confer upon their holders the right to receive notice to participate and vote in general meetings of shareholders of the Company, the right to receive dividends, if declared, and the right to receive a distribution of any surplus of assets upon liquidation of the Company.
Preferred A shares confer upon their holders the right to receive dividends when paid to holders of
common
stock of the Company on an as-converted basis, and the right to receive a distribution of any surplus of assets upon liquidation of the Company before any distribution or payment shall be made to the holders of any common stock.
Preferred C shares confer upon their holders the right to receive dividends when paid to holders of common stock of the Company on an as-converted basis. The shares of Series C Convertible Preferred Stock have the right to receive a distribution of any surplus of assets upon liquidation of the Company before any distribution or payment shall be made to the holders of any other securities.
On August 19, 2016 and prior to consummation of the merger, Artemis issued 524 shares of common
stock
(221,307 shares as adjusted to reflect the reverse recapitalization and reverse stock split) for an aggregate purchase price of $127, which was received in October 2016.
In August 2016, immediately upon consummation of the Merger, the Company issued 68,321 shares of the Company’s common stock, as well as 453 shares of the Company’s newly designated Series A Convertible Preferred Stock convertible into 658,498 shares of common stock, to an investor for an aggregate purchase price of $481,000 (net of issuance expenses). These shares have anti-dilution protection for a period of twenty four months. The anti-dilution protection has not been triggered through the date of these financial statements. In addition, the investor, within a 24-month period, may purchase up to an additional 100% of its preferred A shares at 120% of the per share purchase price paid in August 2016. This additional purchase option was recorded in equity.
In October 2017, the Company issued 300,000 shares of the Company’s common stock, warrants to
purchase
275,000 shares of common stock, as well as 250 shares newly designated Series C Convertible Preferred Stock to investors for an aggregate purchase price of $550,000 less issuance expenses. Each share of Series C Convertible Preferred Stock is convertible into 1,000 shares of common stock, subject to adjustments in the event of future financing at a price of less than the conversion price. Preferred shares confer upon their holders the right to receive dividends when paid to holders of common stock of the Company on an as-converted basis. The shares of Series C Convertible Preferred Stock have the right to receive a distribution of any surplus of assets upon liquidation of the Company before any distribution or payment shall be made to the holders of any other securities.
The 275,000 warrants contain a full ratchet anti-dilution price protection so that, in most situations upon the issuance of any common stock or securities convertible into common stock at a price below the then-existing exercise price of the outstanding warrants, the warrant exercise price will be reset to the lower common stock sales price.
As such anti-dilution price protection, does not meet the specific conditions for equity classification, the Company is required to classify the fair value of these warrants as a liability, with
changes
in fair value to be recorded as income (loss) due to change in fair value of warrant liability. The estimated fair value of our warrant liability at issuance date
, was approximately $
319. The Company recorded a finance expense of $109 at December 31, 2017 in respect of these warrants.
The Company uses the Black-Scholes valuation model to estimate fair value of these warrants. In
using
this model, the Company makes certain assumptions about risk-free interest rates, dividend yields, volatility, expected term of the warrants and other assumptions. Risk-free interest rates are derived from the yield on U.S. Treasury debt securities. Dividend yields are based on our historical dividend payments, which have been zero to date. Volatility is estimated from the historical volatility of our common stock as traded on NASDAQ. The expected term of the warrants is based on the time to expiration of the warrants from the date of measurement.
In accordance with ASC-820-10-50-2(g), the Company has performed a sensitivity analysis of the derivative warrant liabilities of the Company which are classified as level 3 financial instruments. The Company recalculated the value of warrants by applying a +/- 5% changes to the input variables in the Black-Scholes model that vary over time, namely, the volatility
and
the risk-free rate. A 5.0% decrease or increase in volatility would not cause a material change in the value of the warrants. A 5.0% decrease or increase in the risk-free rate would not have materially changed the value of the warrants; the value of the warrants is not strongly correlated with small changes in interest rates.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 7 - STOCK CAPITAL (Cont.)
On December 16, 2016, the Company effected a one-for-fifty (1:50) reverse stock split of its issued and
outstanding
shares of common stock. Share data included in these financial statements is retroactively adjusted as if the reverse stock split had occurred at the beginning of the earliest period presented.
|
D.
|
Options issued to consultants and employees:
|
On August 22, 2016, the Company granted 126,730 stock options to consultants. Each stock option is exercisable into a share of the Company’s common stock of and expires no later than 10 years from the date of grant.
One third of the options vested on the grant date, and one third of the options vest upon the first and second anniversaries of the grant date, with the option becoming fully vested on August 22, 2018. As a result, the Company recognized compensation expenses in the amount of $75,
included
in Research & Development Expenses. 35,202 of these options were exercised in July 2017.
On August 1, 2017, the Company granted 242,640 stock options to the Company’s CEO. Each stock option is exercisable into a share of the Company’s common stock. . As a result, the
Company
recognized compensation expenses in the amount of $31 included in General & Administrative Expenses.
Upon termination of the CEO’s employment agreement any of the then unvested options shall expire
immediately
. All vested options may be exercised for a period of 90 days from the termination of the agreement. The options are subject to a 48 month vesting period whereby 5,055 options were vested on September 1, 2017 and 5,055 options become vested on the first day of each following month assuming the employment agreement has not been terminated.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 7 - STOCK CAPITAL (Cont.)
A summary of the Company's option activity and related information is as follows:
|
|
For the Twelve months ended
December 31, 2017
|
|
|
|
Number of stock options
|
|
|
Weighted average exercise price
|
|
|
Aggregate intrinsic value
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding at beginning of period
|
|
|
126,730
|
|
|
|
0.01
|
|
|
|
|
Granted
|
|
|
242,640
|
|
|
|
1.30
|
|
|
|
|
Exercised
|
|
|
35,202
|
|
|
|
0.01
|
|
|
|
|
Cancelled
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding at end of period
|
|
|
334,168
|
|
|
$
|
0.95
|
|
|
|
218,321
|
|
Options exercisable at period end
|
|
|
69,505
|
|
|
$
|
0.39
|
|
|
|
84,429
|
|
The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between the fair market value of the Company’s common stock on December 31, 2017, 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.
The stock options outstanding as of December 31, 2017
and 2016, have been separated into exercise price, as follows:
Exercise price
|
|
|
Stock options outstanding as of December 31,
|
|
|
Weighted average remaining contractual life – years as of December 31,
|
|
|
Stock options exercisable as of December 31,
|
|
$
|
|
|
2 0 1 7
|
|
|
2 0 1 6
|
|
|
2 0 1 7
|
|
|
2 0 1 6
|
|
|
2 0 1 7
|
|
|
2 0 1 6
|
|
|
0.01
|
|
|
|
91,528
|
|
|
|
126,730
|
|
|
|
8.64
|
|
|
|
9.65
|
|
|
|
49,283
|
|
|
|
42,243
|
|
|
1.30
|
|
|
|
242,640
|
|
|
|
-
|
|
|
|
9.68
|
|
|
|
-
|
|
|
|
20,220
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
334,168
|
|
|
|
126,730
|
|
|
|
9.40
|
|
|
|
9.65
|
|
|
|
69,503
|
|
|
|
42,243
|
|
(*) Less than 1
Compensation expense recorded by the Company with respect to its stock-based employee compensation awards in accordance with ASC 718-10 for the
year ended December 31, 2017 and 2016 was $103 and $36, respectively.
As the exercise price of the options is nominal, the Company estimated their fair values based on the value of the Company's shares at the measurement date.
Artemis Therapeutics Inc.
Notes to the financial statement
(USD in thousands)
NOTE 8 - Convertible preferred stock Series A and common stock - Restatement
As explained in note 7, the Company issued Series A Convertible Preferred Stock to one of its shareholders. The shares are convertible to common shares at any point in time and participate in earning on an as converted basis. The Company in its Q1 2017 filling as well as in its fillings prior to Q1 2017erroneously presented these shares as if the shares had been converted to common shares.
In Addition, as explained in note 7, the Company effected a one-for-fifty (1:50) reverse stock split of its issued and outstanding shares of common stock. The par value of $0.01 per share did not change as a result of the reverse stock split. The Company in its previous filings erroneously presented its par value and share premium line items based on a $0.5 par value per share.
The following tables present the restated financial statements line items:
Artemis Therapeutics, Inc.
Condensed Consolidated Statements Balance Sheet
(Audited)
|
|
December 31, 2016
|
|
|
|
As Reported
|
|
|
Adjustments
|
|
|
As Restated
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity
|
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01 par value - Authorized: 10,000,000 shares; issued and outstanding: 0 and 453 shares (as reported and as restated) as of December 31, 2016
|
|
|
-
|
|
|
|
(*
|
)
|
|
|
(*
|
)
|
Common stock, $0.01 par value - Authorized: 51,000,000; issued and outstanding: 5,774,549 and 4,818,178 (as reported and as restated) as of December 31, 2016
|
|
|
2,887
|
|
|
|
(2838
|
)
|
|
|
49
|
|
Additional paid in capital
|
|
|
(1,709
|
)
|
|
|
2,838
|
|
|
|
1,129
|
|
Accumulated deficit
|
|
|
(264
|
)
|
|
|
-
|
|
|
|
(264
|
)
|
Total shareholders' equity
|
|
|
914
|
|
|
|
-
|
|
|
|
914
|
|
(*) Represents an amount lower than 1,000 USD
NOTE 9 - Subsequent Events
On March 15, 2018, the Company granted options to purchase 48,528 shares of common stock to its CEO, which vested on the grant date and options to purchase 50,000 shares of common stock to its CFO, which options will vest over a 48 month period. These options have an exercise price of $1.30 and will expire on March 15, 2028.