SHAREHOLDERS' EQUITY | NOTE 8:- SHAREHOLDERS’ EQUITY a. Share option plans: As of September 30, 2018 , and December 31, 2017 , the Company had reserved 1,499,886 a nd 1,301,521 ordinary shares, respectively, for issuance to the Company’s and its affiliates’ respective employees, directors, officers and consultants pursuant to equity awards granted under the Company's 2014 Incentive Compensation Plan (the “2014 Plan”). Options to purchase ordinary shares generally vest over four years, with certain options to non-employee directors vesting quarterly over one year. Any option that is forfeited or canceled before expiration becomes available for future grants under the 2014 Plan. The fair value for options granted during the nine months ended September 30, 2018 and September 30, 2017 was estimated at the date of the grant using a Black-Scholes-Merton option pricing model with the following assumptions: Nine Months Ended September 30, 2018 2017 Expected volatility 57% - 61% 56% - 58% Risk-free rate 2.74% - 2.83% 1.78% - 2.07% Dividend yield —% —% Expected term (in years) 6.11 5.31-6.11 Share price $1.02- $1.15 $1.3- $2.1 The fair value of restricted share units (“RSUs”) granted is determined based on the price of the Company's ordinary shares on the date of grant. A summary of employee options to purchase ordinary shares and RSUs during the nine months ended September 30, 2018 is as follows: Nine Months Ended September 30, 2018 Number Average exercise price Average remaining contractual life (in years) (1) Aggregate intrinsic value (in thousands) Options and RSUs outstanding at the beginning of the period 1,846,797 $ 1.86 6.33 $ 586 Options granted 662,427 1.09 RSUs granted 510,803 — Options exercised (2) — — RSUs vested (2) (216,703 ) — RSUs forfeited (84,304 ) — Options forfeited (87,146 ) 7.31 Options and RSUs outstanding at the end of the period 2,631,874 $ 1.33 6.49 $ 663 Options exercisable at the end of the period 1,053,787 $ 2.33 4.29 $ 1 (1) Calculation of weighted average remaining contractual term does not include RSUs, which have an indefinite contractual term. (2) During the nine months ended September 30, 2018 , the aggregate number of ordinary shares that were issued pursuant to RSUs that became vested and options that were exercised on a net basis was 214,864 ordinary shares. The weighted average grant date fair value of options granted during the nine months ended September 30, 2018 and September 30, 2017 was $0.61 and $1.10 , respectively. The weighted average grant date fair value of RSUs granted during the nine months ended September 30, 2018 and September 30, 2017 was $1.09 and $2.01 , respectively. The aggregate intrinsic value in the table above represents the total intrinsic value that would have been received by the option holders had all option holders that hold options with positive intrinsic value exercised their options on the last date of the exercise period. No options were exercised during the nine months ended September 30, 2018 , and the total intrinsic value of options exercised during the nine months ended September 30, 2017 was $29 thousand . As of September 30, 2018 , there were $2.3 million of total unrecognized compensation costs related to non-vested share-based compensation arrangements granted under the Company's 2012 Equity Incentive Plan and its 2014 Plan. This cost is expected to be recognized over a period of approximately 2.0 years. The number of options and RSUs outstanding as of September 30, 2018 is set forth below, with options separated by range of exercise price. Range of exercise price Options and RSUs outstanding as of September 30, 2018 Weighted average remaining contractual life (years) (1) Options exercisable as of September 30, 2018 Weighted average remaining contractual life (years) (1) RSUs only 778,867 — — — $0.82 31,806 1.42 31,806 1.42 $1.02 - $1.32 985,755 7.59 328,328 3.61 $1.35 - $2.10 737,106 5.16 603,284 4.38 $7.30 - $8.07 66,941 7.30 59,948 7.33 $9.22 - $10.98 14,046 7.58 13,483 7.58 $20.77 - $20.97 17,353 6.22 16,938 6.22 2,631,874 6.49 1,053,787 4.29 (1) Calculation of weighted average remaining contractual term does not include the RSUs that were granted, which have an indefinite contractual term. b. Share-based awards to non-employee consultants: The Company granted 63,867 fully vested RSUs during the nine months ended September 30, 2018 to a non-employee consultant. As of September 30, 2018 , there are no outstanding options or RSUs held by non-employee consultants. c. Warrants to purchase ordinary shares: The following table summarizes information about warrants outstanding and exercisable as of September 30, 2018 : Issuance date Warrants outstanding Exercise Warrants Contractual term (number) (number) July 14, 2014 (1) — $ 10.08 — July 13, 2018 December 30, 2015 (2) 119,295 $ 9.64 119,295 See footnote (2) November 1, 2016 (3) 2,437,500 $ 4.75 2,437,500 November 1, 2021 December 28, 2016 (4) 47,717 $ 9.64 47,717 See footnote (4) 2,604,512 2,604,512 (1) Represents warrants to purchase ordinary shares at an exercise price of $10.08 per share, which were granted on July 14, 2014 as part of our series E investment round. Those warrants expired on July 14, 2018 . (2) Represents shares issuable upon the exercise of warrants to purchase ordinary shares at an exercise price of $9.64 per share, which were granted on December 31, 2015 to Kreos in connection with a loan made by Kreos to us and are currently exercisable (in whole or in part) until the earlier of (i) December 30, 2025 or (ii) immediately prior to the consummation of a merger, consolidation, or reorganization of us with or into, or the sale or license of all or substantially all the assets or shares of us to, any other entity or person, other than a wholly-owned subsidiary of us, excluding any transaction in which our shareholders prior to the transaction will hold more than 50% of the voting and economic rights of the surviving entity after the transaction. None of these warrants had been exercised as of September 30, 2018 . (3) Represents warrants issued as part of our follow-on offering in November 2016. The exercise price and the number of ordinary shares into which the warrants may be exercised are subject to adjustment upon certain corporate events, including stock splits, reverse stock splits, combinations, stock dividends, recapitalizations, reorganizations and certain other events. Our board of directors may also determine to make such adjustments to the exercise price and number of ordinary shares to be issued upon exercise based on similar events, including the granting of stock appreciation rights, phantom stock rights or other rights with equity features. At any time, the board of directors may reduce the exercise price of the warrants to any amount and for any period of time it deems appropriate. (4) Represents warrants to purchase 47,717 ordinary shares that were issued as part of the $8.0 million drawdown under the Loan Agreement that occurred on December 28, 2016. See footnote 2 for exercisability terms. d. Share-based compensation expense for employees and non-employees: The Company recognized non-cash share-based compensation expense for both employees and non-employees in the consolidated statements of operations as follows (in thousands): Nine Months Ended September 30, 2018 2017 Cost of revenues $ 11 $ 57 Research and development, net 330 344 Sales and marketing, net 352 585 General and administrative 1,649 1,611 Total $ 2,342 $ 2,597 e. At-the-market offering program: On May 10, 2016, the Company entered into an equity distribution agreement (the “Equity Distribution Agreement”) with Piper Jaffray, pursuant to which it may offer and sell, from time to time, ordinary shares having an aggregate offering price of up to $25 million , through Piper Jaffray acting as its agent. As of September 30, 2018 the Company could raise up to a remaining $9.3 million under its ATM Offering Program, subject to a limitation on sales under the Company’s effective Form S-3 limiting sales under such Form S-3 to $13.7 million during any 12-month period. Subject to the terms and conditions of the Equity Distribution Agreement, Piper Jaffray will use its commercially reasonable efforts to sell on the Company’s behalf all of the ordinary shares requested to be sold by the Company, consistent with its normal trading and sales practices. Piper Jaffray may also act as principal in the sale of ordinary shares under the Equity Distribution Agreement. Sales may be made under the Company's registration statement on Form S-3, which was declared effective on May 9, 2016 (the “Form S-3”), in what may be deemed “at-the-market” equity offerings as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “ATM Offering Program”). Sales may be made directly on or through the Nasdaq Capital Market, the existing trading market for the Company's ordinary shares, to or through a market maker other than on an exchange or otherwise, in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices, and/or any other method permitted by law, including in privately negotiated transactions. Piper Jaffray is entitled to compensation at a fixed commission rate of 3.0% of the gross sales price per share sold through it as agent under the Equity Distribution Agreement. Where Piper Jaffray acts as principal in the sale of ordinary shares under the Equity Distribution Agreement, such rate of compensation will not apply, but in no event will the total compensation of Piper Jaffray, when combined with the reimbursement of Piper Jaffray for the out-of-pocket fees and disbursements of its legal counsel, exceed 8.0% of the gross proceeds received from the sale of the ordinary shares. The Company is not required to sell any of its ordinary shares at any time. During the nine months ended September 30, 2018 , the Company issued and sold 1,247,172 ordinary shares at an average price of $ 1.08 per share under its ATM Offering Program. The gross proceeds to the Company were approximately $1.4 million , and the net aggregate proceeds after deducting commissions, fees and offering expenses in the amount of $ 237 thousand were approximately $1.1 million . As a result, from the inception of the ATM Offering Program in May 2016 until September 30, 2018 , the Company had sold 7,552,318 ordinary shares under the ATM Offering Program for gross proceeds of approximately $15.7 million and net proceeds to the Company of approximately $14.6 million (after commissions, fees and expenses). Additionally, as of that date, the Company had paid Piper Jaffray compensation of approximately $471 thousand and had incurred total expenses of approximately $1.1 million in connection with the ATM Offering Program. f. Timwell investment agreement: On March 6, 2018, the Company entered into an investment agreement with Timwell Corporation Limited, a Hong Kong corporation (“Timwell”), as amended on May 15, 2018 (the "Investment Agreement"), pursuant to which the Company agreed to issue to Timwell, in three different tranches, an aggregate of 16,000,000 ordinary shares in return for aggregate gross proceeds of $20 million. The closing of each tranche is subject to certain closing conditions. The closing of the first tranche (the "First Tranche Closing") took place on May 15, 2018, upon which Timwell received 4,000,000 ordinary shares for an aggregate purchase price of $5,000,000, and Timwell and the Company signed a registration rights agreement in the form attached to the Investment Agreement. The net aggregate proceeds of the First Tranche Closing after deducting fees and other related expenses in the amount of approximately $705 thousands were approximately $4.3 million. The remaining investment is to occur in two tranches, including $10 million for the issuance to Timwell of 8,000,000 ordinary shares (the “Second Tranche”) and $5 million for the issuance to Timwell of 4,000,000 ordinary shares (the “Third Tranch”). The closing of the second and third tranches is subject to specified closing conditions, including, with respect to the second tranche, the signing of a license agreement and a supply agreement and the formation of the China JV (the “China JV”) based on the JV Framework Agreement, and, with respect to the third tranche, the successful production of certain ReWalk products by the China JV. The second tranche closing was initially expected to occur by July 1, 2018 and the third tranche closing was initially expected to occur by December 31, 2018 and no later than April 1, 2019. While we are still in discussions with Timwell, due to the different jurisdictions involved, new positions taken by the counterparty on certain key commercial points, and certain technical and administrative delays relating to governmental approvals in China, there is a significant risk that we and Timwell will not reach the required milestones in order to complete the closings of the second and third tranches and receive the gross proceeds of $10.0 million and $5.0 million, respectively. Although we remain in dialogue with RealCan Ambrum Healthcare Industry Enterprise (Limited Partnership), Timwell’s affiliate (RealCan), and have discussed with RealCan various alternatives to the original investment agreement, we are also evaluating alternative paths with different groups to penetrate the Chinese market. For more information, see Note 13 to our audited consolidated financial statements in our 2017 Form 10-K. In May 2018, the Company entered into a fee and release agreement with Canaccord Genuity LLC ("Canaccord Genuity") requiring the Company to pay to Canaccord Genuity, in connection with a settlement, in addition to certain cash amounts, (i) $125 thousand in ordinary shares of the Company after the closing of the First Tranche of the Timwell transaction and (ii) $225 thousand in ordinary shares of the Company after the closing of the Second Tranche (the "Second Tranche Closing") of the Timwell transaction (or such lower amount if the Second Tranche Closing is less than $10.0 million). The price per share used for calculation of the number of ordinary shares issued by the Company to Canaccord Genuity is based on the volume weighted average price of the Company’s ordinary shares as reported on the Nasdaq Capital Market for the five consecutive trading days prior to the date of issuance. The Company is also obligated to pay $100 thousand in cash following the closing of the Third Tranche (the "Third Tranche Closing") of $5.0 million (or such lower amount if the Third Tranche Closing is less than $5.0 million). Following the closing of the first tranche of the Timwell transaction in May 15, 2018, the Company issued 117,891 ordinary shares to Canaccord Genuity. In connection with the First Tranche Closing, on May 15, 2018, the Company also amended its exclusive distribution agreement with Yaskawa Electric Corporation ("Yaskawa"), dated September 24, 2013, to terminate the distribution rights granted to Yaskawa in China (including Hong Kong and Macau), as required by the Investment Agreement. |