Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 20, 2023 | |
Document Information Line Items | ||
Entity Registrant Name | SAMSARA LUGGAGE, INC. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 11,622,414 | |
Amendment Flag | false | |
Entity Central Index Key | 0001530163 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Sep. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-54649 | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 26-0299456 | |
Entity Address, Address Line One | 135 E. 57th Street | |
Entity Address, Address Line Two | Suite 18-130 | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | (855) | |
Local Phone Number | -256-7477 | |
Entity Interactive Data Current | Yes |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 35 | $ 168 |
Accounts receivable | 1 | |
Inventory | 72 | 155 |
Other current assets | 13 | 21 |
Total current assets | 120 | 345 |
TOTAL ASSETS | 120 | 345 |
Current liabilities | ||
Accounts payable | 133 | 47 |
Other current liabilities | 453 | 285 |
Related party payable | 161 | 121 |
Deferred revenue | 2 | 6 |
Convertible notes and short-term loans | 1,226 | 1,167 |
Note payable, net | 27 | 61 |
Conversion option derivative liability | 922 | 632 |
Warrant derivative liability | 1 | |
Total current liabilities | 2,924 | 2,320 |
TOTAL LIABILITIES | 2,924 | 2,320 |
MEZZANINE EQUITY: | ||
Convertible and redeemable preferred shares, $0.0001 par value, 1,000,000 shares authorized, 80,698 and 193,408 shares outstanding at September 30, 2023 and December 31, 2022, respectively | 66 | 161 |
STOCKHOLDERS’ DEFICIT | ||
Common stock, $0.0001 par value; 7,500,000,000 shares authorized; 11,622,414 and 4,406,312 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively. | 1 | |
Additional paid-in capital | 10,605 | 10,464 |
Accumulated deficit | (13,476) | (12,600) |
Total stockholders’ deficit | (2,870) | (2,136) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | 120 | 345 |
Related Party | ||
Current liabilities | ||
Related party payable | $ 161 | $ 121 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parentheticals) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Convertible and redeemable preferred shares, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Convertible and redeemable preferred shares, authorized | 1,000,000 | 1,000,000 |
Convertible and redeemable preferred shares, outstanding | 80,698 | 193,408 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized shares | 7,500,000,000 | 7,500,000,000 |
Common stock, shares issued | 11,622,414 | 4,406,312 |
Common stock, shares outstanding | 11,622,414 | 4,406,312 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
REVENUE | $ 9 | $ 235 | $ 358 | $ 378 |
COST OF GOODS SOLD | 17 | 206 | 203 | 287 |
GROSS PROFIT | (8) | 29 | 155 | 91 |
OPERATING EXPENSES | ||||
Research and development | 66 | 43 | 112 | |
Sales and marketing | 16 | 175 | 144 | 585 |
General and administrative | 65 | 176 | 354 | 625 |
TOTAL OPERATING EXPENSES | 81 | 417 | 541 | 1,322 |
OPERATING LOSS | (89) | (388) | (386) | (1,231) |
FINANCING INCOME (EXPENSES) | ||||
Interest and amortization of issuance cost on note and short-term loan and other | (37) | (170) | (200) | (776) |
Income (expenses) in respect of warrants issued and convertible component in convertible loan, net interest expenses | (561) | 89 | (290) | 307 |
TOTAL FINANCING INCOME (EXPENSES) | (598) | (81) | (490) | (469) |
NET INCOME (LOSS) | $ (687) | $ (469) | $ (876) | $ (1,700) |
Net Income (Loss) Per-share | ||||
Basic (in Dollars per share) | $ (0.07) | $ (0.15) | $ (0.12) | $ (0.67) |
Diluted (in Dollars per share) | $ (0.07) | $ (0.15) | $ (0.12) | $ (0.67) |
Weighted average number of common shares outstanding (in Shares) | 10,480,891 | 3,108,358 | 7,538,709 | 2,521,517 |
Condensed Statements of Changes
Condensed Statements of Changes in Stockholders’ Deficit (Unaudited) - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Services receivable | Accumulated Deficit | Total |
Balance at Dec. 31, 2021 | $ 9,852 | $ (356) | $ (10,194) | $ (698) | |
Balance (in Shares) at Dec. 31, 2021 | 2,055,487 | ||||
Conversion of convertible debt into common shares | 56 | 56 | |||
Conversion of convertible debt into common shares (in Shares) | 97,458 | ||||
Amortization of services | 176 | 176 | |||
Net income (loss) | (289) | (289) | |||
Balance at Mar. 31, 2022 | 9,908 | (180) | (10,483) | (755) | |
Balance (in Shares) at Mar. 31, 2022 | 2,152,945 | ||||
Balance at Dec. 31, 2021 | 9,852 | (356) | (10,194) | (698) | |
Balance (in Shares) at Dec. 31, 2021 | 2,055,487 | ||||
Net income (loss) | (1,700) | ||||
Balance at Sep. 30, 2022 | 10,207 | (11,894) | (1,687) | ||
Balance (in Shares) at Sep. 30, 2022 | 3,323,085 | ||||
Balance at Mar. 31, 2022 | 9,908 | (180) | (10,483) | (755) | |
Balance (in Shares) at Mar. 31, 2022 | 2,152,945 | ||||
Conversion of convertible debt into common shares | 141 | 141 | |||
Conversion of convertible debt into common shares (in Shares) | 457,604 | ||||
Issuance of shares to service provider | 41 | 41 | |||
Issuance of shares to service provider (in Shares) | 27,303 | ||||
Amortization of services | 150 | 150 | |||
Net income (loss) | (942) | (942) | |||
Balance at Jun. 30, 2022 | 10,090 | (30) | (11,425) | (1,365) | |
Balance (in Shares) at Jun. 30, 2022 | 2,637,852 | ||||
Conversion of convertible debt into common shares | 117 | 117 | |||
Conversion of convertible debt into common shares (in Shares) | 685,233 | ||||
Issuance of shares to service provider | 30 | 30 | |||
Amortization of services | (469) | (469) | |||
Net income (loss) | (469) | ||||
Balance at Sep. 30, 2022 | 10,207 | (11,894) | (1,687) | ||
Balance (in Shares) at Sep. 30, 2022 | 3,323,085 | ||||
Balance at Dec. 31, 2022 | 10,464 | (12,600) | (2,136) | ||
Balance (in Shares) at Dec. 31, 2022 | 4,406,312 | ||||
Conversion of Preferred A shares into common shares | $ 1 | 40 | 41 | ||
Conversion of Preferred A shares into common shares (in Shares) | 1,481,840 | ||||
Net income (loss) | (238) | (238) | |||
Balance at Mar. 31, 2023 | $ 1 | 10,504 | (12,838) | (2,333) | |
Balance (in Shares) at Mar. 31, 2023 | 5,888,152 | ||||
Balance at Dec. 31, 2022 | 10,464 | (12,600) | (2,136) | ||
Balance (in Shares) at Dec. 31, 2022 | 4,406,312 | ||||
Net income (loss) | (876) | ||||
Balance at Sep. 30, 2023 | $ 1 | 10,605 | (13,476) | (2,870) | |
Balance (in Shares) at Sep. 30, 2023 | 11,622,414 | ||||
Balance at Mar. 31, 2023 | $ 1 | 10,504 | (12,838) | (2,333) | |
Balance (in Shares) at Mar. 31, 2023 | 5,888,152 | ||||
Conversion of Preferred A shares into common shares | 35 | 35 | |||
Conversion of Preferred A shares into common shares (in Shares) | 2,049,297 | ||||
Stock Based Compensation | 46 | 46 | |||
Stock Based Compensation (in Shares) | 1,666,666 | ||||
Net income (loss) | 49 | 49 | |||
Balance at Jun. 30, 2023 | $ 1 | 10,585 | (12,789) | (2,203) | |
Balance (in Shares) at Jun. 30, 2023 | 9,604,115 | ||||
Conversion of Preferred A shares into common shares | 20 | 20 | |||
Conversion of Preferred A shares into common shares (in Shares) | 2,018,299 | ||||
Stock Based Compensation | |||||
Net income (loss) | (687) | (687) | |||
Balance at Sep. 30, 2023 | $ 1 | $ 10,605 | $ (13,476) | $ (2,870) | |
Balance (in Shares) at Sep. 30, 2023 | 11,622,414 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash Flows From Operating Activities | ||
Net loss | $ (876) | $ (1,700) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Amortization of services receivable | 356 | |
Stock based compensation | 46 | |
Interest on convertible note and short-term loan and amortization of issuance cost | 41 | 776 |
Change in fair value of liability | (1) | |
Expenses in respect of warrants issued and convertible component in convertible loan, net interest expenses | 290 | (308) |
Change in operating assets and liabilities | ||
Inventory | 83 | (92) |
Prepaid expenses and other current assets | 8 | |
Accounts receivable | 1 | |
Other current assets | 38 | |
Accounts payable | 86 | (15) |
Other current liabilities | 169 | (61) |
Deferred revenues | (4) | 135 |
Related parties payable | 40 | (16) |
Net cash used in operating activities | (117) | (887) |
Cash Flows From Investing Activities | ||
Purchase of property and equipment | ||
Net cash provided by (used in) investing activities | ||
Cash Flows From Financing Activities | ||
Repayment of notes payable | (16) | |
Proceeds from issuance of preferred stock, net of issuance costs | 185 | |
Net cash provided by financing activities | (16) | 185 |
Net change in cash and cash equivalents | (133) | (702) |
Cash and cash equivalents, beginning of period | 168 | 827 |
Cash and cash equivalents, end of period | 35 | 125 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | ||
Cash paid for income tax | ||
Non-cash investing and financing activities | ||
Common stock issued for conversion of convertible note and accrued interest | 314 | |
Common stock issued against accounts payables | $ 96 | $ 41 |
Organization and Description of
Organization and Description of Business | 9 Months Ended |
Sep. 30, 2023 | |
Organization and Description of Business [Abstract] | |
Organization and Description of Business | NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS A. Samsara Luggage is a global smart luggage and lifestyle brand that incorporates innovative design and functional technology into its smart travel products. The Company launched the first product from the Tag Smart collection of smart suitcases in April 2022, as travel resumed to pre-COVID levels. This collection is equipped with Apple AirTag technology, allowing travelers to track their suitcase using the iPhone’s Find My app. Lost luggage became a prominent issue for global travelers during the Summer 2022 travel season. The Tag Smart suitcase offered travelers precise tracking of their suitcase along with immediate information regarding their luggage’s whereabouts. The Tag Smart collection is currently available in two different sizes to accommodate both international and US domestic travel. The newest collection comes in three colors in durable polycarbonate and two colors in a lightweight, aviation-grade aluminum material. The Company launched Street Smart in February 2023. Street Smart is a curated collection of travel and lifestyle accessories that builds on the fashion element of travel. Included in the collection are a selection of sunglasses, tote bag, stylish ballcaps and a stand-alone portable battery for electronic devices. Street Smart compliments Samsara Luggage’s aesthetic and allows the brand to offer more travel-ready products at varying price points. During the last quarter of 2020, Samsara launched Sarah & Sam Fashion and Lifestyle Collection. Sarah & Sam is a part of Samsara Direct business model prompted by the travel limitations due to the coronavirus pandemic, leveraging the company’s established digital assets and manufacturing and fulfillment supply chain capabilities to offer additional consumer products that respond to the changing needs of the market. On November 12, 2019, the Company completed its merger with the Delaware corporation that was previously known as “Samsara Luggage, Inc.” (“Samsara Delaware”) in accordance with the terms of the Merger Agreement and Plan of Merger, dated as of May 10, 2019, (the “Merger Agreement”) by and among the Company, Samsara Delaware, and Avraham Bengio, pursuant to which Samsara Delaware merged with and into the Company, with the Company being the surviving corporation (the “Merger”). Following the completion of the Merger, the business of the Company going forward became the business of Samsara Delaware prior to the Merger, namely, designing, manufacturing, and selling high quality luggage products to meet the evolving needs of frequent travelers and also seeking to present new technologies within the aluminum luggage industry, including an aluminum “smart” suitcase. The Common Stock listed on the OTC Pink Marketplace, previously trading through the close of business on November 11, 2019 under the ticker symbol “DAVC,” commenced trading on the OTC Pink Marketplace under the ticker symbol “SAML” on November 12, 2019. The Common Stock has a new CUSIP number, 79589J101. B. Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of September 30, 2023, the Company had approximately $35 i approximately $ and |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION Unaudited Interim Financial Statements The accompanying unaudited financial statements include the accounts of the Company, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the for nine-months ended September 30, 2023. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2023. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses. Actual amounts could differ from these estimates. Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). The accompanying unaudited condensed financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on April 3, 2023 (the “Annual Report”). For further information, reference is made to the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“‘US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. As applicable to the financial statements, the most significant estimates and assumptions relate to the measurement of the convertible notes, derivative liabilities and going concern. Functional currency The functional currency of the Company is the US dollar (“US$”), which is the currency of the primary economic environment in which the operations of the Company are conducted. Cash and cash equivalents Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired. Inventory Inventories are valued at the lower of cost or net realizable value. Cost of raw and packaging materials, purchased products, manufactured finished products and products in process are determined on the average cost basis. The Company regularly reviews its inventories for impairment and reserves are established when necessary. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the related assets, which range from three to five years. Derivative Liabilities and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments. Fair value, as defined in ASC 820, is 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. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company records a debt discount related to the issuance of convertible debts that have conversion features at adjustable rates. The debt discount for the convertible instruments is recognized and measured by allocating a portion of the proceeds as an increase in additional paid-in capital and as a reduction to the carrying amount of the convertible instrument equal to the fair value of the conversion features. The debt discount will be accreted by recording additional non-cash gains and losses related to the change in fair values of derivative liabilities over the life of the convertible notes. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of September 30, 2023 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 922 922 Fair value of warrants issued in convertible loan - - - - Total liabilities - - 922 922 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 632 632 Fair value of warrants issued in convertible loan - - 1 1 Total liabilities - - 633 633 Revenue recognition Revenues are recognized when delivery has occurred and there is persuasive evidence of an agreement, the fee is fixed or determinable and collection of the related receivables is reasonably assured, and no further obligations exist. Revenues from sales of products are recognized when title and risk and rewards for the products are transferred to the customer. Research and development expenses Research and development expenses are charged to operations as incurred. Income Taxes Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code section 382 if a change of ownership occurs. Net Loss Per Basic and Diluted Common Share Basic loss per ordinary share is computed by dividing the loss for the period applicable to ordinary shareholders by the weighted average number of shares of common stock outstanding during the period. Securities that may participate in dividends with the shares of common stock (such as the convertible preferred) are considered in the computation of basic loss per share under the two-class method. However, in periods of net loss, only the convertible preferred shares are considered, since such shares have a contractual obligation to share in the losses of the Company. In computing diluted loss per share, basic loss per share is adjusted to reflect the potential dilution that could occur upon the exercise of potential shares. Accordingly, in periods of net loss, no potential shares are considered. Recent accounting pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed, the Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on the Company’s financial position or results of operations upon adoption. |
Convertible Notes
Convertible Notes | 9 Months Ended |
Sep. 30, 2023 | |
Convertible Notes [Abstract] | |
CONVERTIBLE NOTES | NOTE 3 – CONVERTIBLE NOTES A. On June 5, 2019, the Company entered into a Securities Purchase Agreement (“SPA”) with YAII PN, Ltd. (the “Investor”), pursuant to which the Investor agreed to provide the Company with a convertible loan in the aggregate amount of $1,100,000 in three tranches, and the Company agreed to issue convertible debentures and a warrant to the Investor. The funds were received in 2019. In the period from loan inception through December 31, 2021, the full amount of outstanding principal and accrued interest was converted into shares of common stock. In addition, the Company issued to the Investor a warrant to purchase 13,095 shares of common stock, at an exercise price equal to $21.00. The warrants may be exercised within 5 years from the issuance date by cash payment or through cashless exercise by the surrender of warrants shares having a value equal to the exercise price of the portion of the warrant being exercised. The Company considered the provisions of ASC 815-40, “Derivatives and Hedging: Contracts in Entity’s Own Equity”, with respect to the detachable warrants that were issued to the convertible loan, and determined that as a result of the “cashless exercise” and variable exercise price that would adjust the number of warrants and the exercise price of the warrants based on the price at which the Company subsequently issues shares or other equity-linked financial instruments, such warrants cannot be considered as indexed to the Company’s own stock. Accordingly, the warrants were recognized as derivative liability at their fair value on initial recognition. In subsequent periods, the warrants were marked to market with the changes in fair value recognized as financing expense or income in the consolidated statement of operations. The warrants were estimated by third party appraiser using the Black-Scholes option-pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet date. The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Expected volatility 135.81 % Expected term 0.68 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price 0.0902 Expected volatility 262.09 % Expected term 1.43 years Risk free rate 4.59 % Expected dividend yield 0 % Fair market value of warrants $ - * * represents an amount less than $1 thousand B. On September 3, 2020, the Company entered into a second SPA with the Investor, pursuant to which the Investor will invest an aggregate amount of $220 in two tranches, and the Company will issue convertible debentures and warrants to the Investor. The funds were received in 2020. In the period from loan inception through December 31, 2021, the full amount of outstanding principal and accrued interest was converted into shares of common stock. In addition, the Company issued to the Investor a warrant to purchase 2,619 shares of common stock, at an exercise price equal to $21.00. The warrants may be exercised within 5 years from the issuance date by cash payment or through cashless exercise by the surrender of warrants shares having a value equal to the exercise price of the portion of the warrant being exercised. The Company considered the provisions of ASC 815-40, “Derivatives and Hedging: Contracts in Entity’s Own Equity”, with respect to the detachable warrants that were issued to the Convertible loan, and determined that as a result of the “cashless exercise” and variable exercise price that would adjust the number of warrants and the exercise price of the warrants based on the price at which the Company subsequently issues shares or other equity-linked financial instruments, such warrants cannot be considered as indexed to the Company’s own stock. Accordingly, the warrants were recognized as derivative liability at their fair value on initial recognition. In subsequent periods, the warrants were marked to market with the changes in fair value recognized as financing expense or income in the consolidated statement of operations. The warrants were estimated by third party appraiser using the Black-Scholes option-pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet dates: The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Expected volatility 224.93 % Expected term (years) 1.93 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price 0.0902 Expected volatility 278.10 % Expected term (years) 2.68 Risk free rate 4.28 % Expected dividend yield 0 % Fair market value of warrants $ - * * represents an amount less than $1 thousand C. On April 6, 2021, the Company entered into a third SPA with the Investor, pursuant to which the Investor agreed to provide the Company with a convertible loan in the aggregate amount of $150 and the Company agreed to issue convertible debentures and a warrant to the Investor. The loan will bear interest at an annual rate of ten percent (10%) and will be repayable after two years. The loan has reached maturity and the Company is negotiating an extension for this loan. The investment will be convertible at any time into shares of the Company’s Common Stock at a conversion price equal to the lower of (a) $3.46, or (b) 80% of the lowest the daily dollar volume-weighted average price for the Company’s Common Stock during the 10 trading days immediately preceding the conversion date. In accordance with ASC 815-15-25 the conversion feature was considered to be a derivative instrument and is to be recorded at its fair value as its fair value can be separated from the convertible loan and its conversion is independent of the underlying note value. The conversion feature derivative liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations. As of September 30, 2023, the convertible debentures have reached maturity. Therefore, the fair value of the Convertible Component was calculated based on its intrinsic value as of September 30, 2023. The fair value of the convertible component at December 31, 2022 was estimated by third party appraiser using the Monte Carlo Simulation Model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each of the issuance and balance sheet dates. The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 117 December 31, Common stock price $ 0.0902 Expected volatility 146.61 % Expected term 0.26 Risk free rate 4.46 % Expected dividend yield 0 % Fair market value of convertible component $ 80 As part of the transaction, the Company issued to the Investor warrants to purchase an aggregate of 10,838 shares of Common Stock, at an exercise price equal to $3.46. The term of each warrant is five years from the issue date. Each warrant may be exercised by cash payment or through cashless exercise by the surrender of warrant shares having a value equal to the exercise price of the portion of the warrant being exercised. The warrants were estimated by third party appraiser using the Black-Scholes option-pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each of the issuance and balance sheet dates. The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Expected volatility 270.36 % Expected term 2.52 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price $ 0.0902 Expected volatility 269.78 % Expected term 3.27 Risk free rate 4.19 % Expected dividend yield 0 % Fair market value of warrants $ 1 * represents an amount less than $1 thousand D. On June 7, 2021, the Company entered into a fourth SPA with the Investor, pursuant to which the Investor will invest an aggregate amount of $1,250 in three tranches, and the Company will issue convertible debentures and warrants to the Investor, in which each tranche is convertible into shares of the Company’s common stock, par value $0.0001. The funds were received in 2021. On December 28, 2022, the Company signed a forbearance agreement with the Investor extending the maturity date for all outstanding principal and interest under this loan to June 30, 2023. The Company is currently negotiating an extension for this loan. As of December 31, 2022, the full amount of the first tranche principal in the amount of $500 remains outstanding. In the period from inception through December 31, 2022, $424 of outstanding principal from the second tranche and $43 of accrued interest was converted into 2,121,262 shares of common stock. As of December 31, 2022, the outstanding principal balance from the second tranche was $76. As a result of the conversion of the convertible loans, for the year ended December 31, 2022, the Company recorded losses from conversion in the amount of $71. In the period from loan inception through December 31, 2021, the full amount of outstanding principal and accrued interest relating to the third tranche was converted into shares of common stock. The Convertible Debentures bear interest at a rate of 10% per annum (15% on default) and have a maturity date of one (1) year. The Convertible Debentures provide a conversion right, in which any portion of the principal amount of the Convertible Debentures, together with any accrued but unpaid interest, may be converted into the Company’s Common Stock at a conversion price equal to 80% of the lowest volume weighted average price of the Company’s Common Stock during the ten (10) trading days immediately preceding the date of conversion, subject to adjustment. The Convertible Debentures may not be converted into common stock to the extent such conversion would result in the Investor beneficially owning more than 9.99% of the Company’s outstanding Common Stock (the “Beneficial Ownership Limitation”); provided, however, that the Beneficial Ownership Limitation may be waived by the Investor upon not less than 65 days’ prior notice to the Company. The Convertible Debentures provide the Company with a redemption right, pursuant to which the Company, upon fifteen (15) business days’ prior notice to the Investor, may redeem, in whole or in part, outstanding principal and interest at a redemption price equal to the principal amount being redeemed plus a redemption premium equal to 5% of the outstanding principal amount being redeemed plus outstanding and accrued interest; however, the Investor shall have fifteen (15) business days after receipt of the Company’s redemption notice to elect to convert all or any portion of the Convertible Debentures, subject to the Beneficial Ownership Limitation. In accordance with ASC 815-15-25 the conversion feature was considered to be a derivative instrument and is to be recorded at its fair value as its fair value can be separated from the convertible loan and its conversion is independent of the underlying note value. The conversion feature derivative liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations. As of September 30, 2023, the convertible debentures have reached maturity. Therefore, the fair value of the Convertible Component was calculated based on its intrinsic value as of September 30, 2023. The fair value of the convertible component was estimated by third party appraiser using the Monte Carlo Simulation Model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance sheet dates: The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 436 December 31, Common stock price $ 0.0902 Expected volatility 146.61 % Expected term 0.50 Risk free rate 4.76 % Expected dividend yield 0 % Fair market value of Convertible component $ 299 E. On December 14, 2021, the Company entered into a fifth SPA with the Investor, pursuant to which the Investor invested an aggregate amount of $500, and the Company issued convertible debentures to the Investor. The Convertible Debenture bears interest at a rate of 10% per annum (15% on default) and has a maturity date of one (1) year. The Convertible Debenture provides a conversion right, in which any portion of the principal amount of the Convertible Debenture, together with any accrued but unpaid interest, may be converted into the Company’s Common Stock at a conversion price equal to 80% of the lowest volume weighted average price of the Company’s Common Stock during the ten (10) trading days immediately preceding the date of conversion, subject to adjustment. The Convertible Debenture may not be converted into common stock to the extent such conversion would result in the Investor beneficially owning more than 4.99% of the Company’s outstanding Common Stock; provided, however, that the Beneficial Ownership Limitation may be waived by the Investor upon not less than 65 days’ prior notice to the Company. The Convertible Debenture provides the Company with a redemption right, pursuant to which the Company, upon fifteen (15) business days’ prior notice to the Investor, may redeem, in whole or in part, outstanding principal and interest under the Convertible Debenture at a redemption price equal to the principal amount being redeemed plus a redemption premium equal to 5% of the outstanding principal amount being redeemed plus outstanding and accrued interest; however, the Investor shall have fifteen (15) business days after receipt of the Company’s redemption notice to elect to convert all or any portion of the Convertible Debenture, subject to the Beneficial Ownership Limitation. On December 28, 2022, the Company signed a forbearance agreement with the Investor extending the maturity date for all outstanding principal and interest under this loan to June 30, 2023. The Company is currently negotiating an extension for this loan. In accordance with ASC 815-15-25 the conversion feature was considered to be a derivative instrument and is to be recorded at its fair value as its fair value can be separated from the convertible loan and its conversion is independent of the underlying note value. The conversion feature derivative liability is then marked to market each reporting period with the resulting gains or losses shown in the statements of operations. As of September 30, 2023, the convertible debentures have reached maturity. Therefore, the fair value of the Convertible Component was calculated based on its intrinsic value as of September 30, 2023. The following are the data and assumptions used as of the balance sheet date: September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 369 December 31, Common stock price $ 0.9585 Expected volatility 205.2 % Expected term 0.95 Risk free rate 0.37 % Expected dividend yield 0 % Fair market value of convertible component $ 522 The following table presents the changes in fair value of the level 3 liabilities for the periods ended September 30, 2023 and December 31, 2022: Warrants Convertible (U.S. dollars in thousands) Outstanding at December 31, 2021 24 1,017 Settlement of derivative liabilities - (127 ) Changes in fair value (23 ) (258 ) Outstanding at December 31, 2022 1 632 Changes in fair value (1 ) 290 Outstanding at September 30, 2023 - 922 |
Stockholders_ Equity
Stockholders’ Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders’ Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 4 – STOCKHOLDERS’ EQUITY Common Stock On April 11, 2022, the Company issued 27,303 shares of Common Stock to a service provider as payment for services rendered. The fair market value of the shares was $41. During the year ended December 31, 2022, and pursuant to the SPA, YAII exercised its option to convert Convertible Promissory Note principal in the amount of $249 and accrued interest of $20 into 1,930,735 shares of Common Stock of the Company. The fair market value of the shares was $56. During the year ended December 31, 2022, and pursuant to the Series A SPA, the Preferred A Investor exercised its option to convert 27,966 shares of Series A Preferred Stock into 390,477 shares of Common Stock of the Company. During the nine months ended September 30, 2023, and pursuant to the Series A SPA, the Preferred A Investor exercised its option to convert 112,710 shares of Series A Preferred Stock into 5,549,436 shares of Common Stock of the Company. On June 6, 2023, the Company issued 1,666,666 shares of Common Stock to executives on the Company as Stock based compensation with a fair value of $46. Series A Preferred Stock On May 12, 2022, the Company established a series of redeemable convertible preferred stock (the “Series A Preferred Stock”), par value $0.0001 per share, stated value $1.0 per share, pursuant to a Certificate of Designation, Preference and Rights of Series A Preferred Stock of the Company (the “Certificate of Designation”). On May 17, 2022, the Company entered into a Series A Preferred Stock Purchase Agreement (the “Series A SPA”) with 1800 Diagonal Lending LLC f/k/a Sixth Street Lending LLC, a Virginia limited liability company (the “Preferred A Investor”) pursuant to which the Company issued and sold to the Preferred A Investor 148,062 shares of Series A Preferred Stock for a purchase price of $129, of which the Company received proceeds of $125, net of issuance costs. The Company has accounted for the Series A Preferred Stock as mezzanine equity. On August 10, 2022, the Company entered into an additional Series A SPA with the Preferred A Investor pursuant to which the Company issued and sold to the Preferred A Investor 73,312 shares of Series A Preferred Stock for a purchase price of $63, of which the Company received proceeds of $60, net of issuance costs. The Company has accounted for the Series A Preferred Stock as mezzanine equity. Pursuant to the Series A SPA, the Preferred A Investor may convert all or a portion of the outstanding Series A Preferred Stock into shares of the Company’s Common Stock beginning on the date which is 180 days after the issuance date of the Series A Preferred Stock (the “Issuance Date”) into Common Stock; provided, however, that the Preferred A Investor may not convert the Series A Preferred Stock to the extent that such conversion would result in beneficial ownership by the Preferred A Investor and its affiliates of more than 4.99% of the Company’s issued and outstanding Common Stock. The Series A Preferred Stock may be convertible into shares of Common Stock of the Company at the option of the holders thereof at any time after the issuance of the Series A Preferred Stock, at a conversion price equal to the Variable Conversion Price. The Variable Conversion Price means 80% multiplied by the Market Price. The Market Price means the average of the lowest two trading prices for the Common Stock during the ten-trading day period ending on the latest complete trading day prior to the conversion date. The Company will have the right, at the Company’s sole option, provided that an event of default has not occurred, to redeem all or any portion of the shares of Series A Preferred Stock, exercisable on not more than 3 Trading Days prior written notice to the holders of the Series A Preferred Stock, in full. If the Company redeems the shares of Series A Preferred Stock within 180 days of its issuance, the Company must pay all of the principal at a cash redemption premium of 110%; if such prepayment is made between the 181st day and the 730th day after the issuance of the Series A Preferred Stock, then such redemption premium is 120%. After the 730th day following the Issuance Date, there shall be no further right of redemption. The Series A Preferred Stock will, with respect to dividend rights and rights upon liquidation, winding-up or dissolution, rank: (a) senior with respect to dividends and right of liquidation with the Company’s Common Stock and (b) junior with respect to dividends and right of liquidation to all existing and future indebtedness of the Company and existing and outstanding preferred stock of the Company. The Series A Preferred Stock shall have no right to vote on any matters requiring shareholder approval or any matters on which the shareholders are permitted to vote. Each share of Series A Preferred Stock will carry an annual dividend in the amount of 6% of the price per share of Series A Preferred Stock of $1.00, which shall be cumulative, payable solely upon redemption, liquidation or conversion. Upon the occurrence of an event of default (as further defined further in the Certificate of Designation), the Dividend Rate shall automatically increase to 15%. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 – RELATED PARTY TRANSACTIONS Related party payable September 30, December 31, (U.S. dollars in thousands) Related parties payable due to management fee $ 161 $ 119 Related parties payable due to research and development - 2 Total $ 161 $ 121 General and Administrative Expenses For the period ended 2023 2022 (U.S. dollars in thousands) Management fee 75 75 Research and Development Expenses For the period ended 2023 2022 (U.S. dollars in thousands) Consulting fee 24 72 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 6 – SUBSEQUENT EVENTS None |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
Unaudited Interim Financial Statements | Unaudited Interim Financial Statements The accompanying unaudited financial statements include the accounts of the Company, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, the financial statements presented herein have not been audited by an independent registered public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the for nine-months ended September 30, 2023. However, these results are not necessarily indicative of results for any other interim period or for the year ended December 31, 2023. The preparation of financial statements in conformity with GAAP requires the Company to make certain estimates and assumptions for the reporting periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses. Actual amounts could differ from these estimates. Certain information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). The accompanying unaudited condensed financial statements should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on April 3, 2023 (the “Annual Report”). For further information, reference is made to the financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“‘US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. As applicable to the financial statements, the most significant estimates and assumptions relate to the measurement of the convertible notes, derivative liabilities and going concern. |
Functional currency | Functional currency The functional currency of the Company is the US dollar (“US$”), which is the currency of the primary economic environment in which the operations of the Company are conducted. |
Cash and cash equivalents | Cash and cash equivalents Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired. |
Inventory | Inventory Inventories are valued at the lower of cost or net realizable value. Cost of raw and packaging materials, purchased products, manufactured finished products and products in process are determined on the average cost basis. The Company regularly reviews its inventories for impairment and reserves are established when necessary. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. The Company provides for depreciation and amortization using the straight-line method over the estimated useful lives of the related assets, which range from three to five years. |
Derivative Liabilities and Fair Value of Financial Instruments | Derivative Liabilities and Fair Value of Financial Instruments Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments and measurement of their fair value for accounting purposes. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt under ASC 470, the Company will continue its evaluation process of these instruments as derivative financial instruments under ASC 815. Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. Fair value of certain of the Company’s financial instruments including cash, accounts receivable, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments. Fair value, as defined in ASC 820, is 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. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk. Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values. Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income. The Company records a debt discount related to the issuance of convertible debts that have conversion features at adjustable rates. The debt discount for the convertible instruments is recognized and measured by allocating a portion of the proceeds as an increase in additional paid-in capital and as a reduction to the carrying amount of the convertible instrument equal to the fair value of the conversion features. The debt discount will be accreted by recording additional non-cash gains and losses related to the change in fair values of derivative liabilities over the life of the convertible notes. The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of September 30, 2023 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 922 922 Fair value of warrants issued in convertible loan - - - - Total liabilities - - 922 922 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 632 632 Fair value of warrants issued in convertible loan - - 1 1 Total liabilities - - 633 633 |
Revenue recognition | Revenue recognition Revenues are recognized when delivery has occurred and there is persuasive evidence of an agreement, the fee is fixed or determinable and collection of the related receivables is reasonably assured, and no further obligations exist. Revenues from sales of products are recognized when title and risk and rewards for the products are transferred to the customer. |
Research and development expenses | Research and development expenses Research and development expenses are charged to operations as incurred. |
Income Taxes | Income Taxes Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code section 382 if a change of ownership occurs. |
Net Loss Per Basic and Diluted Common Share | Net Loss Per Basic and Diluted Common Share Basic loss per ordinary share is computed by dividing the loss for the period applicable to ordinary shareholders by the weighted average number of shares of common stock outstanding during the period. Securities that may participate in dividends with the shares of common stock (such as the convertible preferred) are considered in the computation of basic loss per share under the two-class method. However, in periods of net loss, only the convertible preferred shares are considered, since such shares have a contractual obligation to share in the losses of the Company. In computing diluted loss per share, basic loss per share is adjusted to reflect the potential dilution that could occur upon the exercise of potential shares. Accordingly, in periods of net loss, no potential shares are considered. |
Recent accounting pronouncements | Recent accounting pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standard Board (“FASB”) or other standard setting bodies that the Company adopts as of the specified effective date. Unless otherwise discussed, the Company does not believe that the impact of recently issued standards that are not yet effective will have a material impact on the Company’s financial position or results of operations upon adoption. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Summary of Significant Accounting Policies and Basis of Presentation [Abstract] | |
Schedule of Financial Assets and Liabilities that are Measured at Fair Value on a Recurring Basis | The Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows: Balance as of September 30, 2023 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 922 922 Fair value of warrants issued in convertible loan - - - - Total liabilities - - 922 922 Balance as of December 31, 2022 Level 1 Level 2 Level 3 Total (U.S. dollars in thousands) Liabilities: Fair value of convertible component in convertible loan, net of discounts and debt issue costs - - 632 632 Fair value of warrants issued in convertible loan - - 1 1 Total liabilities - - 633 633 |
Convertible Notes (Tables)
Convertible Notes (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Convertible Notes [Abstract] | |
Schedule of the Fair Value of the Derivative at Each Balance Sheet | The following are the data and assumptions used as of the balance sheet dates: September 30, Common stock price $ 0.0182 Expected volatility 135.81 % Expected term 0.68 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price 0.0902 Expected volatility 262.09 % Expected term 1.43 years Risk free rate 4.59 % Expected dividend yield 0 % Fair market value of warrants $ - * September 30, Common stock price $ 0.0182 Expected volatility 224.93 % Expected term (years) 1.93 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price 0.0902 Expected volatility 278.10 % Expected term (years) 2.68 Risk free rate 4.28 % Expected dividend yield 0 % Fair market value of warrants $ - * September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 117 December 31, Common stock price $ 0.0902 Expected volatility 146.61 % Expected term 0.26 Risk free rate 4.46 % Expected dividend yield 0 % Fair market value of convertible component $ 80 September 30, Common stock price $ 0.0182 Expected volatility 270.36 % Expected term 2.52 Risk free rate 4.92 % Expected dividend yield 0 % Fair market value of warrants $ * December 31, Common stock price $ 0.0902 Expected volatility 269.78 % Expected term 3.27 Risk free rate 4.19 % Expected dividend yield 0 % Fair market value of warrants $ 1 September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 436 December 31, Common stock price $ 0.0902 Expected volatility 146.61 % Expected term 0.50 Risk free rate 4.76 % Expected dividend yield 0 % Fair market value of Convertible component $ 299 September 30, Common stock price $ 0.0182 Discount to Common stock price 20.0 % Fair market value of convertible component $ 369 December 31, Common stock price $ 0.9585 Expected volatility 205.2 % Expected term 0.95 Risk free rate 0.37 % Expected dividend yield 0 % Fair market value of convertible component $ 522 |
Schedule of Changes in Fair Value of the Level 3 Liabilities | The following table presents the changes in fair value of the level 3 liabilities for the periods ended September 30, 2023 and December 31, 2022: Warrants Convertible (U.S. dollars in thousands) Outstanding at December 31, 2021 24 1,017 Settlement of derivative liabilities - (127 ) Changes in fair value (23 ) (258 ) Outstanding at December 31, 2022 1 632 Changes in fair value (1 ) 290 Outstanding at September 30, 2023 - 922 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Related Parties Payable | Related party payable September 30, December 31, (U.S. dollars in thousands) Related parties payable due to management fee $ 161 $ 119 Related parties payable due to research and development - 2 Total $ 161 $ 121 |
Schedule of Related Party Transactions | General and Administrative Expenses For the period ended 2023 2022 (U.S. dollars in thousands) Management fee 75 75 For the period ended 2023 2022 (U.S. dollars in thousands) Consulting fee 24 72 |
Organization and Description _2
Organization and Description of Business (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Organization and Description of Business [Abstract] | |
Cash and cash equivalents | $ 35 |
Deficit of working capital | 2,804 |
Stockholders’ deficit | 2,870 |
Accumulated deficit | $ 13,476 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Basis of Presentation (Details) | Sep. 30, 2023 |
Minimum [Member] | |
Summary of Significant Accounting Policies and Basis of Presentation [Line Items] | |
Estimated useful lives | 3 years |
Maximum [Member] | |
Summary of Significant Accounting Policies and Basis of Presentation [Line Items] | |
Estimated useful lives | 5 years |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies and Basis of Presentation (Details) - Schedule of Financial Assets and Liabilities that are Measured at Fair Value on a Recurring Basis - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Liabilities: | ||
Fair value of convertible component in convertible loan, net of discounts and debt issue costs | $ 922 | $ 632 |
Fair value of warrants issued in convertible loan | 1 | |
Total liabilities | 922 | 633 |
Level 1 [Member] | ||
Liabilities: | ||
Fair value of convertible component in convertible loan, net of discounts and debt issue costs | ||
Fair value of warrants issued in convertible loan | ||
Total liabilities | ||
Level 2 [Member] | ||
Liabilities: | ||
Fair value of convertible component in convertible loan, net of discounts and debt issue costs | ||
Fair value of warrants issued in convertible loan | ||
Total liabilities | ||
Level 3 [Member] | ||
Liabilities: | ||
Fair value of convertible component in convertible loan, net of discounts and debt issue costs | 922 | 632 |
Fair value of warrants issued in convertible loan | 1 | |
Total liabilities | $ 922 | $ 633 |
Convertible Notes (Details)
Convertible Notes (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||||||
Dec. 31, 2022 | Apr. 06, 2021 | Sep. 30, 2023 | Dec. 14, 2021 | Jun. 07, 2021 | Sep. 03, 2020 | Jun. 05, 2019 | |
Convertible Notes [Abstract] | |||||||
Convertible debentures | $ 150 | $ 220 | |||||
Exercisable term | 5 years | ||||||
Convertible debt amount | $ 1 | ||||||
Warrants to purchase shares of common stock (in Shares) | 2,121,262 | 2,619 | |||||
Conversion price, percentage | 80% | ||||||
Invest amount | $ 1,250 | ||||||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Principal amount | $ 500 | ||||||
Accrued interest | 43 | ||||||
Outstanding principal balance | 76 | ||||||
Maturity term | 1 year | ||||||
Outstanding common stock, percentage | 9.99% | ||||||
Outstanding principal amount, percentage | 5% | ||||||
Securities Purchase Agreement [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Convertible debentures | $ 1,100,000 | ||||||
Exercise price (in Dollars per share) | $ 3.46 | ||||||
Convertible debt amount | $ 1 | ||||||
Description of convertible notes | The loan will bear interest at an annual rate of ten percent (10%) and will be repayable after two years. | ||||||
Conversion price, percentage | 80% | 80% | |||||
Principal amount | $ 500 | ||||||
Interest rate | 10% | ||||||
Maturity term | 1 year | ||||||
Outstanding common stock, percentage | 4.99% | ||||||
Outstanding principal amount, percentage | 5% | ||||||
Investor Warrants [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Exercise price (in Dollars per share) | $ 3.46 | ||||||
Issuance of common stock (in Shares) | 10,838 | ||||||
YAII PN, Ltd. [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Conversion price (in Dollars per share) | $ 21 | ||||||
Conversion amount | 71 | ||||||
Interest rate | 15% | ||||||
Convertible [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Interest rate | 10% | ||||||
Convertible [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Warrants to purchase (in Shares) | 13,095 | ||||||
Exercise price (in Dollars per share) | $ 21 | ||||||
Exercisable term | 5 years | ||||||
Convertible debenture interest rate | 15% | ||||||
Convertible Debt [Member] | |||||||
Convertible Notes [Abstract] | |||||||
Convertible debt amount | $ 1 | ||||||
Principal amount | $ 424 |
Convertible Notes (Details) - S
Convertible Notes (Details) - Schedule of the Fair Value of the Derivative at Each Balance Sheet - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2023 | Dec. 31, 2022 | |||
June 5, 2019 [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.0902 | ||
Expected volatility | 135.81% | 262.09% | ||
Expected term (years) | 8 months 4 days | 1 year 5 months 4 days | ||
Risk free rate | 4.92% | 4.59% | ||
Expected dividend yield | 0% | 0% | ||
Fair market value of warrants (in Dollars) | [1] | |||
September 3, 2020 [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.0902 | ||
Expected volatility | 224.93% | 278.10% | ||
Expected term (years) | 1 year 11 months 4 days | 2 years 8 months 4 days | ||
Risk free rate | 4.92% | 4.28% | ||
Expected dividend yield | 0% | 0% | ||
Fair market value of warrants (in Dollars) | [1] | |||
April 6, 2021 [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.0902 | ||
Discount to Common stock price | 20% | |||
Fair market value of convertible component (in Dollars) | $ 117 | $ 80 | ||
Expected volatility | 146.61% | |||
Expected term (years) | 3 months 3 days | |||
Risk free rate | 4.46% | |||
Expected dividend yield | 0% | |||
Black-Scholes Option-Pricing Model [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.0902 | ||
Expected volatility | 270.36% | 269.78% | ||
Expected term (years) | 2 years 6 months 7 days | 3 years 3 months 7 days | ||
Risk free rate | 4.92% | 4.19% | ||
Expected dividend yield | 0% | 0% | ||
Fair market value of warrants (in Dollars) | [1] | $ 1 | ||
June 7, 2021 [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.0902 | ||
Discount to Common stock price | 20% | |||
Fair market value of convertible component (in Dollars) | $ 436 | $ 299 | ||
Expected volatility | 146.61% | |||
Expected term (years) | 6 months | |||
Risk free rate | 4.76% | |||
Expected dividend yield | 0% | |||
December 14, 2021 [Member] | ||||
Schedule of the fair value of the derivative at each balance sheet [Abstract] | ||||
Common stock price (in Dollars per share) | $ 0.0182 | $ 0.9585 | ||
Discount to Common stock price | 20% | |||
Fair market value of convertible component (in Dollars) | $ 369 | $ 522 | ||
Expected volatility | 205.20% | |||
Expected term (years) | 11 months 12 days | |||
Risk free rate | 0.37% | |||
Expected dividend yield | 0% | |||
[1]represents an amount less than $1 thousand |
Convertible Notes (Details) -_2
Convertible Notes (Details) - Schedule of Changes in Fair Value of the Level 3 Liabilities - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Warrants [Member] | ||
Schedule of changes in fair value of the level 3 liabilities [Abstract] | ||
Outstanding, beginning balance | $ 1 | $ 24 |
Settlement of derivative liabilities | ||
Changes in fair value | (1) | (23) |
Outstanding,ending balance | 1 | |
Convertible Component [Member] | ||
Schedule of changes in fair value of the level 3 liabilities [Abstract] | ||
Outstanding, beginning balance | 632 | 1,017 |
Settlement of derivative liabilities | (127) | |
Changes in fair value | 290 | (258) |
Outstanding,ending balance | $ 922 | $ 632 |
Stockholders_ Equity (Details)
Stockholders’ Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
Jun. 06, 2023 | Aug. 10, 2022 | May 17, 2022 | Apr. 11, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | May 12, 2022 | |
Stockholders’ Equity [Line Items] | |||||||
Shares of common stock | 1,666,666 | ||||||
Fair market value | $ 46 | ||||||
Common stock issued and outstanding percentage | 4.99% | ||||||
Conversion price percentage | 80% | ||||||
Dividend percentage | 15% | ||||||
Common Stock [Member] | |||||||
Stockholders’ Equity [Line Items] | |||||||
Shares of common stock | 27,303 | ||||||
Fair market value | $ 41 | ||||||
Series A Preferred Stock [Member] | |||||||
Stockholders’ Equity [Line Items] | |||||||
Investor exercised | 112,710 | 27,966 | |||||
Shares of common stock | 5,549,436 | 390,477 | |||||
Series A preferred stock par value, per share | $ 0.0001 | ||||||
Stated value per share | $ 1 | ||||||
Shares of Series A Preferred Stock | 73,312 | 148,062 | |||||
Purchase price | $ 63 | $ 129 | |||||
Net of issuance costs | $ 60 | $ 125 | |||||
Dividend percentage | 6% | ||||||
Price per share | $ 1 | ||||||
Series A Preferred Stock [Member] | Minimum [Member] | |||||||
Stockholders’ Equity [Line Items] | |||||||
Redemption premium percentage | 110% | ||||||
Series A Preferred Stock [Member] | Maximum [Member] | |||||||
Stockholders’ Equity [Line Items] | |||||||
Redemption premium percentage | 120% | ||||||
Convertible Promissory Note [Member] | |||||||
Stockholders’ Equity [Line Items] | |||||||
Shares of common stock | 1,930,735 | ||||||
Fair market value | $ 56 | ||||||
Principal amount | 249 | ||||||
Accrued interest | $ 20 |
Related Party Transactions (Det
Related Party Transactions (Details) - Schedule of Related Parties Payable - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Schedule of Related Parties Payable [Abstract] | ||
Related parties payable due to management fee | $ 161 | $ 119 |
Related parties payable due to research and development | 2 | |
Total | $ 161 | $ 121 |
Related Party Transactions (D_2
Related Party Transactions (Details) - Schedule of Related Party Transactions - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
General and Administrative Expenses [Member] | ||
Related Party Transactions (Details) - Schedule of Related Party Transactions [Line Items] | ||
Management fee | $ 75 | $ 75 |
Research and Development Expenses [Member] | ||
Related Party Transactions (Details) - Schedule of Related Party Transactions [Line Items] | ||
Consulting fee | $ 24 | $ 72 |