Delaware
|
20-8133057
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
|
110
East 59th Street
|
|
New
York, New York
|
10022
|
(Address
of principal executive offices)
|
(Zip
code)
|
Large
accelerated filer ¨
|
Accelerated
filer ¨
|
Non-accelerated
filer ¨
(Do
not check if a smaller reporting company)
|
Smaller
reporting company x
|
|
|
Page
Number
|
PART
I - FINANCIAL INFORMATION
|
|
|
|
|
|
Item
1. Financial Statements
|
|
3
|
Item
2. Management’s Discussion and Analysis of Financial Condition and Results
of Operations
|
|
25
|
Item
3. Quantitative and Qualitative Disclosures About Market
Risk
|
29
|
|
Item
4. Controls and Procedures
|
|
29
|
|
|
|
PART
II - OTHER INFORMATION
|
|
|
|
|
|
Item
1. Legal Proceedings
|
|
30
|
Item
1A. Risk Factors
|
30
|
|
Item
5. Other Information
|
30
|
|
Item
6. Exhibits
|
|
30
|
Page
|
|
Consolidated
Balance Sheets
|
4
|
|
|
Consolidated
Statements of Operations
|
5
|
Statements
of Changes in Stockholders' Equity (Deficiency)
|
6
- 8
|
Consolidated
Statements of Cash Flows
|
9
|
Notes
to Consolidated Financial Statements
|
10 -
24
|
March
31,
|
|
December
31,
|
|
||||
|
|
2
0 0 8
|
|
2
0 0 7
|
|
||
|
|
Unaudited
|
|
||||
ASSETS
|
|||||||
CURRENT
ASSETS:
|
|||||||
Cash
and cash equivalents
|
$
|
-
|
$
|
86
|
|||
Restricted
cash
|
38
|
35
|
|||||
Other
receivable and prepaid expenses
|
66
|
137
|
|||||
Total
current
assets
|
104
|
258
|
|||||
LONG-TERM
INVESTMENTS:
|
|||||||
Prepaid
expenses
|
15
|
9
|
|||||
Severance
pay fund
|
99
|
75
|
|||||
Total
Long-term
investments
|
114
|
84
|
|||||
PROPERTY
AND EQUIPMENT, NET
|
866
|
739
|
|||||
Deferred
charges
|
-
|
2
|
|||||
Total
assets
|
1,084
|
1,083
|
|||||
LIABILITIES
AND STOCKHOLDERS' DEFICIENCY
|
|||||||
CURRENT
LIABILITIES:
|
|||||||
Short
term credit from bank
|
11
|
-
|
|||||
Trade
payables
|
812
|
838
|
|||||
Other
accounts payable and accrued expenses
|
1,231
|
1,049
|
|||||
Short-term
convertible loans
|
190
|
396
|
|||||
Short-term
loan
|
1,184
|
945
|
|||||
Total
current liabilities
|
3,428
|
3,228
|
|||||
LONG
TERM CONVERTIBLE LOANS
|
-
|
200
|
|||||
ACCRUED
SEVERANCE PAY
|
100
|
83
|
|||||
Total
liabilities
|
3,528
|
3,511
|
|||||
STOCKHOLDERS'
DEFICIENCY:
|
|||||||
Stock
capital: (Note 7)
|
|||||||
Common
stock of $0.00005 par value - Authorized: 800,000,000 shares at
March 31,
2008 and December 31, 2007; Issued and outstanding: 42,617,268 and
41,004,409 shares
at March 31, 2008 and December 31, 2007, respectively
|
2
|
2
|
|||||
Subscription
on account of shares
|
730
|
-
|
|||||
Additional
paid-in capital
|
30,574
|
30,058
|
|||||
Deficit
accumulated during the development stage
|
(33,750
|
)
|
(32,488
|
)
|
|||
Total
stockholders' deficiency
|
(2,444
|
)
|
(2,428
|
)
|
|||
Total
liabilities and stockholders' deficiency
|
$
|
1,084
|
$
|
1,083
|
Three months ended
March 31,
|
|
Period from
September 22,
2000 (inception
date) through
March 31,
|
|
||||||||||
|
|
2
0 0 8
|
|
2
0 0 7
|
|
2
0 0 8
|
|
||||||
|
|
Unaudited
|
|
Unaudited
|
|||||||||
Operating
costs and expenses:
|
|||||||||||||
Research
and development
|
$
|
590
|
$
|
590
|
$
|
20,455
|
|||||||
General
and administrative
|
544
|
748
|
10,604
|
||||||||||
Total
operating costs and expenses
|
1,134
|
1,338
|
31,059
|
||||||||||
Financial
expenses, net
|
(128
|
)
|
(381
|
)
|
(
2,474
|
)
|
|||||||
1,262
|
1,719
|
33,533
|
|||||||||||
Taxes
on income
|
-
|
5
|
53
|
||||||||||
Loss
from continuing operations
|
1,262
|
1,724
|
33,586
|
||||||||||
Net
loss from discontinued operations
|
-
|
-
|
164
|
||||||||||
Net
loss
|
$
|
1,262
|
$
|
1,724
|
$
|
33,750
|
|||||||
Basic
and diluted net loss per share from continuing operations
|
$
|
0.03
|
$
|
0.07
|
|||||||||
Weighted
average number of shares outstanding used in computing basic and
diluted
net loss per share
|
41,774,344
|
24,372,261
|
|
|
|
|
|
|
Deficit
accumulated
|
|
Total
|
|
||||||||||
|
|
|
|
Additional
|
|
Deferred
|
|
during the
|
|
stockholders'
|
|
||||||||
|
|
Common stock
|
|
paid-in
|
|
stock-based
|
|
development
|
|
equity
|
|
||||||||
|
|
Number
|
|
Amount
|
|
capital
|
|
compensation
|
|
stage
|
|
(deficiency)
|
|||||||
Balance
as of September 22, 2000 (date of inception)
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
|
|
|
|
|
|
|
|||||||||||||
Stock
issued on September 22, 2000 for cash at $0.00188 per
share
|
8,500,000
|
1
|
16
|
-
|
-
|
17
|
|||||||||||||
Stock
issued on March 31, 2001 for cash at $0.0375 per share
|
1,600,000
|
*
-
|
60
|
-
|
-
|
60
|
|||||||||||||
Contribution
of capital
|
-
|
-
|
8
|
-
|
-
|
8
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(17
|
)
|
(17
|
)
|
|||||||||||
Balance
as of March 31, 2001
|
10,100,000
|
1
|
84
|
-
|
(17
|
)
|
68
|
||||||||||||
|
|
|
|
|
|
|
|||||||||||||
Contribution
of capital
|
-
|
-
|
11
|
-
|
-
|
11
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(26
|
)
|
(26
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of March 31, 2002
|
10,100,000
|
1
|
95
|
-
|
(43
|
)
|
53
|
||||||||||||
|
|
|
|
|
|
|
|||||||||||||
Contribution
of capital
|
-
|
-
|
15
|
-
|
-
|
15
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(47
|
)
|
(47
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of March 31, 2003
|
10,100,000
|
1
|
110
|
-
|
(90
|
)
|
21
|
||||||||||||
|
|
|
|
|
|
|
|||||||||||||
2-for-1
stock split
|
10,100,000
|
*
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Stock
issued on August 31, 2003 to purchase mineral option at $0.065
per
share
|
100,000
|
*
-
|
6
|
-
|
-
|
6
|
|||||||||||||
Cancellation
of shares granted to Company's President
|
(10,062,000
|
)
|
*
-
|
*
-
|
-
|
-
|
-
|
||||||||||||
Contribution
of capital
|
-
|
*
-
|
15
|
-
|
-
|
15
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(73
|
)
|
(73
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of March 31, 2004
|
10,238,000
|
1
|
131
|
-
|
(163
|
)
|
(31
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Stock
issued on June 24, 2004 for private placement at $0.01 per share,
net of
$25,000 issuance expenses (Note 7c(1)(a)
|
8,510,000
|
*
-
|
60
|
-
|
-
|
60
|
|||||||||||||
Contribution
capital
|
-
|
-
|
7
|
-
|
-
|
7
|
|||||||||||||
Stock
issued in 2004 for private placement at $0.75 per unit
(Note 7c(1)(b)
|
1,894,808
|
*
-
|
1,418
|
-
|
-
|
1,418
|
|||||||||||||
Cancellation
of shares granted to service providers
|
(1,800,000
|
)
|
*
-
|
|
-
|
-
|
-
|
||||||||||||
Deferred
stock-based compensation related to options granted to employees
|
-
|
-
|
5,979
|
(5,979
|
)
|
-
|
-
|
||||||||||||
Amortization
of deferred stock-based compensation related to shares and options
granted
to employees (Note 7c(2))
|
-
|
-
|
-
|
584
|
-
|
584
|
|||||||||||||
Compensation
related to shares and options granted to service providers (Note
7c(3))
|
2,025,000
|
*
-
|
17,506
|
-
|
-
|
17,506
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(18,840
|
)
|
(18,840
|
)
|
|||||||||||
Balance
as of March 31, 2005
|
20,867,808
|
1
|
25,101
|
(5,395
|
)
|
(19,003
|
)
|
704
|
|
Deficit
accumulated
|
Total
|
|||||||||||||||||
Additional
|
Deferred
|
during the
|
stockholders'
|
||||||||||||||||
Common stock
|
paid-in
|
stock-based
|
development
|
equity
|
|||||||||||||||
Number
|
Amount
|
capital
|
compensation
|
stage
|
(deficiency)
|
||||||||||||||
Balance
as of March 31, 2005
|
20,867,808
|
1
|
25,101
|
(5,395
|
)
|
(19,003
|
)
|
704
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Stock
issued on May 12, 2005 for private placement at $0.8 per share
(Note
7c(1)(c))
|
186,875
|
*
-
|
149
|
-
|
-
|
149
|
|||||||||||||
Stock
issued on July 27, 2005 for private placement at $0.6 per share
(Note
7c(1)(d))
|
165,000
|
*
-
|
99
|
-
|
-
|
99
|
|||||||||||||
Stock
issued on September 30, 2005 for private placement at $0.8 per
share (Note
7c(1)(e))
|
312,500
|
*
-
|
225
|
-
|
-
|
225
|
|||||||||||||
Stock
issued on December 7, 2005 for private placement at $0.8 per share
(Note
7c(1)(e))
|
187,500
|
*
-
|
135
|
-
|
-
|
135
|
|||||||||||||
Forfeiture
of options granted to employees
|
-
|
-
|
(3,363
|
)
|
3,363
|
-
|
-
|
||||||||||||
Deferred
stock-based compensation related to shares and options granted
to
directors and employees
|
200,000
|
*
-
|
486
|
(486
|
)
|
-
|
-
|
||||||||||||
Amortization
of deferred stock-based compensation related to options and shares
granted
to employees and directors (Note 7c(2))
|
-
|
-
|
51
|
1,123
|
-
|
1,174
|
|||||||||||||
Stock-based
compensation related to options and shares granted to service providers
(Note 7c(3))
|
934,904
|
*
-
|
662
|
-
|
-
|
662
|
|||||||||||||
Reclassification
due to application of EITF 00-19
|
-
|
-
|
(7,906
|
)
|
|
|
(7,906
|
)
|
|||||||||||
Beneficial
conversion feature related to a convertible bridge loan
|
-
|
-
|
164
|
-
|
-
|
164
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(3,317
|
)
|
(3,317
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of March 31, 2006
|
22,854,587
|
1
|
15,803
|
(1,395
|
)
|
(22,320
|
)
|
(7,911
|
)
|
||||||||||
|
|
|
|
|
|
|
|||||||||||||
Elimination
of deferred stock compensation due to implementation of SFAS
123(R)
|
-
|
-
|
(1,395
|
)
|
1,395
|
-
|
-
|
||||||||||||
Stock-based
compensation related to shares and options granted to directors
and
employees (note 7c(2)
|
200,000
|
*
-
|
1,168
|
-
|
-
|
1,168
|
|||||||||||||
Reclassification
due to application of EITF 00-19
|
-
|
-
|
7,191
|
-
|
-
|
7,191
|
|||||||||||||
Stock-based
compensation related to options and shares granted to service providers
(Note 7c(3))
|
1,147,225
|
-
|
453
|
-
|
-
|
453
|
|||||||||||||
Warrants
issued to convertible note holder
|
-
|
-
|
11
|
-
|
-
|
11
|
|||||||||||||
Warrants
issued to loan holder
|
-
|
-
|
110
|
-
|
-
|
110
|
|||||||||||||
Beneficial
conversion feature related to convertible bridge loans
|
-
|
-
|
1,086
|
-
|
-
|
1,086
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(3,924
|
)
|
(3,924
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of December 31, 2006
|
24,201,812
|
1
|
24,427
|
-
|
(26,244
|
)
|
(1,816
|
)
|
|
|
|
|
|
|
Deficit
accumulated
|
|
Total
|
|
||||||||||
|
|
|
|
Additional
|
|
Deferred
|
|
during the
|
|
stockholders'
|
|
||||||||
|
|
Common stock
|
|
paid-in
|
|
stock-based
|
|
development
|
|
equity
|
|
||||||||
|
|
Number
|
|
Amount
|
|
capital
|
|
compensation
|
|
stage
|
|
(deficiency)
|
|||||||
Balance
as of December 31, 2006
|
24,201,812
|
1
|
24,427
|
-
|
(26,244
|
)
|
(1,816
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Stock-based
compensation related to options and shares granted to service providers
(Note 7c(3))
|
544,095
|
|
1,446
|
-
|
-
|
1,446
|
|||||||||||||
Warrants
issued to convertible note holder
|
-
|
-
|
109
|
-
|
-
|
109
|
|||||||||||||
Stock-based
compensation related to shares and options granted to directors
and
employees (Note 7c(2))
|
200,000
|
*
-
|
1,232
|
-
|
-
|
1,232
|
|||||||||||||
Beneficial
conversion feature related to convertible loans
|
-
|
-
|
407
|
-
|
-
|
407
|
|||||||||||||
Conversion
of convertible loans
|
725,881
|
*
-
|
224
|
-
|
-
|
224
|
|||||||||||||
Exercise
of warrants
|
3,832,621
|
*
-
|
214
|
-
|
-
|
214
|
|||||||||||||
Stock
issued for private placement at $0.1818 per unit, net of finder's
fee
(Note 7c(1)(f))
|
11,500,000
|
1
|
1,999
|
-
|
-
|
2,000
|
|||||||||||||
Net
loss
|
-
|
-
|
-
|
-
|
(6,244
|
)
|
(6,244
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of December 31, 2007
|
41,004,409
|
2
|
30,058
|
-
|
(32,488
|
)
|
(2,428
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Stock-based
compensation related to options and stock granted to service providers
(Note 7c(3))
|
-
|
-
|
70
|
-
|
|
70
|
|||||||||||||
Stock-based
compensation related to stock and options granted to directors
and
employees
|
-
|
-
|
199
|
-
|
|
199
|
|||||||||||||
Beneficial
conversion feature related to convertible bridge loans
|
-
|
-
|
-
|
-
|
|
|
|||||||||||||
Conversion
of convertible loans
|
695,460
|
*-
|
244
|
-
|
|
244
|
|||||||||||||
Exercise
of warrants
|
900,000
|
*-
|
|
|
|
|
|||||||||||||
Exercise
of options
|
17,399
|
*-
|
3
|
-
|
|
3
|
|||||||||||||
Subscription
of shares
|
-
|
-
|
730
|
-
|
|
730
|
|||||||||||||
Net
loss
|
|
|
|
|
(1,262
|
)
|
(1,262
|
)
|
|||||||||||
|
|
|
|
|
|
|
|||||||||||||
Balance
as of March 31, 2008 (unaudited)
|
42,617,268
|
2
|
31,304
|
-
|
(33,750
|
)
|
(2,444
|
)
|
Three months ended
March
31,
|
Period from
September 22,
2000
(inception
date) through
March 31,
|
|||||||||
2
0 0 8
|
2
0 0 7
|
2
0 0 8
|
||||||||
Unaudited
|
Unaudited
|
|||||||||
Cash
flows from operating activities:
|
||||||||||
Net
loss
|
$
|
(1,262
|
)
|
$
|
(1,724
|
)
|
$
|
(33,750
|
)
|
|
Less
- loss for the period from discontinued operations
|
-
|
164
|
||||||||
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||||
Depreciation
and amortization of deferred charges
|
33
|
48
|
399
|
|||||||
Erosion
of restricted cash
|
(3
|
)
|
-
|
(9
|
)
|
|||||
Accrued
severance pay, net
|
(6
|
)
|
7
|
2
|
||||||
Accrued
interest on loans
|
41
|
38
|
357
|
|||||||
Amortization
of discount on short-term loans
|
36
|
286
|
1,858
|
|||||||
Change
in fair value of options and warrants
|
-
|
558
|
(795
|
)
|
||||||
Expenses
related to stocks and options granted to service providers
|
70
|
299
|
20,203
|
|||||||
Amortization
of deferred stock-based compensation related to options granted
to
employees and directors
|
199
|
7
|
4,357
|
|||||||
Increase
in accounts receivable and prepaid expenses
|
70
|
34
|
(66
|
)
|
||||||
Increase
(decrease) in trade payables
|
(26
|
)
|
199
|
811
|
||||||
Increase
in other accounts payable and accrued expenses
|
182
|
-
|
1,226
|
|||||||
Net
cash used in continuing operating activities
|
(666
|
)
|
(248
|
)
|
(5,243
|
)
|
||||
Net
cash used in discontinued operating activities
|
-
|
-
|
(22
|
)
|
||||||
Total
net cash used in operating activities
|
(666
|
)
|
(248
|
)
|
(5,265
|
)
|
||||
Cash
flows from investing activities:
|
||||||||||
Purchase
of property and equipment
|
(157
|
)
|
(37
|
)
|
(1,083
|
)
|
||||
Restricted
cash
|
-
|
(1
|
)
|
(29
|
)
|
|||||
Investment
in lease deposit
|
(7
|
)
|
(4
|
)
|
(15
|
)
|
||||
Net
cash used in continuing investing activities
|
(164
|
)
|
(42
|
)
|
(1,127
|
)
|
||||
Net
cash used in discontinued investing activities
|
-
|
-
|
(16
|
)
|
||||||
Total
net cash used in investing activities
|
(164
|
)
|
(42
|
)
|
(1,143
|
)
|
||||
Cash
flows from financing activities:
|
||||||||||
Proceeds
from issuance of common stock and warrants
|
730
|
-
|
4,817
|
|||||||
Proceeds
from loans, notes and issuance of warrants net
|
-
|
260
|
2,060
|
|||||||
Credit
from the bank
|
11
|
-
|
11
|
|||||||
Repayment
of loans
|
-
|
-
|
(551
|
)
|
||||||
Proceeds
from exercise of warrants and options
|
3
|
-
|
28
|
|||||||
Net
cash provided by continuing financing activities
|
744
|
260
|
6,365
|
|||||||
Net
cash provided by discontinued financing activities
|
-
|
-
|
43
|
|||||||
Total
net cash provided by financing activities
|
744
|
260
|
6,408
|
|||||||
Increase
(decrease) in cash and cash equivalents
|
(86
|
)
|
(30
|
)
|
-
|
|||||
Cash
and cash equivalents at the beginning of the period
|
86
|
60
|
-
|
|||||||
Cash
and cash equivalents at end of the period
|
$
|
-
|
$
|
30
|
$
|
-
|
NOTE
1:-
|
GENERAL
|
a.
|
Brainstorm
Cell Therapeutics Inc. (formerly: Golden Hand Resources Inc.) ("the
Company") was incorporated in the State of Washington on September
22,
2000.
|
b.
|
On
May 21, 2004, the former major stockholders of the Company entered
into a
purchase agreement with a group of private investors, who purchased
from
the former major stockholders 6,880,000 shares of the then issued
and
outstanding 10,238,000 shares of the Company's common stock.
|
c.
|
On
July 8, 2004, the Company entered into a licensing agreement with
Ramot of
Tel Aviv University Ltd. ("Ramot"), an Israeli corporation, to
acquire
certain stem cell technology. Subsequent to this agreement, the
Company
decided to focus on the development of novel cell therapies for
neurodegenerative diseases, particularly, Parkinson's disease,
based on
the acquired technology and research to be conducted and funded
by the
Company.
|
d.
|
On
November 22, 2004, the Company changed its name from Golden Hand
Resources
Inc. to Brainstorm Cell Therapeutics Inc. to better reflect its
new line
of business in the development of novel cell therapies for
neurodegenerative diseases.
|
e.
|
On
October 25, 2004, the Company formed a wholly-owned subsidiary
in Israel,
Brainstorm Cell Therapeutics Ltd. ("BCT").
|
f.
|
On
December 21, 2006, the Company changed its state of incorporation
from
Washington to Delaware.
|
g.
|
On
September 17, 2006, the Company's Board determined to change the
Company's
fiscal year-end from March 31 to December 31.
|
h.
|
Since
its inception, the Company has devoted substantially most of its
efforts
to research and development, recruiting management and technical
staff,
acquiring assets and raising capital. In addition, the Company
has not
generated revenues. Accordingly, the Company is considered to be
in the
development stage, as defined in Statement of Financial Accounting
Standards No. 7, "Accounting and reporting by development Stage
Enterprises" ("SFAS No. 7").
|
As
of March 31, 2008, the Company had an accumulated deficit of $33,750,
a
working capital deficiency of $3,324, incurred net loss of $1,252
and
negative cash flows from operating activities in the amount of
$666 for
the three months ended March 31, 2008. In addition, the Company
has not
yet generated any revenues.
|
NOTE
1:-
|
GENERAL
(Cont.)
|
NOTE
2:-
|
SIGNIFICANT
ACCOUNTING POLICIES
|
NOTE
3:-
|
UNAUDITED
INTERIM CONSOLIDATED FINANCIAL
STATEMENTS
|
NOTE
4:-
|
RESEARCH
AND LICENSE AGREEMENT
|
NOTE
4:-
|
RESEARCH
AND LICENSE AGREEMENT
(Cont.)
|
Payment
date
|
Amount
|
|||
|
|
|||
September
5, 2007
|
100
|
|||
November
20, 2007
|
150
|
|||
February
20, 2008
|
150
|
|||
May
20, 2008
|
150
|
|||
August
4, 2008
|
90
|
Payment
date
|
Amount
|
|||
|
|
|||
August
4, 2008
|
60
|
|||
November
20, 2008
|
150
|
|||
February
20, 2009
|
170
|
NOTE
5:-
|
CONSULTING
AGREEMENTS
|
a.
|
On
July 8, 2004, the Company entered into two consulting agreements
with
Prof. Eldad Melamed and Dr. Daniel Offen (together, the "Consultants"),
upon which the Consultants shall provide the Company scientific
and
medical consulting services in consideration for a monthly payment
of $6
each. In addition, the Company granted each of the Consultants,
a fully
vested warrant to purchase 1,097,215 shares of Common Stock at
an exercise
price of $0.01 per share. The warrants issued pursuant to the agreement
were issued to the Consultants effective as of November 4, 2004.
Each of
the warrants is exercisable for a seven-year period beginning on
November
4, 2005.
|
b.
|
As
of March 31, 2008, the Company had a total obligation of $118 for
services
rendered by the Consultants.
|
NOTE
6:-
|
SHORT-TERM
LOANS
|
On
September 10, 2007, the Company entered into a payment agreement
with a
lender with respect to the following promissory notes: (i) a Convertible
Promissory Note, dated February 7, 2006, in the original principal
amount
of $500, (ii) a Convertible Promissory Note, dated June 5, 2006,
in the
original principal amount of $500, and (iii) a Convertible Promissory
Note, dated September 14, 2006, in the original principal amount
of $100.
|
Payment
Date
|
Amount
|
|||
August
16, 2007
|
$
|
100
|
(already paid)
|
|
November
30, 2007
|
$
|
100
|
||
January
15, 2008
|
$
|
175
|
||
February
28, 2008
|
$
|
175
|
||
April
30, 2008
|
$
|
175
|
||
June
30, 2008
|
$
|
175
|
||
August
31, 2008
|
$
|
175
|
||
November
30, 2008
|
$
|
175
|
||
January
31, 2009
|
$
|
200
|
NOTE
7:-
|
CAPITAL
STOCK
|
a.
|
The
rights of common stock are as
follows:
|
b.
|
The
former president of the Company donated services valued at $6 and
rent
valued at $2 for the nine months ended March 31, 2004. These amounts
were
charged to the statement of operations as part of discontinued
operations
and classified as additional paid-in capital in the stockholders'
equity.
|
c.
|
Issuance
of stocks warrants and options:
|
1.
|
Private
placements
|
a) |
On
June 24, 2004, the Company issued to investors 8,510,000 shares
of common
stock for total proceeds of $60 (net of $25 issuance
expenses).
|
b) |
On
February 23, 2005, the Company completed a private placement round
for the
sale of 1,894,808 units for total proceeds of $1,418. Each unit
consists
of one share of common stock and a three year warrant to purchase
one
share of common stock at $2.50 per share. This private placement
was
consummated in four tranches which closed in October 2004, November
2004
and February 2005.
|
c)
|
On
May 12, 2005, the Company issued to a certain investor 186,875
shares of
its common stock for total proceeds of $149 at a price per share
of
$0.8.
|
d)
|
On
July 27, 2005, the Company issued to certain investors 165,000
shares of
its common stock for total proceeds of $99 at a price per share
of
$0.6.
|
e)
|
On
August 11, 2005, the Company signed a private placement agreement
with
investors for the sale of up to 1,250,000 units at a price per
unit of
$0.8. Each unit consists of one share
of common
stock and one warrant to purchase one share
of common
stock at $1.00 per share. The warrants are exercisable for a period
of
three years from issuance. On March 31, 2005, the Company sold
312,500
units for total net proceeds of $225. On December 7, 2005, the
Company
sold 187,500 units for total net proceeds of $135.
|
NOTE
7:-
|
CAPITAL
STOCK (Cont.)
|
f) |
On
July 2, 2007 the Company entered into an investment agreement,
pursuant to
which the Company agreed to sell up to 27,500,000 shares of the
Company's
common stock, for an aggregate subscription price of up to $5 million
and
warrants to purchase up to 30,250,000 shares of common stock. Separate
closings of the purchase and sale of the shares and the warrants
shall
take place as follows:
|
Purchase
date
|
Purchase
price
|
Number
of subscription shares
|
Number
of warrant shares
|
|||||||
|
|
|
|
|||||||
August
30, 2007
|
|
$1,250
(includes $250 paid
as
a convertible loan)
|
|
6,875,000
|
7,562,500
|
|||||
November
15, 2007
|
|
$750
|
4,125,000
|
4,537,500
|
||||||
February
15, 2008
|
|
$750
|
4,125,000
|
4,537,500
|
||||||
May
15, 2008
|
|
$750
|
4,125,000
|
4,537,500
|
||||||
July
30, 2008
|
|
$750
|
4,125,000
|
4,537,500
|
||||||
November
15, 2008
|
|
$750
|
4,125,000
|
4,537,500
|
NOTE
7:-
|
CAPITAL
STOCK (Cont.)
|
2.
|
Share-based
compensation to employees and to
directors
|
a)
|
Options
to employees and directors:
|
NOTE
7:-
|
CAPITAL
STOCK (Cont.)
|
Three
months ended
March
31, 2008
|
|||||||
Amount of
options
|
Weighted
average
exercise price
|
||||||
$
|
|||||||
Outstanding
at beginning of the period
|
5,280,760
|
$
|
0.372
|
||||
Granted
|
170,000
|
0.49
|
|||||
Exercised
|
(17,399
|
)
|
0.15
|
||||
Outstanding
at end of period
|
5,433,361
|
$
|
0.377
|
||||
Vested
and expected-to-vest options at end of the period
|
3,286,728
|
$
|
0.205
|
NOTE
7:-
|
CAPITAL
STOCK (Cont.)
|
b)
|
Restricted
shares to directors:
|
3.
|
Stock
and warrants to service providers and
investors:
|
NOTE
7:-
|
CAPITAL
STOCK (Cont.)
|
Issuance
date
|
Number
of warrants issued
|
Exercised
|
Forfeited
|
Outstanding
|
Exercise
price
|
Warrants
exercisable
|
Exercisable
through
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
November
2004
|
12,800,845
|
2,181,925
|
|
10,618,920
|
$
|
0.01
|
10,618,920
|
November
2012
|
||||||||||||||
December
2004
|
1,800,000
|
1,800,000
|
|
-
|
$
|
0.00005
|
—
|
-
|
||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
|
14,600,845
|
3,981,925
|
|
10,618,920
|
|
10,618,920
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
February
2005
|
1,894,808
|
|
1,894,808
|
-
|
$
|
1.62
|
-
|
|
||||||||||||||
May
2005
|
47,500
|
|
|
47,500
|
$
|
1.62
|
47,500
|
May
2010
|
||||||||||||||
June
2005
|
30,000
|
|
|
30,000
|
$
|
0.75
|
30,000
|
June
2010
|
||||||||||||||
August
2005
|
70,000
|
|
|
70,000
|
$
|
0.15
|
70,000
|
August
2008
|
||||||||||||||
September
2005
|
3,000
|
3,000
|
|
-
|
$
|
0.15
|
-
|
-
|
||||||||||||||
September
2005
|
36,000
|
|
|
36,000
|
$
|
0.75
|
30,000
|
September
2010
|
||||||||||||||
September-December
2005
|
500,000
|
|
|
500,000
|
$
|
1
|
500,000
|
September
- December 2008
|
||||||||||||||
December
2005
|
20,000
|
20,000
|
|
-
|
$
|
0.15
|
-
|
-
|
||||||||||||||
December
2005
|
457,163
|
|
|
457,163
|
$
|
0.15
|
342,872
|
July
2010
|
||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
|
17,659,316
|
4,004,925
|
1,894,808
|
11,759,583
|
|
11,639,292
|
|
|||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
February
2006
|
230,000
|
|
|
230,000
|
$
|
0.65
|
153,333
|
February
2008
|
||||||||||||||
February
2006
|
40,000
|
|
|
40,000
|
$
|
1.5
|
40,000
|
February
2011
|
||||||||||||||
February
2006
|
8,000
|
|
|
8,000
|
$
|
0.15
|
8,000
|
February
2011
|
||||||||||||||
February
2006
|
189,000
|
97,696
|
91,304
|
-
|
$
|
0.
5
|
-
|
-
|
||||||||||||||
May
2006
|
50,000
|
|
|
50,000
|
$
|
0.0005
|
50,000
|
May
2016
|
||||||||||||||
May
-December 2006
|
48,000
|
|
|
48,000
|
$
|
0.35
|
48,000
|
May
- December 2011
|
||||||||||||||
May
-December 2006
|
48,000
|
|
|
48,000
|
$
|
0.75
|
48,000
|
May
- December 2011
|
||||||||||||||
May
2006
|
200,000
|
|
|
200,000
|
$
|
1
|
200,000
|
May
2011
|
||||||||||||||
June
2006
|
24,000
|
|
|
24,000
|
$
|
0.15
|
24,000
|
June
2011
|
||||||||||||||
May
2006
|
19,355
|
|
|
19,355
|
$
|
0.15
|