SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
President and Chief Executive Officer
Telephone: +972-8-931-1900
Facsimile: +972-8-946-6724
Title of each class | Trading symbol(s) | Name of each exchange on which registered |
Ordinary shares, par value NIS 0.02 per share | EVGN | Nasdaq Stock Market LLC |
Large accelerated filer ☐ | Accelerated filer ☐ |
Non-accelerated filer ☒ | Emerging Growth Company ☐ |
U.S. GAAP ☐ | International Financial Reporting Standards as issued by the International Accounting Standards Board ☒ | Other ☐ |
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F-1 |
◾ | references to “Evogene,” “we,” “us,” “our,” “our company” and “the company” refer to Evogene Ltd. and its consolidated subsidiaries, consisting of AgPlenus Ltd., or AgPlenus, Biomica Ltd., or Biomica, Canonic Ltd., or Canonic, Casterra Ag Ltd. (formerly known as Evofuel Ltd.), or Casterra, Evogene Inc., Lavie Bio Ltd., or Lavie Bio, and their consolidated subsidiaries; |
◾ | references to “U.S. dollars,”, “USD”, “$” or “dollars” are to United States dollars; |
◾ | references to “NIS” or “shekels” are to New Israeli Shekels; |
◾ | References to the “U.S.” are to the United States; |
◾ | references to “ordinary shares,” “our shares” and similar expressions refer to our Ordinary Shares, par value NIS 0.02 per share; |
◾ | references to the “articles of association” are to our Amended and Restated Articles of Association, which became effective upon the closing of the U.S. initial public offering, as subsequently amended; |
◾ | references to the “Companies Law” are to the Israeli Companies Law, 5759-1999, as amended; |
◾ | references to the “Securities Act” are to the Securities Act of 1933, as amended; |
◾ | references to the “Exchange Act” are to the Securities Exchange Act of 1934, as amended; |
◾ | references to the “NYSE” are to the New York Stock Exchange; |
◾ | references to the “Nasdaq” are to the Nasdaq Stock Market LLC; |
◾ | references to the “TASE” are to the Tel Aviv Stock Exchange; and |
◾ | references to the “SEC” are to the United States Securities and Exchange Commission. |
◾ | the extent to which we continue to maintain our holdings in our subsidiary companies; |
◾ | the extent to which our discoveries and product candidates will have the desired effect so as to reach the stage of commercialization; |
◾ | whether we and our collaborators are able to allocate the resources needed to develop commercial products from our discoveries and product candidates; |
◾ | the length and degree of complexity of the process of our developing commercial products based on our discoveries and product candidates and the probability of our success, and the success of our collaborators, in developing such products; |
◾ | the degree of success of third parties upon whom we rely to conduct certain activities, such as field-trials and pre-clinical studies; |
◾ | whether we are able to comply with regulatory requirements; |
◾ | whether we and our subsidiaries are able to meet expected timelines in the performance of our activities (or are delayed, including as a result of the effect of the Coronavirus); |
◾ | the extent of the future growth of the agriculture, human health and industrial application industries in which we operate; |
◾ | whether we can maintain our current business models; |
◾ | the actual commercial value of our key product candidates; |
◾ | whether we or our collaborators receive regulatory approvals for the product candidates developed by us or our collaborators; |
◾ | whether products and product candidates containing or based on our discoveries are commercialized and earn us revenues or royalties; |
◾ | whether we are able to maintain and recruit knowledgeable or specialized personnel to perform our research and development work; |
◾ | the degree of our success at adapting to the continuous technological changes in our industries; |
◾ | whether we can maintain our collaboration agreements with our current collaborators or enter into new collaboration agreements and expand our research and development to new fields; |
◾ | whether we can improve our existing, or develop and launch new, computational technologies and screening and validation systems; |
◾ | whether we can patent our discoveries and protect our trade secrets and proprietary know-how; and |
◾ | the duration, degree of severity of, and strength of recovery from, the global COVID-19 pandemic, including government decisions implemented to limit its spread. |
◾ | If our equity holdings in our subsidiary companies are diluted, the benefits recognized by our shareholders from the value that may be created in such subsidiary companies may be substantially reduced. |
◾ | Our discoveries and product candidates may not achieve the desired effect required in order to create commercially-viable products. In addition, our product development cycle is lengthy and uncertain and various factors may delay or prevent commercialization of our product candidates. We may never sell or earn royalties on the sale of commercial products based on our discoveries. |
◾ | Due to mergers and consolidations, there is a reduced number of companies in the agriculture industry with which we might establish strategic partnerships, and we rely on a limited number of collaborators to develop and commercialize product candidates containing our seed trait, ag-chemical and ag-biological product candidates. In addition, a decrease in research expenditures by the major companies in our target markets may jeopardize the continuation, or scope, of our collaborations with such companies and adversely impact our ability to continue or extend existing collaborations or enter into new collaborations on favorable financial terms. |
◾ | We or our collaborators may fail to perform obligations under the collaboration agreements. |
◾ | We are operating in multiple industries, each of which consists of multiple companies with much greater resources than us. If we are unable to compete effectively, our financial resources will be diluted and our financial results will suffer. |
◾ | We are working to develop and commercialize novel ag-biological products, ag-chemical products, seed-trait products, human microbiome-based therapeutic product candidates, medical cannabis products, and our efforts with respect to any of these products may be unsuccessful. |
◾ | We are working to develop and commercialize castor seeds for industrial applications, and our efforts may be unsuccessful in achieving a commercial presence in this market. |
◾ | If Lavie Bio Ltd. is unable to establish successful distribution and retail channels for the commercialization of its products, it will not be able to meet its commercialization plans. |
◾ | Biomica’s product candidates are based on microbiome therapeutics, which is an unproven approach to therapeutic intervention. |
◾ | Even if we are, or believe we are, entitled to royalties from our collaborators, we may not actually receive these royalties. |
◾ | Each of us and our subsidiaries depends on our key personnel and, if we are not able to attract and retain qualified scientific, technological, business and managerial personnel, we may not be able to grow our business or develop and commercialize our product candidates. |
◾ | We develop certain discoveries independent om our collaborators, and we may need to finance the cost of the development of such technologies product candidates ourselves. |
◾ | Our business is subject to various government regulations and, if we or our collaborators are unable to obtain the necessary regulatory approvals, we may not be able to continue our operations. |
◾ | Our medical cannabis activity exposes us to legal and reputational risks associated with the cannabis industry. |
◾ | If the cost we incur of Directors and Officers, or D&O, liability insurance continues to increase, it will have an adverse effect on our results of operations. |
◾ | Disruption to our information technology, or IT, system could adversely affect our reputation and have a material adverse effect on our business and results of operations. |
◾ | The COVID-19 pandemic, or any other pandemic, epidemic or outbreak of an infectious disease has adversely impacted us and may continue to adversely impact our operating results and financial condition. |
◾ | Consumer and government resistance to genetically modified organisms, or GMOs, may negatively affect our public image and reduce sales of plants containing our traits. |
◾ | We have a history of operating losses and negative cash flow, and we may never achieve or maintain profitability. |
◾ | The licenses we grant to our collaborators are in most cases exclusive with respect to a specified discovery, product type or market area. This may limit our opportunities to enter into additional licensing or other arrangements with respect to such discoveries, product types or market areas. |
◾ | We may be required to pay substantial damages as a result of uninsured product liability claims. |
◾ | Changes in laws and regulations to which we are subject, or to which we may become subject in the future, may materially increase our costs of operation, decrease our operating revenues and disrupt our business. |
◾ | Our success depends on our ability to protect our intellectual property and our proprietary technologies. If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be materially adversely affected and our business would be harmed. In addition, we may not be able to protect our intellectual property rights throughout the world. |
◾ | If we or one of our collaborators are sued for infringing the intellectual property rights of a third party, such litigation could be costly and time consuming and could prevent us or our collaborators from developing or commercializing our product candidates. |
◾ | Our employment agreements with our employees and other agreements with our collaborators and third parties may not adequately prevent disclosure of trade secrets, know-how and other proprietary information. In addition, we may not be able to fully enforce covenants not to compete with our key employees. |
◾ | Conditions in Israel could adversely affect our business. |
◾ | Any appreciation of the NIS relative to the U.S. dollar would adversely impact our financial results. |
◾ | Interest rate fluctuations may devalue our investments and could have an adverse impact on our financial condition. |
◾ | The terms of our Israeli government grants for certain of our research and development activities may require us to satisfy specified conditions in order to manufacture products and transfer technologies supported by such grants outside of Israel. In addition, in some circumstances, we may be required to pay penalties in addition to repaying the grants. |
◾ | The market price of our ordinary shares could be highly volatile and may fluctuate substantially as a result of many factors. In addition, our ordinary shares are traded on more than one market and this may result in price variations. We believe we were a passive foreign investment company, PFIC, for U.S. federal income tax purposes in 2020, and there is significant risk we will be a PFIC in 2021 as well. |
ITEM 1. | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE |
ITEM 3. | KEY INFORMATION |
For the year ended December 31, | ||||||||||||||||||||
(in thousands of U.S. dollars) | 2016 | 2017 | 2018 | 2019 | 2020 | |||||||||||||||
Consolidated Statements of Profit or Loss and Other Comprehensive Income (Loss): | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Research and development payments, including up-front payments | $ | 6,500 | $ | 3,369 | $ | 1,747 | $ | 753 | $ | 1,040 | ||||||||||
Share purchase related revenues | 40 | 12 | - | - | - | |||||||||||||||
Total Revenues | 6,540 | 3,381 | 1,747 | 753 | 1,040 | |||||||||||||||
Cost of revenues | 5,639 | 2,845 | 1,452 | 334 | 574 | |||||||||||||||
Gross profit | 901 | 536 | 295 | 419 | 466 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Research and development, net | 16,405 | 16,987 | 14,686 | 15,791 | 17,287 | |||||||||||||||
Business development | 1,696 | 1,686 | 2,084 | 2,029 | 2,672 | |||||||||||||||
General and administrative | 3,889 | 3,810 | 3,514 | 3,765 | 5,321 | |||||||||||||||
Total operating expenses | 21,990 | 22,483 | 20,284 | 21,585 | 25,280 | |||||||||||||||
Operating loss | (21,089 | ) | (21,947 | ) | (19,989 | ) | (21,166 | ) | (24,814 | ) | ||||||||||
Financing income | 2,424 | 2,125 | 1,413 | 2,630 | 1,591 | |||||||||||||||
Financing expenses | (891 | ) | (1,005 | ) | (2,206 | ) | (555 | ) | (2,951 | ) | ||||||||||
Loss before taxes on income | (19,556 | ) | (20,827 | ) | (20,782 | ) | (19,091 | ) | (26,174 | ) | ||||||||||
Taxes on income | 36 | 11 | 30 | 24 | 32 | |||||||||||||||
Loss | (19,592 | ) | (20,838 | ) | (20,812 | ) | (19,115 | ) | (26,206 | ) | ||||||||||
Other comprehensive income (loss): | ||||||||||||||||||||
Loss from cash flow hedges | - | - | - | - | - | |||||||||||||||
Amounts transferred to the statement of profit or loss for cash flow hedges | - | - | - | - | - | |||||||||||||||
Total comprehensive loss | $ | (19,592 | ) | $ | (20,838 | ) | $ | (20,812 | ) | $ | (19,115 | ) | $ | (26,206 | ) | |||||
Attributable to: | ||||||||||||||||||||
Equity holders of the Company | - | - | (20,758 | ) | (18,112 | ) | (23,374 | ) | ||||||||||||
Non-controlling interests | - | - | (54 | ) | (1,003 | ) | (2,832 | ) | ||||||||||||
$ | (19,592 | ) | $ | (20,838 | ) | $ | (20,812 | ) | $ | (19,115 | ) | $ | (26,206 | ) | ||||||
Basic and diluted loss per share, attributable to equity holders of the Company | $ | (0.77 | ) | $ | (0.81 | ) | $ | (0.81 | ) | $ | (0.70 | ) | $ | (0.83 | ) | |||||
Weighted average number of ordinary shares used in computing basic and diluted loss per share (1) | 25,444,733 | 25,673,276 | 25,753,411 | 25,754,297 | 28,158,779 |
As of December 31, | ||||||||||||||||||||
(in thousands of U.S. dollars) | 2016 | 2017 | 2018 | 2019 | 2020 | |||||||||||||||
Selected Consolidated Statements of Financial Position Data: | ||||||||||||||||||||
Cash and cash equivalents | $ | 3,236 | $ | 3,435 | $ | 5,810 | $ | 34,748 | $ | 46,229 | ||||||||||
Marketable securities | 71,738 | 59,940 | 26,065 | 2,128 | - | |||||||||||||||
Short-term bank deposits | 13,137 | 8,380 | 22,592 | 10,000 | 2,000 | |||||||||||||||
Trade receivables | 169 | 132 | 160 | 72 | 222 | |||||||||||||||
Total current assets | 89,490 | 72,791 | 55,488 | 49,027 | 51,823 | |||||||||||||||
Total assets | 95,986 | 77,602 | 58,694 | 71,364 | 71,915 | |||||||||||||||
Net assets | 87,289 | 69,378 | 50,306 | 60,217 | 56,882 | |||||||||||||||
Deferred revenues and other advances | 1,105 | 605 | 440 | 386 | 47 | |||||||||||||||
Total liabilities | 8,697 | 8,224 | 8,388 | 11,147 | 15,033 | |||||||||||||||
Working capital (2) | 84,265 | 68,127 | 50,057 | 43,281 | 42,147 | |||||||||||||||
Shareholders’ equity | 87,289 | 69,378 | 50,306 | 60,217 | 56,882 |
(1) | Basic and diluted loss per share is computed based on the weighted average number of ordinary shares outstanding during each period, in accordance with International Accounting Standard 33, “Earnings per Share.” |
◾ | our discoveries and product candidates may not be successfully validated or may not have the desired effect required in order to become, or to be incorporated into, commercial products; |
◾ | the process of developing product candidates based on our discoveries is lengthy and expensive, and we or our collaborators may not be able to allocate the resources needed to complete such development within the desired timeline; |
◾ | we or our collaborators may decide to discontinue, pause, reduce, or alter the scope of the development efforts for our product candidates; |
◾ | we may fail to satisfy, in a timely manner or at all, relevant milestones under our agreements with our collaborators; |
◾ | regulatory conditions related to our product candidates may change in different territories, thus negatively affecting the relevant development processes and extending their length or limiting the commercialization of such product candidates; |
◾ | we or our collaborators may be unable to obtain the requisite regulatory approvals for product candidates based on our discoveries; |
◾ | our competitors may launch competing or more effective products; |
◾ | we or our collaborators may be unable to fully develop and commercialize product candidates containing our discoveries or may decide, for whatever reason, not to commercialize, or to delay the commercialization of, such product candidates; |
◾ | a market may not exist for products containing our discoveries or such products may not be commercially successful or relevant; and |
◾ | we may be unable to protect the intellectual property underlying our discoveries in the necessary jurisdictions. |
◾ | we or our collaborators may not be able to allocate the resources needed to develop product candidates based on our discoveries; |
◾ | we or our collaborators may revise the process of product development or make other decisions regarding the product development pipelines that may extend the development period; |
◾ | we or our collaborators may prioritize other development activities ahead of development activities with respect to the product candidates on which we collaborate; |
◾ | our discoveries may not be successfully validated or may not have the desired effect sought by us or by our collaborators; and |
◾ | we or our collaborators may be unable to obtain the requisite regulatory approvals for the product candidates based on our discoveries within expected timelines or at all. |
◾ | failure to establish the requisite infrastructure to enable the discovery and development of microbial bio-stimulants; |
◾ | failure to identify and develop microbial candidates that enhance plant performance at the desired efficacy and stability; |
◾ | failure to successfully complete development of microorganisms to achieve cost-effective and commercially viable products; |
◾ | failure to obtain and maintain patent and trade secret protection for its product candidates; |
◾ | failure to operate without infringing or violating the valid and enforceable patents or other intellectual property rights of third parties; |
◾ | inability to obtain sufficient funding to fully execute its business plan; |
◾ | failure to meet regulatory requirements; and |
◾ | failure to establish cost-effective go-to-market models for selling its products. |
◾ | failure of its relatively novel target-based approach to lead to an effective product candidate or failure to identify chemical compounds that will display required level of performance; |
◾ | failure to obtain and maintain patent and trade secret protection for its product candidates; |
◾ | failure to operate without infringing or violating the valid and enforceable patents or other intellectual property rights of third parties; |
◾ | inability to obtain sufficient funding to fully execute its ag-chemical business plan; and |
◾ | failure to meet regulatory requirements. |
◾ | failure to identify and develop candidate genomic elements having the desired effect on the target trait in the plant of interest; |
◾ | failure to identify and develop toxin candidates having the desired effect on the target insects when inserted into the plants of interest; |
◾ | failure to obtain and maintain patent and trade secret protection for our product candidates; |
◾ | failure to operate without infringing or violating the valid and enforceable patents or other intellectual property rights of third parties; |
◾ | inability to obtain sufficient funding to fully execute the business plan; |
◾ | failure to successfully complete development of our seed trait product candidates; and |
◾ | our failure to meet regulatory requirements for seed trait and insect control product candidates. |
◾ | failure to complete pre-clinical studies and clinical trials with positive results; |
◾ | failure to finance the development and commercialization of its product candidates; |
◾ | failure to receive marketing approvals from applicable regulatory authorities; |
◾ | failure to obtain and maintain patent and trade secret protection and regulatory exclusivity for its product candidates; |
◾ | failure to making arrangements with third-party manufacturers for, or establishing its own commercial manufacturing capabilities; |
◾ | failure to launch commercial sales of its products, if and when approved, whether alone or in collaboration with others; |
◾ | failure to enter into new collaborations throughout the development process as appropriate, from pre-clinical studies through to commercialization; |
◾ | failure to achieve acceptance of its products, if and when approved, by patients, the medical community and third-party payors; |
◾ | failure of its products, if approved, to compete effectively with other therapies; |
◾ | failure to obtain and maintain coverage and adequate reimbursement by third-party payors, including government payors, for its products, if approved; |
◾ | failure to protect its rights in its intellectual property portfolio; |
◾ | failure to operate without infringing or violating the valid and enforceable patents or other intellectual property rights of third parties; |
◾ | failure to maintain a continued acceptable safety profile of the products following approval; |
◾ | failure to maintain and develop an organization of scientists and business people who can develop and commercialize its products and technology; and |
◾ | inability to obtain sufficient funding to fully execute its business plan. |
◾ | failure to develop cannabis varieties having desired efficacy and stability; |
◾ | failure to meet regulatory requirements; |
◾ | failure to engage with, and successfully operate, contractors, in Israel and abroad, for performing cultivation and production services; |
◾ | failure to establish successful distribution channels, in Israel and abroad, for its medical cannabis products; |
◾ | failure to satisfy the requirements for the export of seeds, seedlings of finished products; |
◾ | failure to meet patients’ satisfaction; |
◾ | inability to obtain sufficient funding to fully execute its business plan; |
◾ | failure to secure its cannabis cultivation facilities; and |
◾ | the market for medical cannabis products is relatively new and suffers from high uncertainty in many aspects, including demand, supply, pricing, regulation, customer preferences, etc. |
◾ | failure to reach desired yields of its castor seed varieties on a commercial scale to secure economic viability as bio-based oil feedstock; |
◾ | failure to establish an efficient mechanical harvest solution; |
◾ | failure to establish a cost-effective production of castor bean grains, allowing grower profitability; |
◾ | failure to reach large scale adoption of castor by growers, including the successful management of diseases and pests; |
◾ | failure to address the health and environmental risks posed by castor bean seeds, which contain ricin, a naturally occurring poison; |
◾ | failure to comply with any regulatory requirement related to sales of castor beans, and in particular those related to the import of such beans and the potential effects of ricin; and |
◾ | failure to establish sustainable production of castor seeds. |
◾ | activities in the field of cannabis are subject to enhanced regulation in Israel and worldwide. For example, Israeli regulation requires that we obtain a specific permit for each of the following activities: research, propagation, cultivation, production, marketing and distribution and use; |
◾ | changes in laws, regulations and guidelines related to cannabis may result in significant additional compliance costs for us or limit our ability to operate in certain jurisdictions; |
◾ | certain banks will not accept deposits from or provide other bank services to businesses involved with cannabis; |
◾ | third parties with whom we do business may perceive that they are exposed to reputational risk as a result of our cannabis-related business activities and may ultimately elect not to do business with us; |
◾ | future sales of medical cannabis products may expose us to consumer complaints or legal claims with respect to product quality or activity; and |
◾ | Increased premiums under our D&O liability insurance policies. |
◾ | fluctuations in foreign currency exchange rates; |
◾ | potentially adverse tax consequences; |
◾ | difficulties in staffing and managing foreign operations; |
◾ | hiring and retention of employees and/or consultants under foreign employment laws which are not familiar to us; |
◾ | laws and business practices that sometimes favor local business; |
◾ | compliance with foreign legislation, being subject to laws, regulations and the court systems of multiple jurisdictions; and |
◾ | tariffs, trade barriers and other regulatory or contractual limitations on our ability to develop (and, when applicable in the future, sell) our solutions in certain foreign markets. |
◾ | impair or eliminate our ability to research and develop our product candidates, including validating our product candidates through lab, greenhouse, field or clinical trials; |
◾ | increase our compliance and other costs of doing business through increases in the cost to patent or otherwise protect our intellectual property or increases in the cost to our collaborators to obtain the necessary regulatory approvals to commercialize and market the product candidates we develop with them; |
◾ | require significant product redesign or systems redevelopment; |
◾ | render our product candidates less profitable, obsolete or less attractive compared to competing products; |
◾ | affect our collaborators’ willingness to do business with us; |
◾ | jeopardize import or export of raw material or end products, such as with respect to medical cannabis seeds, seedlings and products; |
◾ | reduce the amount of revenues we receive from our collaborators through milestone payments or royalties; and |
◾ | discourage our collaborators from offering, and consumers from purchasing, products that incorporate our discoveries. |
◾ | our inability to obtain additional funding |
◾ | any delay in filing a regulatory submission for any of our product or product candidates and any adverse development or perceived adverse development with respect to the review of that regulatory submission by the applicable regulatory body |
◾ | actual or anticipated fluctuations in our results of operations; |
◾ | variance in our financial performance from the expectations of market analysts; |
◾ | announcements by us or our competitors of significant business developments, changes in relationships with our collaborators, acquisitions or expansion plans; |
◾ | our involvement in litigation; |
◾ | our sale, or the sale by our significant shareholders, of ordinary shares or other securities in the future; |
◾ | failure to publish research or the publishing of inaccurate or unfavorable research; |
◾ | market conditions in our industry and changes in estimates of the future size and growth rate of our markets; |
◾ | changes in key personnel; |
◾ | the trading volume of our ordinary shares; and |
◾ | general economic and market conditions, including as a result of the scope and duration of the COVID-19 pandemic. |
ITEM 4. | INFORMATION ON THE COMPANY |
◾ | R&D funding for activities that Evogene conducts in the collaboration, |
◾ | Milestone payments for when the candidates advance in our partner’s pipeline, and |
◾ | Revenue sharing from the end-product. |
◾ | Microbial based products for the aqua-culture industry, using MicroBoost AI |
◾ | Drug optimization for human health using ChemPass AI, and |
◾ | Developing high quality plant-based food, using GeneRator AI for genome-editing. |
◾ | Corporate branding (May 2020) – we launched our new branding to reflect Evogene’s expanded vision and new business model. |
◾ | CRISPR-IL consortium (June 2020) – we announced our participation in the CRISPR-IL consortium to provide an end-to-end artificial intelligence system for genome-editing. |
◾ | Fundraising (September 2020) – we secured a $10 million equity investment led by ARK Investment Management, LLC. |
◾ | Fundraising (November 2020) – we secured a $12 million investment by institutional investors. |
◾ | CRISPR-IL consortium (January 2021) – we announced a 2020 year-end update for the CRISPR-IL consortium. |
◾ | At-the-market, or ATM, offering (February 2021) – we completed a $28 million ATM offering and entered into a new ATM offering sales agreement for the sale of up to $50 million of our ordinary shares. |
◾ | Bio-pesticide program (October 2020) – LAV312 showed positive results in protecting grapes from Botrytis in a trial that took place in an Italian vineyard. Product expected to reach the market in 2024. |
◾ | Bio-stimulant program (December 2020) – LAV211 was successfully combined with harvesting spring wheat in North Dakota. Based on results gained during the last three years, product launch is expected in 2022. |
◾ | Strategic collaboration (March 2020) – entry into a strategic collaboration with Corteva Agriscience, to develop a novel herbicide, based on pre-lead candidates. |
◾ | Herbicide program (December 2020) – reaching a lead phase for lead candidate APH1, following the completion of field tests that demonstrated APH1’s effective control over a broad panel of weeds, including ones known to have resistance to existing herbicides. |
◾ | Immuno-oncology program (September 2020) – achieved positive results in a pre-clinical study. |
◾ | Immuno-oncology program (October 2020) – initial scale-up and first GMP production of drug candidates, as preparation for first-in-man clinical trial, expected to be initiated in 2021. |
◾ | Go-to-market strategy (December 2020) – entered into an agreement with a commercial partner for cultivation of proprietary cannabis varieties, as part of the strategic goal to build an end-to-end value chain - from seed to product sale. |
◾ | Precise product family (February 2021) – entered into a collaboration agreement with Tikun Olam-Cannbit Pharmaceuticals Ltd. for the development of novel medical cannabis products. |
◾ | MetaYield product family (March 2021) – announced identification of leading cannabis varieties to be further developed into commercial varieties, towards expected commercial launch in Israel in 2022. |
◾ | Go-to-market strategy (March 2021) – entered into agreements with Tikun Olam-Cannbit Pharmaceuticals Ltd. for production, packaging and distribution of medical cannabis products under Canonic’s brand. |
◾ | Novel insect control traits (March 2021) – entered a collaboration agreement with Plastomics Inc. targeting novel insect control traits for soybean. Evogene’s insect control genes demonstrating new modes of action (MoAs) will be introduced into soybeans using Plastomics chloroplast technology. |
The market for ag-biological products was estimated at $7.8 billion in 20182 and is a growing segment in the approximately $250 billion agricultural input market which includes the seed, crop protection and fertilizers segments. The sales of ag-biological products significantly grew in past years, expanding from a market size of $3.2 billion in 2015 to its current size following a shift in growers and consumer preferences to more sustainable and healthier practices, while driving agriculture productivity. According to market estimates, this market is forecasted to reach sales of $19 billion in 20252, anticipated to be driven by improvement of the product attributes of ag-biologicals, such as efficacy, stability and commercial viability.
(i) | Direct market access – in fragmented markets Lavie Bio expects to complete product development of its products independently and then will establish a tailored market access strategy per specific product and territory (such as certain fruits and vegetables); |
(ii) | Indirect market access – in markets in which Lavie Bio identifies strategic partners that can drive the go-to-market for its products, the aim is to gain market access through collaborations with such partners. The revenues could include co-development and royalty-bearing commercialization agreements; and |
(iii) | Precision Optimization collaboration – Lavie Bio’s platform is used to optimize activity on promising candidates (Precision Optimization). This activity is a unique asset that allows Lavie Bio to harness the potential of live microbial products, addressing challenges of efficacy (e.g. impact against pest), consistency (e.g. stability of performance in the field) and commercial viability (e.g. shelf life). Currently, Precision Optimization is implemented for internal product programs, but can also significantly contribute to other ag-biological companies with existing products or products that are close to market release that face challenges blocking their commercial potential. Payments for this may include co-development and royalty-bearing commercialization agreements with third party collaborators. |
◾ | Discovery: The identification of a candidate microbial strain, or microbial strain teams, having the potential to improve the target trait. A collection of selected microbial candidates is typically tested on the crop(s) of choice in greenhouse screens or limited field experiments for various efficacy, stability and commercial viability criteria. Candidates that meet the testing criteria are referred to as “Hits”. Typically, the duration of the discovery phase is approximately 12-18 months. |
◾ | Pre-development: Promising Hits are advanced to pre-development phase, in order to further assess and optimize performance criteria such as shelf life, efficacy and stability. Successfully performing microbial candidates are referred to as “Advanced Hits”. Typically, the duration of this phase is approximately 12-18 months. |
◾ | Development: This phase is usually divided into Development Stage 1, resulting with a “Lead”, and Development Stage 2, resulting with a “Pre-Product”. In this phase, the fermentation and formulation procedures are further optimized to allow for further testing and validation of efficacy and stability in the field as well as for commercial scale production, addressing cost of good targets and compatibility with other agricultural inputs. Based on industry benchmarks and our estimates, we estimate the duration of this stage to be approximately 24 months. |
◾ | Pre-commercialization: In this phase, extensive field tests are undertaken to demonstrate the effectiveness of product candidates in enhancing the target trait, including production of data to support product positioning. Additional activities towards launch are performed, including packaging development, upscale manufacturing protocol, registration and regulation. Based on industry benchmarks and our estimates, in the U.S. we expect the duration of this stage to be approximately 24 months for bio-stimulants and 36-48 months for bio-pesticides due to longer regulation processes. |
◾ | Identification of Targets – identification and validation of vital targets or proteins that when inhibited (for instance by a chemical), lead to plant or insect death. |
◾ | Identification of Hits – screening of chemical compounds for the identification of candidate Hits that potentially inhibit identified vital targets and are capable of achieving the desired impact on the plants or insects of interest. The development process includes in-silico as well as biological screening and validation activities. |
◾ | Hit-to-Lead process – Hits displaying confirmed activity in the initial validation screens will enter the Hit-to-Lead process, including several optimization cycles, each constructed of compound design (in our case, focusing on computational optimization), synthesis of compounds and validation experiments. This stage ends with a ‘Lead’ compound, which is a validated hit that has confirmed activity in advanced validation screens proving commercial level efficacy that is confirmed in initial field trials. |
◾ | In this stage, multiple field trials are conducted in diverse geographies, as well as greenhouse experiments on resistant weed biotypes and on commercial crops, and the compound structure and formulation are finalized. Lead optimization also entails initial toxicology tests, process engineering on the molecule and cost of goods analysis. This stage ends with an ‘Optimized Lead’ compound. |
◾ | In this stage, field trials to validate all commercial cases are conducted, including testing product mixtures, as well as additional safety trials. This stage ends with a ‘Pre Development’ compound. |
◾ | In the final development phases, new chemical products are registered with the proper regulatory authorities and then launched for commercialization. According to publications of key industry players. We expect that these last stages of development will be conducted by our current and future collaboration partners or by our customers. |
(1) | The table does not present product development programs undertaken with collaborators that are subject to confidentiality restrictions. |
◾ | Discovery: The identification of target genetic elements for enhancing specified plant traits. We test these elements in different validation systems to determine their ability to enhance the specified trait. In our experience, the Discovery phase takes approximately 6-18 months. The target genetic elements may be applicable to product development through different technological approaches (i.e. genome editing, GM or advanced breeding). In our collaborations, we typically undertake this phase. |
◾ | Phase I, or “Proof of Concept”: Validated candidate genetic elements are advanced to Phase I. In this phase, they are tested in target plants through greenhouse trials, field trials, or both, for their efficacy in improving plant performance. Phase I may be conducted by us or by our collaborators, and in our experience, may last between two and five years for a GM product or, three years for a genome editing or advanced breeding product. For products developed through genome editing, deregulation process for classifying a product as non-GM is typically initiated during Phase I. |
◾ | Phase II, or “Early Development”: In this phase, the field tests are expanded, and our collaborators evaluate the genetic elements on multiple geographical locations and varieties, to reach commercially viable success rates. We estimate the duration of Phase II is between two to four years. For a GM product, by the end of this phase, a specific product candidate will be selected to advance to Phase III. For genome editing and advanced breeding products, the end of this phase will lead straight to Phase IV (Pre-Launch). |
◾ | Phase III, or “Advanced Development and Regulation”: This phase is relevant only for the development of GM products. Extensive field trials are performed to test the effectiveness of the selected product candidate across locations, and regulatory approvals are obtained, including potential environmental impact assessments, toxicity and allergenicity. We estimate the duration of Phase III is between one to two years. |
◾ | Phase IV, or “Pre-Launch”: This phase involves preparation for commercial launch. The range of activities here includes preparing the seeds for commercial sales, formulation of a marketing strategy and preparation of marketing materials. We estimate the duration of Phase IV is between one to two years. |
Program | Crop | Technology | Collaborator | Development Phase | ||||
1 | Corn | GM | Bayer | Phase I – at collaborator under license. | ||||
2 | (1) | Advanced breeding | A consumer goods company (1) | Undisclosed. At collaborator under license. |
(1) | Crop and collaborator name not disclosed. |
Program | Crop | Trait | Technology | Collaborator | Development Phase | |||||
1 | Corn | Fusarium | GM & genome editing | Bayer | Undisclosed. At collaborator under license. | |||||
2 | Soybean | Asian Soybean Rust | GM | Corteva | Undisclosed. At collaborator under license. | |||||
3 | Soybean | Nematodes | Genome editing | TMG | Discovery | |||||
4 | Banana | Black Sigatoka | GM | Rahan Meristem | Phase I – at collaborator under license. |
Program | Trait | Crop | Technology | Collaborator and Collaboration Phase | Phase | |||||
1 | Lepidoptera | Corn, Soybean, Cotton | GM | Internal program | Phase I | |||||
2 | Coleoptera | Corn, Cotton | GM | Internal program | Phase I | |||||
3 | Hemiptera | Soybean | GM | Internal program | Phase I |
◾ | Irritable Bowel Syndrome (IBS) is a common disorder that affects the large intestine. Signs and symptoms include cramping, abdominal pain, bloating, gas, and diarrhea or constipation, or both. It is estimated that the total market for IBS reached $1.5 billion in 2018, with 45 million patients in the U.S. alone and is expected to reach $3.3 billion in 20261112. Existing drugs for IBS mainly treat the symptoms of the condition, leaving patients exposed to cycles of remission and relapse that characterize this chronic condition. |
◾ | Inflammatory Bowel Disease (IBD) is a group of GI diseases, mainly comprised of Ulcerative colitis and Crohn’s disease. IBDs cause long term chronic as well as severe inflammation in the gastrointestinal tract without any known cause. According to the Centers for Disease Control and Prevention, or CDC, in 2015 an estimated 3.1 million people (1.3% of the entire population) in the United States were diagnosed either with Crohn’s disease or with Ulcerative Colitis. The global IBD drug market is estimated to grow from $15.9 billion in 2018 to $22.4 billion in 2026.13 |
◾ | Clostridium Difficile Infection (CDI) – The CDC has identified CDI as one of the top three most urgent antibiotic-resistant bacterial threats in the United States. CDI is most often caused by the use of broad spectrum antibiotics which induce dysbiosis of the microbiome causing susceptibility to infection by C. difficile, a spore forming bacterium. It is the most common cause of hospital acquired infection in the United States. |
◾ | Methicillin-Resistant Staphylococcus Aureus (MRSA) - One of the most common Staphylococcus aureus infections is caused by MRSA, which is a multi-drug resistant bacterium, responsible for several difficult-to-treat infections in humans, leading to tens of thousands of annual cases of mortality in the U.S. MRSA is the leading causative agent for hospital acquired infections and has recently been documented as community-acquired as well as livestock-acquired. Current medical treatments include broad spectrum antibiotics that are becoming increasingly ineffective. The current MRSA market was valued at approximately $922 million in 2018 and is projected to reach over $1.3 billion by 2026.15 |
◾ | At the taxonomic level our analysis allows strain-level resolution and relies on an extensive proprietary strain database. |
◾ | At the functional level, our proprietary resources rely on a comprehensive catalog of microbial genes enabling mapping of an average of 90% of the functions of the human gut microbiome obtained through metagenomics sequencing. |
◾ | Variety stability – Current cannabis varieties demonstrate high variability in active compound concentration and other desired traits. Patients continuously seek more reliable consistent products. This variability starts with the cannabis lines demonstrating unstable genetics and it leads to frustration with inconsistent and unreliable products. |
◾ | Cannabinoid yield – Yield in cannabis refers to the active compounds or metabolites found in the plant. Currently, low yield leads to higher production costs and subsequently higher costs for the patients. With the increasing legalization of cannabis in more and more countries, the price per gram of cannabis is decreasing. The decreasing selling price of cannabis has made this product increasingly sensitive to the cost of production, making yield of cannabinoid per growing area a significant factor. |
◾ | Cannabinoid specificity – Cannabis is known to contain hundreds of active compounds, and a critical need is to connect specific active compounds to the relevant medical indication and to develop cannabis varieties and products that include these specific active compounds in a stable and consistent manner. The lack of clinical data demonstrating correlation between medical indications and the genomic and cannabinoid profile of cannabis plants creates difficulties to develop indication-specific products. |
◾ | Development of varieties – This stage includes pre-breeding and breeding activities of tailored cannabis varieties (i.e., selective crossing of cannabis varieties) to achieve desired properties. In addition, the company is searching and identifying elite plant varieties from its existing genetic collection to shorten time to market. During this stage Canonic also performs pre-clinical trials to support and direct its medical product development pipeline. |
◾ | Pre-production and pre-commercialization – This stage includes the testing of cannabis varieties with licensed cultivators (variety trials), upscaling propagation and cultivation activities and entering into business agreements with cultivators, manufacturers and distributers. |
◾ | Production and commercialization – This stage includes the production of Canonic’s products through sub-contractors and commercialization through regional distributors. |
◾ | MetaYield – focused on agronomic and consumer traits for the enhancement of total active compounds in the plant. In this program Canonic has initiated pre-commercial activities for its first varieties while continuing development of next generation product candidates. Canonic expects commercial launch and initial sales of first MetaYield product in Israel in 2022. |
◾ | Precise – focused on the enhancement of specific active compounds in the plant, targeting anti-inflammatory and pain management properties. In this program Canonic is at the development of varieties phase. Canonic expects to reach in 2022 a first Precise commercial variety for reducing pain or inflammation, as preparation for commercial launch in 2023. |
Name of Subsidiary | Jurisdiction | Ownership Interest | ||
AgPlenus Ltd. | Israel | 98.3% (1) | ||
Biomica Ltd. | Israel | 90.9% (2) | ||
Canonic Ltd. | Israel | 100% | ||
Casterra Ag Ltd. (formerly known as Evofuel Ltd.). | Israel | 100% | ||
Lavie Bio Ltd. | Israel | 72.2% (3) |
(1) | The remaining 1.7% of AgPlenus Ltd.’s outstanding share capital is held by AgPlenus’ former Chief Executive Officer and current director as a result of exercise of options. |
(2) | The remaining 9.1% of Biomica Ltd.’s outstanding share capital is held by Biomica's Chief Technology Officer. |
(3) | The remaining 27.8% of Lavie Bio Ltd.’s outstanding share capital is held by Pioneer Hi-Bred International, Inc. (also known by the name Corteva). |
ITEM 4A. | UNRESOLVED STAFF COMMENTS |
ITEM 5. | OPERATING AND FINANCIAL REVIEW AND PROSPECTS |
Year ended December 31, | ||||||||||||
Operating Segment: | 2020 | 2019 | 2018 | |||||||||
(U.S. dollars, in thousands) | ||||||||||||
Agriculture | $ | 847 | $ | 651 | $ | 1,641 | ||||||
Industry | 33 | 26 | 106 | |||||||||
Human | 75 | - | - | |||||||||
Unallocated | 85 | 76 | - | |||||||||
Total | $ | 1,040 | $ | 753 | $ | 1,747 |
Year ended December 31, | ||||||||||||
Geographical Region: | 2020 | 2019 | 2018 | |||||||||
United States | 65 | % | 33 | % | 57 | % | ||||||
Germany | - | 2 | % | 13 | % | |||||||
Israel | 22 | % | 35 | % | 12 | % | ||||||
Brazil | 11 | % | 28 | % | 6 | % | ||||||
Other | 2 | % | 2 | % | 12 | % | ||||||
Total | 100 | % | 100 | % | 100 | % |
◾ | Agriculture: Our Agriculture segment includes our division and subsidiaries engaged in agricultural activities, including seed traits activity, ag-chemicals activity (now through our subsidiary AgPlenus) and ag-biologicals activity (now through our subsidiary Lavie Bio). |
◾ | Human Health: Our Human Health segment focuses mainly on discovery and development of human microbiome-based therapeutics (through our subsidiary Biomica) and cannabis activity (through our subsidiary Canonic). |
◾ | Industrial Applications: Our Industry Application segment focuses on the development and commercialization of improved castor bean seeds for industrial uses (through our subsidiary Casterra). |
Agriculture | Industry | Human | Unallocated | Total | ||||||||||||||||
(in thousands) | ||||||||||||||||||||
Year ended December 31, 2020 | ||||||||||||||||||||
Revenues | $ | 847 | $ | 33 | $ | 75 | $ | 85 | $ | 1,040 | ||||||||||
Operating loss | (8,687 | ) | (333 | ) | (4,669 | ) | (11,125 | ) | (24,814 | ) | ||||||||||
Year ended December 31, 2019 | ||||||||||||||||||||
Revenues | $ | 651 | $ | 26 | $ | - | $ | 76 | $ | 753 | ||||||||||
Operating loss | (10,062 | ) | (419 | ) | (3,219 | ) | (7,466 | ) | (21,166 | ) | ||||||||||
Year ended December 31, 2018 | ||||||||||||||||||||
Revenues | $ | 1,641 | $ | 106 | $ | - | $ | - | $ | 1,747 | ||||||||||
Operating loss | (7,674 | ) | (456 | ) | (1,608 | ) | (10,251 | ) | (19,989 | ) |
2020 | 2019 | 2018 | ||||||||||
Consolidated Statements of Comprehensive loss: | (U.S. dollars, in thousands) | |||||||||||
Total Revenues | $ | 1,040 | $ | 753 | $ | 1,747 | ||||||
Cost of revenues | 574 | 334 | 1,452 | |||||||||
Gross profit | 466 | 419 | 295 | |||||||||
Operating Expenses: | ||||||||||||
Research and development, net | 17,287 | 15,791 | 14,686 | |||||||||
Business development | 2,672 | 2,029 | 2,084 | |||||||||
General and administrative | 5,321 | 3,765 | 3,514 | |||||||||
Total operating expenses | 25,280 | 21,585 | 20,284 | |||||||||
Operating loss | (24,814 | ) | (21,166 | ) | (19,989 | ) | ||||||
Financing income | 1,591 | 2,630 | 1,413 | |||||||||
Financing expenses | (2,951 | ) | (555 | ) | (2,206 | ) | ||||||
Loss before taxes on income | (26,174 | ) | (19,091 | ) | (20,782 | ) | ||||||
Taxes on income | 32 | 24 | 30 | |||||||||
Loss | $ | (26,206 | ) | $ | (19,115 | ) | $ | (20,812 | ) |
◾ | amortization over an eight-year period of the cost of purchased know-how and patents and rights to use a patent and know-how which are used for the development or advancement of the Industrial Enterprise, commencing in the year in which such rights were first exercised; |
◾ | under limited conditions, an election to file consolidated tax returns together with Israeli Industrial Companies controlled by it; and |
◾ | expenses related to a public offering are deductible in equal amounts over a three-year period, commencing in the year of the offering. |
2020 | 2019 | 2018 | ||||||||||
(U.S. dollars, in thousands) | ||||||||||||
Net cash used in operating activities | $ | (19,514 | ) | $ | (17,666 | ) | $ | (15,161 | ) | |||
Net cash provided by investing activities | 9,415 | 37,139 | 17,353 | |||||||||
Net cash provided by financing activities | 20,374 | 9,306 | 297 | |||||||||
Exchange rate differences - cash and cash equivalents | 1,206 | 159 | (114 | ) | ||||||||
Net increase in cash and cash equivalents | $ | 11,481 | $ | 28,938 | $ | 2,375 |
Less than 1 year | 1-3 years | 3-5 years | More than 5 years | Total | ||||||||||||||||
(in thousands, unaudited) | ||||||||||||||||||||
Trade payables | $ | 863 | $ | - | $ | - | $ | - | $ | 863 | ||||||||||
Employees and payroll accruals | 2,535 | - | - | - | 2,535 | |||||||||||||||
Other payables(1) | 1,238 | - | - | - | 1,238 | |||||||||||||||
Liabilities in respect of government grants (undiscounted)(2) | 72 | 468 | 1,505 | 2,639 | 4,684 | |||||||||||||||
Non-cancellable operating leases (undiscounted) (3) | 777 | 1,281 | 733 | 133 | 2,924 | |||||||||||||||
Total | $ | 5,485 | $ | 1,749 | $ | 2,238 | $ | 2,772 | $ | 12,244 |
(1) | Consists of accrued expenses to be paid to suppliers and subcontractors, mainly for work related to our research and development activities. |
(2) | Consists of the projected repayments of government grants that partly fund our research and development activities. |
(3) | Consists of non-cancellable operating leases of our offices, laboratory facilities, greenhouses and motor vehicles. |
ITEM 6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
Name | Age | Position | ||
Executive officers | ||||
Mr. Ofer Haviv | 54 | President and Chief Executive Officer | ||
Mr. Ido Dor | 45 | Chief Executive Officer of Lavie Bio Ltd. | ||
Dr. Eyal Emmanuel | 47 | Chief Scientific Officer | ||
Dr. Elran Haber | 40 | Chief Executive Officer of Biomica Ltd. | ||
Dr. Arnon Heyman | 44 | Chief Executive Officer of Canonic Ltd. | ||
Mr. Mark Kapel | 44 | Executive Vice President Technology | ||
Mr. Douglas A. Eisner | 55 | Chief Executive Officer of AgPlenus Ltd. | ||
Ms. Dorit Kreiner | 49 | Chief Financial Officer | ||
Directors | ||||
Mr. Martin S. Gerstel(3)(4) | 79 | Chairman of the Board | ||
Ms. Sarit Firon(1)(2)(4) | 54 | Director | ||
Mr. Ziv Kop(1)(2)(3)(4) | 49 | Director | ||
Dr. Adrian Percy(4) | 55 | Director | ||
Mr. Leon Y. Recanati(3)(4) | 72 | Director | ||
Dr. Oded Shoseyov(1)(2)(4) | 64 | Director |
(1) | Member of our Audit Committee. |
(2) | Member of our Compensation and Nominating Committee. |
(3) | Member of our Corporate Development Committee. |
(4) | Independent director under the Nasdaq Listing Rules. |
(in thousands, US$)(1) | ||||||||||||||||
Name and Position | Salary and related benefits | Bonus(2) | Value of Options Granted(3) | Total | ||||||||||||
Ofer Haviv President and Chief Executive Officer | 367 | 131 | 94 | 592 | ||||||||||||
Ido Dor CEO Lavie Bio | 246 | 40 | 1,555 | 1,841 | ||||||||||||
Arnon Heyman CEO Canonic | 213 | 35 | 27 | 275 | ||||||||||||
Mark Kapel EVP Technology | 207 | 44 | 25 | 276 | ||||||||||||
Dorit Kreiner Chief Financial Officer | 213 | 45 | 18 | 276 |
(1) | All amounts reported in the table are in terms of cost to the Company, as recorded in our financial statements. |
(2) | Bonus amounts shown in this table reflect bonuses that were paid in 2021 relating to the office holders’ service in our company in 2020, as approved by our compensation and nominating committee and board of directors, and, to the extent required, also by our shareholders. |
(3) | Consists of amounts recognized as non-cash expenses in our statement of profit or loss for the year ended December 31, 2020 in respect of option grants. Some of our office holders were granted options to purchase equity of our subsidiaries for which they serve as officers, for which the related expenses were recorded in our statement of profit or loss. |
◾ | Annual fees in an amount of approximately $18,000 for directors not classified as experts and approximately $24,000 for directors classified as experts; and |
◾ | Per-meeting fees in an amount of approximately $1,000 for directors not classified as experts and approximately $1,300 for directors classified as experts; 60% of such amounts for participation in meetings via phone and 50% of such amounts for resolutions adopted in writing. |
Subsidiary | Percentage of Subsidiary's Equity Issuable as Equity Incentives | Percentage of Equity Granted to Date as Equity Incentives | ||||||
AgPlenus | 9.1 | % | 8.8 | % | ||||
Biomica | 24.5 | % | 14.4 | % | ||||
Casterra | 8.4 | % | 3.9 | % | ||||
Canonic | 9.1 | % | 6.0 | % | ||||
Lavie Bio | 9.1 | % | 8.0 | % |
◾ | such majority includes at least 2/3 of the shares held by all shareholders who are not controlling shareholders and do not have a personal interest in such appointment, present and voting at such meeting; or |
◾ | the total number of shares of non-controlling shareholders who do not have a personal interest in such appointment voting against such appointment does not exceed two percent of the aggregate voting rights in the company. |
◾ | retaining and terminating the services of our independent auditors, subject to the approval of the board of directors and shareholders; |
◾ | pre-approval of audit and non-audit services to be provided by the independent auditors; |
◾ | reviewing with management and our independent directors our financial reports prior to their submission to the SEC; and |
◾ | approval of certain transactions with office holders and other related-party transactions. |
◾ | reviewing and recommending an overall compensation policy with respect to our Chief Executive Officer and other executive officers, as described above under “Item 6. Directors, Senior Management and Employees—B. Compensation—Compensation Policy”; |
◾ | reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer and other executive officers, including evaluating their performance in light of such goals and objectives; |
◾ | reviewing and approving the granting of options and other incentive awards; |
◾ | reviewing, evaluating and making recommendations regarding the compensation and benefits for our non-employee directors; and |
◾ | advising our board of directors in selecting individuals who are best able to fulfill the responsibilities of a director or executive officer of our company. |
◾ | at least a majority of the voting rights in the company held by non-controlling shareholders who have no conflict of interest (referred to under the Companies Law as a “personal interest”) in the transaction or arrangement and who are present and voting (in person or by proxy) at the general meeting, must be voted in favor of approving the transaction or arrangement (for this purpose, abstentions are disregarded); or |
◾ | the voting rights held by non-controlling, non-conflicted shareholders (as described in the previous bullet point) who are present and voting (in person or by proxy) at the general meeting, and who vote against the transaction, do not exceed two percent of the voting rights in the company. |
◾ | financial liability imposed on him or her in favor of another person pursuant to a judgment, settlement or arbitrator’s award approved by a court. However, if an undertaking to indemnify an office holder with respect to such liability is provided in advance, then such an undertaking must be limited to events which, in the opinion of the board of directors, can be foreseen based on the company’s activities when the undertaking to indemnify is given, and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances, and such undertaking shall detail the abovementioned events and amount or criteria; |
◾ | reasonable litigation expenses, including attorneys’ fees, incurred by the office holder as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (i) no indictment was filed against such office holder as a result of such investigation or proceeding; and (ii) no financial liability, such as a criminal penalty, was imposed upon him or her as a substitute for the criminal proceeding as a result of such investigation or proceeding or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent; and |
◾ | reasonable litigation expenses, including attorneys’ fees, incurred by the office holder or imposed by a court in proceedings instituted against him or her by the company, on its behalf or by a third party or in connection with criminal proceedings in which the office holder was acquitted or as a result of a conviction for an offense that does not require proof of criminal intent. |
As of December 31, 2020 | ||||||||||||
Israel | U.S. | Total | ||||||||||
Executive Management | 4 | - | 4 | |||||||||
Lavie Bio Ltd. | 17 | 5 | 22 | |||||||||
AgPlenus Ltd. | 11 | 1 | 12 | |||||||||
Ag-Seeds division | 2 | - | 2 | |||||||||
Casterra Ag Ltd. | 1 | - | 1 | |||||||||
Biomica Ltd. | 7 | - | 7 | |||||||||
Canonic Ltd. | 6 | - | 6 | |||||||||
Technology Platform | 48 | - | 48 | |||||||||
General and administrative | 28 | - | 28 | |||||||||
Total | 124 | 6 | 130 |
ITEM 7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS |
Shares Beneficially Held | ||||||||
Name of Beneficial Owner | Number | Percentage of Class | ||||||
Principal Shareholders | ||||||||
ARK Investment Management LLC (1) | 4,594,499 | 11.4 | % | |||||
Entities affiliated with Waddell & Reed Financial, Inc. (2) | 2,757,223 | 6.8 | % | |||||
Executive Officers and Directors | ||||||||
Ofer Haviv | 720,930 | (3) | 1.8 | % | ||||
Gadi Ben Nissim | 21,875( | **) | * | |||||
Ido Dor | 269,875 | (4) | * | |||||
Douglas A. Eisner | 0 (5 | ) | * | |||||
Dr. Eyal Emmanuel | 56,256 | (6) | * | |||||
Dr. Elran Haber | 0 (7 | ) | * | |||||
Dr. Arnon Heyman | 93,619 | (8) | * | |||||
Mark Kapel | 124,434 | (9) | * | |||||
Dorit Kreiner | 71,494 | (10) | * | |||||
Dr. Gaya Loren | 25,000( | **) | * | |||||
Martin S. Gerstel | 670,256 | (11) | 1.6 | % | ||||
Sarit Firon | 11,875 | (12) | * | |||||
Ziv Kop | 18,125 | (13) | * | |||||
Dr. Adrian Percy | 5,625 | (14) | * | |||||
Leon Y. Recanati | 855,735 | (15) | 2.1 | % | ||||
Dr. Oded Shoseyov | 6,250 | (16) | * | |||||
All directors and executive officers as a group (16 persons**) | 2,951,349 | 6.8 | % |
* | Less than 1%. |
** | The engagement of each of Mr. Ben Nissim and Dr. Loren as executive officers ended during 2020. Beneficial ownership information for such persons is based on our own internal records as of the date on which their engagement ended. |
(1) | This information is based upon a Schedule 13G/A filed by ARK Investment Management LLC with the SEC on February 16, 2021. ARK Investment Management LLC is a Delaware limited liability company and possesses sole voting and dispositive power over these ordinary shares. The principal address for ARK Investment Management LLC is 3 East 28th Street, 7th Floor, New York, NY 10016. |
(2) | This information is based upon a Schedule 13G/A filed jointly with the SEC on February 12, 2021 by (i) Waddell & Reed Financial, Inc., or WDR; and (ii) Ivy Investment Management Company, or IICO, an investment advisory subsidiary of WDR, each of which reported sole voting and dispositive power with regard to all 2,757,223 shares. According to this Schedule 13G/A, the investment advisory contracts grant IICO investment power over securities owned by their advisory clients and the investment sub-advisory contracts grant IICO investment power over securities owned by their sub-advisory clients and, in most cases, voting power. Any investment restriction of a sub-advisory contract does not restrict investment discretion or power in a material manner. Therefore, IICO may be deemed the beneficial owner of the securities under Rule 13d-3 of the Exchange Act. These ordinary shares are held by WDR and IICO. The principal address for these entities is 6300 Lamar Avenue, Overland Park, KS 66202. |
(3) | Consists of 720,930 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 215,000 on July 17, 2023, 170,000 on March 22, 2025, 210,930 on August 8, 2027 and 125,000 on April 21, 2030. The weighted average exercise price of these options is NIS 29.83. |
(4) | Ido Dor serves as the CEO of our subsidiary company Lavie Bio, and as such, he holds options to purchase shares of Lavie Bio. In addition, Mr. Dor also holds options to purchase 269,875 ordinary shares of Evogene that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 21,875 on September 21, 2021, 7,500 on July 15, 2023, 25,000 on November 9, 2024, 23,000 on March 22, 2025, 80,000 on November 17, 2025, and 112,500 on August 8, 2027. The weighted average exercise price of these options is NIS 28.23. |
(5) | Douglas A. Eisner serves as the CEO of our subsidiary company AgPlenus, and as such, he holds options to purchase shares of AgPlenus rather than our company itself. For a description of our subsidiaries’ equity incentive plans, please see Item 6 “Directors, Senior Management and Employees—B. Compensation—Share Option and Incentive Plans—Subsidiary Equity Incentive Plans”. |
(6) | Consists of 56,256 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 28,128 on November 13, 2028, and 28,128 on December 23, 2028. The weighted average exercise price of these options is NIS 10.16. |
(7) | Elran Haber serves as the CEO of our subsidiary company Biomica, and as such, he holds options to purchase shares of Biomica rather than our company itself. For a description of our subsidiaries’ equity incentive plans, please see Item 6 “Directors, Senior Management and Employees—B. Compensation—Share Option and Incentive Plans—Subsidiary Equity Incentive Plans”. |
(8) | Arnon Heyman serves as the CEO of our subsidiary company Canonic Ltd. Dr. Heyman holds options to purchase 93,619 ordinary shares of Evogene that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 10,000 on November 9, 2024, 18,000 on May 18, 2026, 46,875 on August 8, 2027, and 18,744 on February 26, 2028. The weighted average exercise price of these options is NIS 21.85. |
(9) | Consists of 124,434 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 13,500 on July 15, 2023, 12,000 on March 22, 2025, 21,750 on August 8, 2027, 45,000 on February 26, 2028, 16,875 on February 4, 2029 and 15,309 on July 30, 2029. The weighted average exercise price of these options is NIS 18.57. |
(10) | Includes 69,994 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 19,685 on February 4, 2029, and 50,309 on July 30, 2029. The weighted average exercise price of these options is NIS 6.52. Also includes 1,500 ordinary shares held by a trustee in favor of Ms. Kreiner. |
(11) | Includes 636,506 ordinary shares, consisting of: (a) 37,500 ordinary shares held by a trustee in favor of Mr. Gerstel; (b) 383,815 ordinary shares held by Martin Gerstel; and (c) 215,191 ordinary shares held by Shomar Corporation with respect to which Martin Gerstel and his wife Mrs. Shoshana Gerstel possess voting and investment power. Also includes 33,750 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 5,000 on September 17, 2021, 5,000 on June 11, 2022, 5,000 on September 15, 2023, 5,000 on August 17, 2024, 5,000 on July 2, 2025, 5,000 on May 18, 2026, and 3,750 on May 16, 2027. The weighted average exercise price of these options is NIS 37.47. |
(12) | Consists of 11,875 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 10,000 on August 10, 2026, and 1,875 on August 8, 2027. The weighted average exercise price of these options is NIS 25.59. |
(13) | Consists of 18,125 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 10,000 on March 20, 2024, 2,500 on March 22, 2025, 2,500 on February 28, 2026, 2,500 on January 12, 2027, and 625 on January 11, 2028. The weighted average exercise price of these options is NIS 52.46. |
(14) | Consists of 5,625 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, which expire on December 23, 2028. The exercise price of these options is USD $2.56. |
(15) | Includes 838,860 ordinary shares held by Mr. Recanati. Also includes 16,875 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, of which options to purchase the following number of shares expire on the following dates, respectively: 2,500 on September 17, 2021, 2,500 on June 11, 2022, 2,500 on September 15, 2023, 2,500 on August 17, 2024, 2,500 on July 2, 2025, 2,500 on May 18, 2026, and 1,875 on May 16, 2027. The weighted average exercise price of these options is NIS 37.47. |
(16) | Consists of 6,250 ordinary shares issuable upon exercise of options that are currently exercisable or exercisable within 60 days of March 20, 2021, which expire on November 13, 2028. The exercise price of these options is NIS 10.67. |
ITEM 8. | FINANCIAL INFORMATION |
ITEM 9. | THE OFFER AND LISTING |
ITEM 10. | ADDITIONAL INFORMATION |
◾ | banks, financial institutions or insurance companies; |
◾ | real estate investment trusts, regulated investment companies or grantor trusts; |
◾ | dealers or traders in securities, commodities or currencies; |
◾ | tax-exempt entities; |
◾ | certain former citizens or long-term residents of the United States; |
◾ | persons that received our shares as compensation for the performance of services; |
◾ | persons that will hold our shares as part of a “hedging,” “integrated” or “conversion” transaction or as a position in a “straddle” for United States federal income tax purposes; |
◾ | partnerships (including entities classified as partnerships for United States federal income tax purposes) or other pass-through entities, or holders that will hold our shares through such an entity; |
◾ | persons subject to special tax accounting rules as a result of any item of gross income with respect to the ordinary shares being taken into account in an “applicable financial statement” pursuant to Section 451(b) of the Code (as defined below); |
◾ | U.S. Holders (as defined below) whose “functional currency” is not the U.S. dollar; or |
◾ | holders that own directly, indirectly or through attribution 10.0% or more of the voting power or value of our shares. |
◾ | a citizen or resident of the United States; |
◾ | a corporation (or other entity treated as a corporation for United States federal income tax purposes) created or organized in or under the laws of the United States or any state thereof, including the District of Columbia; |
◾ | an estate the income of which is subject to United States federal income taxation regardless of its source; or |
◾ | a trust if such trust has validly elected to be treated as a United States person for United States federal income tax purposes or if (1) a court within the United States is able to exercise primary supervision over its administration and (2) one or more United States persons have the authority to control all of the substantial decisions of such trust. |
◾ | at least 75% of its gross income is “passive income”; or |
◾ | at least 50% of the average quarterly value of its gross assets (which may be determined in part by the market value of our ordinary shares, which is subject to change) is attributable to assets that produce “passive income” or are held for the production of passive income. |
ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Period | Depreciation (Appreciation) of the NIS against the U.S. dollar (%) Based on Average of Daily Exchange Rates Throughout Year Compared to Previous Year | |
2020 | (7.0) | |
2019 | (7.7) | |
2018 | (0.1) | |
2017 | (6.3) | |
2016 | (1.1) | |
ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
ITEM 15. | CONTROLS AND PROCEDURES |
(a) | Disclosure Controls and Procedures |
(b) | Management’s Annual Report on Internal Control Over Financial Reporting |
(c) | Attestation Report of Registered Public Accounting Firm |
(d) | Changes in internal control over financial reporting |
ITEM 16. | [RESERVED] |
ITEM 16A. | AUDIT COMMITTEE FINANCIAL EXPERT |
ITEM 16B. | CODE OF ETHICS |
ITEM 16C. | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
2020 | 2019 | |||||||
Audit Fees | $ | 215,000 | $ | 130,000 | ||||
Audit-Related Fees | - | 5,000 | ||||||
Tax Fees | 16,905 | 14,000 | ||||||
All Other Fees | - | - | ||||||
Total | $ | 231,905 | $ | 149,000 |
ITEM 16D. | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
ITEM 16E. | PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS |
ITEM 16F. | CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT |
ITEM 16G. | CORPORATE GOVERNANCE |
◾ | Quorum. As permitted under the Companies Law, pursuant to our articles of association, the quorum required for an ordinary meeting of shareholders consists of at least two shareholders present in person, by proxy or by other voting instrument in accordance with the Companies Law, who hold at least 25% of the voting power of our shares (and in an adjourned meeting, with some exceptions, at least two shareholders), instead of 33 1/3% of the issued share capital, as required under the Nasdaq Listing Rules. |
◾ | Executive sessions of independent directors. Israeli law does not require executive sessions of independent directors. Although all of our current directors are “independent directors” under the applicable Nasdaq criteria, we do not intend to comply with this requirement if we have directors who are not independent. |
◾ | Shareholder approval. We seek shareholder approval for all corporate actions requiring such approval under the Companies Law, which include (i) transactions with directors concerning the terms of their service or indemnification, exemption and insurance for their service (or for any other position that they may hold at our company), (ii) transactions concerning the compensation, indemnification, exculpation and insurance of the chief executive officer; (iii) the compensation policy recommended by the compensation committee of our board of directors and approved by our board of directors (and any amendments thereto); (iv) extraordinary transactions with, and the terms of employment or other engagement of, a controlling shareholder (if and when this becomes relevant to our company), (v) amendments to our articles of association, and (vi) certain non-public issuances of securities. In addition, under the Companies Law, a merger requires approval of the shareholders of each of the merging companies. We are not required, however, to seek shareholder approval for any of the following events described in the Nasdaq Listing Rules: |
◾ | certain issuances of shares in excess of 20% of the outstanding shares of the Company; |
◾ | an issuance that will result in a change of control of our company; and |
◾ | adoption of, or material changes to, our equity compensation plans. |
ITEM 16H. | MINE SAFETY DISCLOSURE |
ITEM 17. | FINANCIAL STATEMENTS |
ITEM 18. | FINANCIAL STATEMENTS |
ITEM 19. | EXHIBITS |
Exhibit No. | Description | |
* | Portions of this exhibit have been omitted in accordance with the rules of the SEC. |
Evogene Ltd. | ||
Date: April 2, 2021 | By: /s/ Ofer Haviv Name: Ofer Haviv Title: President and Chief Executive Officer |
Page | |
F - 2 - F - 3 | |
F - 4 | |
F - 5 | |
F - 6 | |
F - 7 - F - 8 | |
F - 9 - F - 49 |
Kost Forer Gabbay & Kasierer 144 Menachem Begin Road, Building A Tel-Aviv 6492102, Israel | Tel: +972-3-6232525 Fax: +972-3-5622555 ey.com |
December 31, | ||||||||||||
Note | 2020 | 2019 | ||||||||||
CURRENT ASSETS: | ||||||||||||
Cash and cash equivalents | 6 | $ | 46,229 | $ | 34,748 | |||||||
Marketable securities | 7 | - | 2,128 | |||||||||
Short-term bank deposits | 2,000 | 10,000 | ||||||||||
Trade receivables | 222 | 72 | ||||||||||
Other receivables and prepaid expenses | 8 | 3,372 | 2,079 | |||||||||
51,823 | 49,027 | |||||||||||
LONG-TERM ASSETS: | ||||||||||||
Long-term deposits | 9 | 9 | ||||||||||
Right-of-use-assets | 9 | 1,872 | 2,671 | |||||||||
Property, plant and equipment, net | 10 | 2,072 | 2,583 | |||||||||
Intangible assets, net | 11 | 16,139 | 17,074 | |||||||||
20,092 | 22,337 | |||||||||||
$ | 71,915 | $ | 71,364 | |||||||||
CURRENT LIABILITIES: | ||||||||||||
Trade payables | $ | 863 | $ | 1,001 | ||||||||
Employees and payroll accruals | 2,535 | 2,079 | ||||||||||
Current maturities of lease liabilities | 777 | 895 | ||||||||||
Liabilities in respect of government grants | 12 | 72 | 37 | |||||||||
Pre-funded warrants | 4,144 | - | ||||||||||
Deferred revenues and other advances | 5 | 47 | 386 | |||||||||
Other payables | 1,238 | 1,348 | ||||||||||
9,676 | 5,746 | |||||||||||
LONG-TERM LIABILITIES: | ||||||||||||
Lease liability | 1,663 | 2,076 | ||||||||||
Liabilities in respect of government grants | 12 | 3,694 | 3,325 | |||||||||
5,357 | 5,401 | |||||||||||
SHAREHOLDERS' EQUITY: | 17 | |||||||||||
Ordinary shares of NIS 0.02 par value: Authorized − 150,000,000 ordinary shares; Issued and outstanding – 35,600,088 shares on December 31, 2020 and 25,754,297 shares on December 31, 2019 | 200 | 142 | ||||||||||
Share premium and other capital reserves | 225,121 | 205,904 | ||||||||||
Accumulated deficit | (179,276 | ) | (155,902 | ) | ||||||||
Equity attributable to equity holders of the Company | 46,045 | 50,144 | ||||||||||
Non-controlling interests | 10,837 | 10,073 | ||||||||||
Total equity | 56,882 | 60,217 | ||||||||||
$ | 71,915 | $ | 71,364 |
April 2, 2021 | ||||||
Date of approval of the | Martin Gerstel | Ofer Haviv | Dorit Kreiner | |||
financial statements | Chairman of the board | Chief Executive Officer | Chief Financial Officer |
Year ended December 31, | ||||||||||||||||
Note | 2020 | 2019 | 2018 | |||||||||||||
Revenues | $ | 1,040 | $ | 753 | $ | 1,747 | ||||||||||
Cost of revenues | 19a | 574 | 334 | 1,452 | ||||||||||||
Gross profit | 466 | 419 | 295 | |||||||||||||
Operating expenses: | ||||||||||||||||
Research and development, net | 19b | 17,287 | 15,791 | 14,686 | ||||||||||||
Business development | 19c | 2,672 | 2,029 | 2,084 | ||||||||||||
General and administrative | 19d | 5,321 | 3,765 | 3,514 | ||||||||||||
Total operating expenses | 25,280 | 21,585 | 20,284 | |||||||||||||
Operating loss | (24,814 | ) | (21,166 | ) | (19,989 | ) | ||||||||||
Finance income | 19e | 1,591 | 2,630 | 1,413 | ||||||||||||
Finance expenses | 19e | (2,951 | ) | (555 | ) | (2,206 | ) | |||||||||
Financing income (expenses), net | (1,360 | ) | 2,075 | (793 | ) | |||||||||||
Loss before taxes on income | (26,174 | ) | (19,091 | ) | (20,782 | ) | ||||||||||
Taxes on income | 32 | 24 | 30 | |||||||||||||
Loss | $ | (26,206 | ) | $ | (19,115 | ) | $ | (20,812 | ) | |||||||
Attributable to: | ||||||||||||||||
Equity holders of the Company | (23,374 | ) | (18,112 | ) | (20,758 | ) | ||||||||||
Non-controlling interests | (2,832 | ) | (1,003 | ) | (54 | ) | ||||||||||
$ | (26,206 | ) | $ | (19,115 | ) | $ | (20,812 | ) | ||||||||
Basic and diluted loss per share, attributable to equity holders of the Company | 20 | $ | (0.83 | ) | $ | (0.70 | ) | $ | (0.81 | ) | ||||||
Weighted average number of shares used in computing basic and diluted loss per share | 28,158,779 | 25,754,297 | 25,753,411 |
Attributable to equity holders of the Company | ||||||||||||||||||||||||
Share capital | Share premium and other capital reserves | Accumulated deficit | Total | Non-controlling interests | Total equity | |||||||||||||||||||
Balance as of January 1, 2018 | $ | 142 | $ | 186,268 | $ | (117,032 | ) | $ | 69,378 | $ | - | $ | 69,378 | |||||||||||
Loss | - | - | (20,758 | ) | (20,758 | ) | (54 | ) | (20,812 | ) | ||||||||||||||
Exercise of options | *)- | 9 | - | 9 | - | 9 | ||||||||||||||||||
Share-based compensation | - | 1,424 | - | 1,424 | 307 | 1,731 | ||||||||||||||||||
Balance as of December 31, 2018 | $ | 142 | $ | 187,701 | $ | (137,790 | ) | $ | 50,053 | $ | 253 | $ | 50,306 | |||||||||||
Loss | - | - | (18,112 | ) | (18,112 | ) | (1,003 | ) | (19,115 | ) | ||||||||||||||
Issuance of subsidiary's ordinary shares to non-controlling interests | - | 17,406 | - | 17,406 | 10,042 | 27,448 | ||||||||||||||||||
Benefit to non-controlling interests regarding share-based compensation | - | (17 | ) | - | (17 | ) | 17 | - | ||||||||||||||||
Share-based compensation | - | 814 | - | 814 | 764 | 1,578 | ||||||||||||||||||
Balance as of December 31, 2019 | $ | 142 | $ | 205,904 | $ | (155,902 | ) | $ | 50,144 | $ | 10,073 | $ | 60,217 | |||||||||||
Loss | - | - | (23,374 | ) | (23,374 | ) | (2,832 | ) | (26,206 | ) | ||||||||||||||
Issuance of ordinary shares on September 2, 2020 | 35 | 9,766 | - | 9,801 | - | 9,801 | ||||||||||||||||||
Issuance of ordinary shares on November 2, 2020 | 23 | 8,834 | - | 8,857 | - | 8,857 | ||||||||||||||||||
Exercise of subsidiary options | - | 165 | - | 165 | (156 | ) | 9 | |||||||||||||||||
Benefit to non-controlling interests regarding share-based compensation | - | (10 | ) | - | (10 | ) | 10 | - | ||||||||||||||||
Exercise of options | *)- | 107 | - | 107 | - | 107 | ||||||||||||||||||
Share-based compensation | - | 355 | - | 355 | 3,742 | 4,097 | ||||||||||||||||||
Balance as of December 31, 2020 | $ | 200 | $ | 225,121 | $ | (179,276 | ) | $ | 46,045 | $ | 10,837 | $ | 56,882 |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Loss | $ | (26,206 | ) | $ | (19,115 | ) | $ | (20,812 | ) | |||
Adjustments to reconcile loss to net cash used in operating activities: | ||||||||||||
Adjustments to the profit or loss items: | ||||||||||||
Depreciation | 1,792 | 2,395 | 2,020 | |||||||||
Amortization of intangible assets | 935 | 374 | - | |||||||||
Share-based compensation | 4,097 | 1,578 | 1,731 | |||||||||
Pre-funded warrants issuance expenses | 211 | - | - | |||||||||
Decrease (increase) in accrued bank interest | 64 | 32 | (52 | ) | ||||||||
Net financing expenses (income) | 967 | (2,446 | ) | 746 | ||||||||
Loss from derecognition of property, plant and equipment | - | 12 | - | |||||||||
Taxes on income | 32 | 24 | 30 | |||||||||
8,098 | 1,969 | 4,475 | ||||||||||
Changes in asset and liability items: | ||||||||||||
Decrease (increase) in trade receivables | (150 | ) | 88 | (28 | ) | |||||||
Decrease (increase) in other receivables | (1,300 | ) | (1,250 | ) | 95 | |||||||
Increase in long term deposits | - | (10 | ) | - | ||||||||
Decrease in trade payables | (29 | ) | (122 | ) | (114 | ) | ||||||
Increase (decrease) in employees and payroll accruals | 456 | (33 | ) | 31 | ||||||||
Increase (decrease) in other payables | (87 | ) | 375 | 20 | ||||||||
Decrease in deferred revenues and other advances | (339 | ) | (45 | ) | (165 | ) | ||||||
(1,449 | ) | (997 | ) | (161 | ) | |||||||
Cash received (paid) during the year for: | ||||||||||||
Interest received | 294 | 803 | 1,360 | |||||||||
Interest paid | (238 | ) | (302 | ) | - | |||||||
Taxes paid | (13 | ) | (24 | ) | (23 | ) | ||||||
Net cash used in operating activities | $ | (19,514 | ) | $ | (17,666 | ) | $ | (15,161 | ) |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Cash flows from investing activities: | ||||||||||||
Purchase of property, plant and equipment | $ | (682 | ) | $ | (900 | ) | $ | (374 | ) | |||
Proceeds from sale of marketable securities | 2,097 | 27,084 | 63,639 | |||||||||
Purchase of marketable securities | - | (1,637 | ) | (31,700 | ) | |||||||
Proceeds from (investment in) bank deposits, net | 8,000 | 12,592 | (14,212 | ) | ||||||||
Net cash provided by investing activities | 9,415 | 37,139 | 17,353 | |||||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from issuance of ordinary shares | 18,658 | - | - | |||||||||
Proceeds from issuance of pre-funded warrants | 1,989 | - | - | |||||||||
Proceeds from issuance of subsidiary's ordinary shares to non-controlling interests | - | 10,000 | - | |||||||||
Proceeds from advances for pre-funded warrants | 9 | - | - | |||||||||
Proceeds from exercise of options | 59 | - | 9 | |||||||||
Repayment of lease liability | (639 | ) | (597 | ) | - | |||||||
Proceeds from government grants | 320 | 493 | 354 | |||||||||
Repayment of government grants | (22 | ) | (590 | ) | (66 | ) | ||||||
Net cash provided by financing activities | 20,374 | 9,306 | 297 | |||||||||
Exchange rate differences on cash and cash equivalent balances | 1,206 | 159 | (114 | ) | ||||||||
Increase in cash and cash equivalents | 11,481 | 28,938 | 2,375 | |||||||||
Cash and cash equivalents at the beginning of the year | 34,748 | 5,810 | 3,435 | |||||||||
Cash and cash equivalents at the end of the year | $ | 46,229 | $ | 34,748 | $ | 5,810 | ||||||
Significant non-cash activities | ||||||||||||
Acquisition of property, plant and equipment | $ | 57 | $ | 216 | $ | 80 | ||||||
Increase (decrease) of right-of-use asset recognized with corresponding lease liability | $ | (41 | ) | $ | 3,437 | $ | - | |||||
Exercise of options | $ | 57 | $ | - | $ | - | ||||||
Acquisition of intangible assets | $ | - | $ | 17,448 | $ | - |
a. | Evogene Ltd. together with its subsidiaries (the "Company" or "Evogene") is a leading computational biology company focused on revolutionizing product discovery and development in multiple life-science based industries, including human health, and agriculture through the use of its broadly applicable Computational Predictive Biology (“CPB”) platform. The CPB platform, incorporating a deep understanding of biology leveraged through the power of Big Data and Artificial Intelligence, has been designed to computationally discover and uniquely guide the development of life-science products based on microbes, small molecules and genetic elements. Utilizing the CPB platform, Evogene and its subsidiaries are now advancing product pipelines for human microbiome-based therapeutics through Biomica Ltd., medical cannabis through Canonic Ltd., ag-biologicals through Lavie Bio Ltd., ag-chemicals through AgPlenus Ltd., and ag-solutions for castor oil production through Casterra Ag Ltd. |
b. | The Company principally derives its revenues from collaboration arrangements, see Note 5. As to major customers, see Note 21c. |
c. | The Company has the following subsidiaries: Casterra Ag Ltd. (formerly Evofuel Ltd.), Evogene Inc., Biomica Ltd., AgPlenus Ltd., AgPlenus Inc., Lavie Bio Ltd., Lavie Bio Inc., Lavie Bio Tech Inc., Taxon Biosciences, Inc. and Canonic Ltd. |
d. | On August 6, 2019, Corteva Inc. (“Corteva”) invested in the Company's agriculture biologicals subsidiary, Lavie Bio Ltd., which included a cash investment of $10,000 and the contribution of all shares of Corteva’s wholly owned subsidiary Taxon Biosciences, Inc. for 27.84% of Lavie Bio Ltd.'s shares. As part of the foregoing transaction, the parties entered into a commercial arrangement, including with respect to the commercialization by Corteva of Lavie Bio Ltd.’s products, mainly in corn and soybean (See Note 11 and Note 17). |
e. | On September 2, 2020, the Company issued 5,882,353 ordinary shares in a registered direct offering, for gross proceeds of $10,000 and on November 2, 2020, the Company issued 3,920,000 ordinary shares and 883,534 pre-funded warrants in a second registered direct offering, for gross proceeds of $12,000 (See Note 17). |
f. | The Company’s subsidiaries and divisions are split into three operating segments: (1) Agriculture - Evogene seed traits division, Lavie Bio Ltd. and Ag Plenus Ltd.; (2) Human – Biomica Ltd. and Canonic Ltd.; and (3) Industrial – Casterra Ag Ltd. (see also Note 21). |
g. | The duration, scope and effects of the ongoing COVID-19 pandemic, government and other third-party responses to it, and the related macroeconomic effects, and the extent of its impact on the Company’s operational and financial performance will depend on certain developments. The Company considered the impact of COVID-19 on the estimates and assumptions and determined that there were no material adverse impacts on the consolidated financial statements for the period ended December 31, 2020. As events continue to evolve and additional information becomes available, the Company’s estimates and assumptions may change in future periods. |
h. | Definitions |
Subsidiary | - Company that is controlled by the Company (as defined in International Financial Reporting Standards (“IFRS”) 10- Consolidated Financial Statements) and whose accounts are consolidated with those of the Company. |
Related parties | - As defined in International Accounting Standard (“IAS”) 24- Related Party Disclosures. |
a. | Basis of presentation of the financial statements: |
b. | Consolidated financial statements: |
c. | Other comprehensive loss: |
d. | Functional currency, presentation currency and foreign currency: |
1. | Functional currency and presentation currency: |
NOTE 2:- | SIGNIFICANT ACCOUNTING POLICIES (Cont.) |
2. | Transactions, assets and liabilities in foreign currency: |
e. | Cash equivalents: |
f. | Short-term deposits: |
g. | Government grants: |
NOTE 2:- | SIGNIFICANT ACCOUNTING POLICIES (Cont.) |
h. | Leases: |
1. | Right-of-use assets |
Years | Mainly | |||
Office space | 2-8 | 6 | ||
Laboratory space | 2-8 | 6 | ||
Motor vehicles | 1-3 | 2 |
2. | Lease liabilities |
3. | Short-term leases and leases of low-value assets |
i. | Property, plant and equipment: |
% | Mainly % | |||
Laboratory equipment | 9-30 | 15 | ||
Computers and peripheral equipment | 15-33.33 | 33.33 | ||
Office equipment and furniture | 6-20 | 6 | ||
Leasehold improvements | see below |
j. | Intangible assets: |
Years | ||
Pipeline Products | 17 | |
Potential Products | 19 | |
Microorganisms Collection | 20 |
k. | Impairment of non-financial assets: |
l. | Revenue recognition: |
m. | Taxes on income: |
1. | Current taxes: |
2. | Deferred taxes: |
n. | Financial instruments: |
1. | Financial assets: |
2. | Impairment of financial assets: The Company evaluates at the end of each reporting period the loss allowance for financial debt instruments which are not measured at fair value through profit or loss. |
3. | Financial liabilities: |
a) | Financial liabilities measured at amortized cost: |
b) | Financial liabilities measured at fair value through profit or loss: |
4. | Offsetting financial instruments: |
5. | De-recognition of financial instruments: |
a) | Financial assets: |
b) | Financial liabilities: |
o. | Fair value measurement: |
Level 1 | - | Quoted prices (unadjusted) in active markets for identical assets or liabilities. |
Level 2 | - | Inputs other than quoted prices included within Level 1 that are observable directly or indirectly. |
Level 3 | - | Inputs that are not based on observable market data (valuation techniques which use inputs that are not based on observable market data). |
p. | Provisions: |
q. | Employee benefit liabilities: |
1. | Short-term employee benefits: |
2. | Post-employment benefits: |
s. | Loss per share: |
t. | IFRS 3, "Business Combinations": |
1. | Clarification that to meet the definition of a business, an integrated set of activities and assets must include, as a minimum, an input and a substantive process that together significantly contribute to the ability to create output. |
2. | Removal of the reference to the assessment whether market participants are capable of acquiring the business and continuing to operate it and produce outputs by integrating the business with their own inputs and processes. |
3. | Introduction of additional guidance and examples to assist entities in assessing whether the acquired processes are substantive. |
4. | Narrowing the definitions of "outputs" and "business" by focusing on goods and services provided to customers. |
5. | Introducing an optional concentration test that permits a simplified assessment of whether an acquired set of activities and assets is not a business. |
u. | Reclassification: |
NOTE 3: - | SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUPMTIONS USED IN THE PREPARATION OF THE FINANCIAL STATEMENTS |
a. | Judgments: |
- | Determining the timing of satisfaction of performance obligations: |
- | Discount rate for a lease liability: |
b. | Estimates and assumptions: |
- | Government grants: |
NOTE 3: - | SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUPMTIONS USED IN THE PREPARATION OF THE FINANCIAL STATEMENTS (Cont.) |
- | Legal claims: |
- | Determining the fair value of share-based payment transactions: |
- | Leases - Estimating the IBR: |
- | Lease extension and/or termination options: |
NOTE 3: - | SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUPMTIONS USED IN THE PREPARATION OF THE FINANCIAL STATEMENTS (Cont.) |
- | Intangible assets - Estimating the fair value: |
NOTE 4:- | DISCLOSURE OF NEW STANDARDS IN THE PERIOD PRIOR TO THEIR ADOPTION |
a. | Amendment to IAS 16, "Property, Plant and Equipment": |
NOTE 4:- | DISCLOSURE OF NEW STANDARDS IN THE PERIOD PRIOR TO THEIR ADOPTION (Cont.) |
b. | Amendment to IAS 37, "Provisions, Contingent Liabilities and Contingent Assets": |
c. | Annual improvements to IFRSs 2018-2020: |
NOTE 5: - | COLLABORATION AND RESEARCH AGREEMENTS- |
a. | In November 2016, the Company entered into a research agreement with ADAMA Ltd. for research of samples sent by ADAMA Ltd. to the Company. |
b. | In July 2017, the Company entered into a research agreement with Corteva for the validation and further development activities relating to certain microbial strains. In January 2019, the Company provided Corteva with collaboration strains for performance of a second year of field trials. As a result of the research agreement, the Company recorded revenue of $250 in 2019. |
c. | In May 2018, the Company entered into a research agreement with Instituto Matogrossense do Algodao for evaluating the insecticidal activity of certain proprietary material obtained from bacteria. The Company transferred two batches of certain proteins for testing in an insect bioassay. |
d. | In December 2018, the Company entered into a collaboration with TMG Tropical Melhoramento e Genetica S.A. (“TMG”) for the development of a soybean cyst nematode, and potentially other nematode resistance using genome editing technology. In the initial phase of the collaboration, the Company calibrated its proprietary genome editing protocols for the TMG soybean lines on which to perform genome edits using its CPB platform. In the next phase, the Company will design genome edits with respect to various combinations. In the final phase, the Company will deliver edited lines to TMG. |
e. | In March 2020, the Company entered into a research collaboration and license agreement with Corteva for the evaluation of potentially herbicidal targets and several potential chemical candidates against such targets, in order to appraise the nature of such targets. |
f. | In April 2020, the Company entered into a proof-of-concept agreement with customer H (see Note 21c.) for the purpose of optimization of a bioinsecticide. |
December 31, | ||||||||
2020 | 2019 | |||||||
Cash for immediate withdrawal in USD | $ | 32,757 | $ | 24,823 | ||||
Cash for immediate withdrawal in New Israeli Shekels (“NIS”) | 13,044 | 9,459 | ||||||
Cash for immediate withdrawal in Euro and other currencies | 428 | 466 | ||||||
$ | 46,229 | $ | 34,748 |
December 31, | ||||||||
2020 | 2019 | |||||||
Financial assets measured at fair value through profit or loss: | ||||||||
Participation certificates in trust funds | $ | - | $ | 1,042 | ||||
Corporate bonds and government treasury notes | - | 1,086 | ||||||
$ | - | $ | 2,128 |
December 31, | ||||||||
2020 | 2019 | |||||||
Government authorities | $ | 207 | $ | 241 | ||||
Grant receivables | 643 | 276 | ||||||
Patent cost reimbursement | 1,078 | 539 | ||||||
Accrued bank interests | 18 | 82 | ||||||
Prepaid expenses | 1,308 | 886 | ||||||
Restricted cash | 47 | 47 | ||||||
Other | 71 | 8 | ||||||
$ | 3,372 | $ | 2,079 |
a. | Information on leases in which the Company is a lessee: |
Year ended December 31 | ||||||||
2020 | 2019 | |||||||
Interest expense on lease liabilities | $ | 238 | $ | 302 | ||||
Exchange rate differences | 152 | 160 | ||||||
CPI expenses on lease liabilities and right-of-use assets | (1 | ) | 1 | |||||
Depreciation expenses on right-of-use assets | 758 | 767 | ||||||
Income due to removal of lease liabilities and right-of-use assets | * | ) | (2 | ) |
b. | Lease extension and cancelation options: |
c. | Disclosures of right-of-use assets: |
Leasehold | Motor vehicles | Total | ||||||||||
Cost: | ||||||||||||
Balance as of January 1, 2020 | $ | 3,041 | $ | 381 | $ | 3,422 | ||||||
Additions during the year: | ||||||||||||
Additions to right-of-use assets for new leases in the period | - | 23 | 23 | |||||||||
Revaluation recognized in CPI | (16 | ) | (7 | ) | (23 | ) | ||||||
Disposals during the year: | ||||||||||||
Disposals of right-of-use assets for leases terminated in the period | - | (78 | ) | (78 | ) | |||||||
Balance as of December 31, 2020 | 3,025 | 319 | 3,344 | |||||||||
Accumulated depreciation: | ||||||||||||
Balance as of January 1, 2020 | 596 | 155 | 751 | |||||||||
Additions during the year: | ||||||||||||
Depreciation | 628 | 130 | 758 | |||||||||
Disposals during the year: | ||||||||||||
Disposals of right-of-use assets | - | (37 | ) | (37 | ) | |||||||
Balance as of December 31, 2020 | 1,224 | 248 | 1,472 | |||||||||
Depreciated cost on December 31, 2020 | $ | 1,801 | $ | 71 | $ | 1,872 |
Leasehold | Motor vehicles | Total | ||||||||||
Cost: | ||||||||||||
Balance as of January 1, 2019 | $ | 3,023 | $ | 267 | $ | 3,290 | ||||||
Additions during the year: | ||||||||||||
Additions to right-of-use assets for new leases in the period | - | 168 | 168 | |||||||||
Revaluation recognized in CPI | 18 | 1 | 19 | |||||||||
Disposals during the year: | ||||||||||||
Disposals of right-of-use assets for leases terminated in the period | - | (55 | ) | (55 | ) | |||||||
Balance as of December 31, 2019 | 3,041 | 381 | 3,422 | |||||||||
Accumulated depreciation: | ||||||||||||
Balance as of January 1, 2019 | - | - | - | |||||||||
Additions during the year: | ||||||||||||
Depreciation | 596 | 171 | 767 | |||||||||
Disposals during the year: | ||||||||||||
Disposals of right-of-use assets | - | (16 | ) | (16 | ) | |||||||
Balance as of December 31, 2019 | 596 | 155 | 751 | |||||||||
Depreciated cost on December 31, 2019 | $ | 2,445 | $ | 226 | $ | 2,671 |
d. | Disclosures of lease liability: |
Leasehold | Motor vehicles | Total | ||||||||||
Balance as of January 1, 2020 | $ | 2,760 | $ | 211 | $ | 2,971 | ||||||
Lease payments | (740 | ) | (137 | ) | (877 | ) | ||||||
Lease deposits | - | (5 | ) | (5 | ) | |||||||
Interest expense | 216 | 22 | 238 | |||||||||
Exchange rate differences | 145 | 7 | 152 | |||||||||
Additions to lease liability for new leases in the period | - | 21 | 21 | |||||||||
Reduction of lease liability for leases terminated in the period | - | (40 | ) | (40 | ) | |||||||
Revaluation recognized in CPI | (6 | ) | (14 | ) | (20 | ) | ||||||
Balance as of December 31, 2020 | 2,375 | 65 | 2,440 |
Leasehold | Motor vehicles | Total | ||||||||||
Balance as of January 1, 2019 | $ | 3,023 | $ | 245 | $ | 3,268 | ||||||
Lease payments | (718 | ) | (181 | ) | (899 | ) | ||||||
Lease deposits | - | (5 | ) | (5 | ) | |||||||
Interest expense | 291 | 11 | 302 | |||||||||
Exchange rate differences | 145 | 15 | 160 | |||||||||
Additions to lease liability for new leases in the period | - | 165 | 165 | |||||||||
Reduction of lease liability for leases terminated in the period | - | (40 | ) | (40 | ) | |||||||
Revaluation recognized in CPI | 19 | 1 | 20 | |||||||||
Balance as of December 31, 2019 | 2,760 | 211 | 2,971 |
Leasehold | Motor vehicles | Total | ||||||||||
2021 | 700 | 77 | 777 | |||||||||
2022 | 611 | 48 | 659 | |||||||||
2023 | 621 | 1 | 622 | |||||||||
2024 | 622 | - | 622 | |||||||||
2025 and thereafter | 244 | - | 244 | |||||||||
Total lease payments | $ | 2,798 | $ | 126 | $ | 2,924 | ||||||
Less: imputed interest | 423 | 61 | 484 | |||||||||
Present value of lease liabilities | $ | 2,375 | $ | 65 | $ | 2,440 | ||||||
NOTE 10: - | PROPERTY, PLANT AND EQUIPMENT, NET |
Laboratory equipment | Computers and peripheral equipment | Office equipment and furniture | Leasehold improvements | Total | ||||||||||||||||
Cost: | ||||||||||||||||||||
Balance on January 1, 2020 | $ | 4,939 | $ | 4,051 | $ | 264 | $ | 13,527 | $ | 22,781 | ||||||||||
Additions | 299 | 61 | - | 163 | 523 | |||||||||||||||
Deductions | (1,088 | ) | (1,103 | ) | - | - | (2,191 | ) | ||||||||||||
Balance on December 31, 2020 | 4,150 | 3,009 | 264 | 13,690 | 21,113 | |||||||||||||||
Accumulated Depreciation: | ||||||||||||||||||||
Balance on January 1, 2020 | 4,230 | 3,780 | 157 | 12,031 | 20,198 | |||||||||||||||
Additions | 315 | 153 | 16 | 550 | 1,034 | |||||||||||||||
Deductions | (1,088 | ) | (1,103 | ) | - | - | (2,191 | ) | ||||||||||||
Balance on December 31, 2020 | 3,457 | 2,830 | 173 | 12,581 | 19,041 | |||||||||||||||
Depreciated cost on December 31, 2020 | $ | 693 | $ | 179 | $ | 91 | $ | 1,109 | $ | 2,072 |
Laboratory equipment | Computers and peripheral equipment | Office equipment and furniture | Leasehold improvements | Total | ||||||||||||||||
Cost: | ||||||||||||||||||||
Balance on January 1, 2019 | $ | 4,852 | $ | 3,895 | $ | 225 | $ | 12,838 | $ | 21,810 | ||||||||||
Additions | 87 | 156 | 39 | 689 | 971 | |||||||||||||||
Balance on December 31, 2019 | 4,939 | 4,051 | 264 | 13,527 | 22,781 | |||||||||||||||
Accumulated Depreciation: | ||||||||||||||||||||
Balance on January 1, 2019 | 3,834 | 3,593 | 144 | 11,052 | 18,623 | |||||||||||||||
Additions | 396 | 187 | 13 | 979 | 1,575 | |||||||||||||||
Balance on December 31, 2019 | 4,230 | 3,780 | 157 | 12,031 | 20,198 | |||||||||||||||
Depreciated cost on December 31, 2019 | $ | 709 | $ | 271 | $ | 107 | $ | 1,496 | $ | 2,583 |
Pipeline Products | Potential Products | Microorganisms Collection | Total | |||||||||||||
Cost: | ||||||||||||||||
Balance on January 1, 2020 | $ | 7,028 | $ | 4,920 | $ | 5,500 | $ | 17,448 | ||||||||
Additions | - | - | - | - | ||||||||||||
Balance on December 31, 2020 | 7,028 | 4,920 | 5,500 | 17,448 | ||||||||||||
Accumulated Depreciation: | ||||||||||||||||
Balance on January 1, 2020 | $ | 162 | $ | 102 | $ | 110 | $ | 374 | ||||||||
Additions | 405 | 254 | 276 | 935 | ||||||||||||
Balance on December 31, 2020 | 567 | 356 | 386 | 1,309 | ||||||||||||
Amortized cost on December 31, 2020 | $ | 6,461 | $ | 4,564 | $ | 5,114 | $ | 16,139 |
Pipeline Products | Potential Products | Microorganisms Collection | Total | |||||||||||||
Cost: | ||||||||||||||||
Balance on January 1, 2019 | $ | - | $ | - | $ | - | $ | - | ||||||||
Additions (Acquisition on August 6, 2019) | 7,028 | 4,920 | 5,500 | 17,448 | ||||||||||||
Balance on December 31, 2019 | 7,028 | 4,920 | 5,500 | 17,448 | ||||||||||||
Accumulated Depreciation: | ||||||||||||||||
Balance on January 1, 2019 | $ | - | $ | - | $ | - | $ | - | ||||||||
Additions | 162 | 102 | 110 | 374 | ||||||||||||
Balance on December 31, 2019 | 162 | 102 | 110 | 374 | ||||||||||||
Depreciated cost on December 31, 2019 | $ | 6,866 | $ | 4,818 | $ | 5,390 | $ | 17,074 |
2020 | 2019 | |||||||
Balance on January 1, | $ | 3,362 | $ | 3,886 | ||||
Grants received | 320 | 493 | ||||||
Royalties paid | (22 | ) | (44 | ) | ||||
BIRD repayment | - | (546 | ) | |||||
Amounts recorded in profit or loss | 106 | (427 | ) | |||||
Balance on December 31, | $ | 3,766 | $ | 3,362 |
NOTE 13: - | FINANCIAL INSTRUMENTS |
a. | Classification of financial instruments by fair value hierarchy: |
December 31, | ||||||||
2020 | 2019 | |||||||
Financial assets: | ||||||||
Marketable securities – Level 1 | $ | - | $ | 1,042 | ||||
Marketable securities – Level 2 | - | 1,086 | ||||||
$ | - | $ | 2,128 |
1. | Market Risk: |
a) | Foreign currency risk: |
b) | Price risk: |
NOTE 13: - | FINANCIAL INSTRUMENTS (Cont.) |
2. | Credit Risk: |
3. | Liquidity Risk: |
Up to 1 year | 1 year to 2 years | 2 years to 3 years | 3 years to 4 years | 4 years to 5 years | Over 5 years | Total | ||||||||||||||||||||||
Trade payables | $ | 863 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 863 | ||||||||||||||
Employees and payroll accruals | 2,535 | - | - | - | - | - | 2,535 | |||||||||||||||||||||
Other payables | 1,238 | - | - | - | - | - | 1,238 | |||||||||||||||||||||
Leases liability | 777 | 659 | 622 | 622 | 111 | 133 | 2,924 | |||||||||||||||||||||
Liabilities in respect of government grants | 72 | 177 | 291 | 557 | 948 | 2,639 | 4,684 | |||||||||||||||||||||
$ | 5,485 | $ | 836 | $ | 913 | $ | 1,179 | $ | 1,059 | $ | 2,772 | $ | 12,244 |
Up to 1 year | 1 year to 2 years | 2 years to 3 years | 3 years to 4 years | 4 years to 5 years | Over 5 years | Total | ||||||||||||||||||||||
Trade payables | $ | 1,001 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 1,001 | ||||||||||||||
Employees and payroll accruals | 2,079 | - | - | - | - | - | 2,079 | |||||||||||||||||||||
Other payables | 1,348 | - | - | - | - | - | 1,348 | |||||||||||||||||||||
Leases liability | 895 | 734 | 616 | 583 | 582 | 229 | 3,639 | |||||||||||||||||||||
Liabilities in respect of government grants | 37 | 107 | 196 | 333 | 652 | 2,474 | 3,799 | |||||||||||||||||||||
$ | 5,360 | $ | 841 | $ | 812 | $ | 916 | $ | 1,234 | $ | 2,703 | $ | 11,866 |
c. | Fair Value: |
NOTE 13: - | FINANCIAL INSTRUMENTS (Cont.) |
d. | Sensitivity tests relating to changes in market factors: |
December 31, | ||||||||
2020 | 2019 | |||||||
Sensitivity test to changes in the USD/NIS exchange rate: | ||||||||
Gain (loss) from the change: | ||||||||
Increase of 5% in exchange rate | $ | (485 | ) | $ | (381 | ) | ||
Decrease of 5% in exchange rate | $ | 485 | $ | 381 | ||||
Sensitivity test to changes in the market price of listed securities: | ||||||||
Gain (loss) from the change: | ||||||||
Increase of 5% in market price | $ | - | $ | 106 | ||||
Decrease of 5% in market price | $ | - | $ | ( 106 | ) |
a. | Claims: |
b. | Government grants: |
NOTE 15: - | SEVERANCE PAY LIABILITY |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Expenses - defined contribution plan | $ | 665 | $ | 703 | $ | 712 |
NOTE 16: - | TAXES ON INCOME |
a. | Tax rates applicable to the Company and its subsidiaries: |
1. | In December 2016, the Israeli Parliament approved the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2017 and 2018 Budget Years), 2017, which reduces the corporate income tax rate to 24% (instead of 25%) effective from January 1, 2017 and to 23% effective from January 1, 2018. |
b. | Tax assessments: |
c. | Carryforward losses for tax purposes and other temporary differences: |
d. | Deferred taxes: |
e. | Theoretical tax: |
a. | Share capital: |
December 31, | ||||||||||||||||
2020 | 2019 | |||||||||||||||
Authorized | Issued and Outstanding | Authorized | Issued and Outstanding | |||||||||||||
Number of shares | ||||||||||||||||
Ordinary shares of NIS 0.02 par value each | 150,000,000 | 35,600,088 | 150,000,000 | 25,754,297 |
b. | Changes in share capital: |
Number of shares | NIS par value | |||||||
Outstanding on January 1, 2019 | 25,754,297 | 515,086 | ||||||
Exercise of options | - | - | ||||||
Outstanding on December 31, 2019 | 25,754,297 | 515,086 | ||||||
Exercise of options | 43,438 | 869 | ||||||
Issuance of ordinary shares | 9,802,353 | 196,047 | ||||||
Outstanding on December 31, 2020 | 35,600,088 | 712,002 |
1. | On September 2, 2020, the Company issued 5,882,353 ordinary shares in a registered direct offering. Each ordinary share was sold at $1.70 per share resulting in gross proceeds of $10,000. |
On November 2, 2020, the Company completed a second registered direct offering with certain institutional investors for the purchase of 3,920,000 ordinary shares at a share price of $2.50 per ordinary share and 883,534 pre-funded warrants with an exercise price of $0.01 per share at price of $2.49 per warrant (see Note 23a.), resulting in gross proceeds of $12,000. According to the agreement, the holder can choose settlement in cash or by exchanging shares for cash. According to the provisions of IAS 32, "Financial Instruments: Presentation", these pre-funded warrants are accounted for as a liability and measured at fair value according to IFRS 9. In January 2021, these pre-funded warrants were exercised. |
c. | Rights attached to shares: |
d. | Rights attached to pre-funded warrants: |
e. | Capital management in the Company: |
f. | Composition of non-controlling interests in the statement of financial position: |
December 31, | ||||||||
2020 | 2019 | |||||||
Balance on January 1, | $ | 10,073 | $ | 253 | ||||
Shares issuance by a subsidiary to a non-controlling interest | - | 10,042 | ||||||
Share-based compensation | 3,742 | 764 | ||||||
Exercise of subsidiary options | (156 | ) | - | |||||
Benefit to non-controlling interests regarding Share-based compensation | 10 | 17 | ||||||
Loss attributed to non-controlling interests | (2,832 | ) | (1,003 | ) | ||||
Balance on December 31, | $ | 10,837 | $ | 10,073 |
1. | On August 6, 2019, Corteva invested in the Company's agriculture biologicals subsidiary, Lavie Bio Ltd., which included the contribution of all Corteva’s holdings in its wholly owned subsidiary Taxon Biosciences, Inc. along with an amount of $10,000. Upon consummation of the foregoing transactions, Corteva was issued 27.84% of Lavie Bio Ltd.’s equity while Evogene Ltd. holds 72.16% of Lavie Bio Ltd.’s equity. As a result, the Company recorded a share premium and a non-controlling interest in the amounts of $17,406 and $10,042, respectively. |
2. | On July 24, 2020, 36,520 options were exercised in AgPlenus Ltd. into its ordinary shares. Upon the exercise of options, the non-controlling interest was issued 1.66% of AgPlenus Ltd.'s equity. As a result, the Company recorded a debit share premium and a non-controlling interest in the amounts of $165 and $156, respectively. |
a. | Expenses recognized in the financial statements: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Share-based compensation – Attributable to equity holders of the Company | $ | 355 | $ | 814 | $ | 1,424 | ||||||
Share-based compensation – Attributable to non-controlling interests (see Note 17f.) | 3,742 | 764 | 307 | |||||||||
$ | 4,097 | $ | 1,578 | $ | 1,731 |
b. | Evogene Ltd. share-based payment plan for employees, directors and consultants: |
c. | Evogene Ltd. share options activity: |
2020 | 2019 | 2018 | ||||||||||||||||||||||
Number of options | Weighted average exercise prices ($) | Number of options | Weighted average exercise prices ($) | Number of options | Weighted average exercise prices ($) | |||||||||||||||||||
Outstanding on January 1, | 4,335,017 | 7.08 | 4,389,523 | 7.46 | 5,106,300 | 8.47 | ||||||||||||||||||
Granted | 1,046,500 | 1.37 | 750,000 | 1.67 | 555,000 | 3.16 | ||||||||||||||||||
Exercised | (43,438 | ) | 2.45 | - | - | (3,750 | ) | 2.64 | ||||||||||||||||
Forfeited | (1,307,377 | ) | 6.98 | (804,506 | ) | 7.13 | (1,268,027 | ) | 9.66 | |||||||||||||||
Outstanding on December 31, | 4,030,702 | 6.24 | 4,335,017 | 7.08 | 4,389,523 | 7.46 | ||||||||||||||||||
Exercisable at December 31, | 2,556,360 | 8.54 | 2,855,405 | 9.09 | 2,843,582 | 8.95 |
Options outstanding | |||||||||||||
Range of exercise prices ($) | Number outstanding | Average remaining contractual life | Weighted average exercise price | ||||||||||
0.53 - 1.78 | 1,170,243 | 8.56 | 1.39 | ||||||||||
1.82 - 3.37 | 517,625 | 8.15 | 2.88 | ||||||||||
3.40 - 4.56 | 179,000 | 8.00 | 4.05 | ||||||||||
5.54 -8.36 | 911,000 | 6.33 | 5.99 | ||||||||||
8.47 - 13.77 | 932,834 | 3.27 | 11.72 | ||||||||||
14.12 - 22.10 | 320,000 | 2.92 | 15.44 | ||||||||||
Total | 4,030,702 | 6.31 | 6.24 |
d. | The weighted average outstanding remaining contractual term of the options as of December 31, 2020 is 6.31 years (as of December 31, 2019, it was 6.08 years). |
e. | The weighted average fair value of options granted during 2020 was $0.60 (for options granted during 2019, the fair value was $0.52). |
f. | The fair value of Company share options granted to employees, directors and consultants for the years ended December 31, 2020, 2019 and 2018 was estimated using the binomial model with the following assumptions: |
2020 | 2019 | 2018 | ||||
Dividend yield (%) | - | - | - | |||
Expected volatility of the share prices (%) | 34-41 | 33-34 | 35-42 | |||
Risk-free interest rate (%) | 0.2-0.9 | 0.97-1.51 | 1.90-2.93 | |||
Suboptimal factor | 1.8-2 | 1.8-2 | 1.8-2 | |||
Post-vesting forfeiture rate (%) | 5-10 | 5-10 | 5-10 |
g. | The Company's subsidiaries maintain share option and incentive plans with similar terms and conditions. |
2020 | 2019 | |||||||||||||||
Number of options | Weighted average exercise prices ($) | Number of options | Weighted average exercise prices ($) | |||||||||||||
Outstanding on January 1, | 460,038 | 0.13 | 205,543 | 0.05 | ||||||||||||
Granted | 837,847 | 1.85 | 255,370 | 0.2 | ||||||||||||
Exercised | (36,520 | ) | 0.25 | - | - | |||||||||||
Forfeited | (58,386 | ) | 0.20 | (875 | ) | 0.19 | ||||||||||
Outstanding on December 31, | 1,202,979 | 1.32 | 460,038 | 0.13 | ||||||||||||
Exercisable on December 31, | 606,542 | 0.71 | 135,194 | 0.11 |
h. | The fair value of Company's subsidiaries share options granted to employees, directors and consultants for the years ended December 31, 2020 and 2019 was estimated using the binomial model with the following assumptions: |
2020 | 2019 | |||
Dividend yield (%) | - | - | ||
Expected volatility of the share prices (%) | 46-90 | 48-72 | ||
Risk-free interest rate (%) | 0.07-0.9 | 0.11-2.03 | ||
Suboptimal factor | 1.8-2 | 1.8-2 | ||
Post-vesting forfeiture rate (%) | 5-10 | 5-10 |
a. | Cost of revenues: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Salaries and benefits | $ | 508 | $ | 242 | $ | 873 | ||||||
Share-based compensation | - | - | 68 | |||||||||
Materials and sub-contractors | 66 | 63 | 216 | |||||||||
Depreciation | - | - | 161 | |||||||||
Rentals and maintenance | - | - | 130 | |||||||||
Other | - | 29 | 4 | |||||||||
$ | 574 | $ | 334 | $ | 1,452 |
b. | Research and development, net: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Salaries and benefits | $ | 9,198 | $ | 9,811 | $ | 9,599 | ||||||
Share-based compensation | 2,227 | 782 | 960 | |||||||||
Materials and sub-contractors | 3,817 | 2,686 | 1,368 | |||||||||
Plant growth and greenhouse maintenance | 628 | 337 | 342 | |||||||||
Rentals and office maintenance | 684 | 428 | 1,114 | |||||||||
Depreciation and amortization | 2,709 | 2,742 | 1,859 | |||||||||
Other | 45 | 579 | 709 | |||||||||
Participation in respect of government grants | (2,021 | ) | (1,574 | ) | (1,265 | ) | ||||||
$ | 17,287 | $ | 15,791 | $ | 14,686 |
c. | Business development: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Salaries and benefits | $ | 1,002 | $ | 907 | $ | 1,301 | ||||||
Share-based compensation | 1,115 | 442 | 381 | |||||||||
Travel | 58 | 168 | 163 | |||||||||
Legal | 35 | 133 | 67 | |||||||||
Other | 462 | 379 | 172 | |||||||||
$ | 2,672 | $ | 2,029 | $ | 2,084 |
d. | General and administrative: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Salaries and benefits | $ | 2,362 | $ | 1,922 | $ | 1,755 | ||||||
Share-based compensation | 755 | 354 | 322 | |||||||||
Professional fees | 2,023 | 1,151 | 1,075 | |||||||||
Other | 181 | 338 | 362 | |||||||||
$ | 5,321 | $ | 3,765 | $ | 3,514 |
e. | Financing income and expenses |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Exchange differences | $ | 1,361 | $ | 1,432 | $ | - | ||||||
Interest income | 230 | 759 | 1,413 | |||||||||
Change in the fair value of marketable securities | - | 439 | - | |||||||||
$ | 1,591 | $ | 2,630 | $ | 1,413 |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Bank expenses and commissions | $ | 32 | $ | 52 | $ | 141 | ||||||
Exchange differences | 350 | 160 | 660 | |||||||||
Change in the fair value of marketable securities | 34 | - | 1,285 | |||||||||
Pre-funded warrants issuance expenses | 211 | - | - | |||||||||
Revaluation of pre-funded warrants | 1,944 | - | - | |||||||||
Lease liability interest | 237 | 302 | - | |||||||||
Revaluation of liabilities in respect of government grants | 143 | 41 | 120 | |||||||||
$ | 2,951 | $ | 555 | $ | 2,206 |
Year ended December 31, | ||||||||||||||||||||||||
2020 | 2019 | 2018 | ||||||||||||||||||||||
Weighted number of shares *) | Loss attributable to equity holders of the Company | Weighted number of shares *) | Loss attributable to equity holders of the Company | Weighted number of shares *) | Loss attributable to equity holders of the Company | |||||||||||||||||||
Number of shares and loss | 28,158,179 | (23,374 | ) | 25,754,297 | (18,112 | ) | 25,753,411 | (20,758 | ) |
*) | To compute diluted loss per share, potential ordinary shares (detailed below) have not been taken into account due to their anti-dilutive effect: 137,977 warrants 4,030,702 options to employees under share-based payment plans |
NOTE 21: - | OPERATING SEGMENTS |
a. | General: |
Agriculture segment | - | Develops seed traits, ag-chemical products, and ag-biological products to improve plant performance. |
Industry segment | - | Develops improved castor bean seeds to serve as a feedstock source for other industrial uses. |
Human segment | - | Discovery and development of human microbiome-based therapeutics and cannabis activity. |
Unallocated | - | Other corporate expenses and general development of enabling technologies for optimization. |
b. | The following table presents our revenues and operating loss by segments: |
Agriculture | Industry | Human | Unallocated | Total | ||||||||||||||||
For the Year Ended December 31, 2020 | ||||||||||||||||||||
Revenues | $ | 847 | $ | 33 | $ | 75 | $ | 85 | $ | 1,040 | ||||||||||
Operating loss | $ | (8,687 | ) | $ | (333 | ) | $ | (4,669 | ) | $ | (11,125 | ) | $ | (24,814 | ) | |||||
Net financing expenses | $ | (1,360 | ) | |||||||||||||||||
Loss before taxes on income | $ | (26,174 | ) |
Agriculture | Industry | Human | Unallocated | Total | ||||||||||||||||
For the Year Ended December 31, 2019 | ||||||||||||||||||||
Revenues | $ | 651 | $ | 26 | $ | - | $ | 76 | $ | 753 | ||||||||||
Operating loss | $ | (10,062 | ) | $ | (419 | ) | $ | (3,219 | ) | $ | (7,466 | ) | $ | (21,166 | ) | |||||
Net financing income | $ | 2,075 | ||||||||||||||||||
Loss before taxes on income | $ | (19,091 | ) |
NOTE 21: - | OPERATING SEGMENTS (Cont.) |
Agriculture | Industry | Human | Unallocated | Total | ||||||||||||||||
For the Year Ended December 31, 2018 | ||||||||||||||||||||
Revenues | $ | 1,641 | $ | 106 | $ | - | $ | - | $ | 1,747 | ||||||||||
Operating loss | $ | (7,674 | ) | $ | (456 | ) | $ | (1,608 | ) | $ | (10,251 | ) | $ | (19,989 | ) | |||||
Net financing expenses | $ | (793 | ) | |||||||||||||||||
Loss before taxes on income | $ | (20,782 | ) |
c. | Major customers: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Customer A (shareholder) | - | - | 38 | % | ||||||||
Customer B | - | - | 19 | % | ||||||||
Customer C | - | *)- | 13 | % | ||||||||
Customer D (subsidiary shareholder) | 48 | % | 33 | % | - | |||||||
Customer E | - | 24 | % | - | ||||||||
Customer F | - | 13 | % | *)- | ||||||||
Customer G | *)- | 13 | % | - | ||||||||
Customer H | 17 | % | - | - |
d. | Geographical information: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
United States | 65 | % | 33 | % | 57 | % | ||||||
Germany | - | 2 | % | 13 | % | |||||||
Israel | 22 | % | 35 | % | 12 | % | ||||||
Brazil | 11 | % | 28 | % | 6 | % | ||||||
Other | 2 | % | 2 | % | 12 | % | ||||||
100 | % | 100 | % | 100 | % |
NOTE 21: - | OPERATING SEGMENTS (Cont.) |
December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
United States | 82 | % | 79 | % | 14 | % | ||||||
Israel | 18 | % | 21 | % | 86 | % | ||||||
100 | % | 100 | % | 100 | % |
NOTE 22: - | BALANCES AND TRANSACTIONS WITH EXECUTIVE OFFICERS AND CERTAIN SHAREHOLDERS |
a. | 2020 shareholders information refers to Monsanto Company (owned by Bayer AG), Corteva (see Note 21c, customer A and D) and Alpha Capital Anstalt, which to the Company’s knowledge, and as reported by the shareholders, Monsanto Company and Alpha Capital Anstalt hold approximately 4.5% and 2.9% of the Company's ordinary shares, respectively, and Corteva holds 27.84% of the Company's subsidiary shares. Monsanto Company and Corteva are major customers. |
b. | Balances: |
Executive officers | Certain shareholders | |||||||
Receivables | $ | - | $ | 1,078 | ||||
Pre-funded warrants | $ | - | $ | 4,144 | ||||
Other payables | $ | 739 | $ | 49 | ||||
Other advances (see Note 23a.) | - | $ | 9 |
Executive officers | Certain shareholder | |||||||
Receivables | $ | - | $ | 539 | ||||
Other payables | $ | 477 | $ | - |
NOTE 22: - | BALANCES AND TRANSACTIONS WITH EXECUTIVE OFFICERS AND CERTAIN SHAREHOLDERS (Cont.) |
Executive officers | Certain shareholder | |||||||
Receivables | $ | - | $ | 89 | ||||
Other payables | $ | 439 | $ | - |
c. | Benefits to directors: |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Compensation to directors not employed by the Company or on its behalf | $ | 385 | $ | 254 | $ | 261 | ||||||
Number of directors that received the above compensation by the Company | 6 | 6 | 7 |
Year ended December 31, | ||||||||||||
2020 | 2019 | 2017 | ||||||||||
Salary and related benefits | $ | 2,385 | $ | 1,960 | $ | 1,976 | ||||||
Share-based compensation | 1,789 | 1,070 | 669 | |||||||||
$ | 4,174 | $ | 3,030 | $ | 2,645 | |||||||
Number of people that received salary and benefits | 11 | 8 | 10 |
e. | Transactions: |
Executive officers | Certain shareholders | |||||||
Revenues | $ | - | $ | 500 | ||||
Cost of revenues | - | 17 | ||||||
Research and development expenses (participation) | 978 | (1,723 | ) | |||||
Business development expenses | 1,756 | - | ||||||
General and administrative expenses | 1,440 | - | ||||||
Financing expenses | $ | - | $ | 1,944 |
NOTE 22: - | BALANCES AND TRANSACTIONS WITH EXECUTIVE OFFICERS AND CERTAIN SHAREHOLDERS (Cont.) |
Executive officers | Certain shareholder | |||||||
Revenues | $ | - | $ | 250 | ||||
Research and development expenses (participation) | 669 | (1,280 | ) | |||||
Business development expenses | 1,250 | - | ||||||
General and administrative expenses | $ | 1,111 | $ | - |
Executive officers | Certain shareholders | |||||||
Revenues | $ | - | $ | 664 | ||||
Research and development expenses (participation) | 1,056 | (1,077 | ) | |||||
Business development expenses | 945 | - | ||||||
General and administrative expenses | $ | 644 | $ | - |
NOTE 23: - | SUBSEQUENT EVENTS |
a. | On January 4. 2021, 883,534 pre-funded warrants were exercised into 883,534 of the Company's ordinary shares at an exercise price of $0.01 per pre-funded warrant for a total amount of $9 (see Note 22b.). |
b. | In January 2021, the Company entered a Controlled Equity Offering Sales Agreement. pursuant to which it issued 3,803,594 ordinary shares between January and February 2021, in an “at the market” (“ATM”) offering”, with a weighted average selling price of $7.36 per share, resulting in gross proceeds of $28,000. |
c. | On February 19, 2021, the Company entered a new Controlled Equity Offering Sales Agreement. In accordance with the terms of the sales agreement, from time to time the Company may offer and sell its ordinary shares in an “ATM” offering having an aggregate offering price of up to $50,000. |