Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 11, 2020 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | My Size, Inc. | |
Entity Central Index Key | 0001211805 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State Country Code | DE | |
Entity File Number | 001-37370 | |
Entity Common Stock, Shares Outstanding | 7,232,836 |
Condensed Consolidated Interim
Condensed Consolidated Interim Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 3,524 | $ 1,203 |
Restricted cash | 80 | 263 |
Restricted deposits | 182 | |
Accounts receivable | 34 | 38 |
Other receivables and prepaid expenses | 103 | 321 |
Total current assets | 3,923 | 1,825 |
Property and equipment, net | 126 | 141 |
Right-of-use Asset | 890 | 966 |
Investment in marketable securities | 44 | 26 |
Total non-current assets | 1,060 | 1,133 |
Total assets | 4,983 | 2,958 |
Current liabilities: | ||
Operating lease liability | 119 | 102 |
Trade payables | 429 | 440 |
Accounts payable | 386 | 378 |
Warrants and derivatives | 328 | |
Total current liabilities | 934 | 1,248 |
Operating lease liability | 572 | 659 |
Total non-current liabilities | 572 | 659 |
Total liabilities | 1,506 | 1,907 |
COMMITMENTS AND CONTINGENCIES | ||
Stockholders' equity: | ||
Common stock of $ 0.001 par value - Authorized: 100,000,000 shares; Issued and outstanding: 7,232,836 and 2,085,900 as of September 30, 2020 and December 31, 2019, respectively | 7 | 2 |
Additional paid-in capital | 36,907 | 30,102 |
Accumulated other comprehensive loss | (486) | (539) |
Accumulated deficit | (32,951) | (28,514) |
Total stockholders' equity | 3,477 | 1,051 |
Total liabilities and stockholders' equity | $ 4,983 | $ 2,958 |
Condensed Consolidated Interi_2
Condensed Consolidated Interim Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 7,232,836 | 2,085,900 |
Common stock, shares outstanding | 7,232,836 | 2,085,900 |
Condensed Consolidated Interi_3
Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenues | $ 88 | $ 6 | $ 139 | $ 31 |
Cost of revenues | (1) | (2) | (1) | |
Gross profit | 87 | 6 | 137 | 30 |
Operating expenses | ||||
Research and development | (397) | (395) | (1,085) | (1,066) |
Sales and marketing | (555) | (526) | (1,632) | (1,387) |
General and administrative | (777) | (684) | (1,855) | (2,002) |
Total operating expenses | (1,729) | (1,605) | (4,572) | (4,455) |
Operating loss | (1,642) | (1,599) | (4,435) | (4,425) |
Financial income (expenses), net | (32) | 249 | (2) | 182 |
Net loss | (1,674) | (1,350) | (4,437) | (4,243) |
Other comprehensive income (loss): | ||||
Foreign currency translation differences | 50 | 58 | 53 | 292 |
Total comprehensive loss | $ (1,624) | $ (1,292) | $ (4,384) | $ (3,951) |
Basic and diluted loss per share | $ (0.23) | $ (0.75) | $ (0.89) | $ (2.1) |
Basic and diluted weighted average number of shares outstanding | 7,217,619 | 1,992,242 | 4,971,202 | 1,991,525 |
Condensed Consolidated Interi_4
Condensed Consolidated Interim Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Common stock | Additional paid-in capital | Accumulated other comprehensive loss | Accumulated deficit | Total | ||
Balance at Dec. 31, 2018 | $ 2 | $ 29,144 | $ (835) | $ (23,017) | $ 5,294 | ||
Balance, shares at Dec. 31, 2018 | 1,990,159 | ||||||
Stock-based compensation related to options granted to employees and consultants | 519 | 519 | |||||
Issuance of shares to consultants | [1] | 48 | 48 | ||||
Issuance of shares to consultants, shares | 2,084 | ||||||
Total comprehensive loss | 292 | (4,243) | (3,951) | ||||
Balance at Sep. 30, 2019 | $ 2 | 29,711 | (543) | (27,260) | 1,910 | ||
Balance, shares at Sep. 30, 2019 | 1,992,243 | ||||||
Balance at Jun. 30, 2019 | $ 2 | 29,566 | (601) | (25,910) | 3,057 | ||
Balance, shares at Jun. 30, 2019 | 1,992,243 | ||||||
Stock-based compensation related to options granted to employees and consultants | 145 | 145 | |||||
Total comprehensive loss | 58 | (1,350) | (1,292) | ||||
Balance at Sep. 30, 2019 | $ 2 | 29,711 | (543) | (27,260) | 1,910 | ||
Balance, shares at Sep. 30, 2019 | 1,992,243 | ||||||
Balance at Dec. 31, 2019 | $ 2 | 30,102 | (539) | (28,514) | 1,051 | ||
Balance, shares at Dec. 31, 2019 | 2,085,900 | ||||||
Stock-based compensation related to options granted to employees and consultants | 388 | 388 | |||||
Issuance of shares, net of issuance cost of $1,160 | $ 3 | 5,992 | 5,995 | ||||
Issuance of shares, net of issuance cost of $1,160, shares | 2,439,802 | ||||||
Exercise of warrants and pre funded warrants | $ 2 | 97 | 99 | ||||
Exercise of warrants and pre funded warrants, shares | 2,707,134 | ||||||
Liability reclassified to equity | [2] | 328 | 328 | ||||
Total comprehensive loss | 53 | (4,437) | (4,384) | ||||
Balance at Sep. 30, 2020 | $ 7 | 36,907 | (486) | (32,951) | 3,477 | ||
Balance, shares at Sep. 30, 2020 | 7,232,836 | ||||||
Balance at Jun. 30, 2020 | $ 7 | 36,599 | (536) | (31,277) | 4,793 | ||
Balance, shares at Jun. 30, 2020 | 7,157,836 | ||||||
Stock-based compensation related to options granted to employees and consultants | 225 | 225 | |||||
Exercise of warrants and pre funded warrants | [1] | 83 | 83 | ||||
Exercise of warrants and pre funded warrants, shares | 75,000 | ||||||
Total comprehensive loss | 50 | (1,674) | (1,624) | ||||
Balance at Sep. 30, 2020 | $ 7 | $ 36,907 | $ (486) | $ (32,951) | $ 3,477 | ||
Balance, shares at Sep. 30, 2020 | 7,232,836 | ||||||
[1] | Represents an amount less than $1. | ||||||
[2] | See note 2 c. |
Condensed Consolidated Interi_5
Condensed Consolidated Interim Statements of Changes in Stockholders' Equity (Parenthetical) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Issuance of cost net | $ 1,160 |
Condensed Consolidated Interi_6
Condensed Consolidated Interim Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (4,437) | $ (4,243) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 28 | 21 |
Amortization of operating lease right-of-use asset | 31 | |
Revaluation of warrants and derivatives | 2 | (629) |
Interest and revaluation of short-term deposit | 55 | |
Interest received from short-term deposit | 16 | |
Revaluation of investment in marketable securities | (18) | 146 |
Stock based compensation | 388 | 567 |
Decrease in accounts receivables | 5 | |
Decrease (increase) in other receivables and prepaid expenses | 218 | (188) |
(Decrease) increase in trade payable | (10) | 165 |
Increase in accounts payable | 2 | 8 |
Net cash used in operating activities | (3,791) | (4,082) |
Cash flows from investing activities: | ||
Proceeds from short-term deposits | 1,200 | |
(Investment in) proceeds from restricted deposits | (170) | 181 |
Investment in right-of-use asset | (25) | |
Purchase of property and equipment | (14) | (21) |
Net cash provided by (used in) investing activities | (209) | 1,360 |
Cash flows from financing activities: | ||
Proceeds from issuance of shares and pre-funded warrants, net of issuance costs | 6,094 | |
Net cash provided by financing activities | 6,094 | |
Effect of exchange rate fluctuations on cash and cash equivalents | 44 | 315 |
Increase in cash, cash equivalents and restricted cash | 2,138 | (2,407) |
Cash, cash equivalents and restricted cash at the beginning of the period | 1,466 | 5,230 |
Cash, cash equivalents and restricted cash at the end of the period | $ 3,604 | $ 2,823 |
General
General | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | Note 1 - General a. My Size, Inc. is developing unique measurement technologies based on algorithms with applications in a variety of areas, from the apparel e-commerce market, to the courier services market and to the Do It Yourself smartphone and tablet apps market. The technology is driven by proprietary algorithms which are able to calculate and record measurements in a variety of novel ways. The Company has three subsidiaries, My Size Israel 2014 Ltd. and Topspin Medical (Israel) Ltd., both of which are incorporated in Israel and My Size LLC which was incorporated in Russian Federation. References to the Company include the subsidiaries unless the context indicates otherwise. b. During the nine month period ended September 30, 2020, the Company has incurred significant losses and negative cash flows from operations and has an accumulated deficit of $32,951. The Company has financed its operations mainly through fundraising from various investors. The Company's management expects that the Company will continue to generate losses and negative cash flows from operations for the foreseeable future. Based on the projected cash flows and cash balances as of September 30, 2020, management is of the opinion that its existing cash will be sufficient to fund operations until the end of the second quarter of 2021. As a result, there is substantial doubt about the Company's ability to continue as a going concern. Management's plans include the continued commercialization of the Company's products and securing sufficient financing through the sale of additional equity securities, debt or capital inflows from strategic partnerships. Additional funds may not be available when the Company needs them, on terms that are acceptable to it, or at all. If the Company is unsuccessful in commercializing its products and securing sufficient financing, it may need to cease operations. The financial statements include no adjustments for measurement or presentation of assets and liabilities, which may be required should the Company fail to operate as a going concern. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2 - Significant Accounting Policies a. Unaudited condensed consolidated financial statements: The accompanying unaudited condensed consolidated interim financial statements included herein have been prepared by the Company in accordance with the rules and regulations of the United States Securities and Exchange Commission ("SEC"). The unaudited condensed consolidated financial statements are comprised of the financial statements of the Company. In management's opinion, the interim financial data presented includes all adjustments necessary for a fair presentation. All intercompany accounts and transactions have been eliminated. Certain information required by U.S. generally accepted accounting principles ("GAAP") has been condensed or omitted in accordance with rules and regulations of the SEC. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2019. b. Use of estimates: The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. c. Functional currency: The Company reassessed its functional currency and determined to change its functional currency to the U.S. dollar from the NIS as of January 1, 2020. The change in functional currency was accounted for prospectively from that date. In 2019, the Company went through a strategic shift which involved a significant change in its business model, that clearly indicates that the functional currency has changed, beginning January 2020. In previous years, the Company acted as a platform to fund its operational subsidiary, My Size Israel, which conducts its research and development activities in NIS. Accordingly, the Company has not been substantially focused on its operating activities for that period. By the end of 2018, the Company transitioned to a new business model (B2B2C) and concluded that the main market that the Company should focus on would be the apparel market in the US. Consequently, the Company established marketing and distribution channels in the US along with having a new pricing model denominated in USD. Throughout 2019, the Company itself hired sales personnel which are based in the US and signed agreements with customers for which it began generating revenue in USD for the first time since it began its operations. Accordingly, by the end of 2019, the Company is no longer considered a 'holding company' for the matter of determining its functional currency under ASC 830 based on the currency of its operating entities. As a result of being an operational company that enters into operational agreements and generates revenues on an ongoing basis, the management of the Company has concluded that as of January 1 2020, the currency that most faithfully portrays the economic results of the Company's operations is the U.S. dollar. My Size Israel's functional currency remains the NIS. As a result of the change in the Company's functional currency, the Company reclassified its warrants that were outstanding as a financial liability in an amount of $328 as at December 31, 2019 to equity. d. Reclassification: Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements. These reclassifications had no effect on the previously reported net loss. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments | Note 3 - Financial Instruments Fair value of financial instruments: Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures, relating to fair value measurements, defines fair value and established a framework for measuring fair value. ASC 820 fair value hierarchy distinguishes between market participant assumptions developed based on market data obtained from sources independent of the reporting entity and the reporting entity's own assumptions about market participant assumptions developed based on the best information available in the circumstances. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price. In addition, the fair value of assets and liabilities should include consideration of non-performance risk, which for the liabilities described below includes the Company's own credit risk. In accordance with ASC 820 when measuring the fair value, an entity shall take into account the characteristics of the asset or liability if a market participant would take those characteristics into account when pricing the asset or liability at the measurement date. Such characteristics include, for example: a. The condition and location of the asset. b. Restrictions, if any, on the sale or the use of the asset. As a basis for considering such assumptions, ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Valuations based on quoted prices in active markets for identical assets that the Company has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment. Level 2 - Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The expected volatility of the share prices reflects the assumption that the historical volatility of the share prices is reasonably indicative of expected future trends. The carrying amounts of cash and cash equivalents, accounts receivable, other receivables, trade payables and accounts payable approximate their fair value due to the short-term maturities of such instruments. The Company holds share certificates in iMine Corporation ("iMine") formerly known as Diamante Minerals, Inc., a publicly-traded company on the OTCQB. Due to sales restrictions on the sale of the iMine share, the fair value of the shares was measured on the basis of the quoted market price for an otherwise identical unrestricted equity instrument of the same issuer that trades in a public market, adjusted to reflect the effect of the sales restrictions and is therefore, ranked as Level 2 assets. September 30, 2020 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 44 - December 31, 2019 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 26 - December 31, 2019 Fair value hierarchy Level 1 Level 2 Level 3 Financial liabilities Warrants and derivatives - 328 - (*) For the nine and three month periods ended September 30, 2020 and 2019, the recognized gain (loss) (based on quoted market prices with a discount due to security restrictions on iMine shares) of the marketable securities was $18 and $3, and $(146) and $(42), respectively. |
Stock Based Compensation
Stock Based Compensation | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Based Compensation | Note 4 - Stock Based Compensation The stock-based expense equity awards recognized in the financial statements for services received is related to Research and Development, Sales and Marketing and General and Administrative expenses as shown in the following table: Nine months ended Three months ended 2020 2019 2020 2019 Stock-based compensation expense - Research and Development 126 125 75 33 Stock-based compensation expense - Sales and Marketing 87 211 41 56 Stock-based compensation expense - General and Administrative 175 231 109 56 388 567 225 145 Options issued to consultants: a. Further to Note 11n of the Company's Annual Report on Form 10-K for the year ended December 31, 2019: In September 2020, the Company granted additional options to a consultant ("Consultant14") to purchase up to 22,233 shares of the Company's common stock. The options are exercisable at $1.08 per share and shall vest in four equal instalments every six months starting September 1, 2020. Unexercised options shall expire on September 1,2025. During the nine and three month period ended September 30, 2020, an amount of $1 was recorded by the Company as stock option compensation expense with respect to the option grant to Consultant14. b. During the nine month period ended September 30, 2020, the Company granted an aggregate of 28,233 options to consultants. No such options were exercised and 8,338 options expired. The total stock option compensation expense during the nine and three month period ended September 30, 2020 and 2019 which was recorded under sales and marketing was $8 and $3, and $70 and $10, respectively and under general and administrative was $17 and $5, and $65 and $11, respectively. Warrants issued to consultants: a. On January 15, 2020, the Company conducted a registered direct offering pursuant to which it issued 514,801 shares of its common stock and in a concurrent private placement issued warrants to purchase up to 514,801 shares of common stock at an exercise price of $3.76 per share for gross proceeds of $2,000. The term of the warrants are five and a half years. The Company received net proceeds of $1,694 after deducting placement agent fees and other offering expenses. In addition to the fees above, the Company issued to the placement agent warrants on substantially the same terms as the investors in the offering in an amount equal to 6% of the aggregate number of shares of common stock sold in the offering, or 30,888 shares of common stock, at an exercise price of $4.8563 per share and a term expiring on January 15, 2025. The warrants were measured at fair value of $52. b On May 8, 2020 the Company completed a public offering of (i) 1,925,001 units, each unit consisting of one share of common stock, and one warrant to purchase one share of common stock at a price of $1.10, and (ii) 2,620,453 pre-funded units, each pre-funded unit consisting of one pre-funded warrant to purchase one share of common stock and one warrant, at a price of $1.099 per pre-funded unit. The net proceeds to the Company from the offering were approximately $4.3 million, after deducting placement agent's fees and other offering expenses payable by the Company. The warrants to purchase an aggregate of 4,545,454 shares of common stock are immediately exercisable and may be exercised at a consideration of $1.10 per share. The term of the warrants are five and a half years. Pre-funded warrants were immediately exercisable and were exercisable at a nominal consideration of $0.001 per share. During May, 2020, the pre-funded warrants were exercised in full and therefore are no longer outstanding. In addition to the fees above, the Company issued to the placement agent warrants on substantially the same terms as the investors in the offering in an amount equal to 6% of the aggregate number of shares of common stock sold in the offering, or 272,727 shares of common stock, at an exercise price of $1.375 per share and a term expiring on May 6, 2025. The warrants were measured at fair value of $160. Pursuant to the anti-dilution adjustment provisions in outstanding warrants to purchase 144,277 shares of common stock, the per share exercise price was reduced to $0.9289, following the issuance of the securities in the public offering. c. Further to Note 11a of the Company's Annual Report on Form 10-K for the year ended December 31, 2019: In March 2020, warrants to purchase up to 66,667 shares of common stock of the Company, that were not exercised, expired. d. In June 2020, the Company entered into a consulting agreement with a consultant pursuant to which the Company agreed upon the three-month anniversary of the agreement to issue to the consultant a warrant to purchase up to 7,500 shares of the Company's common stock. The warrant is exercisable at $1.30 per share and has a term of 18 months from the grant date. During the nine and three month period ended September 30, 2020, an amount of $4 and $4, respectively, was recorded by the Company as stock option compensation expense with respect to the consultant. Stock Option Plan for Employees: In March 2017, the Company adopted the My Size, Inc. 2017 Equity Incentive Plan (the "2017 Employee Plan") pursuant to which the Company's Board of Directors may grant stock options to officers and key employees. The total number of options which may be granted to directors, officers, employees under this plan, was initially limited to 200,000 shares of common stock. Stock options can be granted with an exercise price equal to or less than the stock's fair market value at the grant date. As further described below, in August 2020, the Company's shareholders approved an increase in the number of shares available for issuance under the Plan to 1,450,000. On May 25, 2020, the compensation committee of the Board of Directors of the Company reduced the exercise price of outstanding options of employees and directors of the Company for the purchase of an aggregate of 140,237 shares of common stock of the Company (with exercise prices ranging between $18.15 and $9.15) to $1.04 per share, which was the closing price for the Company's common stock on May 22, 2020, and extended the term of the foregoing options for an additional one year from the original date of expiration. The incremental compensation cost resulting from the repricing was $53, and the expenses during both the nine and three months ended 30, 2020 were $47 and $4, respectively. On August 10, 2020, the Company's shareholders approved an increase in the shares available for issuance under the 2017 Employee Plan from 200,000 to 1,450,000 shares. As a result and pursuant to approval of the Company's compensation committee that was contingent on the foregoing shareholder approval, the following occurred on August 10, 2020: (i) the number of shares available for issuance under the Company's 2017 Consultant Incentive Plan was reduced from 466,667 to 216,667 shares: (ii) the Company granted to the Company's Chief Executive Officer (A) a five-year options to purchase up to 160,000 ordinary shares at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022, and (B) 80,000 performance-based restricted stock units, each representing the right to receive one share of common stock, which vest (x) upon the Company generating revenue of at least $50,000 in the Russian Federation during the year ending 2020, or (y) upon the Company generating revenue of at least $500,000 in the Russian Federation during the year ending 2021; (iii) the Company granted five-year options to purchase up to 130,000 ordinary shares to the Company's Chief Financial Officer at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; (iv) the Company granted five-year options to purchase up to 130,000 ordinary shares to the Company's Chief Operating Officer and Chief Product Officer at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; (v) the Company granted five-year options to purchase up to 325,893 ordinary shares to other employees of the Company at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; and (vi) the Company granted five-year options to purchase up to 30,000 ordinary shares to each of the Company's non-employee board members at an exercise price of $1.04 per share. These options vest on November 26, 2020. During the nine and three month period ended September 30, 2020, the Company granted an aggregate of 861,999 of stock options under the 2017 Employee Plan, no such options were exercised and options to purchase 24,780 and 2,780 shares of common stock, respectively, expired. The total stock option compensation expense during the nine and three month period ended September 30, 2020 and 2019 which was recorded was $312 and $209, and $432 and $124, respectively. |
Contingencies and Commitments
Contingencies and Commitments | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Commitments | Note 5 - Contingencies and Commitments a. On August 7, 2018, the Company commenced an action against North Empire LLC ("North Empire") in the Supreme Court of the State of New York, County of New York for breach of a Securities Purchase Agreement (the "Agreement") in which it is seeking damages in an amount to be determined at trial, but in no event less than $616,000. On August 2, 2018, North Empire filed a Summons with Notice against the Company, also in the same Court, in which they allege damages in an amount of $11.4 million arising from an alleged breach of the Agreement. On September 6, 2018 North Empire filed a Notice of Discontinuance of the action it had filed on August 2, 2018. On September 27, 2018, North Empire filed an answer and asserted counterclaims in the action commenced by the Company against them, alleging that the Company failed to deliver stock certificates to North Empire causing damage to North Empire in the amount of $10,958,589. North Empire also filed a third-party complaint against the Company's CEO and now former Chairman of the Board asserting similar claims against them in their individual capacities. On October 17, 2018, the Company filed a reply to North Empire's counterclaims. On November 15, 2018, the Company's CEO and now former Chairman of the Board filed a motion to dismiss North Empire's third-party complaint. On January 6, 2020, the Court granted the motion and dismissed the third-party complaint. The parties are now engaging in discovery in connection with the claims and counterclaims. The Company believes it is more likely than not that the counterclaims will be denied. b. Further to Note 13b of the Company's Annual Report on Form 10-K for the year ended December 31, 2019: On February 7, 2020, the Company received the formal decision of the Nasdaq Hearings Panel (the "Panel"), in which the Panel determined that the Company has evidenced full compliance with the minimum $1.00 per share bid price requirement, and granted the Company's request for continued listing on Nasdaq pursuant to an extension, through May 18, 2020, to demonstrate compliance with the minimum $2.5 million stockholders' equity requirement. On May 12, 2020, the Company received the formal decision of the Panel, in which the Panel determined that the Company has evidenced full compliance with the minimum $2.5 million stockholders' equity requirement. Accordingly, the Panel has determined to continue the listing of the Company's securities on the Nasdaq Stock Market and closed this matter. |
Significant Events During the R
Significant Events During the Reporting Period | 9 Months Ended |
Sep. 30, 2020 | |
Other Receivables and Prepaid Expenses [Abstract] | |
Significant Events During the Reporting Period | Note 6 - Significant Events During the Reporting Period a. On January 15, 2020, the Company conducted a public offering of its securities pursuant to which it issued 514,801 shares of its common stock and warrants to purchase up to 514,801 shares of common stock at an exercise price of $3.76 per share for gross proceeds of $2,000. The term of the warrants are five and a half years. The Company received net proceeds of $1,694 after deducting placement agent fees and other offering expenses. b. On May 8, 2020, the Company conducted a public offering of its securities pursuant to which it issued 1,925,001 shares of its common stock, pre funded warrants to purchase up to 2,620,453 shares of common stock at an exercise price of $0.001 per share and five-year warrants to purchase up to 4,545,454 shares of common stock at an exercise price of $1.10 per share for gross proceeds of $5,000. The net proceeds to the Company from the offering were approximately $4,300, after deducting placement agent's fees and other offering expenses payable by the Company. In addition, the Company issued to the placement agent five-year placement agent warrants to purchase 272,727 shares of common stock at an exercise price of $1.375 per share. c. In late 2019, a novel strain of COVID-19, also known as coronavirus, was reported in Wuhan, China. While initially the outbreak was largely concentrated in China, it has now spread to Israel and the United States, and infections have been reported globally. Many countries around the world, including in Israel, have significant governmental measures being implemented to control the spread of the virus, including temporary closure of businesses, severe restrictions on travel and the movement of people, and other material limitations on the conduct of business. These measures have resulted in work stoppages and other disruptions. The Company has implemented remote working and work place protocols for its employees in accordance with government requirements. In addition, while the Company has seen an increased demand for MySizeID, the COVID-19 pandemic has had a particularly adverse impact on the retail industry and this has resulted in an adverse impact on the Company's marketing and sales activities. For example, the Company has three ongoing pilots with international retailers that have been halted, the Company is unable to participate physically in industry conferences, its ability to meet with potential customers is limited and in certain instances sales processes have been delayed or cancelled. The extent to which COVID-19 continues to impact the Company's operations will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration and severity of the outbreak, and the actions that may be required to contain COVID-19 or treat its impact. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Unaudited condensed consolidated financial statements | a. Unaudited condensed consolidated financial statements: The accompanying unaudited condensed consolidated interim financial statements included herein have been prepared by the Company in accordance with the rules and regulations of the United States Securities and Exchange Commission ("SEC"). The unaudited condensed consolidated financial statements are comprised of the financial statements of the Company. In management's opinion, the interim financial data presented includes all adjustments necessary for a fair presentation. All intercompany accounts and transactions have been eliminated. Certain information required by U.S. generally accepted accounting principles ("GAAP") has been condensed or omitted in accordance with rules and regulations of the SEC. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2019. |
Use of estimates | b. Use of estimates: The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. |
Functional currency | c. Functional currency: The Company reassessed its functional currency and determined to change its functional currency to the U.S. dollar from the NIS as of January 1, 2020. The change in functional currency was accounted for prospectively from that date. In 2019, the Company went through a strategic shift which involved a significant change in its business model, that clearly indicates that the functional currency has changed, beginning January 2020. In previous years, the Company acted as a platform to fund its operational subsidiary, My Size Israel, which conducts its research and development activities in NIS. Accordingly, the Company has not been substantially focused on its operating activities for that period. By the end of 2018, the Company transitioned to a new business model (B2B2C) and concluded that the main market that the Company should focus on would be the apparel market in the US. Consequently, the Company established marketing and distribution channels in the US along with having a new pricing model denominated in USD. Throughout 2019, the Company itself hired sales personnel which are based in the US and signed agreements with customers for which it began generating revenue in USD for the first time since it began its operations. Accordingly, by the end of 2019, the Company is no longer considered a 'holding company' for the matter of determining its functional currency under ASC 830 based on the currency of its operating entities. As a result of being an operational company that enters into operational agreements and generates revenues on an ongoing basis, the management of the Company has concluded that as of January 1 2020, the currency that most faithfully portrays the economic results of the Company's operations is the U.S. dollar. My Size Israel's functional currency remains the NIS. As a result of the change in the Company's functional currency, the Company reclassified its warrants that were outstanding as a financial liability in an amount of $328 as at December 31, 2019 to equity. |
Reclassification | d. Reclassification: Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements. These reclassifications had no effect on the previously reported net loss. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of significant assets and liabilities that are measured at fair value on recurring basis | September 30, 2020 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 44 - December 31, 2019 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 26 - December 31, 2019 Fair value hierarchy Level 1 Level 2 Level 3 Financial liabilities Warrants and derivatives - 328 - (*) For the nine and three month periods ended September 30, 2020 and 2019, the recognized gain (loss) (based on quoted market prices with a discount due to security restrictions on iMine shares) of the marketable securities was $18 and $3, and $(146) and $(42), respectively. |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock options granted to non-employees | Nine months ended Three months ended 2020 2019 2020 2019 Stock-based compensation expense - Research and Development 126 125 75 33 Stock-based compensation expense - Sales and Marketing 87 211 41 56 Stock-based compensation expense - General and Administrative 175 231 109 56 388 567 225 145 |
General (Details)
General (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
General (Textual) | ||
Accumulated deficit | $ 32,951 | $ 28,514 |
Significant Accounting Polici_3
Significant Accounting Policies (Details) | Dec. 31, 2019shares |
Significant Accounting Policies (Textual) | |
Warrants outstanding as financial liability | 328 |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | |
Level 1 [Member] | |||
Financial assets | |||
Investment in marketable securities | [1] | ||
Financial liabilities | |||
Warrants and derivatives | |||
Level 2 [Member] | |||
Financial assets | |||
Investment in marketable securities | [1] | 44 | 26 |
Financial liabilities | |||
Warrants and derivatives | 328 | ||
Level 3 [Member] | |||
Financial assets | |||
Investment in marketable securities | [1] | ||
Financial liabilities | |||
Warrants and derivatives | |||
[1] | For the nine and three month periods ended September 30, 2020 and 2019, the recognized gain (loss) (based on quoted market prices with a discount due to security restrictions on iMine shares) of the marketable securities was $18 and $3, and $(146) and $(42), respectively. |
Financial Instruments (Details
Financial Instruments (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Financial Instruments (Textual) | ||||
Recognized gain (loss) of marketable securities | $ 3 | $ (42) | $ 18 | $ (146) |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 225 | $ 145 | $ 388 | $ 567 |
Research and Development [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 75 | 33 | 126 | 125 |
Sales and Marketing [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 41 | 56 | 87 | 211 |
General and Administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 109 | $ 56 | $ 175 | $ 231 |
Stock Based Compensation (Det_2
Stock Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Aug. 10, 2020 | May 25, 2020 | May 08, 2020 | Jan. 15, 2020 | Aug. 31, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2017 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 |
Stock Based Compensation (Textual) | |||||||||||||
Stock-based compensation expense | $ 225 | $ 145 | $ 388 | $ 567 | |||||||||
Number of shares of common stock | 861,999 | 861,999 | |||||||||||
Number of options to purchase common stock expired | 2,780 | ||||||||||||
Number of options to purchase common stock | 1,450,000 | 24,780 | |||||||||||
Common stock shares issued | 7,232,836 | 7,232,836 | 2,085,900 | ||||||||||
Exercise price | $ 0.001 | $ 0.001 | |||||||||||
Share price | $ 0.001 | ||||||||||||
Warrants to purchase | 272,727 | ||||||||||||
Warrants measured at fair value | $ 160 | $ 160 | |||||||||||
Number of warrants to purchase according to anti-dilution adjustment provisions | 144,277 | 144,277 | |||||||||||
Term expiring | May 6, 2025 | ||||||||||||
Public Offering [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Common stock shares issued | 1,925,001 | ||||||||||||
Exercise price | $ 1.099 | ||||||||||||
Pre funded warrants | 2,620,453 | ||||||||||||
Share price | $ 1.10 | ||||||||||||
Warrants to purchase | 4,545,454 | ||||||||||||
Gross proceeds | $ 5,000 | ||||||||||||
Net proceeds | $ 4,300 | ||||||||||||
Consulting agreement, description | In addition to the fees above, the Company issued to the placement agent warrants on substantially the same terms as the investors in the offering in an amount equal to 6% of the aggregate number of shares of common stock sold in the offering, or 272,727 shares of common stock, at an exercise price of $1.375 per share and a term expiring on May 6, 2025. | ||||||||||||
Stock option compensation expense with respect to consultant | $ 4 | $ 4 | |||||||||||
Reduction of exercise price | $ 0.9289 | ||||||||||||
Selling and Marketing Expense [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Stock-based compensation expense | 41 | 56 | 87 | 211 | |||||||||
General and Administrative [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Stock-based compensation expense | 109 | 56 | 175 | 231 | |||||||||
Employee Stock Option [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Number of shares of common stock | 200,000 | ||||||||||||
Stock option compensation expense | 209 | 124 | 312 | 432 | |||||||||
Exercise price of outstanding options, description | The Company’s shareholders approved an increase in the shares available for issuance under the 2017 Employee Plan from 200,000 to 1,450,000 shares. As a result and pursuant to approval of the Company’s compensation committee that was contingent on the foregoing shareholder approval, the following occurred on August 10, 2020: (i) the number of shares available for issuance under the Company’s 2017 Consultant Incentive Plan was reduced from 466,667 to 216,667 shares: (ii) the Company granted to the Company’s Chief Executive Officer (A) a five-year options to purchase up to 160,000 ordinary shares at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022, and (B) 80,000 performance-based restricted stock units, each representing the right to receive one share of common stock, which vest (x) upon the Company generating revenue of at least $50,000 in the Russian Federation during the year ending 2020, or (y) upon the Company generating revenue of at least $500,000 in the Russian Federation during the year ending 2021; (iii) the Company granted five-year options to purchase up to 130,000 ordinary shares to the Company’s Chief Financial Officer at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; (iv) the Company granted five-year options to purchase up to 130,000 ordinary shares to the Company’s Chief Operating Officer and Chief Product Officer at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; (v) the Company granted five-year options to purchase up to 325,893 ordinary shares to other employees of the Company at an exercise price of $1.04 per share. One quarter of such options vest on November 26, 2020, one quarter vest on May 26, 2021, one quarter vest on November 26, 2021 and one quarter vest on May 26, 2022; and (vi) the Company granted five-year options to purchase up to 30,000 ordinary shares to each of the Company’s non-employee board members at an exercise price of $1.04 per share. These options vest on November 26, 2020. | The compensation committee of the Board of Directors of the Company reduced the exercise price of outstanding options of employees and directors of the Company for the purchase of an aggregate of 140,237 shares of common stock of the Company (with exercise prices ranging between $18.15 and $9.15) to $1.04 per share, which was the closing price for the Company’s common stock on May 22, 2020, and extended the term of the foregoing options for an additional one year from the original date of expiration. The incremental compensation cost resulting from the repricing was $53, and the expenses during both the nine and three months ended September 30, 2020 were $47 and $4, respectively. | |||||||||||
Employee Stock Option [Member] | Selling and Marketing Expense [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Stock-based compensation expense | 70 | 10 | 8 | 3 | |||||||||
Employee Stock Option [Member] | General and Administrative [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Stock-based compensation expense | $ 65 | $ 11 | $ 17 | $ 5 | |||||||||
Consultant [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Number of shares of common stock | 28,233 | ||||||||||||
Number of options to purchase common stock expired | 8,338 | ||||||||||||
Common stock shares issued | 514,801 | ||||||||||||
Exercise price | $ 3.76 | $ 1.08 | $ 1.08 | ||||||||||
Number of common stock purchased by warrants | 22,233 | 22,233 | |||||||||||
Warrants to purchase | 514,801 | 66,667 | |||||||||||
Gross proceeds | $ 2,000 | ||||||||||||
Net proceeds | $ 1,694 | ||||||||||||
Warrants term | 5 years 6 months | ||||||||||||
Warrants measured at fair value | $ 52 | $ 52 | |||||||||||
Consulting agreement, description | The Company entered into a consulting agreement with a consultant pursuant to which the Company agreed upon the three-month anniversary of the agreement to issue to the consultant a warrant to purchase up to 7,500 shares of the Company’s common stock. The warrant is exercisable at $1.30 per share and has a term of 18 months from the grant date. | In addition to the fees above, the Company issued to the placement agent warrants on substantially the same terms as the investors in the offering in an amount equal to 6% of the aggregate number of shares of common stock sold in the offering, or 30,888 shares of common stock, at an exercise price of $4.8563 per share and a term expiring on January 15, 2025. | |||||||||||
Consultant One [Member] | |||||||||||||
Stock Based Compensation (Textual) | |||||||||||||
Stock option compensation expense | $ 1 | $ 1 |
Contingencies and Commitments (
Contingencies and Commitments (Details) - USD ($) $ in Thousands | May 12, 2020 | Feb. 07, 2020 | Aug. 07, 2018 | Aug. 02, 2018 |
Contingencies and Commitments (Textual) | ||||
Plaintiff damage, description | North Empire filed a Summons with Notice against the Company, also in the same Court, in which they allege damages in an amount of $11.4 million arising from an alleged breach of the Agreement. On September 6, 2018 North Empire filed a Notice of Discontinuance of the action it had filed on August 2, 2018. On September 27, 2018, North Empire filed an answer and asserted counterclaims in the action commenced by the Company against them, alleging that the Company failed to deliver stock certificates to North Empire causing damage to North Empire in the amount of $10,958,589. North Empire also filed a third-party complaint against the Company’s CEO and now former Chairman of the Board asserting similar claims against them in their individual capacities. On October 17, 2018, the Company filed a reply to North Empire’s counterclaims. On November 15, 2018, the Company’s CEO and now former Chairman of the Board filed a motion to dismiss North Empire’s third-party complaint. On January 6, 2020, the Court granted the motion and dismissed the third-party complaint. The parties are now engaging in discovery in connection with the claims and counterclaims. | |||
Seeking damages amount | $ 616,000 | $ 11,400 | ||
Nasdaq capital market, description | The Company received the formal decision of the Panel, in which the Panel determined that the Company has evidenced full compliance with the minimum $2.5 million stockholders' equity requirement. Accordingly, the Panel has determined to continue the listing of the Company's securities on the Nasdaq Stock Market and closed this matter. | The Company received the formal decision of the Nasdaq Hearings Panel (the “Panel”), in which the Panel determined that the Company has evidenced full compliance with the minimum $1.00 per share bid price requirement, and granted the Company’s request for continued listing on Nasdaq pursuant to an extension, through May 18, 2020, to demonstrate compliance with the minimum $2.5 million stockholders’ equity requirement. |
Significant Events During the_2
Significant Events During the Reporting Period (Details) - USD ($) $ / shares in Units, $ in Thousands | May 08, 2020 | Jan. 15, 2020 | Mar. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Significant Events During the Reporting Period (Textual) | |||||
Issuance of common stock | 7,232,836 | 2,085,900 | |||
Warrants to purchase | 272,727 | ||||
Exercise price per share | $ 1.375 | ||||
Share price | $ 0.001 | ||||
Public Offering [Member] | |||||
Significant Events During the Reporting Period (Textual) | |||||
Issuance of common stock | 1,925,001 | ||||
Warrants to purchase | 4,545,454 | ||||
Exercise price per share | $ 1.099 | ||||
Gross proceeds | $ 5,000 | ||||
Net proceeds receivable | $ 4,300 | ||||
Pre funded warrant | 2,620,453 | ||||
Share price | $ 1.10 | ||||
Consultant [Member] | |||||
Significant Events During the Reporting Period (Textual) | |||||
Issuance of common stock | 514,801 | ||||
Warrants to purchase | 514,801 | 66,667 | |||
Exercise price per share | $ 3.76 | ||||
Gross proceeds | $ 2,000 | ||||
Net proceeds receivable | $ 1,694 | ||||
Warrants term | 5 years 6 months |