Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2019shares | |
Statement Line Items | |
Entity Registrant Name | Safe-T Group Ltd. |
Entity Central Index Key | 0001725332 |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Shell Company | false |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2019 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | FY |
Entity Interactive Data Current | Yes |
Entity Incorporation State Country Code | L3 |
Document Annual Report | false |
Document Transition Report | false |
Document Shell Company Report | true |
Entity File Number | 001-8610 |
Entity Common Stock, Shares Outstanding | 66,859,992 |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 4,341 | $ 3,717 |
Restricted deposits | 29 | 104 |
Accounts receivable: | ||
Trade, net | 680 | 854 |
Other | 470 | 231 |
Current assets | 5,520 | 4,906 |
NON-CURRENT ASSETS: | ||
Long-term restricted deposits | 82 | |
Long-term deposit | 44 | |
Property, plant and equipment, net | 266 | 143 |
Right of use assets | 441 | |
Intangible assets, net | 4,607 | 796 |
Goodwill | 6,877 | 523 |
Non-current assets | 12,317 | 1,462 |
TOTAL ASSETS | 17,837 | 6,368 |
CURRENT LIABILITIES: | ||
Short-term loan | 4 | |
Accounts payable and accruals: | ||
Trade | 237 | 103 |
Other | 1,553 | 951 |
Contract liabilities | 562 | 495 |
Contingent consideration | 2,170 | |
Convertible debentures | 7,151 | |
Derivative financial instruments | 1,637 | 729 |
Short-term lease liabilities | 184 | |
Liability in respect of the Israeli Innovation Authority | 8 | 49 |
Current liabilities | 13,506 | 2,327 |
NON-CURRENT LIABILITIES: | ||
Contract liabilities | 82 | 249 |
Long-term lease liabilities | 324 | |
Deferred tax liabilities | 1,040 | |
Liability in respect of the Israeli Innovation Authority | 108 | 82 |
Non-current liabilities | 1,554 | 331 |
TOTAL LIABILITIES | 15,060 | 2,658 |
COMMITMENTS AND CONTINGENT LIABILITIES | ||
EQUITY: | ||
Ordinary shares | ||
Share premium | 52,394 | 41,594 |
Other equity reserves | 13,070 | 11,805 |
Accumulated deficit | (62,687) | (49,689) |
TOTAL EQUITY | 2,777 | 3,710 |
TOTAL EQUITY AND LIABILITIES | $ 17,837 | $ 6,368 |
Consolidated Statements of Prof
Consolidated Statements of Profit or Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Profit or loss [abstract] | |||
REVENUES | $ 3,284 | $ 1,466 | $ 1,096 |
COST OF REVENUES | 1,889 | 791 | 583 |
GROSS PROFIT | 1,395 | 675 | 513 |
OPERATING EXPENSES: | |||
Research and development expenses | 2,485 | 2,414 | 1,608 |
Selling and marketing expenses | 3,783 | 5,542 | 4,051 |
General and administrative expenses | 3,757 | 1,925 | 2,150 |
Impairment of goodwill | 1,002 | ||
Contingent consideration measurement | 159 | ||
TOTAL OPERATING EXPENSES | 11,186 | 9,881 | 7,809 |
OPERATING LOSS | (9,791) | (9,206) | (7,296) |
FINANCIAL INCOME (EXPENSES), net | (3,184) | (2,541) | 1,984 |
LOSS BEFORE TAXES ON INCOME | (12,975) | (11,747) | (5,312) |
TAXES ON INCOME | (23) | (6) | (1) |
NET LOSS FOR THE YEAR | $ (12,998) | $ (11,753) | $ (5,313) |
BASIC LOSS PER SHARE (IN DOLLARS) | $ (0.96) | $ (6.66) | $ (5.76) |
DILUTED LOSS PER SHARE (IN DOLLARS) | $ (1.03) | $ (6.99) | $ (5.76) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED TO COMPUTE (IN THOUSANDS): | |||
BASIC LOSS PER SHARE | 13,599 | 1,765 | 922 |
DILUTED LOSS PER SHARE | 14,020 | 1,782 | 922 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity (Capital Deficiency) - USD ($) $ in Thousands | Ordinary shares | Share premium | Other equity reserves | Accumulated deficit | Total |
BALANCE at Dec. 31, 2016 | $ 22,220 | $ 11,624 | $ (32,623) | $ 1,221 | |
CHANGES IN THE YEAR | |||||
Exercise of options | 543 | (463) | 80 | ||
Expiry of options | 29 | (29) | |||
Share-based payments | 1,318 | 1,318 | |||
Exercise of warrants | 2,286 | 2,286 | |||
Placement of shares, net of issuance costs | 3,416 | 133 | 3,549 | ||
Net loss for the year | (5,313) | (5,313) | |||
BALANCE at Dec. 31, 2017 | 28,494 | 12,583 | (37,936) | 3,141 | |
CHANGES IN THE YEAR | |||||
Exercise of options | 791 | (689) | 102 | ||
Expiry of options | 493 | (493) | |||
Share-based payments | 381 | 381 | |||
Classification to equity of series B warrants see Note 14(e) | 3,479 | 3,479 | |||
Placement of shares, net of issuance costs | 2,200 | 23 | 2,223 | ||
Exercise of anti-dilution feature | 2,302 | 2,302 | |||
Public offerings, net of issuance costs | 3,835 | 3,835 | |||
Net loss for the year | (11,753) | (11,753) | |||
BALANCE at Dec. 31, 2018 | 41,594 | 11,805 | (49,689) | 3,710 | |
CHANGES IN THE YEAR | |||||
Exercise of options | 30 | (30) | |||
Exercise of warrants and pre-funded warrants | 1,517 | (1,192) | 325 | ||
Expiry of options | 770 | (770) | |||
Share-based payments | 129 | 483 | 612 | ||
Classification to equity of series B warrants see Note 14(e) | 902 | 902 | |||
Conversion of convertible debentures | 3,263 | 3,263 | |||
Issuance of shares in a business combination | 3,568 | 3,568 | |||
Public offerings, net of issuance costs | 621 | 2,774 | 3,395 | ||
Net loss for the year | (12,998) | (12,998) | |||
BALANCE at Dec. 31, 2019 | $ 52,394 | $ 13,070 | $ (62,687) | $ 2,777 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Capital Deficiency) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Placement of shares | |||
Statement Line Items [Line Items] | |||
Net of issuance costs | $ 187 | $ 422 | |
Public offering | |||
Statement Line Items [Line Items] | |||
Net of issuance costs | $ 661 | $ 840 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss for the year | $ (12,998) | $ (11,753) | $ (5,313) |
Adjustments required to reflect the cash flows from operating activities: | |||
Effect of exchange rate differences on cash and cash equivalents balances | 159 | 54 | (251) |
Issuance expenses | 117 | 517 | 242 |
Depreciation and amortization | 1,122 | 342 | 278 |
Impairment of goodwill and intangible assets | 1,272 | ||
Change in financial liabilities at fair value through profit or loss | 2,596 | 1,891 | (1,981) |
Share-based payments | 612 | 381 | 1,318 |
Exchange rate differences on restricted deposits balances | (9) | 6 | |
Interest expenses related to convertible debentures | 92 | ||
Capital gain | (5) | ||
Total adjustments | 5,961 | 3,191 | (399) |
Changes in operating asset and liability items: | |||
Decrease (increase) in trade receivables | 304 | (210) | (138) |
Decrease (increase) in other receivables | (64) | (68) | (56) |
Increase (decrease) in trade payables | (36) | (75) | 134 |
Increase in other payables | 285 | 84 | 236 |
Decrease in deferred issuance expenses | 61 | ||
Increase in deferred tax liabilities | 14 | ||
Increase (decrease) in contract liabilities | (199) | 34 | 191 |
Changes in operating asset and liability, total | 304 | (174) | 367 |
Net cash used in operating activities | (6,733) | (8,736) | (5,345) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Business combination, net of cash acquired, see note 15 | (5,508) | ||
Long-term deposit | (44) | ||
Restricted deposits | 2 | (17) | (36) |
Purchase of technology | (308) | ||
Proceeds from sale of property, plant and equipment | 15 | ||
Purchase of property, plant and equipment | (46) | (44) | (132) |
Net cash used in investing activities | (5,596) | (369) | (153) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from public and private offerings, net of issuance expenses | 4,391 | 9,231 | 5,582 |
Israeli Innovation Authority, net | (41) | 29 | (26) |
Payment of loans and other financial liabilities | (20) | (63) | |
Deferred issuance expenses | (61) | ||
Proceeds from exercise of options, warrants and pre-funded warrants | 1,177 | 102 | 2,018 |
Proceeds from issuance of convertible debentures | 8,232 | ||
Repayment of convertible debentures | (470) | ||
Payment of interest related to convertible debentures | (29) | ||
Lease payments (interest and principal) | (128) | ||
Net cash provided by financing activities | 13,112 | 9,362 | 7,450 |
INCREASE IN CASH AND CASH EQUIVALENTS | 783 | 257 | 1,952 |
EFFECT OF EXCHANGE RATE DIFFERENCES ON CASH AND CASH EQUIVALENTS | (159) | (54) | 251 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR | 3,717 | 3,514 | 1,311 |
CASH AND CASH EQUIVALENTS AT END OF YEAR | 4,341 | 3,717 | 3,514 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||
Classification to equity of series B warrants see Note 13(e) | 902 | 3,479 | |
Issuance of options to consultants (issuance costs) | (23) | (133) | |
Classification to equity of liability in respect to anti-dilution feature | 1,787 | ||
Conversion of warrants | 348 | ||
Conversion of convertible debenture | 3,199 | ||
Shares issued in a business combination, see Note 15 | 3,568 | ||
Contingent consideration assumed in a business combination | $ 2,008 |
General
General | 12 Months Ended |
Dec. 31, 2019 | |
General [Abstract] | |
GENERAL | NOTE 1 - GENERAL: a. Safe-T Group Ltd. (the "Company") is a holding company, which is engaged, as of the date hereof, (i) through its subsidiaries Safe-T Data A.R Ltd. ("Safe-T") and Safe-T USA Inc. ("Safe-T Inc.") in the development, marketing and sales of solutions which mitigate attacks on enterprises' business-critical services and sensitive data, while ensuring uninterrupted business continuity as well as enabling smooth and efficient traffic flow, interruption-free service; and (ii) through its subsidiary NetNut Ltd. ("NetNut") in providing IP proxy service to business customers. For further information regarding NetNut acquisition on June 12, 2019, see note 15. b. The Company's ordinary shares are listed on the Tel Aviv Stock Exchange Ltd. ("TASE") and as of August 17, 2018, the Company's American Depositary Shares (the "ADSs") are listed on the Nasdaq Capital Market ("Nasdaq"). c. On September 26, 2019, the Company's shareholders approved a reverse split of the share capital of the Company by a ratio of up to 20:1, to be effective at the ratio and date to be determined by the Company's Board of Directors (the "Board of Directors"). On October 2, 2019, the Board of Directors resolved that the final ratio will be 20:1, which became effective on October 21, 2019 (the "Reverse Split"). All descriptions of the Company's share capital in these consolidated financial statements, including share amounts and per share amounts, are presented after giving effect to the Reverse Split. d. The Company has suffered recurring losses from operations, has negative working capital and has an accumulated deficit as of December 31, 2019, as well as negative operating cash flows in recent years. The Company expects to continue incurring losses and negative cash flows from operations until its products reach commercial profitability. As a result of these expected losses and negative cash flows from operations, along with the Company's current cash position, the Company has sufficient resources to fund operations until August 2020. Therefore, there is substantial doubt about the Company's ability to continue as a going concern. These consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. Management's plans include the continued commercialization of the Company's products and raising capital through the sale of additional equity securities, debt or capital inflows from strategic partnerships. There are no assurances however, that the Company will be successful in obtaining the level of financing needed for its operations. If the Company is unsuccessful in commercializing its products and raising capital, it may need to reduce activities, curtail or cease operations. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES: a. Basis of presentation of financial statements: The consolidated financial statements as of December 31, 2019 and 2018, and for each of the three years in the period ended December 31, 2019, are in compliance with International Financial Reporting Standards ("IFRS"), and interpretations issued by the IFRS Interpretations Committee applicable to companies reporting under IFRS. The consolidated financial statements comply with IFRS as issued by the International Accounting Standards Board. In connection with the presentation of these consolidated financial statements, the following should be noted: 1) The significant accounting policies described below have been applied consistently to all the years presented, unless otherwise stated. 2) The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial liabilities (including derivatives) at fair value through profit or loss, which are presented at fair value. 3) The preparation of consolidated financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires the Company's management to exercise its judgment in the process of applying the Company's accounting policies. Actual results may differ materially from estimates and assumptions used by management. b. Consolidated financial statements: Subsidiaries Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. Intercompany balances and transactions, including income and expenses on transactions between the Company's subsidiaries, are eliminated. The accounting policies applied by the subsidiaries are consistent with the accounting policies adopted by the Company. c. Segment reporting: Operating segments are reported in a manner consistent with the internal reporting, which are provided to the chief operating decision maker in the Company, who is responsible for allocating resources and assessing the performance of the operating segments. As of December 31, 2019, The Company has two operating segments. Entity wide disclosures are provided in Note 24. d. Translation of foreign currency balances and transactions: 1) Functional and presentation currency Items included in the financial statements of each of the Company's subsidiaries are measured using the currency of the primary economic environment in which the subsidiary operates (the "Functional Currency"). The consolidated financial statements of the Company are presented in U.S. dollars, which is the Company's Functional Currency. 2) Transactions and balances Transactions made in a currency which is different from the functional currency (the "Foreign Currency") are translated into the Functional Currency using the exchange rates prevailing at the dates of the transactions or valuations where the items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at the end-of-year exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss as finance income (expense). e. Cash and cash equivalents: Cash and cash equivalents include cash in hand, short-term bank deposits and other short-term highly liquid investments with original maturities of three months or less, which are subject to insignificant risk of changes in value. f. Trade receivables: The trade receivables balance represents the unconditional right to consideration because only the passage of time is required before the payment is due from Company customers for licenses granted or services rendered in the ordinary course of business. If collection is expected within one year or less, trade receivables are classified as current assets. If not, trade receivables are presented as non-current assets. Trade receivables are initially recognized based on their transaction price, and subsequently measured at amortized cost using the effective interest method, less a provision for doubtful accounts. For further details see Note 2k. g. Goodwill: Goodwill arising from a business combination represents the excess of the overall amount of the consideration transferred, the amount of any non-controlling interests in the acquired company over the net amount as of acquisition date of the identifiable assets acquired and the liabilities assumed. Impairment reviews of the cash-generating-unit ("CGU") to which goodwill was allocated are undertaken annually and whenever there is any indication of impairment of a CGU. The carrying amount of the Company's assets (which constitutes a single CGU), including goodwill, is compared to its recoverable amount, which is the higher of value in use and the fair value less costs to sell. Any impairment loss is allocated to reduce the carrying amount of the Company's assets at the following order: first to reduce the carrying amount of any goodwill allocated to a CGU and subsequently to the remaining assets of the Company, which fall within the scope of the International Accounting Standard ("IAS") 36, "Impairment of Assets," on a proportionate basis based on the carrying amount of each Company asset. Any impairment loss is recognized immediately in profit or loss and is not subsequently reversed. As of December 31, 2018 and 2017, the Company did not recorded an impairment of goodwill. During the year ended December 31, 2019, the Company recognized an impairment loss of goodwill in a total amount of $1,002 thousand. For further details, see Note 6. h. Intangible assets: 1) Research and development Through December 31, 2019 and 2018, the Company has not met the criteria for capitalizing development expenses as intangible assets, and accordingly, no asset has so far been recognized in the consolidated financial statements in respect of capitalized development expenses. Consequently, the research and development expenses of the Company are fully recognized as incurred. 2) Technology and customer relations a. Technology which acquired either separately or as part of a business combination is initially measured at fair value at the acquisition date, and amortized between 5-8 years using the straight-line method, with such amortization classified as cost of revenues. b. Customer relations which acquired either separately or as part of a business combination is initially measured at fair value at the acquisition date, and amortized over 7.5 years using the straight-line method, with such amortization classified as sales and marketing expenses. i. Impairment of non-monetary assets: An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value, less selling costs and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels of identifiable cash flows (CGUs). The Company constitutes two CGUs. Non-monetary assets, other than goodwill, that were impaired, are reviewed annually for possible reversal of the impairment recognized at each balance sheet date. During the year ended December 31, 2019, the Company recognized an impairment loss related to technology in a total amount of $270 thousand. For further details, see Note 6. j. Government grants: Government grants received from the Israeli Innovation Authority (the "IIA") as a participation in research and development performed by Safe-T (the "IIA Grants") fall into the scope of "forgivable loans" as defined in IAS 20, "Accounting for Government Grants and Disclosure of Government Assistance" ("IAS 20"). IIA Grants are recognized in accordance with IFRS 9, "Financial Instruments" ("IFRS 9"). If on the date on which the right for the IIA Grants is established, the Company's management concludes that there is no reasonable assurance that the IIA Grants, to which entitlement has been established, will not be repaid, the Company recognizes a financial liability on that date, which is accounted for under the provisions of IFRS 9 regarding financial liabilities measured at amortized cost. k. Financial assets: Accounting policies applied from January 1, 2018, under IFRS 9: 1) Classification The Company classifies its financial assets at amortized cost. The classification is determined, among other things, in accordance with the purpose for which the financial assets were acquired. The basis of classification depends on the Company's business model and the contractual cash flow characteristics of the financial asset. Financial assets at amortized cost are held within a business model whose objective is to hold financial assets in order to collect contractual cash flows, and their contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. These assets are classified as current assets, except for maturities of more than 12 months after the balance sheet date, which are classified as non-current assets. The Company's financial assets at amortized cost are included as "accounts receivable," "restricted deposits", "deposits" and "cash and cash equivalents" in the consolidated statements of financial position (see sections e and f above). 2) Recognition and measurement Financial assets, which are initially measured at fair value, including any transaction costs, are measured in subsequent periods at amortized cost using the effective interest method, except of trade receivables (see section f above). For information on the method used to measure the fair value of the Company's financial instruments, see Note 3. 3) Impairment of financial assets - financial assets measured at amortized cost The Company recognizes a loss allowance for expected credit losses on financial assets at amortized cost. At each reporting date, the Company assesses whether the credit risk on a financial asset has increased significantly since initial recognition. If the financial asset is determined to have low credit risk at the reporting date, the Company assumes that the credit risk on a financial asset has not increased significantly since initial recognition. The Company measures the loss allowance for expected credit losses on trade receivables that are within the scope of IFRS 15, "Revenue from Contracts with Customers" ("IFRS 15") and on financial assets for which the credit risk has increased significantly since initial recognition based on lifetime expected credit losses. Otherwise, the Company measures the loss allowance at an amount equal to 12-month expected credit losses at the current reporting date. Accounting policies applied until December 31, 2017, under IAS 39, "Financial Instruments: Recognition and Measurement": 1) Classification The Company classifies its financial assets as loans and receivables. The classification is determined, among other things, in accordance with the purpose for which the financial assets were acquired. The Company management determines the classification of the financial assets upon initial recognition. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities longer than 12 months after the statement of financial position date. These are classified as non-current assets. The Company's loans and receivables are presented among "accounts receivable," "restricted deposits" and "cash and cash equivalents" in the statement of financial position (see sections e and f above). 2) Recognition and measurement Financial assets, which are initially measured at fair value, including any transaction costs, are measured in subsequent periods at amortized cost using the effective interest method. Financial assets, which are measured at fair value through profit or loss are initially measured at fair value and the transaction costs are carried to the statement of operations. For information on the method used to measure the fair value of the Company's financial instruments, see Note 3. 3) Impairment of financial assets - financial assets measured at amortized cost The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset ("Loss Event") and that Loss Event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. Where objective evidence for impairment exists, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not yet been incurred) discounted at the financial asset's original effective interest rate (i.e., the effective interest rate computed for the asset upon initial recognition). The asset's carrying amount is reduced and the amount of the loss is recognized in the statements of operations. If the amount of impairment loss in a subsequent period decreases, and this decrease may be attributed to an objective event that took place after the impairment was recognized (like improved credit rating of the borrower), reversal of the previously recognized impairment loss is recorded in the statements of operations. The Company does not test impairment of groups of customers due to immateriality. l. Financial liabilities 1) Classification The Company early adopted the narrow-scope amendment to IAS 1, " Classification of Liabilities as Current or Non-Current Liabilities are classified as non-current if the entity has a substantive right to defer settlement for at least 12 months at the end of the reporting period. The amendment no longer refers to unconditional rights. The assessment determines whether a right exists, but it does not consider whether the entity will exercise the right. 2) Financial liabilities at fair value through profit or loss: The Company designated its convertible debentures as financial liability at fair value through profit or loss, given the conversion option derivative embedded in such instrument. Changes in the Company's own credit risk from the date of initial recognition are negligible. The convertible debentures are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction, and are adjusted to reflect the difference between the fair value at initial recognition and the transaction price ("day 1 loss"). Changes are recorded to profit or loss on a periodic basis while unrecognized day 1 loss is amortized over the contractual life of each instrument. The Company accounts for contingent consideration as financial liability at fair value through profit or loss. The contingent consideration is measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. m. Derivatives: The Company accounts for warrants with a cashless exercise mechanism, compensation and anti-dilution features issued at public and private offering, as financial liabilities. The warrants, compensation and anti-dilution features are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. The Company accounts for warrants and rights to purchase additional debenture ("green-shoe option") issued at the 2019 securities purchase agreement, as financial liabilities. The warrants and green-shoe option are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction, adjusted to reflect the day 1 loss. Changes are recorded to profit or loss on a periodic basis while unrecognized day 1 loss is amortized over the contractual life of each instrument. See further details in Note 13. n. Unrecognized day 1 loss: A financial liability, in which upon initial recognition the transaction price is different than its fair value is initially recognized at fair value, adjusted to reflect the day 1 loss. After initial recognition, the unrecognized day 1 loss of the said financial liability is amortized over the contractual life of each financial liability. Upon conversion or exercise of convertible debentures or warrants for which an unrecognized day 1 loss exists, the carrying amounts are classified to equity. o. Trade payables: Trade payables are the Company's obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognized initially at fair value, and in subsequent periods at amortized cost using the effective interest method. p. Current and deferred income taxes: The tax expenses for the reported years comprise current and deferred taxes. Taxes are recognized in the consolidated statements of profit or loss, except to the extent that they relate to items recognized directly in equity. In that case, the tax is also recognized in equity. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operates and generates taxable income. The Company's management periodically evaluates the tax aspects applicable to its taxable income based on the relevant tax laws and makes provisions in accordance with the amounts payable to the Israeli Tax Authorities. Deferred income tax is provided using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax liabilities are not accounted for if they arise from initial recognition of goodwill. Also, deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized, or the deferred income tax liability is settled. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. The Company does not provide deferred income tax on temporary differences arising from investments in subsidiaries, since the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. q. Employee benefits: 1) Severance pay and pension obligations A defined contribution plan is a post-employment benefits scheme under which group companies pay fixed contributions into a separate and independent entity. The Company has no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. The Company's severance pay and pension obligations are generally funded through payments to insurance companies or trustee-administered funds. Under their terms, the said pension plans meet the criteria for defined contribution plan as above. 2) Vacation and recreation pay Every employee is legally entitled to vacation and recreation benefits, which are computed on an annual basis. This entitlement is based on the term of employment. The Company charges a liability and expense due to vacation and recreation pay, based on the benefits that have been accumulated for each employee. 3) Severance pay Severance pay is paid when an employee is terminated by the Company before the normal retirement date, or when an employee had agreed to accept voluntary redundancy in exchange for these benefits. The Company recognizes severance pay liabilities at the earlier of: ● When the entity can no longer withdraw the offer of those benefits; and ● When the entity recognizes costs for a restructuring in the scope of IAS 37, "Provisions, Contingent Liabilities and Contingent Assets," that includes the payment of severance benefits. r. Share-based payments: The Company operates a number of equity-settled, share-based compensation plans, under which the Company receives services from employees as consideration for equity instruments (options) of the Company. The fair value of the employee services received in exchange for the grant of the options is recognized as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted excluding the impact of any service and non-market performance vesting conditions. The total expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. In addition, in some circumstances, employees may provide services in advance of the grant date and therefore the grant date fair value is estimated for the purposes of recognizing the expense during the period between service commencement period and grant date. At the date of each balance sheet, the Company revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognizes the impact of the revision to original estimates, if any, in the consolidated statements of profit or loss, with a corresponding adjustment to equity. When the options are exercised, the Company issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium. For plans that include conditions that are not vesting conditions, any relating expenses are immediately recognized in the consolidated statements of profit or loss. When the Company revises the conditions of an equity-settled grant, the Company recognizes an additional expense, in excess of the original expense calculated for every such revision that increases the overall fair value of the granted benefit or benefits the service provider, based on the fair value at the time of revision. s. Revenue recognition: 1) General The Company has adopted IFRS 15 from January 1, 2017 (the "date of initial application"). The early adoption of IFRS 15 by the Company was done pursuant to the transitional provision that enabled the recognition of the accumulated impact of adoption as an adjustment of the opening balance of retained earnings as of January 1, 2017 (also known as the modified retrospective approach). This standard replaced the guidelines that were in effect through January 1, 2017 regarding revenue recognition and presents a new single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The standard provides two approaches to revenue recognition: one point in time or over time. The model framework consists of five steps for analyzing transactions to determine the timing and amount of revenue recognition. a) Identify the contract with the customer. b) Identify the separate performance obligations in the contract. c) Determine the transaction price. d) Allocate the transaction price to each of the performance obligations in the contract. e) Recognize revenue as each performance obligation is satisfied, while making a distinction between satisfying an obligation on a certain date and satisfying an obligation over time. In addition, the standard provides new and more extensive disclosure requirements to those that exist today, which are provided in Notes 17 and 24. 2) Accounting for perpetual and term licenses of software and for software as a service Perpetual and term licenses of software The main impact which the standard had on the Company's consolidated financial statements is the timing of recognition of revenue in respect of the license component in transactions for the sale of fixed-term license contracts. Pursuant to the standard, the Company's promise to the customer in granting a license is to provide a right to use the entity's intellectual property as intellectual property exists (in terms of form and functionality), at the point in time at which the license is granted to the customer. This means that the customer can direct the use of, and obtain substantially all of the remaining benefits from, the license at the point in time at which the license transfers. Therefore, revenue in respect of the license component in such transactions shall be recognized at the time at which the is license granted to the customer. Software as a Service The Company's revenues from its renewable monthly contracts with its customers are recognized rateably over the respective contract periods, since the customers consume benefits from these services. Costs to obtain a contract are expensed as incurred since commissions payable upon renewals are commensurate with the initial commission. The timing for the remaining performance obligations remained unchanged - see below. 3) Presentation of revenue and revenue related balances The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company controls the specified goods or services before the transfer to its customers. In determining this, the Company follows the accounting guidance for principal-agent considerations. This determination involves judgment and is based on an evaluation of the terms of each arrangement, considering the party that is primarily responsible in the arrangement, whether it bears inventory risk and whether it determines the prices charged to the customers. When an entity that is a principal satisfies a performance obligation, the entity recognizes revenue in the gross amount of consideration to which it expects to be entitled in exchange for the goods or services transferred. Sales to resellers are recognized upon delivery of the license to the reseller as the reseller is considered the ultimate customer in such arrangements. Revenue is recognized net to value added tax. The Company recognized obligations in respect of sale contracts at the total amount equal to the total amount of transactions invoiced, net of transactions in respect of which revenues were recognized. 4) Allocation of revenue to multiple performance obligations The Company allocates revenue to licenses, post contract customer support and professional services on a relative stand-alone selling price basis, except in cases in which a stand-alone selling price of an individual performance obligation is highly uncertain or variable, in which case the residual method is used. 5) Election of certain practical expedients The Company has also elected to apply the following practical expedients in connection with the application of IFRS 15: 1) IFRS 15 was applied only to contracts that were not completed as of the date of the initial application. 2) Where the asset that would be recognized as a result of capitalizing the cost of obtaining a contract would be amortized over one year or less, the Company shall expense those costs when incurred. 3) For contracts in which, at inception, the period between the performance of the obligations (transfer of goods or service to the customer) and the associated payment is expected to be one year or less, the Company does not account for the effect of a significant financing component. t. Loss per share: Basic loss per share is calculated by dividing net loss for the year by the weighted average number of ordinary shares (including pre-funded warrants). When calculating the diluted loss per share, the Company adjusts the loss attributable to holders of ordinary shares and the weighted average number of shares in issue, to reflect the effect of all potentially dilutive ordinary shares, as follows: The Company adds to the weighted average number of shares in issue that was used to calculate the basic loss per share the weighted average of the number of shares to be issued assuming the all shares that have a potentially dilutive effect would be converted into shares, and adjusts net loss attributable to holders of the Company's ordinary shares to exclude any profits or losses recorded during the year with respect to potentially dilutive shares. The potential shares, as above, are only taken into account in cases where their effect is dilutive (reducing the earnings per share or increasing the loss per share). u. Leases: Commencing January 1, 2019, the Company accounts for leases in accordance with International Financial Reporting Standard No. 16 "Leases" ("IFRS 16"). Accounting policies applied from January 1, 2019, under IFRS 16: The Company's leases include property and motor vehicle leases. At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company reassesses whether a contract is, or contains, a lease only if the terms and conditions of the contract are changed. At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date, including, inter alia, the exercise price of a purchase option if the Company is reasonably certain to exercise that option. Simultaneously, the Company recognizes a right-of-use asset in the amount of the lease liability. The discount rate applied by the Company is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. The lease term is the non-cancellable period for which the Company has the right to use an underlying asset, together with both, the periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. After the commencement date, the Company measures the right-of-use asset applying the cost model, less any accumulated depreciation and any accumulated impairment losses and adjusted for any remeasurement of the lease liability. Assets are depreciated by the straight-line method over the estimated useful lives of the right of use assets or the lease period, which is shorter: Years Property 1.3-6 Motor vehicles 3 Interest on the lease liability is recognized in profit or loss in each period during the lease term in an amount that produces a constant periodic rate of interest on the remaining balance of the lease liability. Accounting policies applied until December 31, 2018, under IAS 17 "Leases" ("IAS 17"): Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the consolidated statement of profit or loss on a straight-line basis over the period of the lease. v. Business combination: The Company accounts for business combinations by applying the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair value of the assets transferred by the acquirer, and the liabilities incurred by the acquirer to former owners of the acquiree, in exchange for control of the acquiree. The consideration transferred also includes the fair value of any asset or liability arising from a contingent consi |
Financial Instruments and Finan
Financial Instruments and Financial Risk Management | 12 Months Ended |
Dec. 31, 2019 | |
Financial Instruments and Financial Risk Management [Abstract] | |
FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT | NOTE 3 - FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT: Furthermore, it should be noted that the Company elected to apply the exemption regarding the recognition of short-term leases and leases in which the value of the underlying asset is low. The weighted average of lessee's incremental annual borrowing rate applied to the lease liabilities was 13.70%. The effect upon first-time implementation on the Company's consolidated statement of financial position are: right-of-use lease assets of approximately $166 thousand, current lease liabilities of approximately $97 thousand and non-current lease liabilities of approximately $69 thousand. a. Financial risk management: Financial risk factors The Company's activities expose it to a variety of financial risks: credit risk and liquidity risk. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial performance. Risk management is carried out by the Company's finance department in accordance with a policy approved by the Board of Directors. The Company's finance department identifies, evaluates and hedges the financial risks. The Board of Directors provides written principles for the overall management of the risks. 1) Credit risks Most of the Company's credit risks arise from short-term deposits and trade receivables. The Company mitigates the risk by ensuring it has sufficient funds to meet its needs and by selling to customers of high credit quality. No credit limits were exceeded in 2019 and 2018 and management does not expect any losses from non-performance by these counterparties beyond those that have already been recognized. 2) Foreign exchange risk The Company operates internationally and is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the New Israeli Shekel ("NIS"). Foreign exchange risk arises from future commercial transactions, recognized assets and liabilities denominated in foreign currency. The Company hedges and minimizes the foreign exchange risk by ensuring that the amounts of net current assets at a specific point in time correspond to the amount of current liabilities at that point in time. 3) Liquidity risk Prudent liquidity risk management requires maintaining sufficient cash and cash equivalents. The Company works to maintain sufficient cash and cash equivalents, taking into account forecasts as to the cash flows required to fund its activities, in order to minimize the liquidity risk to which it is exposed. 4) Coronavirus For details on the possible effect of the spread of the corona virus, see note 25(c). Cash flow forecasting is performed by the Company's finance department on a consolidated basis. The Company monitors rolling forecasts of the Company's liquidity requirements to ensure it has sufficient cash to meet operational needs. Surplus cash held by the operating entities of the Company over and above the balance required for working capital management are invested in interest bearing current accounts and time deposits, choosing instruments with appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts. The table below categorizes non-derivative financial liabilities into relevant maturity groupings based on the remaining period at balance sheet date to the contractual maturity date. Derivative financial liabilities are included in the analysis if their contractual maturities are essential for an understanding of the timing of the cash flows. Less than Between U.S. dollars in thousands December 31, 2019: Contingent consideration 2,170 - Short-term loan 4 - Convertible debentures 7,151 - Lease liabilities 184 324 IIA liability 8 108 Trade payables and other payables 1,790 - 11,307 432 December 31, 2018: IIA liability 49 82 Trade payables and other payables 1,054 - 1,103 82 b. Fair value estimation: Below is analyzes financial instruments carried at fair value, by valuation method. The different levels have been defined as follows: ● Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). ● Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2). ● Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). Level 1 financial instruments: As of December 31, 2019 the Company has no financial asset or liability measured at level 1. As of December 31, 2018, the Company had a derivative financial liability in amount of $729 thousand. The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm's length basis. Level 3 financial instruments: The Company has several financial liabilities measured at fair value through profit or loss, which meet the level 3 criteria as of December 31, 2019 and 2018. c. Fair value measurements based on unobservable data (level 3): The Company evaluated the fair value of convertible debentures, contingent consideration, derivative financial instruments and anti-dilution feature that were issued in connection with capital raising transactions. The following table presents the changes in level 3 instruments for each of the three years in the period ended December 31, 2019: Contingent consideration Convertible debentures Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2019 - - - - Initial recognition of financial liability 2,008 13,257 9,980 25,245 Initial recognition of unrecognized day 1 loss - (5,836 ) (4,856 ) (10,692 ) Conversion to equity of or other financial liability - (4,501 ) (1,061 ) (5,562 ) Repayment of convertible debentures - (470 ) - (470 ) Recognition of day 1 loss within profit or loss - 4,198 2,551 6,749 Changes in fair value recognized within profit or loss 162 503 (4,977 ) (4,312 ) Balance as of December 31, 2019 2,170 7,151 1,637 10,958 Anti-dilution feature Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2018 692 61 753 Initial recognition 497 2,678 3,175 Changes in fair value recognized within profit or loss 598 1,641 2,239 Classification to equity of Series B warrants - (3,479 ) (3,479 ) Classification to level 1, see Note 15(e) - (901 ) (901 ) Exercise of anti-dilution feature (1,787 ) - (1,787 ) Balance as of December 31, 2018 - - - Anti-dilution feature Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2017 94 - 94 Initial recognition 315 1,958 2,273 Changes in fair value recognized within profit or loss 283 (1,897 ) (1,614 ) Balance as of December 31, 2017 692 61 753 Financial instruments: Financial assets at amortized cost December 31, 2019 U.S. dollars Assets: Cash and cash equivalents 4,341 Trade receivable and other receivables (excluding prepaid expenses) 970 Long-term deposit 44 Restricted deposits 29 5,384 Financial assets at amortized cost December 31, 2018 U.S. dollars Assets: Cash and cash equivalents 3,717 Trade receivable and other receivables (excluding prepaid expenses) 910 Restricted deposits 104 4,731 Liabilities at fair value through profit or loss Financial liabilities at amortized cost Total December 31, 2019 U.S. dollars in thousands Liabilities: Short-term loan - 4 4 Contingent consideration 2,170 - 2,170 Convertible debentures 7,151 7,151 Lease liabilities - 508 508 Trade payables and other payables - 1,790 1,790 IIA liability - 116 116 Derivative financial instruments 1,637 1,637 10,958 2,418 13,376 December 31, 2018 Liabilities: Trade payables and other payables - 1,054 1,054 IIA liability - 131 131 Derivative financial instruments 729 - 729 729 1,185 1,914 Assets and liabilities, which are not measured on a recurring basis at fair value, are presented at their carrying amount, which approximates their fair value. d. Valuation processes of the Company: Set forth below are details regarding the valuation processes of the Company: 1) Series 1 warrants and series 2 warrants - level 1 financial instruments measured at fair value through profit or loss. For details, see Note 15. For details, see Note 15(b). 2) 2017 anti-dilution feature - the Company used the binomial share price model for a period of 12 months, using the following principal assumptions: expected volatility between 52.53% - 69.82%, risk-free interest between 0.01% - 0.11%, expected term between 0.11 - 0.45 years and a 75% probability of capital raise during February - April 2017 and between 10% - 100% probability of capital raise during April - June 2018. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 14(c). 3) 2018 anti-dilution feature - the Company used the binomial share price model for a period of 24 months, using the following principal assumptions: expected volatility between 69.88 - 70.78%, risk-free interest between 0.37% - 0.47%, expected term between 1.9 - 2 years and 100% probability of capital raise until June 2020. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 15(c). 4) Series A warrants, which were issued on August 21, 2018, as part of an underwritten public offering - the Company used the Black-Scholes model, using the following principal assumptions: expected volatility of 77.17%, risk-free interest of 2.77%, expected term of 6 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 15(e). 5) Series B warrants, which were issued on August 21, 2018, as part of an underwritten public offering, until December 19, 2018 - the Company used the binomial share price model for a period of 120 days, using the following principal assumptions: expected volatility between 89.17% - 104.11%, risk-free interest between 2.18% - 2.12%, expected term between 0.22 - 0.33 years. For details, see Note 15(e). 6) Series B warrants, which were issued on August 21, 2018, as part of an underwritten public offering, as of December 19, 2018 - level 1 financial instruments measured at fair value through profit or loss. For details, see Note 15(e). 7) Options to employees and advisors. For details, see Note 14. 8) Convertible debentures - the Company used the binomial share price model for a period of 18 months, using the following principal assumptions: expected volatility between 98.05 - 98.84%, risk-free interest between 1.95% - 2.42%, expected term of 1.5 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. 9) Derivative financial instruments - the Company used the binomial share price model for a periods of 1.5 and 5 years, using the following principal assumptions: expected volatility between 83.32% - 85.42%, risk-free interest between 1.58% - 2.38%, expected term of 1.5, and 5 years. The Company also used the Black-Scholes model, using the following principal assumptions: expected volatility of 84.40%, risk-free interest of 1.76%, expected term of 5.5 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. 10) Contingent consideration - the Company used the Monte Carlo method for a period of 6 months, using the following principal assumptions: expected volatility 51.9%, risk-free interest 1.88%. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 12 Months Ended |
Dec. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
CASH AND CASH EQUIVALENTS | NOTE 4 - CASH AND CASH EQUIVALENTS As of December 31, 2019 and 2018, the balance of cash and cash equivalents was comprised of cash at banks and PayPal account. |
Account Receivables - Trade, Ne
Account Receivables - Trade, Net | 12 Months Ended |
Dec. 31, 2019 | |
Account Receivables - Trade, Net [Abstract] | |
ACCOUNT RECEIVABLES - TRADE, net | NOTE 5 - ACCOUNT RECEIVABLES - TRADE, net As of December 31, 2019 and 2018, the account receivables-trade balance comprises open accounts. Also, as of December 31, 2019, the Company recorded a provision for doubtful accounts in an amount of $95 thousand and as of December 31, 2018, the Company did not record a provision for doubtful accounts. The Company has no customers that exceed their customary credit terms. In addition, during 2019 and 2018 the Company recorded a debt write-off in an amount of $29 thousand and $74 thousand, respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of detailed information about intangible assets [abstract] | |
INTANGIBLE ASSETS | NOTE 6 - INTANGIBLE ASSETS: a. Composition: Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2019: of year the year the year of year of year the year the year of year 2019 U.S. dollar in thousands Technology 2,263 4,651 (1,955 ) 4,959 1,469 808 (1,685 ) 592 4,367 Customer relations 38 259 (38 ) 259 36 21 (38 ) 19 240 Goodwill 523 7,356 (1,002 ) 6,877 - - - - 6,877 2,824 12,266 (2,995 ) 12,095 1,505 829 (1,723 ) 611 11,484 Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2018: of year the year the year of year of year the year the year of year 2018 U.S. dollar in thousands Technology 1,955 308 - 2,263 1,199 270 - 1,469 794 Customer relations 38 - - 38 30 6 - 36 2 Goodwill 523 - - 523 - - - - 523 2,516 308 - 2,824 1,229 276 - 1,505 1,319 Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2017: of year the year the year of year of year the year the year of year 2017 U.S. dollar in thousands Technology 1,955 - - 1,955 954 245 - 1,199 756 Customer relations 38 - - 38 24 6 - 30 8 Goodwill 523 - - 523 - - - - 523 2,516 - - 2,516 978 251 - 1,229 1,287 b. Testing of goodwill impairment: As required by IAS 36 Impairment of Assets The indicators for the quantitative assessment for goodwill impairment for the proxy services business included a decrease in forecasted operating results. For the purpose of the goodwill impairment testing of the proxy services business, the recoverable amount was assessed by management based on value-in-use calculations. The value-in-use calculations use pre-tax cash flow projections covering a six-year forecasted period alongside with a terminal value beyond such forecast period. Cash flows beyond the six-year period to be generated from continuing use are extrapolated using estimated growth rate. The growth rate represents the long-term average growth rate of the proxy services business. As a result of the impairment test, the Company recognized an impairment loss of $479 thousand related to the proxy services business. As of December 31, 2019, goodwill of the proxy services business amounts to $6,877 thousand. The key assumptions used as part purpose of the goodwill impairment testing of the proxy services business are terminal growth rate of 2%, after-tax discount rate of 20.5% and pre-tax discount rate of 22.8% A hypothetical decrease in the growth rate of 1% or an increase of 1% to the discount rate would reduce the value-in-use of the proxy services business by approximately $300 thousand and $711 thousand, respectively, and could trigger a potential impairment of its goodwill. For the purpose of the goodwill impairment testing of the cyber security business, the recoverable amount was assessed by management based on financial performance and future strategies considering current and expected market and economic conditions. As a result of the impairment test, the Company recognized an impairment loss of $523 thousand related to the cyber security business. As a result, the entire balance of goodwill related to this operating segment was written-off. As of December 31, 2018 and 2017, the Company performed a goodwill impairment test for its single CGU. For the purpose of the goodwill impairment test, the recoverable amount was calculated based on its fair value less cost to sell of Company's share. As of December 31, 2018 and 2017, the recoverable amount exceeded the Company's equity and therefore no goodwill impairment existed. c. Intangible assets purchase: 1. On July 2, 2018, Safe-T completed the purchase of the intellectual property of CyKick Labs Ltd. ("CyKick") and the assumption of a royalty liability to the IIA, in consideration of $236 thousand, allocated on a relative basis to the purchased technology ($308 thousand) and IIA liability ($72 thousand). The purchased technology is aimed to recognize hostile attacks on online services through the identification of the users' anomalous behaviour. The amortization is classified to cost of revenues and is calculated for 6 years using the straight-line method over the technology's useful life. For further details see Note 10(b). 2. On June 12, 2019, the Company completed the acquisition of NetNut, and certain assets required for NetNut's operations. The intangible assets included are: technology and customer supplier which are amortized over 5 years and classified to cost of revenues, and customer relations which are amortized over 7.5 years and classified to sales and marketing expenses. For further details, see Note 16. |
Interests in Other Entities
Interests in Other Entities | 12 Months Ended |
Dec. 31, 2019 | |
Interests in Other Entities [Abstract] | |
INTERESTS IN OTHER ENTITIES | NOTE 7 - INTERESTS IN OTHER ENTITIES Subsidiaries: Set forth below are details regarding the Company's subsidiaries as of December 31, 2019 and 2018: Name of company Principal place of business Nature of business activities Percentage held directly by the Company Rate of shares held by the Company % Safe-T Data A.R Ltd. Israel Development of data security software 100 100 Safe-T USA Inc. USA Business development and sales in the USA - 100 NetNut Ltd.* Israel Business proxy network solution 100 100 * Acquired on June 12, 2019 |
Taxes on Income
Taxes on Income | 12 Months Ended |
Dec. 31, 2019 | |
Taxes on Income [Abstract] | |
TAXES ON INCOME | NOTE 8 - TAXES ON INCOME: a. Corporate taxation in Israel: The income of the Company, Safe-T and NetNut is taxed at the regular corporate tax rate, which is 24% for 2017, and 23% for the year 2018 and thereafter. Safe-T Inc. was taxed at a regular U.S. federal tax rate of 20% and 21% for the tax years 2019 and 2018, respectively. b. Tax assessments: Tax assessments filed by the Company and Safe-T by 2014 are considered final. NetNut has not received tax assessments since incorporation. c. Carryforward tax losses: Carryforward tax losses in Israel of the Company amounted to approximately $1.8 million and $1.7 million as of December 31, 2019 and 2018, respectively. Carryforward tax losses in Israel of Safe-T amounted to approximately $31.5 million and $22 million as of December 31, 2019 and 2018, respectively. Carryforward tax losses in Israel of NetNut amounted to approximately $408 thousand and $61 thousand as of December 31, 2019 and 2018, respectively. The Company did not recognize deferred taxes for these losses since their utilization is not expected in the foreseeable future. d. Deferred taxes: Property, plant and equipment, net Intangible assets, net Carryforward tax losses Total U.S. dollar in thousands Balance as of January 1, 2019 - - - - Initial recognition due to business combination (46 ) (1,129 ) 149 (1,026 ) Changes during the year: Taxes on income 13 122 (149 ) (14 ) Balance as of December 31, 2019 (33 ) (1,007 ) - (1,040 ) e. Theoretical tax reconciliation: Following is a reconciliation of the theoretical tax expense, assuming all income is taxed at the regular tax rates applicable to companies in Israel (see section a above) and the actual tax expense: Year ended December 31, 2019 2018 2017 % U.S. dollars % U.S. dollars in thousands % U.S. dollars Loss before taxes on income, as reported in the statement of profit or loss 100 12,975 100 11,747 100 5,312 Theoretical tax saving on this profit or loss (23 ) (2,984 ) (23 ) (2,702 ) (24 ) (1,275 ) Increase in taxes resulting from permanent differences - non-deductible expenses 8.0 1,039 4.5 524 1.6 83 Increase in taxes resulting from losses in the reported year for which deferred taxes were not recognized 15.2 1,968 18.6 2,184 22.5 1,193 Tax expenses 0.18 23 0.05 6 0.02 1 |
Accounts Payable and Accruals
Accounts Payable and Accruals | 12 Months Ended |
Dec. 31, 2019 | |
Accounts Payable and Accruals [Abstract] | |
Accounts Payable and Accruals | NOTE 9 - ACCOUNTS PAYABLE AND ACCRUALS: a. Accounts payable - other: December 31 2019 2018 U.S. dollars in thousands Employees and related institutions 654 628 Accrued expenses 899 323 1,553 951 b. The carrying amount of accounts payables, which are financial liabilities, is a reasonable approximation of their fair value since the effect of discounting is immaterial. |
Commitments and Contingent Liab
Commitments and Contingent Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Commitments [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 10 - COMMITMENTS AND CONTINGENT LIABILITIES: a. Royalties payable to the IIA: 1) Under the terms of a plan with IIA, Safe-T is committed to pay royalties to the IIA on proceeds from sales of products in the research and development of which the IIA participated by way of grants. Royalties are payable at the rate of 3% to 3.5% of the proceeds from such sales. Safe-T completed the performance of the plan on October 31, 2015, and filed a final report to the IIA, who approved the report. Since 2015, Safe-T received a total of $146 thousand in grants. For the years ended December 31, 2019 and 2018, the Company paid royalties in an amount of $41 thousand and $43 thousand, respectively, and presents liabilities to the IIA of $8 thousand and $49 thousand, respectively. 2) On July 2, 2018, Safe-T completed the purchase of the intellectual property of CyKick. As part of such purchase, Safe-T committed to take CyKick’s liability to pay royalties to the IIA on proceeds from sales of products in the research and development of which the IIA participated by way of grants. Royalties are payable at the rate of 3% to 3.5% of the proceeds from such sales. As of December 31, 2019, the Company did not pay the IIA any royalties and its liability to pay the IIA royalties for future sales of CyKick’s technology amounted to approximately $108 thousand. b. Lease agreements (only 2018) 1) During 2013, Safe-T entered into an office lease agreement for the premises it uses, which included an option to extend the lease with a lease fee increase of 6%. During 2015, Safe-T extended the office lease agreement on similar terms until December 31, 2017. On September 13, 2017, Safe-T signed an amendment to its office lease agreement, according to which Safe-T will lease its offices for a monthly fee of approximately $17 thousand. On November 12, 2018, Safe-T signed an amendment to lease additional space for approximately $1.5 thousand per month. During 2016, Safe-T Inc. entered into a lease agreement, which expired on November 30, 2017. On September 19, 2017, Safe-T Inc. signed an extension to its office lease agreement, according to which Safe-T Inc. will lease its offices for a monthly fee of approximately $1.3 thousand. The lease will expire on April 30, 2020. The minimal future lease fees (including management fees), which are payable under the said leases’ agreements are, as of December 31, 2018: For the year ended December 31: U.S. dollars 2019 231 2020 5 During 2016 and 2017, Safe-T entered into lease agreements in connection with a number of vehicles. The lease periods are generally for three years. The minimal future lease fees, which are payable under the Company’s vehicles lease agreements are, as of December 31, 2018: For the year ended December 31: U.S. dollars 2019 89 2020 47 2021 and thereafter 12 Commencing January 1, 2019, the Company recognized a right-of-use asset at an amount equal to the amount of the lease liability for its leases, except for short-term leases and leases in which the value of the underlying asset is low. For details, see Note 2(u). c. Contingent Consideration On April 4, 2019, the Company entered into a share and asset purchase agreement (the “Share and Asset Purchase Agreement”), with NetNut, pursuant to which the Company acquired 100% of the fully diluted share capital of NetNut. The Share and Asset Purchase Agreement includes an earn-out payment to the previous shareholders of NetNut of up to $5 million based on NetNut's revenues in 2019 and for which the Company has granted a first security interest and pledge in 30% of the NetNut shares. In connection with the Share and Asset Purchase Agreement the Company was required to transfer $300,000 to NetNut prior to June 15, 2019, for the purposes of its business and activities as a wholly-owned subsidiary of the Company. By December 31, 2019, the Company have transferred only $175,000. Currently, the Company accounted for earnout payment based on the provisions of the Share and Asset Purchase Agreement which requires a payment of approximately $1.7 million, as well as a provision for an additional potential compensation to NetNut’s former shareholders due to the above-mentioned breach. d. Minimal future lease fees as of December 31, 2019 ( U.S. dollars in thousands) December 31, 2020 346 2021 174 2022 150 2023 121 Total undiscounted cash flows 791 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
LEASES | NOTE 11 - LEASES: Right-of-use assets: Balance at Additions Disposals Balance at beginning during during end of of year year year year U.S. dollars in thousands Cost Property 19 446 - 465 Motor vehicles 147 26 (60 ) 113 166 472 (60 ) 578 Balance at amortization Additions Disposals Balance at beginning during during during end of of year year year year year U.S. dollars in thousands Accumulated amortization Property - (65 ) (41 ) - (106 ) Motor vehicles - (50 ) - 19 (31 ) - (115 ) (41 ) 19 (137 ) Lease liabilities: Balance at Additions Interest expense Termination Payments Balance at beginning during during during during end of of year year year year year year U.S. dollars in thousands Composition in 2019 Property 19 443 49 - (80 ) 431 Motor vehicles 147 26 27 (44 ) (79 ) 77 166 469 76 (44 ) (159 ) 508 Short-term lease liabilities: Property 135 Motor vehicles 49 Long-term lease liabilities: Property 296 Motor vehicles 28 508 Expense relating to short-term leases for the year ended December 31, 2019 amounted to $211 thousand. |
Retirement Benefits Obligation
Retirement Benefits Obligation | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits Obligation [Abstract] | |
RETIREMENT BENEFITS OBLIGATION | NOTE 12 - RETIREMENT BENEFITS OBLIGATION: a. Liability for employee rights upon retirement: Labor laws and agreements require the Company to pay severance pay and/or pensions to employees dismissed or retiring from their employ in certain other circumstances. The amounts of benefits those employees are entitled to upon retirement are based on the number of years of service and the last monthly salary. Also, under labor laws and labor agreements in effect, including the Expansion Order (Combined Version) for Obligatory Pension under the Collective Agreements Law of 1957 (the "Expansion Order"), The Company is liable to make deposits with provident funds, pension funds or other such funds, to cover its employees' pension insurance as well as some of its severance pay liabilities. Under the terms of the Expansion Order, the Company deposits for severance pay as required under the Expansion Order as well as other deposits made by those companies "in lieu of severance pay" and which were announced as such as required under the Expansion Order, replace all payment of severance pay under Section 14 of the Israeli Severance Pay Law, 1963 (the "Severance Pay Law") with respect to the wages, components, periods and rates for which the deposit alone was made. b. Defined contribution plans: The Company's severance pay liability to Israeli employees for which the said liability is covered under section 14 of the Severance Pay Law is covered by regular deposits with defined contribution plans. The amounts funded as above are not reflected in the consolidated statements of financial position. The amounts recognized as expense in respect of defined contribution plans in 2019, 2018 and 2017, are $205 thousand, $234 thousand and $157 thousand, respectively. |
Convertible Debentures
Convertible Debentures | 12 Months Ended |
Dec. 31, 2019 | |
Convertible Debentures [Abstract] | |
CONVERTIBLE DEBENTURES | NOTE 13 - CONVERTIBLE DEBENTURES On April 9, 2019, the Company entered into a Securities Purchase Agreement (the "April 2019 SPA") with certain lenders (the "Lenders"), according to which, the Company obtained a convertible loan in an aggregate amount of $6 million (the "Transaction Price"), for the issuance of convertible debentures (the "Convertible Debentures," or the "Debentures") and 146,341 warrants (the "Warrants") to purchase up to 146,341 ADSs. The first tranche of the loan, in the amount of $1 million was received during April 2019, and the second tranche, in the amount of $5 million, was received during June 2019. The Convertible Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. The Debentures' initial conversion price was set to $41 per ADS, and then was several times reset following triggering of an adjustment mechanism that was agreed upon in the April 2019 Agreement, setting forth that the conversion price will be reset, if there is a subsequent issuance of the Company's securities, below the conversion price, to the price of the subsequent issuance. The Debentures contain other customary anti-dilution features, with the Black-Scholes value of the Debentures payable upon the occurrence of a fundamental transaction. The Company can redeem the Debentures after the effective date, which was set as June 4, 2019, upon a 20 trading days prior notice to the Lenders at 120% of the principal amount of the Debentures, plus accrued interest. Upon issuance, the Warrants had an exercise price of $47.15 per ADS, with 100% warrant coverage to the value of the Debentures. The Warrants have a five-year term and will be exercisable for cash or on a cashless basis if no resale registration statement is available for resale of the ADSs issuable upon exercise. The exercise price of the Warrants was reset several times, in accordance with the adjustment mechanism setting forth that if within 18-month from the issuance of the Warrants, there is a subsequent issuance of the Company's securities below the exercise price, to the price of the subsequent issuance. The Warrants contain other customary anti-dilution features, with the Black-Scholes value of the Warrants payable upon the occurrence of a fundamental transaction. Each Lender was granted with a 12-month participation right in a subsequent financing, up to the amount equal to 50% of the subsequent financing, which will expire on June 5, 2020. The Lenders had a right to purchase additional debentures on the same terms until six months from June 4, 2019 ("Greenshoe Option"), which was extended until January 4, 2020. The Lenders also have a most favored nation right (the "Most Favored Nation Right") for the term of the debenture with respect to a subsequent financing on better terms, such that the Lenders may convert into the subsequent financing terms on a dollar-for-dollar basis. Each of the Company's wholly owned subsidiaries guarantees the obligations under the April 2019 Agreement. The Debentures and Warrants contain customary beneficial ownership blockers for the Lenders, which will prevent a Lender from acquiring a controlling block in the Company. On July 22, 2019, the Company signed a repricing agreement with the Lenders (the "Repricing Agreement") pursuant to which in exchange for the exercise of 36,232 Warrants into ADSs, the Company reduced the exercise price of these Warrants to $27.60 per ADS. The Repricing Agreement was considered as a dilutive issuance, and as a result triggered also the adjustment of the Debenture conversion price and the exercise price of other outstanding Warrants to $27.60. Following the execution of the Repricing Agreement, the Lenders exercised the Warrants into 36,232 ADSs (representing 1,449,280 ordinary shares of the Company) on July 24, 2019, for consideration of $1 million. On August 30, 2019, the Company signed an additional repricing agreement (the "Second Repricing Agreement") with one of the Lenders pursuant to which in exchange for the exercise of 5,020 Warrants into ADSs, the Company reduced the exercise price of these Warrants to $19.92 per ADS. The Second Repricing Agreement was considered, again, as a dilutive issuance, and as a result triggered another adjustment of the Debenture conversion price and the exercise price of other outstanding Warrants to $19.92. Following the execution of the Second Repricing Agreement, the Lender exercised the said Warrants into 5,020 ADSs (representing 200,800 ordinary shares of the Company) on August 30, 2019 for consideration of $0.1 million. On August 30, 2019, pursuant to a partial exercise of such Lenders' Greenshoe Option, the Company signed a second securities purchase agreement, according to which the Company obtained another convertible loan from one of the Lenders in the amount of $0.4 million (the "August Greenshoe Debentures"). The August Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. Upon issuance, the August Greenshoe Debentures were convertible at $19.92. The conversion price of the August Greenshoe Debentures will be reset, but not below $8 per ADS, if there is a subsequent issuance of the Company's securities below the conversion price per share, to the price of the subsequent issuance. On October 31, 2019, the Company signed additional securities purchase agreement, according to which the Company obtained another convertible loan from one of the Lenders, who partially exercised its Greenshoe Option in the amount of $0.5 million (the "October Greenshoe Debentures"). The October Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. The October Greenshoe Debentures' initial conversion price was $8.00 per ADS, subject to adjustments. The Company also signed an amendment to the April 2019 SPA with this Lender, that in exchange for waiving his Most Favored Nation Right with respect to the November 5, 2019 public offering (see also note 15(e)2), the Lender will be able to exercise this right at any time following this offering, under the offering terms. On November 5, 2019, the Company repaid Debentures in the amount of $470,000 to one of the Lenders. Also, the Company paid to the Lender an amount of $330,000 for waiving his Most Favored Nation Right with respect only to the November 5, 2019 public offering (see also note 15(e)2). Following a public offering of the Company's ADSs on November 5, 2019 (see Note 15), the outstanding Warrants price of the said Lender was reset to $8.00. On December 4, 2019, the Company agreed to extend the Lenders' Greenshoe Option, until January 4, 2020. On December 26, 2019, the Company closed a registered direct offering (the "December 2019 Registered Direct Offering"), providing for the issuance of ADSs and pre-funded warrants, each to purchase one ADS. Additionally, in a concurrent private placement, the Company issued to the investors unregistered warrants to purchase ADSs. On December 26, 2019, the Company closed an additional securities purchase agreement, according to which the Company obtained another convertible loan from the Lenders, who partially exercised their Greenshoe Option in the approximate amount of $666 thousand for each Lender, for a total of $1,332 thousand (the "December Greenshoe Debentures"). The December Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. According to the Agreement, the December Greenshoe Debentures as well as all previous outstanding debentures, are convertible at $8.00, subject to adjustments. In addition, the Lenders have a most favored nation right for a subsequent financing on better terms, for the term of the debentures, for the December Greenshoe Debentures as well as for all previous outstanding debentures in the amount of $3,854 thousand, such that the Lenders may convert into the subsequent financing on a dollar-for-dollar basis or at the terms of the December 2019 Registered Direct Offering. The Company has also agreed with the Lenders that the Lenders may exercise their respective Most Favored Nation Rights at any time for their total outstanding Debenture balance, while the respective debenture is outstanding, in connection with the Company's December 2019 Registered Direct Offering. If the Lenders decide to exercise their Most Favored Nation Rights in connection with the December 2019 Registered Direct Offering, then the Lenders will exchange their debentures for (i) ADSs at an exchange rate equal to $3.15, the per ADS offering price in the December 2019 Registered Direct Offering, and (ii) an even number of ADS purchase warrants at $3.30 per ADS (the "MFN Warrants"), which MFN Warrants shall be in form and substance identical to the warrants issued in the concurrent private placement to the December 2019 Registered Direct Offering. For accounting purposes, these financial instruments were classified as financial liabilities in the consolidated statement of financial position as of December 31, 2019 (the Warrants and Greenshoe Option as "derivative financial instruments" and the Debentures as "convertible debenture"). The Convertible Debentures were designated at fair value through profit or loss, given the conversion option derivative embedded in such instrument. Changes in the Company's own credit risk from the date of initial recognition are negligible. The Warrants and Greenshoe Option are derivative financial instruments measured at fair value through profit or loss. These financial liabilities were initially recognized at fair value, adjusted to reflect the day 1 loss and are measured at fair value in each period-end while unrecognized day 1 loss is amortized over the contractual life of each instrument. During 2019, the Lenders were issued 16,401,808 ADSs upon conversion of Debentures including interest, as well as exercises of Warrants, and as a result, a net amount of $3,262 thousand was classified to equity. As of December 31, 2019, the actual outstanding amount of the Debentures principle summed to $3,854 thousand. See also note 25 for subsequent events occurred after the balance sheet date. |
Share Based Payment
Share Based Payment | 12 Months Ended |
Dec. 31, 2019 | |
Share Based Payment [Abstract] | |
SHARE BASED PAYMENT: | NOTE 14 - SHARE BASED PAYMENT: a. The Company maintains a share-based payment plan for employees, directors and consultants (the "Plan"). According to the Plan, the options vest over a period of up to four years, and their term period is ten years. Nevertheless, the Board of Directors is qualified to resolve on different vesting terms. Below is a summary of the Company's grants under the Plan during 2017, 2018 and 2019: Date of grant Options amount Exercise Fair value at the date of grant* Volatility ** Risk free interest Expected term in NIS in thousand In years March 29, 2017 37,395 1 127.42-131.76 655 47.40 % 2.31 % 10 July 24, 2017 32,087 139.52 784 68.07 % 2.05 % 10 August 8, 2017 50,000 150 85 68.03 % 1.95 % 0.5 August 29, 2017 25,000 113.10 473 68.17 % 1.81 % 10 November 27, 2017 15,250 86 163 65.80 % 1.98 % 10 June 20, 2018 33,502 29.80-59.40 130 75.50 % 2.24 % 10 June 20, 2018 11,500 28.60 72 75.30 % 2.24 % 10 October 2, 2019 269,476 0.02-4.062 189 81.33 % 0.72 % 3 1 Out of which 5,000 options were granted to the Company's Chief Executive Officer at an exercise price of NIS 131.76 and approved by the Company's shareholders on August 8, 2017. * The early exercise multiple used for the fair value calculations for grants during 2017, 2018 and 2019 is 2.5 for each offeree. ** Volatility until the March 29, 2017 grant is based on volatility data of share price of software companies for periods matching the expected term of the option until exercise. As of the July 24, 2017 grant, volatility is based on volatility data of the traded share price of the Company. On June 20, 2018, the Board of Directors approved the reduction of the exercise price of 86,675 options that were granted as of August 28, 2016, until August 29, 2017, to officers, employees and consultants at exercise prices which ranged between NIS 97.74 (approximately $25.60) to NIS 139.52 (approximately $38.80). The new exercise price was set at NIS 90.0. The reduction was approved also by the tax authorities subject to renewed tax lock-up period of 24 months. The reduction was subject to the grantee's approval - such approval was received only with respect to 69,058 options, while the rest of the options maintained their original terms. The reduction of the exercise price of options granted to certain officers of the Company was subject to the approval of the general meeting of shareholders of the company, which was obtained on August 12, 2018. The fair value of the options just prior to the date of the change, which was computed according to the binomial model, amounted to $228 thousand, and $249 thousand immediately after the date of the change, such that the incremental value that resulted is $21 thousand. This value is based on the following assumptions: expected volatility of 75.48%, risk free interest ranges between 2.00% and 2.13%, expected term until exercise of 8.19-9.20 years and an early exercise multiple of 2.5 for each offeree. Volatility is based on volatility data of share price of software companies for periods matching the expected term of the option until exercise. b. Movement in the number of share options outstanding and their related weighted average exercise prices are as follows: 2019 2018 2017 Number Average Number Average Number Average of exercise of Exercise of Exercise options price options Price options Price $ $ $ Outstanding at beginning of year: 173,628 22.19 202,763 25.20 119,245 16.80 Granted 269,476 0.88 45,002 9.20 109,732 34.00 Exercised (66,330 ) 0.01 (8,963 ) 11.40 (7,982 ) 10.20 Forfeited (20,720 ) 11.26 (47,767 ) 24.60 (17,590 ) 30.40 Expired (15,476 ) 16.89 (17,407 ) 22.60 (642 ) 22.40 Cancelled (79,302 ) 24.93 - - - - Outstanding at end of year 261,276 6.20 173,628 22.20 202,763 25.20 Exercisable at end of year 253,871 3.22 93,969 17.80 77,633 14.80 c. The following table summarizes information about exercise price and the remaining contractual life of options outstanding at the end of 2019, 2018 and 2017: 2019 2018 2017 Weighted Weighted Weighted Number average Number average Number average outstanding remaining outstanding remaining outstanding remaining Exercise at contractual at contractual at contractual Prices end of year Life end of year Life end of year Life $ Years Years Years 1.17 203,146 2.76 - - - - 7.97 14,771 4.39 14,771 5.39 16,840 6.32 7.97 10,992 5.23 16,139 6.25 17,080 7.25 7.97 13,081 6.05 13,081 7.05 18,616 8.05 7.97 1,281 8.48 18,501 9.48 - - 7.97 7,500 8.48 10,000 9.48 - - 12.20 - - 941 6.01 8,135 7.01 16.40 - - 5,000 9.48 - - 24.40 1,000 7.91 13,500 8.91 15,250 9.91 24.80 2,004 6.66 21,570 7.66 - - 24.80 - - 7,778 7.71 - - 24.80 2,500 7.24 16,145 8.24 - - 24.80 - - 11,501 8.56 - - 24.80 - - 5,000 8.32 - - 24.80 2,500 1.58 7,500 8.66 - - 25.60 - - - - 8,146 8.71 27.40 - - 170 7.66 30,714 8.66 31.60 - - 2,500 8.66 22,500 9.67 34.60 - - 2,500 0.66 2,500 1.66 35.20 - - 1,406 8.25 27,395 9.25 36.60 - - - - 5,000 9.32 38.80 2,500 7.56 5,625 8.56 30,587 9.57 261,276 173,628 202,763 d. Expenses recognized in the financial statements: The costs which were recognized in the Company's financial statements in respect of services received from its employees and consultants are presented in the table below: Year ended December 31, 2019 2018 2017 U.S. dollars in thousands Share-based payment plans 612 381 1,318 The plans are intended to be governed under rules set for that purpose in the Company's options plan. The exercise prices of the options that are exercisable into shares as of December 31, 2019 range between $1.17 to $38.86. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders' Equity [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 15 - SHAREHOLDERS' EQUITY a. Share capital: Reverse split On October 21, 2019, the Company effected a 20:1 reverse split of its share capital. No adjustment was made to the number of ordinary shares underlying each ADS of the Company, and each ADS continues to represent 40 of the Company's ordinary shares, no par value. All descriptions of the Company's share capital in these financial statements, including share amounts and per share amounts, are presented after giving effect to the reverse split. As of December 31, 2019 and 2018, the Company's share capital is composed as follows: Number of shares Authorized Issued and paid December 31, December 31, 2019 2018 2019 2018 Ordinary shares of no-par value 250,000,000 50,000,000 56,391,512 4,067,785 The Company's ordinary shares are traded on the TASE, and, commencing August 21, 2018, the Company's ADSs are traded on the Nasdaq under the symbol "SFET." Each ADS represents 40 ordinary shares. The last reported market price for the Company's securities on December 31, 2019 was $3.03 per ADS on the Nasdaq and $0.073 per share on the TASE (based on the exchange rate reported by the Bank of Israel for that date). b. Tradable warrants: On June 8, 2016, the Company completed a public offering by means of issuing units of securities. As part of the issuance, offers were received to purchase 1,615 units of 1,615 shares, 64,614 Series 1 warrants and 64,614 Series 2 warrants, in consideration for $4,173 thousand. The terms of the warrants, which were issued were as follows: each Series 1 warrant was exercisable into one ordinary share in consideration for NIS 125 until February 9, 2017. Each Series 2 warrant was exercisable into one share in consideration for NIS 150 until December 9, 2017. ● Series 1 warrants On January 30, 2017, the Company's general meeting decided to defer the exercise date of the Series 1 warrants from February 9, 2017 to April 30, 2017 and to reduce the exercise price of the warrants from NIS 125 to NIS 110. As of April 30, 2017, 438 warrants were exercised before the reduction of the exercise price, for a total consideration of approximately NIS 55 thousand (approximately $14 thousand), and 64,077 warrants were exercised after the reduction of the exercise price, for a total consideration of approximately NIS 7,048 thousand (approximately $1,930 thousand) (99.85% of all series 1 warrants were exercised in consideration for approximately NIS 7,103 thousand (approximately $ 1,943 thousand)). The remaining warrants expired on April 30, 2017. ● Series 2 warrants 351 warrants were exercised in May 2017 for a total consideration of approximately NIS 53 thousand (approximately $15 thousand). On November 2017, the Company's general meeting and Board of Directors decided to defer the exercise date of the Series 2 warrants from December 9, 2017 to February 9, 2018 and to reduce the exercise price of the warrants from NIS 150 to NIS 125. On February 9, 2018, the Series 2 Warrants expired with no further exercises. Movement in the number of the Series 1 and 2 warrants are as follows: 2018 2017 Series 2 warrants Series 1 warrants Series 2 warrants Outstanding at beginning of year: 64,263 64,614 64,614 Issuance - - - Exercised - (64,514 ) (351 ) Expired (64,263 ) (100 ) - Outstanding at end of year - - 64,263 c. Private offerings: During the years 2018 and 2017, the Company raised approximately $9.7 million, before deducting issuance expenses, in a series of private offerings, as follows: Date of offering Number of shares Unit price Gross proceeds April 6, 2017 67,742 120 2,237 May 11, 2017 22,074 120 727 May 22, 2017 30,250 120 1,001 June 13, 2017 58,714 140 2,280 June 3, 2018 381,729 26-30 2,959 June 3, 2018 20,823 6 34 September 25, 2018 289,079 6 481 Date of offering Number of warrants Warrant exercise price Expiration date April 6, 2017 67,942 175 November 30, 2018 May 11, 2017 22,074 175 November 30, 2018 May 22, 2017 30,250 175 November 30, 2018 June 13, 2017 58,714 200 November 30, 2018 June 3, 2018 218,935 46.4 November 30, 2019 In connection with the private offerings, the Company used the services of brokers, who mediated between the investors and the Company. In consideration for the services rendered by those brokers, the Company awarded them fully vested non-traded warrants, as follows: Date of award Number of non-traded warrants awarded Exercise price Expiration Date April 6, 2017 569 120 April 9, 2022 April 6, 2017 2,828 120 April 9, 2020 May 11, 2017 1,104 120 May 11, 2020 May 22, 2017 2,269 120 June 21, 2020 June 13, 2017 4,225 200 June 21, 2020 June 3, 2018 20,702 46 November 30, 2019 June 3, 2018 645 200 November 30, 2018 August 21, 2018 745 48 November 30, 2019 The Company accounted for the said awards in accordance with the provisions of IFRS 2 "Share-based payment". The value of the services that were rendered by the brokers was treated as issuance costs, by crediting equity and allocating on a pro rata basis between the premium and finance expenses according to the proportion of equity instruments and liability instruments included in each private issuance. As part of the private offerings, the Company has undertaken that in case that it will decide to issue additional shares over the course of up to 12 or 24 months from the respective dates of the issuances, at a price per share that is lower than the price per share that was set as part of the private issuances, it will compensate the relevant investors by issuing additional shares in accordance with the difference between the price per share of the relevant private issuance and the price per share in that future issuance, up to a minimal price that ranges between NIS 0.88-6.00 per share, according to the terms of the relevant issuance. In addition, the Company has also undertaken to compensate certain brokers by issuing additional warrants in case of an anti-dilution trigger. Following the June 3, 2018 private offering, the Company issued 20,823 shares at an exercise price of NIS 6.0 per share, reflecting the exercise price pursuant to the anti-dilution rights held by the investors, for an approximate amount of $34 thousand, and granted an additional 645 warrants, which were also triggered by an anti-dilution clause provided in prior private offerings. Also, following the public offering as described below, the Company issued 289,079 ordinary shares in consideration for NIS 6.0 per share, reflecting the exercise price pursuant to the anti-dilution rights held by the investors, for an approximate amount of $481 thousand, and granted an additional 745 warrants which were also triggered by an anti-dilution clause provided in prior private offerings. For accounting purposes, the Company recognized financial liabilities in respect of warrants and in respect of anti-dilution features (see above). The warrants are measured at fair value (level 1) in accordance with their quoted price. Changes are recorded to profit or loss on a periodic basis. The anti-dilution features are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. The equity component is initially recognized by subtracting the fair value of the financial liabilities from consideration received. The equity component is not re-measured in subsequent periods. Issuance expenses of $1,545 thousand in 2018 and $663 thousand in 2017 were allocated on a pro-rata basis to the three components mentioned above. d. OTC listing: On June 26, 2017, the Company obtained all approvals required for listing the Company's ordinary shares as ADSs that are tradable as part of the OTCQB Venture Market of the Over the Counter (OTC) market in the United States In accordance with the approvals, the Company commenced trading as part of the ADR Level 1 program as from June 27, 2017 under the symbol "SFTTY"; each ADS represented four (currently 40) ordinary shares of the Company. In August 2018, following the Nasdaq public offering and the listing in Nasdaq, the Company's ADS's ceased to trade on the OTC market. e. Public and registered direct offerings: 1. On August 21, 2018, the Company completed an underwritten public offering on the Nasdaq of 25,522 units comprised of 25,522 ADSs at a price of $287 per ADS, 25,522 Series A warrants to purchase up to 38,278 ADSs with an exercise price of $287 per ADS, and 25,522 Series B warrants to purchase up to a maximum of 59,670 ADSs. Each ADS represents 40 of the Company's ordinary shares. The Company received aggregate gross proceeds of approximately $7.335 million from the offering. The Series A warrants have a term of six years, are exercisable immediately and have an exercise price of $287 per ADS. The Series B warrants will become exercisable, if at all, commencing 120 days after issuance, at the discretion of the holder thereof until exercised in full, if at the 120th day after issuance, 80% of the lowest volume weighted average price of the ADSs during the five trading days immediately prior to such date (the "Reset Price"), is lower than $287. In such event, each Series B warrant holder will be entitled to additional ADSs at an exercise price of $0.02 per ADS, with the number of ADSs exercisable equal to the aggregate investment by such holder in connection with the closing of the offering divided by the Reset Price, less any ADSs issued to such holder at the closing of the offering. In no event shall the Reset Price be less than $86.10, subject to customary adjustments for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions. In the event the right to purchase additional ADSs is not triggered on the 120th day after issuance, the Series B warrants will expire immediately. For accounting purposes, the Company's obligation to issue a variable number of shares pursuant to the series B warrants, was classified as a financial liability measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes in the fair value were recorded to profit and loss until the reset date (see below). The equity components are initially recognized by subtracting the fair value of the financial liability from consideration received, based on the proportion of each one of them. The equity components are not re-measured in subsequent periods. Issuance expenses of $1.3 million in 2018 were allocated on a pro-rata basis to the three components mentioned above. In connection with the underwritten public offering, the Company granted the underwriter a 45-day option to purchase up to 3,828 additional ADSs and Series A warrants to purchase up to an additional 5,742 ADSs and Series B warrants to purchase up to an additional 5,742 ADS. The underwriter did not exercise the option. The Company also granted the underwriter warrants to purchase up to 1,276 ADSs at an exercise of $287 per ADS and a term of 5 years from the issuance date. On December 19, 2018, the Reset Price of the Series B Warrants was set at $86.10 per ADS. As a result, the Series B Warrants holders are entitled to an additional 59,670 ADSs subject to payment of an exercise price of $0.001 per ADS. The exercise period is unlimited. A total of 12,275 ADSs resulting from the Series B Warrants' Reset Price calculations were not registered with the U.S. Securities and Exchange Commission ("SEC"). As a result, in January 2019 those warrants were cancelled and replaced with substantially similar warrants that contain a mechanism for cashless exercise. As of December 31, 2019, 58,231 ADS's were exercised by the Series B warrants holders, such that the unexercised balance as of this date was 1,431 ADSs. For accounting purposes, as of December 19, 2018, following the setting of the Reset Price, as described above, the fair value of the financial liability, as of such date, in the amount of $3,479 thousand, was reclassified to equity on December 31, 2018, other than the amount of ADSs not approved for registration, which was still classified as a financial liability in the statement of financial position based on fair value of the Company's share price at December 31, 2018 (a level 1 measurement). During 2019, the remaining amount of financial liability was classified to equity, after approved for registration. 2. On November 5, 2019, the Company completed an additional underwritten public offering of approximately $3.5 million, before deducting underwriting discounts, commissions and other offering expenses. The offering consisted of (i) 121,400 units (the "Units") of ADSs and warrants to purchase 1.5 ADSs per warrant (the "November 2019 Warrants"), with each Unit consisting of one ADS and one November 2019 Warrant, and (ii) 378,500 pre-funded units (the "Pre-Funded Units"), with each Pre-Funded Unit consisting of a pre-funded warrant to purchase one ADS (a "November 2019 Pre-Funded Warrant") and a November 2019 Warrant. Each ADS represents 40 ordinary shares of the Company. Each Unit was sold at a price of $7.00 per unit, and each Pre-Funded Unit was sold at a price of $7.00 per unit, including the November 2019 Pre-Funded Warrant exercise price of $0.001 per full ADS. The November 2019 Pre-Funded Warrants are exercisable at any time after the date of issuance upon payment of the exercise price. The November 2019 Warrants have a per ADS exercise price of $7.70 per full ADS, are exercisable immediately, and will expire five years from the date of issuance. The Company granted the underwriter a 45-day option to purchase up to an additional 74,985 ADSs and/or November 2019 Warrants to cover over-allotments, if any. The underwriter did not exercise their option. As of December 31, 2019, all Pre-Funded Units from this offering were exercised in exchange for the exercise price of $0.001 per ADS, as well as 10,000 warrants that were exercised in an aggregate amount of $77 thousand. 3. On December 16, 2019, the SEC declared effective the Company's shelf registration statement, which enables it to raise up to $20 million during the three-year period following the effective date, subject to certain SEC regulations. 4. On December 26, 2019, the Company completed the December 2019 Registered Direct Offering of $1,668 thousand, before deducting offering expenses. The offering consisted of (i) 269,272 ADSs, and (ii) 260,281 pre-funded warrants, each to purchase one ADS and one regular warrant to purchase one ADS at an exercise price of $3.30 (the "December 2019 Pre-Funded Warrants"). Each ADS represents 40 ordinary shares of the Company. Each ADSs was sold at a price of $3.15 per ADS, and each December 2019 Pre-Funded Warrant was sold at a price of $3.15 per warrant, including the December 2019 Pre-Funded Warrant exercise price of $0.001 per full ADS. The December 2019 Pre-Funded Warrants are exercisable at any time after the date of issuance upon payment of the exercise price. The December 2019 Warrants have a per ADS exercise price of $3.30 per full ADS, are exercisable immediately, and will expire 5.5 years from the date of issuance. For accounting purposes, the Company recognized financial liability in respect of the December 2019 Warrants. These warrants are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. The equity components are initially recognized by subtracting the fair value of the financial liability from consideration received. The equity components are not re-measured in subsequent periods. Issuance expenses of $185 thousand in 2019 were allocated on a pro-rata basis to the three components mentioned above. f. Rights conferred by shares: Ordinary shares The ordinary shares confer upon their holders voting rights, the right to receive dividends, the right to a share in excess assets upon liquidation of the Company and other rights as set out in the Company's articles of association. |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2019 | |
Business Combination [Abstract] | |
BUSINESS COMBINATION | NOTE 16 - BUSINESS COMBINATION On April 4, 2019, the Company entered into a share and asset purchase agreement (the "Share and Asset Purchase Agreement") with NetNut and its shareholders, pursuant to which the Company acquired all (100%) of the outstanding share capital of NetNut ("Purchased Shares"), a private Israeli company, in the business proxy network solution industry, and certain assets of DiViNetworks Ltd. ("DiVi"), NetNut's former controlling shareholder, which its assets are required for the ongoing operations of NetNut (the "Purchased Assets"). The Purchased Shares and asset acquired were accounted for together as a business combination. In consideration for the Purchased Shares, the Company agreed to pay NetNut's shareholders: An amount equal to $3,400 thousand (the "Initial Shares Purchase Price"), out of which (i) $1,615 thousand was paid on Closing (as defined below) in immediate funds (in addition to an amount of $250 thousand down payment paid by the Company upon signing of Share and Asset Purchase Agreement); (ii) $175 thousand was deposited in escrow; and (iii) $1,360 thousand was paid by issuance of 1,217,370 ordinary shares of the Company (based on NIS 4.62 which is a per share 30-day average price of the Company's ordinary shares on the TASE prior to the date on which the Share and Asset Purchase Agreement was signed (the "Initial Consideration PPS")). The parties agreed that the Initial Shares Purchase Price may be increased or decreased on a dollar-for-dollar basis in the event NetNut has a negative working capital on the date of the Closing. Pursuant to this mechanism, in October 2019 the Initial Shares Purchase Price was decreased by $233 thousand which amount was repaid to the Company. An amount of up to $5,000 thousand payable in contingent consideration (the "EarnOut Amount"), will be paid and distributed to the shareholders of NetNut upon NetNut achieving certain revenue milestones in 2019, hence, the payment of the payable EarnOut Amount will be deferred to the time when the Company's financial results for the year 2019 are published. The Company, at its sole discretion, may elect to pay up to fifty percent (50%) of the EarnOut Amount in ordinary shares (the "EarnOut Shares"), provided that in any event, the amount of the EarnOut Shares will not exceed 2,237,814 ordinary shares (representing a quotient of half of the maximum EarnOut amount,,i.e. $2,500 thousand, divided by the Initial Consideration PPS). In consideration for the sale, delivery, transfer and assignment of the Purchased Assets, the Company agreed to pay DiVi at Closing: An aggregate amount equal to $6,300 thousand (the "Assets Purchase Price"). The Assets Purchase Price was paid as follows: ● An amount equal to $3,455 thousand was paid at Closing in immediately payable funds; ● An amount equal to $325 thousand was deposited in escrow; ● An amount equal to $2,520 thousand, was paid at Closing in ordinary shares, issued at a per share price equal to the Initial Consideration PPS, i.e. 2,255,717 ordinary shares. In connection with the transaction, the Company agreed to pay to certain finders of the transaction a fee equal to the sum of 3% of the total purchase price of the transaction. The Company elected to pay up to 50% of such fee in equity securities of the Company. Accordingly, the Company incurred transaction costs amounting to approximately $312 thousand that were charged to profit or loss within "general and administrative expenses." On June 12, 2019, the Company completed the acquisition according to the terms mentioned above (the "Closing"). The tables below summarize the total purchase price paid for NetNut, and the amounts of assets acquired, and liabilities assumed, as of the Closing date, at their fair values: As of U.S. dollars Purchase price: Share consideration calculation: Company's market price per share $ 1.0274 Number of shares to be issued 3,473,087 Share consideration 3,568 Cash consideration 5,587 Contingent consideration 2,008 Total purchase price 11,163 The market price per share is the share closing price in the TASE as of June 12, 2019, translated into U.S. dollars using the exchange rate as of such date. The fair value of the contingent consideration was valued using a Monte Carlo model with the expected sales and volatility as well as the discount rate being the primary inputs. As of U.S. dollars The fair values of the identifiable assets and liabilities: Cash and cash equivalents 79 Accounts receivable - trade 130 Accounts receivable - other 175 Property, plant and equipment 14 Right of use assets 405 Servers 199 Technology and supplier relations* 4,651 Customer relations* 259 Short-term loan (24 ) Accounts payable - trade (170 ) Accounts payable - other (343 ) Contract liabilities (99 ) Lease liabilities (443 ) Deferred taxes liabilities (1,026 ) Total identifiable net assets at fair value 3,807 Goodwill 7,356 Total purchase price 11,163 * Technology and supplier relations and customer relations are amortized on a straight-line basis over 5 years and 7.5 years, respectively. Goodwill primarily represented the value of expected synergies arising from the acquisition, as well as assembled workforce, and was allocated entirely to the proxy services segment. From the date of acquisition, NetNut had contributed $1,976 thousand to the revenues of the Company and had increased loss from continuing operations of the Company by $82 thousand. If the business combination had taken place on January 1, 2019, consolidated unaudited pro forma revenues and loss from continuing operations would have been $4,510 thousand and $13,045 thousand, respectively, for the year ended December 31, 2019. As of December 31, 2019, the Company accrued $2.17 million for the contingent consideration payment based on the expected settlement amount, see Note 10. As a result, during the year ended December 31, 2019 the Company recognized contingent consideration expenses in the amount of $159 thousand. On October 3, 2019, the Company received an amount of $233 thousand as a repayment on behalf of the acquisition, due to the acquisition working capital adjustments. The repaid amount was allocated as a deduction to the Goodwill amount, which was set to $7,356 thousand. |
Revenues and Cost of Revenues
Revenues and Cost of Revenues | 12 Months Ended |
Dec. 31, 2019 | |
Revenues and Cost of Revenues [Abstract] | |
REVENUES AND COST OF REVENUES | NOTE 17 - REVENUES AND COST OF REVENUES: a. Revenues: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Revenues from proxy services 1,976 - - Revenues from licenses 625 794 486 Revenues from provision of maintenance and support services 655 606 519 Revenue from other license related services 28 66 91 3,284 1,466 1,096 b. Revenue recognized in relation to contract liabilities: The following table includes revenue expected to be recognized in the future related to performance obligations that are unsatisfied at the reporting date. U.S. dollars in thousands 2020 2021 and thereafter Total Contracts with customers 562 82 644 The Company recognized $469 thousand of revenue related to beginning of the period contract liability balances. c. Cost of revenues: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 206 367 203 Share-based payment 31 55 51 Amortization of and depreciation 863 270 245 Impairment of intangible assets 270 - - Cost of internet services providers 360 - - Cost of networks and servers 88 - - Other 71 99 84 1,889 791 583 |
Research and Development Expens
Research and Development Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Research and Development Expenses [Abstract] | |
RESEARCH AND DEVELOPMENT EXPENSES | NOTE 18 - RESEARCH AND DEVELOPMENT EXPENSES: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 1,483 1,632 919 Share-based payment 6 13 103 Subcontractors 668 421 377 Other 328 348 209 2,485 2,414 1,608 |
Selling and Marketing Expenses
Selling and Marketing Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Selling and Marketing Expenses [Abstract] | |
SELLING AND MARKETING EXPENSES | NOTE 19 - SELLING AND MARKETING EXPENSES: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 2,007 2,801 1,567 Share-based payment 180 123 573 Professional fees 363 1,118 823 Marketing 452 699 490 Selling commissions 378 86 99 Other 403 715 499 3,783 5,542 4, 051 |
General and Administrative Expe
General and Administrative Expenses | 12 Months Ended |
Dec. 31, 2019 | |
General and Administrative Expenses [Abstract] | |
GENERAL AND ADMINISTRATIVE EXPENSES | NOTE 20 - GENERAL AND ADMINISTRATIVE EXPENSES: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 838 667 661 Share-based payment 396 190 576 Professional fees 2,018 885 749 Other 505 183 164 3,757 1,925 2,150 |
Financial Expenses, Net
Financial Expenses, Net | 12 Months Ended |
Dec. 31, 2019 | |
Finance Expenses, Net [Abstract] | |
FINANCIAL EXPENSES, NET | NOTE 21 - FINANCIAL EXPENSES, NET: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Finance expenses: Bank fees and interest (166 ) (20 ) (15 ) Issuance expenses (447 ) (517 ) (242 ) Changes financial liabilities at fair value through profit or loss, including day 1 loss (5,649 ) (2,839 ) (718 ) Exchange differences - (120 ) - Total finance expenses (6,262 ) (3,496 ) (975 ) Financing income: Changes in financial liabilities at fair value through profit or loss, including day 1 loss 3,050 945 2,697 Interest received from institutions 4 10 9 Exchange differences 24 - 253 Total financing income 3,078 955 2,959 Financing income (expenses), net (3,184 ) (2,541 ) 1,984 |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Loss Per Share [Abstract] | |
LOSS PER SHARE | NOTE 22 - LOSS PER SHARE: a. Basic: Basic loss per share is calculated by dividing the loss attributable to the Company's owners by the weighted average number of ordinary shares in issue (including pre-funded warrants). Year ended December 31 2019 2018 2017 U.S. dollars in thousands Loss attributable to Company's owners 12,998 11,753 5,313 The weighted average of the number of ordinary shares in issue (including pre-funded warrants) 13,599 1,765 922 Basic loss per share (dollar) 0.96 6.66 5.76 b. Diluted: The Company adjusts the loss attributable to holders of ordinary shares and the weighted average number of shares in issue, to reflect the effect of all potentially dilutive ordinary shares, as follows: The Company adds to the weighted average number of shares in issue that was used to calculate the basic loss per share, the weighted average of the number of shares to be issued assuming that all shares that have a potentially dilutive effect would be converted into shares, and adjusts net loss attributable to holders of the Company's ordinary shares to exclude any profits or losses recorded during the year with respect to potentially dilutive shares. The potential shares, as mentioned above, are only taken into account in cases where their effect is dilutive (reducing the earnings per share or increasing the loss per share). Year ended December 31 2019 2018 2017 U.S. dollars in thousands Adjustment in respect of the finance income relating to derivative financial instruments, anti-dilution mechanism and compensation feature 12,998 11,753 5,313 Adjustment in respect of the finance income relating to anti-dilution mechanism and compensation feature 1,462 710 - 14,460 12,463 5,313 The weighted average of the number of ordinary shares in issue used in computation of basic loss per share (in thousands of shares) 13,599 35,302 18,433 Adjustment in respect of incremental shares assuming the conversion to derivative financial instruments, anti-dilution mechanism and compensation feature 421 344 - 14,020 35,646 18,433 Diluted loss per share (dollar) 1.03 6.99 5 .76 |
Related Parties Transactions an
Related Parties Transactions and Balances | 12 Months Ended |
Dec. 31, 2019 | |
Related Parties Transactions and Balances [Abstract] | |
RELATED PARTIES TRANSACTIONS AND BALANCES | NOTE 23 - RELATED PARTIES TRANSACTIONS AND BALANCES: For 2017, the Company did not take into account any dilutive instruments (contingent consideration, convertible debentures, derivative financial instruments, the share options, options to employees and anti-dilution mechanism) since their effect, on a fully diluted basis, is anti-dilutive. "Related Parties" - As defined in IAS 24, "Related Party Disclosures" ("IAS 24"). Key management personnel - included together with other entities in the said definition of "related parties" in IAS 24, include the members of the Board of Directors and senior executives. a. Transactions with related parties: 1) Compensation to related parties: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll, bonuses, share based compensation and related expenses to interested parties employed by the Company 320 285 234 Management fees, consulting fees and bonuses to interested parties hired by the Company 336 185 344 Compensation to directors who are not employed by the Company 80 66 57 2) Compensation to key management personnel: The compensation paid to key management personnel for work services they provide to the Company is as follows: Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and other short-term benefits 1,385 1,573 1,073 Bonuses and commissions 173 146 178 Advisory fees - - 73 Management fees 336 185 222 Share-based payments 226 219 665 2,120 2,123 2,211 b. Other transactions with related parties: 1) As part of the ongoing running of its business, the Company receives management services from the current Chairman of the Board of Directors and from a director who served as the Chairman of the Board of Directors until January 20, 2019 and was a controlling party until January 2018, in consideration for a monthly payment of approximately $9 thousand and $15 thousand, respectively. In the years 2019, 2018 and 2017, the total amounts in respect of these engagements amounted to $336, $185 and $222 thousand, respectively. As of December 31, 2019 and 2018, the payable balance amounted to $90 and $15 thousand, respectively. 2) During 2017, the Company employed related parties of the then controlling party of the Company. The total amounts relating to those commitments amounted to $121 thousand. As of December 31, 2017, the payable balance amounted to $12 thousand. 3) During 2018 and 2017, the Company paid certain amounts to a subsidiary of then a related party. The amounts were paid in respect of participation in revenues from services provided to a customer, including maintenance and support services. The total amount paid in the 12 months ended December 31, 2018 and 2017, were $10 thousand for each year. |
Entity Level Disclosures and Se
Entity Level Disclosures and Segment Information | 12 Months Ended |
Dec. 31, 2019 | |
Entity Level Disclosures and Segment Information [Abstract] | |
ENTITY LEVEL DISCLOSURES AND SEGMENT INFORMATION | NOTE 24 - ENTITY LEVEL DISCLOSURES AND SEGMENT INFORMATION: Management has determined the Company’s operating segments based on the information reviewed by the Company’s chief operating decision maker for the purpose of allocating resources to the segments and assessing their performance. The chief operating decision maker examines the performance of the operating segments based on revenues and adjusted operating profit (loss), which is calculated based on operating profit (loss) before depreciation and amortization, impairment of goodwill and intangible assets, contingent consideration measurement and the effects of share-based payment transactions. As of December 31, 2019, and following NetNut acquisition at June 12, 2019, the Company has two operating segments: Cyber Security and Proxy services (the latter represents the operations of NetNut). Cyber Security Proxy Services Total Year ended December 31, 2019 U.S. dollar in thousands Revenues 1,308 1,976 3,284 Adjusted operating loss (6,715 ) 89 (6,626 ) Share-based payments (612 ) Contingent consideration measurement (159 ) Impairment of goodwill and intangible assets (1,272 ) Depreciation and amortization (1,122 ) Operating loss (9,791 ) Financial expenses, net (3,184 ) Taxes on income (23 ) Net loss for the period (12,998 ) As of the date of these consolidated financial statements, most of the Company’s customers are commercial Israeli and American companies. The remaining Company customers are European companies. Set forth below is a breakdown of the Company’s revenues by geographic regions: Israel USA Other Total U.S. dollars in thousands Company’s revenues: For the year 2019 1,071 1,418 795 3,284 For the year 2018 988 353 125 1,466 For the year 2017 823 227 46 1,096 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 25 - SUBSEQUENT EVENTS: a. Greenshoe Option: On January 4, 2020, the Greenshoe option of the Lenders expired, with no additional exercises of the right. b. Increase of the Company's authorized share capital: On January 28, 2020, the general meeting of the Company's shareholders approved an increase of the authorized share capital of the Company by an additional 1,250,000,000 ordinary shares, and to amend and restate the articles of association of the Company to reflect the same. As of the date hereof, the authorized share capital of the Company is comprised of 1,500,000,000 ordinary shares. c. Effect of Coronavirus In December 2019, a strain of coronavirus was reported to have surfaced in Wuhan, China, and in 2020 has reached most countries, resulting in government-imposed quarantines, travel restrictions and other public health safety measures in China, the USA, Israel, and other affected countries. The various precautionary measures taken by many governmental authorities around the world in order to limit the spread of the Coronavirus, which has affected and could have an adverse effect on the global markets and its economy, including the demand for consumables, products and services, as well as on the availability and pricing of employees, resources, materials, manufacturing and delivery efforts and other aspects of the global economy. Also, organizations of all sizes and types have closed their offices, instructing employees to remain at home and work remotely. Many organizations are not equipped to provide their entire work force with remote access to corporate resources, for both on-premise and cloud environments. Some organizations do not have remote access technologies, while others have solutions that were built for the organization's remote workers and travellers, but not for the entire work force. At this point, the extent to which the coronavirus may impact our results is uncertain. On one hand, as the Company's growth strategy includes plans to enter or expand into the Chinese market and surrounding, it could negatively impact such plans. On the other hand, as the Company's leading product provides secure access remote solutions for on-premise and hybrid cloud environments, and in light of the increased remoted work needs as described above, it could potentially affect our growth. The global effects of the coronavirus are difficult to assess or predict with meaningful precision since actual effects will depend on many factors beyond our control and knowledge at this stage, however, it may have an impact on our growth rate in the second quarter of 2020, or later. d. Post financial statements date conversions and exercises During the period from January 1, 2020 until the financial statements date, 248,889 pre-funded warrants (9,955,560 ordinary shares) were exercised in exchange for aggregate exercise amounts of $249. Also, one Lender converted debentures at the amount of $315,000 into 100,000 ADSs (4,000,000 ordinary shares). |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
Basis of presentation of financial statements | a. Basis of presentation of financial statements: The consolidated financial statements as of December 31, 2019 and 2018, and for each of the three years in the period ended December 31, 2019, are in compliance with International Financial Reporting Standards ("IFRS"), and interpretations issued by the IFRS Interpretations Committee applicable to companies reporting under IFRS. The consolidated financial statements comply with IFRS as issued by the International Accounting Standards Board. In connection with the presentation of these consolidated financial statements, the following should be noted: 1) The significant accounting policies described below have been applied consistently to all the years presented, unless otherwise stated. 2) The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial liabilities (including derivatives) at fair value through profit or loss, which are presented at fair value. 3) The preparation of consolidated financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires the Company's management to exercise its judgment in the process of applying the Company's accounting policies. Actual results may differ materially from estimates and assumptions used by management. |
Consolidated financial statements | b. Consolidated financial statements: Subsidiaries Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. Intercompany balances and transactions, including income and expenses on transactions between the Company's subsidiaries, are eliminated. The accounting policies applied by the subsidiaries are consistent with the accounting policies adopted by the Company. |
Segment reporting | c. Segment reporting: Operating segments are reported in a manner consistent with the internal reporting, which are provided to the chief operating decision maker in the Company, who is responsible for allocating resources and assessing the performance of the operating segments. As of December 31, 2019, The Company has two operating segments. Entity wide disclosures are provided in Note 24. |
Translation of foreign currency balances and transactions | d. Translation of foreign currency balances and transactions: 1) Functional and presentation currency Items included in the financial statements of each of the Company's subsidiaries are measured using the currency of the primary economic environment in which the subsidiary operates (the "Functional Currency"). The consolidated financial statements of the Company are presented in U.S. dollars, which is the Company's Functional Currency. 2) Transactions and balances Transactions made in a currency which is different from the functional currency (the "Foreign Currency") are translated into the Functional Currency using the exchange rates prevailing at the dates of the transactions or valuations where the items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at the end-of-year exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss as finance income (expense). |
Cash and cash equivalents | e. Cash and cash equivalents: Cash and cash equivalents include cash in hand, short-term bank deposits and other short-term highly liquid investments with original maturities of three months or less, which are subject to insignificant risk of changes in value. |
Trade receivables | f. Trade receivables: The trade receivables balance represents the unconditional right to consideration because only the passage of time is required before the payment is due from Company customers for licenses granted or services rendered in the ordinary course of business. If collection is expected within one year or less, trade receivables are classified as current assets. If not, trade receivables are presented as non-current assets. Trade receivables are initially recognized based on their transaction price, and subsequently measured at amortized cost using the effective interest method, less a provision for doubtful accounts. For further details see Note 2k. |
Goodwill | g. Goodwill: Goodwill arising from a business combination represents the excess of the overall amount of the consideration transferred, the amount of any non-controlling interests in the acquired company over the net amount as of acquisition date of the identifiable assets acquired and the liabilities assumed. Impairment reviews of the cash-generating-unit ("CGU") to which goodwill was allocated are undertaken annually and whenever there is any indication of impairment of a CGU. The carrying amount of the Company's assets (which constitutes a single CGU), including goodwill, is compared to its recoverable amount, which is the higher of value in use and the fair value less costs to sell. Any impairment loss is allocated to reduce the carrying amount of the Company's assets at the following order: first to reduce the carrying amount of any goodwill allocated to a CGU and subsequently to the remaining assets of the Company, which fall within the scope of the International Accounting Standard ("IAS") 36, "Impairment of Assets," on a proportionate basis based on the carrying amount of each Company asset. Any impairment loss is recognized immediately in profit or loss and is not subsequently reversed. As of December 31, 2018 and 2017, the Company did not recorded an impairment of goodwill. During the year ended December 31, 2019, the Company recognized an impairment loss of goodwill in a total amount of $1,002 thousand. For further details, see Note 6. |
Intangible assets | h. Intangible assets: 1) Research and development Through December 31, 2019 and 2018, the Company has not met the criteria for capitalizing development expenses as intangible assets, and accordingly, no asset has so far been recognized in the consolidated financial statements in respect of capitalized development expenses. Consequently, the research and development expenses of the Company are fully recognized as incurred. 2) Technology and customer relations a. Technology which acquired either separately or as part of a business combination is initially measured at fair value at the acquisition date, and amortized between 5-8 years using the straight-line method, with such amortization classified as cost of revenues. b. Customer relations which acquired either separately or as part of a business combination is initially measured at fair value at the acquisition date, and amortized over 7.5 years using the straight-line method, with such amortization classified as sales and marketing expenses. |
Impairment of non-monetary assets | i. Impairment of non-monetary assets: An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value, less selling costs and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels of identifiable cash flows (CGUs). The Company constitutes two CGUs. Non-monetary assets, other than goodwill, that were impaired, are reviewed annually for possible reversal of the impairment recognized at each balance sheet date. During the year ended December 31, 2019, the Company recognized an impairment loss related to technology in a total amount of $270 thousand. For further details, see Note 6. |
Government grants | j. Government grants: Government grants received from the Israeli Innovation Authority (the "IIA") as a participation in research and development performed by Safe-T (the "IIA Grants") fall into the scope of "forgivable loans" as defined in IAS 20, "Accounting for Government Grants and Disclosure of Government Assistance" ("IAS 20"). IIA Grants are recognized in accordance with IFRS 9, "Financial Instruments" ("IFRS 9"). If on the date on which the right for the IIA Grants is established, the Company's management concludes that there is no reasonable assurance that the IIA Grants, to which entitlement has been established, will not be repaid, the Company recognizes a financial liability on that date, which is accounted for under the provisions of IFRS 9 regarding financial liabilities measured at amortized cost. |
Financial assets | k. Financial assets: Accounting policies applied from January 1, 2018, under IFRS 9: 1) Classification The Company classifies its financial assets at amortized cost. The classification is determined, among other things, in accordance with the purpose for which the financial assets were acquired. The basis of classification depends on the Company's business model and the contractual cash flow characteristics of the financial asset. Financial assets at amortized cost are held within a business model whose objective is to hold financial assets in order to collect contractual cash flows, and their contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. These assets are classified as current assets, except for maturities of more than 12 months after the balance sheet date, which are classified as non-current assets. The Company's financial assets at amortized cost are included as "accounts receivable," "restricted deposits" and "cash and cash equivalents" in the consolidated statements of financial position (see sections e and f above). 2) Recognition and measurement Financial assets, which are initially measured at fair value, including any transaction costs, are measured in subsequent periods at amortized cost using the effective interest method, except of trade receivables (see section f above). For information on the method used to measure the fair value of the Company's financial instruments, see Note 3. 3) Impairment of financial assets - financial assets measured at amortized cost The Company recognizes a loss allowance for expected credit losses on financial assets at amortized cost. At each reporting date, the Company assesses whether the credit risk on a financial asset has increased significantly since initial recognition. If the financial asset is determined to have low credit risk at the reporting date, the Company assumes that the credit risk on a financial asset has not increased significantly since initial recognition. The Company measures the loss allowance for expected credit losses on trade receivables that are within the scope of IFRS 15, "Revenue from Contracts with Customers" ("IFRS 15") and on financial assets for which the credit risk has increased significantly since initial recognition based on lifetime expected credit losses. Otherwise, the Company measures the loss allowance at an amount equal to 12-month expected credit losses at the current reporting date. Accounting policies applied until December 31, 2017, under IAS 39, "Financial Instruments: Recognition and Measurement": 1) Classification The Company classifies its financial assets as loans and receivables. The classification is determined, among other things, in accordance with the purpose for which the financial assets were acquired. The Company management determines the classification of the financial assets upon initial recognition. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities longer than 12 months after the statement of financial position date. These are classified as non-current assets. The Company's loans and receivables are presented among "accounts receivable," "restricted deposits" and "cash and cash equivalents" in the statement of financial position (see sections e and f above). 2) Recognition and measurement Financial assets, which are initially measured at fair value, including any transaction costs, are measured in subsequent periods at amortized cost using the effective interest method. Financial assets, which are measured at fair value through profit or loss are initially measured at fair value and the transaction costs are carried to the statement of operations. For information on the method used to measure the fair value of the Company's financial instruments, see Note 3. 3) Impairment of financial assets - financial assets measured at amortized cost The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset ("Loss Event") and that Loss Event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. Where objective evidence for impairment exists, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not yet been incurred) discounted at the financial asset's original effective interest rate (i.e., the effective interest rate computed for the asset upon initial recognition). The asset's carrying amount is reduced and the amount of the loss is recognized in the statements of operations. If the amount of impairment loss in a subsequent period decreases, and this decrease may be attributed to an objective event that took place after the impairment was recognized (like improved credit rating of the borrower), reversal of the previously recognized impairment loss is recorded in the statements of operations. The Company does not test impairment of groups of customers due to immateriality. |
Financial liabilities | l. Financial liabilities 1) Classification The Company early adopted the narrow-scope amendment to IAS 1, " Classification of Liabilities as Current or Non-Current Liabilities are classified as non-current if the entity has a substantive right to defer settlement for at least 12 months at the end of the reporting period. The amendment no longer refers to unconditional rights. The assessment determines whether a right exists, but it does not consider whether the entity will exercise the right. 2) Financial liabilities at fair value through profit or loss: The Company designated its convertible debentures as financial liability at fair value through profit or loss, given the conversion option derivative embedded in such instrument. Changes in the Company's own credit risk from the date of initial recognition are negligible. The convertible debentures are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction, and are adjusted to reflect the difference between the fair value at initial recognition and the transaction price ("day 1 loss"). Changes are recorded to profit or loss on a periodic basis while unrecognized day 1 loss is amortized over the contractual life of each instrument. The Company accounts for contingent consideration as financial liability at fair value through profit or loss. The contingent consideration is measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. |
Derivatives | m. Derivatives: The Company accounts for warrants with a cashless exercise mechanism, compensation and anti-dilution features issued at public and private offering, as financial liabilities. The warrants, compensation and anti-dilution features are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction. Changes are recorded to profit or loss on a periodic basis. The Company accounts for warrants and rights to purchase additional debenture ("green-shoe option") issued at the 2019 securities purchase agreement, as financial liabilities. The warrants and green-shoe option are measured at fair value (level 3) as reflected in a valuation carried out as of the date of the transaction, adjusted to reflect the day 1 loss. Changes are recorded to profit or loss on a periodic basis while unrecognized day 1 loss is amortized over the contractual life of each instrument. See further details in Note 13. |
Unrecognized day 1 loss | n. Unrecognized day 1 loss: A financial liability, in which upon initial recognition the transaction price is different than its fair value is initially recognized at fair value, adjusted to reflect the day 1 loss. After initial recognition, the unrecognized day 1 loss of the said financial liability is amortized over the contractual life of each financial liability. Upon conversion or exercise of convertible debentures or warrants for which an unrecognized day 1 loss exists, the carrying amounts are classified to equity. |
Trade payables | o. Trade payables: Trade payables are the Company's obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognized initially at fair value, and in subsequent periods at amortized cost using the effective interest method. |
Current and deferred income taxes | p. Current and deferred income taxes: The tax expenses for the reported years comprise current and deferred taxes. Taxes are recognized in the consolidated statements of profit or loss, except to the extent that they relate to items recognized directly in equity. In that case, the tax is also recognized in equity. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operates and generates taxable income. The Company's management periodically evaluates the tax aspects applicable to its taxable income based on the relevant tax laws and makes provisions in accordance with the amounts payable to the Israeli Tax Authorities. Deferred income tax is provided using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax liabilities are not accounted for if they arise from initial recognition of goodwill. Also, deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized, or the deferred income tax liability is settled. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. The Company does not provide deferred income tax on temporary differences arising from investments in subsidiaries, since the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. |
Employee benefits | q. Employee benefits: 1) Severance pay and pension obligations A defined contribution plan is a post-employment benefits scheme under which group companies pay fixed contributions into a separate and independent entity. The Company has no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. The Company's severance pay and pension obligations are generally funded through payments to insurance companies or trustee-administered funds. Under their terms, the said pension plans meet the criteria for defined contribution plan as above. 2) Vacation and recreation pay Every employee is legally entitled to vacation and recreation benefits, which are computed on an annual basis. This entitlement is based on the term of employment. The Company charges a liability and expense due to vacation and recreation pay, based on the benefits that have been accumulated for each employee. 3) Severance pay Severance pay is paid when an employee is terminated by the Company before the normal retirement date, or when an employee had agreed to accept voluntary redundancy in exchange for these benefits. The Company recognizes severance pay liabilities at the earlier of: ● When the entity can no longer withdraw the offer of those benefits; and ● When the entity recognizes costs for a restructuring in the scope of IAS 37, "Provisions, Contingent Liabilities and Contingent Assets," that includes the payment of severance benefits. |
Share-based payments | r. Share-based payments: The Company operates a number of equity-settled, share-based compensation plans, under which the Company receives services from employees as consideration for equity instruments (options) of the Company. The fair value of the employee services received in exchange for the grant of the options is recognized as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted excluding the impact of any service and non-market performance vesting conditions. The total expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. In addition, in some circumstances, employees may provide services in advance of the grant date and therefore the grant date fair value is estimated for the purposes of recognizing the expense during the period between service commencement period and grant date. At the date of each balance sheet, the Company revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognizes the impact of the revision to original estimates, if any, in the consolidated statements of profit or loss, with a corresponding adjustment to equity. When the options are exercised, the Company issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium. For plans that include conditions that are not vesting conditions, any relating expenses are immediately recognized in the consolidated statements of profit or loss. When the Company revises the conditions of an equity-settled grant, the Company recognizes an additional expense, in excess of the original expense calculated for every such revision that increases the overall fair value of the granted benefit or benefits the service provider, based on the fair value at the time of revision. |
Revenue recognition | s. Revenue recognition: 1) General The Company has adopted IFRS 15 from January 1, 2017 (the "date of initial application"). The early adoption of IFRS 15 by the Company was done pursuant to the transitional provision that enabled the recognition of the accumulated impact of adoption as an adjustment of the opening balance of retained earnings as of January 1, 2017 (also known as the modified retrospective approach). This standard replaced the guidelines that were in effect through January 1, 2017 regarding revenue recognition and presents a new single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The standard provides two approaches to revenue recognition: one point in time or over time. The model framework consists of five steps for analyzing transactions to determine the timing and amount of revenue recognition. a) Identify the contract with the customer. b) Identify the separate performance obligations in the contract. c) Determine the transaction price. d) Allocate the transaction price to each of the performance obligations in the contract. e) Recognize revenue as each performance obligation is satisfied, while making a distinction between satisfying an obligation on a certain date and satisfying an obligation over time. In addition, the standard provides new and more extensive disclosure requirements to those that exist today, which are provided in Notes 17 and 24. 2) Accounting for perpetual and term licenses of software and for software as a service Perpetual and term licenses of software The main impact which the standard had on the Company's consolidated financial statements is the timing of recognition of revenue in respect of the license component in transactions for the sale of fixed-term license contracts. Pursuant to the standard, the Company's promise to the customer in granting a license is to provide a right to use the entity's intellectual property as intellectual property exists (in terms of form and functionality), at the point in time at which the license is granted to the customer. This means that the customer can direct the use of, and obtain substantially all of the remaining benefits from, the license at the point in time at which the license transfers. Therefore, revenue in respect of the license component in such transactions shall be recognized at the time at which the is license granted to the customer. Software as a Service The Company's revenues from its renewable monthly contracts with its customers are recognized rateably over the respective contract periods, since the customers consume benefits from these services. Costs to obtain a contract are expensed as incurred since commissions payable upon renewals are commensurate with the initial commission. The timing for the remaining performance obligations remained unchanged - see below. 3) Presentation of revenue and revenue related balances The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company controls the specified goods or services before the transfer to its customers. In determining this, the Company follows the accounting guidance for principal-agent considerations. This determination involves judgment and is based on an evaluation of the terms of each arrangement, considering the party that is primarily responsible in the arrangement, whether it bears inventory risk and whether it determines the prices charged to the customers. When an entity that is a principal satisfies a performance obligation, the entity recognizes revenue in the gross amount of consideration to which it expects to be entitled in exchange for the goods or services transferred. Sales to resellers are recognized upon delivery of the license to the reseller as the reseller is considered the ultimate customer in such arrangements. Revenue is recognized net to value added tax. The Company recognized obligations in respect of sale contracts at the total amount equal to the total amount of transactions invoiced, net of transactions in respect of which revenues were recognized. 4) Allocation of revenue to multiple performance obligations The Company allocates revenue to licenses, post contract customer support and professional services on a relative stand-alone selling price basis, except in cases in which a stand-alone selling price of an individual performance obligation is highly uncertain or variable, in which case the residual method is used. 5) Election of certain practical expedients The Company has also elected to apply the following practical expedients in connection with the application of IFRS 15: 1) IFRS 15 was applied only to contracts that were not completed as of the date of the initial application. 2) Where the asset that would be recognized as a result of capitalizing the cost of obtaining a contract would be amortized over one year or less, the Company shall expense those costs when incurred. 3) For contracts in which, at inception, the period between the performance of the obligations (transfer of goods or service to the customer) and the associated payment is expected to be one year or less, the Company does not account for the effect of a significant financing component. |
Loss per share | t. Loss per share: Basic loss per share is calculated by dividing net loss for the year by the weighted average number of ordinary shares (including pre-funded warrants). When calculating the diluted loss per share, the Company adjusts the loss attributable to holders of ordinary shares and the weighted average number of shares in issue, to reflect the effect of all potentially dilutive ordinary shares, as follows: The Company adds to the weighted average number of shares in issue that was used to calculate the basic loss per share the weighted average of the number of shares to be issued assuming the all shares that have a potentially dilutive effect would be converted into shares, and adjusts net loss attributable to holders of the Company's ordinary shares to exclude any profits or losses recorded during the year with respect to potentially dilutive shares. The potential shares, as above, are only taken into account in cases where their effect is dilutive (reducing the earnings per share or increasing the loss per share). |
Leases | u. Leases: Commencing January 1, 2019, the Company accounts for leases in accordance with International Financial Reporting Standard No. 16 "Leases" ("IFRS 16"). Accounting policies applied from January 1, 2019, under IFRS 16: The Company's leases include property and motor vehicle leases. At inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company reassesses whether a contract is, or contains, a lease only if the terms and conditions of the contract are changed. At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date, including, inter alia, the exercise price of a purchase option if the Company is reasonably certain to exercise that option. Simultaneously, the Company recognizes a right-of-use asset in the amount of the lease liability. The discount rate applied by the Company is the rate of interest that the Company would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. The lease term is the non-cancellable period for which the Company has the right to use an underlying asset, together with both, the periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. After the commencement date, the Company measures the right-of-use asset applying the cost model, less any accumulated depreciation and any accumulated impairment losses and adjusted for any remeasurement of the lease liability. Assets are depreciated by the straight-line method over the estimated useful lives of the right of use assets or the lease period, which is shorter: Years Property 1.3-6 Motor vehicles 3 Interest on the lease liability is recognized in profit or loss in each period during the lease term in an amount that produces a constant periodic rate of interest on the remaining balance of the lease liability. Accounting policies applied until December 31, 2018, under IAS 17 "Leases" ("IAS 17"): Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the consolidated statement of profit or loss on a straight-line basis over the period of the lease. |
Business combination | v. Business combination: The Company accounts for business combinations by applying the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair value of the assets transferred by the acquirer, and the liabilities incurred by the acquirer to former owners of the acquiree, in exchange for control of the acquiree. The consideration transferred also includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Identified assets acquired and liabilities assumed as part of a business combination are initially measured at fair value at the acquisition date, except for certain exceptions in accordance with IFRS 3 "Business Combinations" (Revised). Contingent consideration incurred as a part of a business combination is initially measured at fair value at the acquisition date. Subsequent changes in fair value of contingent consideration are classified as assets or liabilities, are recognized in accordance with the IFRS 9 in profit or loss. |
New international financial reporting standards, amendments and interpretations to existing standards: | u. New international financial reporting standards, amendments and interpretations to existing standards: IFRS 16 replaces upon first-time implementation the existing guidance in IAS 17. The standard sets out the principles for the recognition, measurement, presentation and disclosure of leases, and is expected to impact mainly the accounting treatment applied by the lessee in a lease transaction. IFRS 16 changes the existing guidance in IAS 17 and requires lessees to recognize a lease liability that reflects future lease payments and a "right-of-use asset" in all lease contracts (except for the following), with no distinction between financing and capital leases. IFRS 16 exempts lessees in short-term leases or the when underlying asset has a low value. IFRS 16 substantially carries forward the lessor accounting requirements in IAS 17. Accordingly, a lessor continues to classify its leases as operating leases or finance leases, and to account for those two types of leases differently. IFRS 16 also changes the definition of a "lease" and the manner of assessing whether a contract contains a lease. The Company adopted IFRS 16 on January 1, 2019, using a modified retrospective transition approach, and as a result did not adjust prior periods. In respect of agreements in which the Company is the lessee, the Company elected to apply the standard for the first time by recognizing lease liabilities, for leases that were previously classified as operating leases, based on the present value of the remaining lease payments, discounted at the incremental interest rate of the lessee as at the date of first-time application. At the same time, the Company recognized a right-of-use asset at an amount equal to the amount of the lease liabilities, adjusted to reflect any prepaid or accrued lease payments in respect of those leases. As a result, the application of the standard has no an effect on the retained earnings balance. As part of the first-time application of the standard, the Company has elected to apply the following practical expedients: In respect of leases in which the Company is the lessee, to apply a single discount rate to a portfolio of leases with reasonably similar characteristics. For leases in which the Company is the lessee, not to recognize a right-of-use asset and a lease liability in respect of leases whose lease period ends within 12 months of the date of initial application. For leases in which the Company is the lessee, to exclude initial direct costs from the measurement of the right-of-use asset upon initial application. For leases in which the Company is the lessee, to use hindsight in determining the lease term where the contract includes extension or termination options. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Significant Accounting Policies [Abstract] | |
Schedule of estimated useful lives of the right of use assets | Years Property 1.3-6 Motor vehicles 3 |
Financial Instruments and Fin_2
Financial Instruments and Financial Risk Management (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Financial Instruments and Financial Risk Management [Abstract] | |
Schedule of analyzes non-derivative financial liabilities | Less than Between U.S. dollars in thousands December 31, 2019: Contingent consideration 2,170 - Short-term loan 4 - Convertible debentures 7,151 - Lease liabilities 184 324 IIA liability 8 108 Trade payables and other payables 1,790 - 11,307 432 December 31, 2018: IIA liability 49 82 Trade payables and other payables 1,054 - 1,103 82 |
Schedule of changes in level 3 instruments | Contingent consideration Convertible debentures Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2019 - - - - Initial recognition of financial liability 2,008 13,257 9,980 25,245 Initial recognition of unrecognized day 1 loss - (5,836 ) (4,856 ) (10,692 ) Conversion to equity of or other financial liability - (4,501 ) (1,061 ) (5,562 ) Repayment of convertible debentures - (470 ) - (470 ) Recognition of day 1 loss within profit or loss - 4,198 2,551 6,749 Changes in fair value recognized within profit or loss 162 503 (4,977 ) (4,312 ) Balance as of December 31, 2019 2,170 7,151 1,637 10,958 Anti-dilution feature Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2018 692 61 753 Initial recognition 497 2,678 3,175 Changes in fair value recognized within profit or loss 598 1,641 2,239 Classification to equity of Series B warrants - (3,479 ) (3,479 ) Classification to level 1, see Note 15(e) - (901 ) (901 ) Exercise of anti-dilution feature (1,787 ) - (1,787 ) Balance as of December 31, 2018 - - - Anti-dilution feature Derivative financial instruments Total U.S. dollar in thousands Balance as of January 1, 2017 94 - 94 Initial recognition 315 1,958 2,273 Changes in fair value recognized within profit or loss 283 (1,897 ) (1,614 ) Balance as of December 31, 2017 692 61 753 |
Schedule of financial instruments | Financial assets at amortized cost December 31, 2019 U.S. dollars Assets: Cash and cash equivalents 4,341 Trade receivable and other receivables (excluding prepaid expenses) 970 Long-term deposit 44 Restricted deposits 29 5,384 Financial assets at amortized cost December 31, 2018 U.S. dollars Assets: Cash and cash equivalents 3,717 Trade receivable and other receivables (excluding prepaid expenses) 910 Restricted deposits 104 4,731 Liabilities at fair value through profit or loss Financial liabilities at amortized cost Total December 31, 2019 U.S. dollars in thousands Liabilities: Short-term loan - 4 4 Contingent consideration 2,170 - 2,170 Convertible debentures 7,151 7,151 Lease liabilities - 508 508 Trade payables and other payables - 1,790 1,790 IIA liability - 116 116 Derivative financial instruments 1,637 1,637 10,958 2,418 13,376 December 31, 2018 Liabilities: Trade payables and other payables - 1,054 1,054 IIA liability - 131 131 Derivative financial instruments 729 - 729 729 1,185 1,914 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure of detailed information about intangible assets [abstract] | |
Schedule of intangible assets | Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2019: of year the year the year of year of year the year the year of year 2019 U.S. dollar in thousands Technology 2,263 4,651 (1,955 ) 4,959 1,469 808 (1,685 ) 592 4,367 Customer relations 38 259 (38 ) 259 36 21 (38 ) 19 240 Goodwill 523 7,356 (1,002 ) 6,877 - - - - 6,877 2,824 12,266 (2,995 ) 12,095 1,505 829 (1,723 ) 611 11,484 Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2018: of year the year the year of year of year the year the year of year 2018 U.S. dollar in thousands Technology 1,955 308 - 2,263 1,199 270 - 1,469 794 Customer relations 38 - - 38 30 6 - 36 2 Goodwill 523 - - 523 - - - - 523 2,516 308 - 2,824 1,229 276 - 1,505 1,319 Cost Accumulated amortization Balance at Additions Retirements Balance Balance at Additions Retirements Balance Amortized balance beginning during during at end beginning during during at end December 31, 2017: of year the year the year of year of year the year the year of year 2017 U.S. dollar in thousands Technology 1,955 - - 1,955 954 245 - 1,199 756 Customer relations 38 - - 38 24 6 - 30 8 Goodwill 523 - - 523 - - - - 523 2,516 - - 2,516 978 251 - 1,229 1,287 |
Interests in Other Entities (Ta
Interests in Other Entities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Notes to Financial Statements | |
Schedule of interests in other entities | Name of company Principal place of business Nature of business activities Percentage held directly by the Company Rate of shares held by the Company % Safe-T Data A.R Ltd. Israel Development of data security software 100 100 Safe-T USA Inc. USA Business development and sales in the USA - 100 NetNut Ltd.* Israel Business proxy network solution 100 100 * Acquired on June 12, 2019 |
Taxes on Income (Tables)
Taxes on Income (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Taxes on Income [Abstract] | |
Schedule of deferred taxes | Property, plant and equipment, net Intangible assets, net Carryforward tax losses Total U.S. dollar in thousands Balance as of January 1, 2019 - - - - Initial recognition due to business combination (46 ) (1,129 ) 149 (1,026 ) Changes during the year: Taxes on income 13 122 (149 ) (14 ) Balance as of December 31, 2019 (33 ) (1,007 ) - (1,040 ) |
Schedule of reconciliation of theoretical tax expense | Year ended December 31, 2019 2018 2017 % U.S. dollars % U.S. dollars in thousands % U.S. dollars Loss before taxes on income, as reported in the statement of profit or loss 100 12,975 100 11,747 100 5,312 Theoretical tax saving on this profit or loss (23 ) (2,984 ) (23 ) (2,702 ) (24 ) (1,275 ) Increase in taxes resulting from permanent differences - non-deductible expenses 8.0 1,039 4.5 524 1.6 83 Increase in taxes resulting from losses in the reported year for which deferred taxes were not recognized 15.2 1,968 18.6 2,184 22.5 1,193 Tax expenses 0.18 23 0.05 6 0.02 1 |
Accounts Payable and Accruals (
Accounts Payable and Accruals (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounts Payable and Accruals [Abstract] | |
Schedule of accounts payable - other | December 31 2019 2018 U.S. dollars in thousands Employees and related institutions 654 628 Accrued expenses 899 323 1,553 951 |
Commitments and Contingent Li_2
Commitments and Contingent Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments [Abstract] | |
Schedule of minimal future lease fees payable under office lease agreements | For the year ended December 31: U.S. dollars 2019 231 2020 5 |
Schedule of minimal future lease fees payable under vehicles lease agreements | For the year ended December 31: U.S. dollars 2019 89 2020 47 2021 and thereafter 12 |
Schedule of minimal future lease | ( U.S. dollars in thousands) December 31, 2020 346 2021 174 2022 150 2023 121 Total undiscounted cash flows 791 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of right-of-use asset | Right-of-use assets: Balance at Additions Disposals Balance at beginning during during end of of year year year year U.S. dollars in thousands Cost Property 19 446 - 465 Motor vehicles 147 26 (60 ) 113 166 472 (60 ) 578 Balance at amortization Additions Disposals Balance at beginning during during during end of of year year year year year U.S. dollars in thousands Accumulated amortization Property - (65 ) (41 ) - (106 ) Motor vehicles - (50 ) - 19 (31 ) - (115 ) (41 ) 19 (137 ) |
Schedule of lease liability composition | Lease liabilities: Balance at Additions Interest expense Termination Payments Balance at beginning during during during during end of of year year year year year year U.S. dollars in thousands Composition in 2019 Property 19 443 49 - (80 ) 431 Motor vehicles 147 26 27 (44 ) (79 ) 77 166 469 76 (44 ) (159 ) 508 Short-term lease liabilities: Property 135 Motor vehicles 49 Long-term lease liabilities: Property 296 Motor vehicles 28 508 |
Share Based Payment (Tables)
Share Based Payment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share Based Payment [Abstract] | |
Schedule of company's grants under the Plan | Date of grant Options amount Exercise Fair value at the date of grant* Volatility ** Risk free interest Expected term in NIS in thousand In years March 29, 2017 37,395 1 127.42-131.76 655 47.40 % 2.31 % 10 July 24, 2017 32,087 139.52 784 68.07 % 2.05 % 10 August 8, 2017 50,000 150 85 68.03 % 1.95 % 0.5 August 29, 2017 25,000 113.10 473 68.17 % 1.81 % 10 November 27, 2017 15,250 86 163 65.80 % 1.98 % 10 June 20, 2018 33,502 29.80-59.40 130 75.50 % 2.24 % 10 June 20, 2018 11,500 28.60 72 75.30 % 2.24 % 10 October 2, 2019 269,476 0.02-4.062 189 81.33 % 0.72 % 3 |
Schedule of share options outstanding and weighted average exercise prices | 2019 2018 2017 Number Average Number Average Number Average of exercise of Exercise of Exercise options price options Price options Price $ $ $ Outstanding at beginning of year: 173,628 22.19 202,763 25.20 119,245 16.80 Granted 269,476 0.88 45,002 9.20 109,732 34.00 Exercised (66,330 ) 0.01 (8,963 ) 11.40 (7,982 ) 10.20 Forfeited (20,720 ) 11.26 (47,767 ) 24.60 (17,590 ) 30.40 Expired (15,476 ) 16.89 (17,407 ) 22.60 (642 ) 22.40 Cancelled (79,302 ) 24.93 - - - - Outstanding at end of year 261,276 6.20 173,628 22.20 202,763 25.20 Exercisable at end of year 253,871 3.22 93,969 17.80 77,633 14.80 |
Schedule of information about exercise price and remaining contractual life of options outstanding | 2019 2018 2017 Weighted Weighted Weighted Number average Number average Number average outstanding remaining outstanding remaining outstanding remaining Exercise at contractual at contractual at contractual Prices end of year Life end of year Life end of year Life $ Years Years Years 1.17 203,146 2.76 - - - - 7.97 14,771 4.39 14,771 5.39 16,840 6.32 7.97 10,992 5.23 16,139 6.25 17,080 7.25 7.97 13,081 6.05 13,081 7.05 18,616 8.05 7.97 1,281 8.48 18,501 9.48 - - 7.97 7,500 8.48 10,000 9.48 - - 12.20 - - 941 6.01 8,135 7.01 16.40 - - 5,000 9.48 - - 24.40 1,000 7.91 13,500 8.91 15,250 9.91 24.80 2,004 6.66 21,570 7.66 - - 24.80 - - 7,778 7.71 - - 24.80 2,500 7.24 16,145 8.24 - - 24.80 - - 11,501 8.56 - - 24.80 - - 5,000 8.32 - - 24.80 2,500 1.58 7,500 8.66 - - 25.60 - - - - 8,146 8.71 27.40 - - 170 7.66 30,714 8.66 31.60 - - 2,500 8.66 22,500 9.67 34.60 - - 2,500 0.66 2,500 1.66 35.20 - - 1,406 8.25 27,395 9.25 36.60 - - - - 5,000 9.32 38.80 2,500 7.56 5,625 8.56 30,587 9.57 261,276 173,628 202,763 |
Schedule of expenses recognized in the financial statements | Year ended December 31, 2019 2018 2017 U.S. dollars in thousands Share-based payment plans 612 381 1,318 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders' Equity [Abstract] | |
Schedule of ordinary share capital | Number of shares Authorized Issued and paid December 31, December 31, 2019 2018 2019 2018 Ordinary shares of no-par value 250,000,000 50,000,000 56,391,512 4,067,785 |
Schedule of movement in number of Series 1 and 2 warrants | 2018 2017 Series 2 warrants Series 1 warrants Series 2 warrants Outstanding at beginning of year: 64,263 64,614 64,614 Issuance - - - Exercised - (64,514 ) (351 ) Expired (64,263 ) (100 ) - Outstanding at end of year - - 64,263 |
Schedule of private offerings | Date of offering Number of shares Unit price Gross proceeds April 6, 2017 67,742 120 2,237 May 11, 2017 22,074 120 727 May 22, 2017 30,250 120 1,001 June 13, 2017 58,714 140 2,280 June 3, 2018 381,729 26-30 2,959 June 3, 2018 20,823 6 34 September 25, 2018 289,079 6 481 Date of offering Number of warrants Warrant exercise price Expiration date April 6, 2017 67,942 175 November 30, 2018 May 11, 2017 22,074 175 November 30, 2018 May 22, 2017 30,250 175 November 30, 2018 June 13, 2017 58,714 200 November 30, 2018 June 3, 2018 218,935 46.4 November 30, 2019 |
Schedule of fully-vested non-traded warrants | Date of award Number of non-traded warrants awarded Exercise price Expiration Date April 6, 2017 569 120 April 9, 2022 April 6, 2017 2,828 120 April 9, 2020 May 11, 2017 1,104 120 May 11, 2020 May 22, 2017 2,269 120 June 21, 2020 June 13, 2017 4,225 200 June 21, 2020 June 3, 2018 20,702 46 November 30, 2019 June 3, 2018 645 200 November 30, 2018 August 21, 2018 745 48 November 30, 2019 |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combination [Abstract] | |
Schedule of total purchase price paid | As of U.S. dollars Purchase price: Share consideration calculation: Company's market price per share $ 1.0274 Number of shares to be issued 3,473,087 Share consideration 3,568 Cash consideration 5,587 Contingent consideration 2,008 Total purchase price 11,163 |
Schedule of fair values of identifiable assets and liabilities | As of U.S. dollars The fair values of the identifiable assets and liabilities: Cash and cash equivalents 79 Accounts receivable - trade 130 Accounts receivable - other 175 Property, plant and equipment 14 Right of use assets 405 Servers 199 Technology and supplier relations* 4,651 Customer relations* 259 Short-term loan (24 ) Accounts payable - trade (170 ) Accounts payable - other (343 ) Contract liabilities (99 ) Lease liabilities (443 ) Deferred taxes liabilities (1,026 ) Total identifiable net assets at fair value 3,807 Goodwill 7,356 Total purchase price 11,163 * Technology and supplier relations and customer relations are amortized on a straight-line basis over 5 years and 7.5 years, respectively. Goodwill primarily represented the value of expected synergies arising from the acquisition, as well as assembled workforce, and was allocated entirely to the proxy services segment. |
Revenues and Cost of Revenues (
Revenues and Cost of Revenues (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenues and Cost of Revenues [Abstract] | |
Schedule of revenues | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Revenues from proxy services 1,976 - - Revenues from licenses 625 794 486 Revenues from provision of maintenance and support services 655 606 519 Revenue from other license related services 28 66 91 3,284 1,466 1,096 |
Schedule of revenue recognized in relation to contract liabilities | U.S. dollars in thousands 2020 2021 and thereafter Total Contracts with customers 562 82 644 |
Schedule of cost of revenues | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 206 367 203 Share-based payment 31 55 51 Amortization of and depreciation 863 270 245 Impairment of intangible assets 270 - - Cost of internet services providers 360 - - Cost of networks and servers 88 - - Other 71 99 84 1,889 791 583 |
Research and Development Expe_2
Research and Development Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Research and Development Expenses [Abstract] | |
Schedule of research and development expenses | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 1,483 1,632 919 Share-based payment 6 13 103 Subcontractors 668 421 377 Other 328 348 209 2,485 2,414 1,608 |
Selling and Marketing Expenses
Selling and Marketing Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Selling and Marketing Expenses [Abstract] | |
Schedule of selling and marketing expenses | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 2,007 2,801 1,567 Share-based payment 180 123 573 Professional fees 363 1,118 823 Marketing 452 699 490 Selling commissions 378 86 99 Other 403 715 499 3,783 5,542 4, 051 |
General and Administrative Ex_2
General and Administrative Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
General and Administrative Expenses [Abstract] | |
Schedule of general and administrative expenses | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and related expenses 838 667 661 Share-based payment 396 190 576 Professional fees 2,018 885 749 Other 505 183 164 3,757 1,925 2,150 |
Financial Expenses, Net (Tables
Financial Expenses, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Finance Expenses, Net [Abstract] | |
Schedule of finance expenses, net | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Finance expenses: Bank fees and interest (166 ) (20 ) (15 ) Issuance expenses (447 ) (517 ) (242 ) Changes financial liabilities at fair value through profit or loss, including day 1 loss (5,649 ) (2,839 ) (718 ) Exchange differences - (120 ) - Total finance expenses (6,262 ) (3,496 ) (975 ) Financing income: Changes in financial liabilities at fair value through profit or loss, including day 1 loss 3,050 945 2,697 Interest received from institutions 4 10 9 Exchange differences 24 - 253 Total financing income 3,078 955 2,959 Financing income (expenses), net (3,184 ) (2,541 ) 1,984 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Loss Per Share [Abstract] | |
Schedule of basic loss per share | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Loss attributable to Company's owners 12,998 11,753 5,313 The weighted average of the number of ordinary shares in issue (including pre-funded warrants) 13,599 1,765 922 Basic loss per share (dollar) 0.96 6.66 5.76 |
Schedule of diluted loss per share | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Adjustment in respect of the finance income relating to derivative financial instruments, anti-dilution mechanism and compensation feature 12,998 11,753 5,313 Adjustment in respect of the finance income relating to anti-dilution mechanism and compensation feature 1,462 710 - 14,460 12,463 5,313 The weighted average of the number of ordinary shares in issue used in computation of basic loss per share (in thousands of shares) 13,599 35,302 18,433 Adjustment in respect of incremental shares assuming the conversion to derivative financial instruments, anti-dilution mechanism and compensation feature 421 344 - 14,020 35,646 18,433 Diluted loss per share (dollar) 1.03 6.99 5 .76 |
Related Parties Transactions _2
Related Parties Transactions and Balances (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Parties Transactions and Balances [Abstract] | |
Schedule of transactions with related parties | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll, bonuses, share based compensation and related expenses to interested parties employed by the Company 320 285 234 Management fees, consulting fees and bonuses to interested parties hired by the Company 336 185 344 Compensation to directors who are not employed by the Company 80 66 57 |
Schedule of compensation to key management personnel | Year ended December 31 2019 2018 2017 U.S. dollars in thousands Payroll and other short-term benefits 1,385 1,573 1,073 Bonuses and commissions 173 146 178 Advisory fees - - 73 Management fees 336 185 222 Share-based payments 226 219 665 2,120 2,123 2,211 |
Entity Level Disclosures and _2
Entity Level Disclosures and Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Entity Level Disclosures and Segment Information [Abstract] | |
Schedule of revenues by geographical area | Cyber Security Proxy Services Total Year ended December 31, 2019 U.S. dollar in thousands Revenues 1,308 1,976 3,284 Adjusted operating loss (6,715 ) 89 (6,626 ) Share-based payments (612 ) Contingent consideration measurement (159 ) Impairment of goodwill and intangible assets (1,272 ) Depreciation and amortization (1,122 ) Operating loss (9,791 ) Financial expenses, net (3,184 ) Taxes on income (23 ) Net loss for the period (12,998 ) |
Schedule of major customers | Israel USA Other Total U.S. dollars in thousands Company's revenues: For the year 2019 1,071 1,418 795 3,284 For the year 2018 988 353 125 1,466 For the year 2017 823 227 46 1,096 |
Significant Accounting Polici_4
Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Statement Line Items [Line Items] | |
Motor vehicles | 3 years |
Minimum [Member] | |
Statement Line Items [Line Items] | |
Property | 1 year 3 months 19 days |
Maximum [Member] | |
Statement Line Items [Line Items] | |
Property | 6 years |
Significant Accounting Polici_5
Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Significant Accounting Policies (Textual) | ||
Impairment loss of goodwill | $ 1,002 | |
Fair value at acquisition period | 7 years 6 months | |
Derivative financial instruments | $ 729 | |
Technology [Member] | ||
Significant Accounting Policies (Textual) | ||
Impairment loss related to technology | $ 270 | |
Technology [Member] | Minimum [Member] | ||
Significant Accounting Policies (Textual) | ||
Straight-line method | 5 Years | |
Technology [Member] | Maximum [Member] | ||
Significant Accounting Policies (Textual) | ||
Straight-line method | 8 Years |
Financial Instruments and Fin_3
Financial Instruments and Financial Risk Management (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Line Items [Line Items] | ||
Contingent consideration | $ 2,170 | |
Convertible debentures | 7,151 | |
Lease liabilities | 166 | |
Less than one year [Member] | ||
Statement Line Items [Line Items] | ||
Contingent consideration | 2,170 | |
Short-term loan | 4 | |
Convertible debentures | 7,151 | |
Lease liabilities | 184 | |
IIA liability | 8 | 82 |
Trade payables and other payables | 1,790 | |
Non-derivative financial liabilities | 11,307 | 82 |
Between one to two years [Member] | ||
Statement Line Items [Line Items] | ||
Lease liabilities | 324 | |
IIA liability | 108 | 49 |
Trade payables and other payables | 1,054 | |
Non-derivative financial liabilities | $ 432 | $ 1,103 |
Financial Instruments and Fin_4
Financial Instruments and Financial Risk Management (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
Exercise of anti-dilution feature | $ 2,302 | ||
Level 3 Instruments [Member] | |||
Statement Line Items [Line Items] | |||
Balance | 753 | $ 94 | |
Initial recognition of financial liability | 25,245 | 753 | |
Initial recognition of unrecognized day 1 loss | (10,692) | ||
Conversion to equity of or other financial liability | (5,562) | ||
Repayment of convertible debentures | (470) | ||
Recognition of day 1 loss within profit or loss | 6,749 | ||
Initial recognition | 3,175 | 2,273 | |
Changes in fair value recognized within profit or loss | (4,312) | 2,239 | (1,614) |
Classification to equity of Series B warrants | (3,479) | ||
Classification to level 1 (see Note 13(e)) | (901) | ||
Exercise of anti-dilution feature | (1,787) | ||
Balance | 10,958 | 753 | |
Level 3 Instruments [Member] | Derivative Financial Instruments [Member] | |||
Statement Line Items [Line Items] | |||
Balance | 61 | ||
Initial recognition of financial liability | 9,980 | 61 | |
Initial recognition of unrecognized day 1 loss | (4,856) | ||
Conversion to equity of or other financial liability | (1,061) | ||
Recognition of day 1 loss within profit or loss | 2,551 | ||
Initial recognition | 2,678 | 1,958 | |
Changes in fair value recognized within profit or loss | (4,977) | 1,641 | (1,897) |
Classification to equity of Series B warrants | (3,479) | ||
Classification to level 1 (see Note 13(e)) | (901) | ||
Exercise of anti-dilution feature | |||
Balance | 1,637 | 61 | |
Contingent consideration [Member] | Level 3 Instruments [Member] | |||
Statement Line Items [Line Items] | |||
Balance | |||
Initial recognition of financial liability | 2,008 | ||
Initial recognition of unrecognized day 1 loss | |||
Conversion to equity of or other financial liability | |||
Recognition of day 1 loss within profit or loss | |||
Balance | 2,170 | ||
Convertible debentures [Member] | Level 3 Instruments [Member] | |||
Statement Line Items [Line Items] | |||
Balance | |||
Initial recognition of financial liability | 13,257 | ||
Initial recognition of unrecognized day 1 loss | (5,836) | ||
Conversion to equity of or other financial liability | (4,501) | ||
Repayment of convertible debentures | (470) | ||
Recognition of day 1 loss within profit or loss | 4,198 | ||
Changes in fair value recognized within profit or loss | 503 | ||
Balance | 7,151 | ||
Anti-Dilution Feature [Member] | Level 3 Instruments [Member] | |||
Statement Line Items [Line Items] | |||
Balance | 692 | 94 | |
Initial recognition | 497 | 315 | |
Changes in fair value recognized within profit or loss | 598 | 283 | |
Classification to equity of Series B warrants | |||
Classification to level 1 (see Note 13(e)) | |||
Exercise of anti-dilution feature | (1,787) | ||
Balance | $ 692 |
Financial Instruments and Fin_5
Financial Instruments and Financial Risk Management (Details 2) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets: | ||||
Cash and cash equivalents | $ 4,341 | $ 3,717 | $ 3,514 | $ 1,311 |
Long-term deposit | 44 | |||
Assets | 17,837 | 6,368 | ||
Liabilities: | ||||
Contingent Consideration | 2,170 | |||
Lease liabilities | 166 | |||
Liabilities | 15,060 | 2,658 | ||
Financial Instruments [Member] | ||||
Liabilities: | ||||
Short-term loan | 4 | |||
Contingent Consideration | 2,170 | |||
Convertible debentures | 7,151 | |||
Lease liabilities | 508 | |||
Trade payables and other payables | 1,790 | 1,054 | ||
IIA liability | 116 | 131 | ||
Derivative financial instruments | 1,637 | 729 | ||
Liabilities | 13,376 | 1,914 | ||
Financial Instruments [Member] | Financial Liabilities at Amortized Cost [Member] | ||||
Liabilities: | ||||
Short-term loan | 4 | |||
Contingent Consideration | ||||
Lease liabilities | 508 | |||
Trade payables and other payables | 1,790 | 1,054 | ||
IIA liability | 116 | 131 | ||
Derivative financial instruments | ||||
Liabilities | 2,418 | 1,185 | ||
Financial Instruments [Member] | Liabilities at Fair Value Through Profit or Loss [Member] | ||||
Liabilities: | ||||
Short-term loan | ||||
Contingent Consideration | 2,170 | |||
Convertible debentures | 7,151 | |||
Lease liabilities | ||||
Trade payables and other payables | ||||
IIA liability | ||||
Derivative financial instruments | 1,637 | 729 | ||
Liabilities | 10,958 | 729 | ||
Financial assets at amortised cost, category [member] | Financial Instruments [Member] | ||||
Assets: | ||||
Cash and cash equivalents | 4,341 | |||
Trade receivable and other receivables (excluding prepaid expenses) | 970 | |||
Long-term deposit | 44 | |||
Restricted deposits | 29 | |||
Assets | $ 5,384 | |||
Loans and receivables, category [member] | Financial Instruments [Member] | ||||
Assets: | ||||
Cash and cash equivalents | 3,717 | |||
Trade receivable and other receivables (excluding prepaid expenses) | 910 | |||
Restricted deposits | 104 | |||
Assets | $ 3,741 |
Financial Instruments and Fin_6
Financial Instruments and Financial Risk Management (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Aug. 21, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Financial Instruments and Financial Risk Management (Textual) | ||||
Amounts of the liabilities | $ 15,060 | $ 2,658 | ||
Annual borrowing rate | 13.70% | |||
Series A Warrants [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the Black-Scholes model, using the following principal assumptions: expected volatility of 77.17%, risk-free interest of 2.77%, expected term of 6 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 15(e). | |||
Series B Warrants [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the binomial share price model for a period of 120 days, using the following principal assumptions: expected volatility between 89.17% - 104.11%, risk-free interest between 2.18% - 2.12%, expected term between 0.22 - 0.33 years. For details, see Note 15(e). | |||
Level 1 of fair value hierarchy [member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Amounts of the liabilities | $ 729 | |||
Anti-Dilution Feature [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the binomial share price model for a period of 24 months, using the following principal assumptions: expected volatility between 69.88 - 70.78%, risk-free interest between 0.37% - 0.47%, expected term between 1.9 - 2 years and 100% probability of capital raise until June 2020. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 15(c). | The Company used the binomial share price model for a period of 12 months, using the following principal assumptions: expected volatility between 52.53% - 69.82%, risk-free interest between 0.01% - 0.11%, expected term between 0.11 - 0.45 years and a 75% probability of capital raise during February - April 2017 and between 10% - 100% probability of capital raise during April - June 2018. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. For details, see Note 14(c). | ||
Convertible debentures [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the binomial share price model for a period of 18 months, using the following principal assumptions: expected volatility between 98.05 - 98.84%, risk-free interest between 1.95% - 2.42%, expected term of 1.5 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. | |||
Derivative financial instruments [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the binomial share price model for a periods of 1.5 and 5 years, using the following principal assumptions: expected volatility between 83.32% - 85.42%, risk-free interest between 1.58% - 2.38%, expected term of 1.5, and 5 years. The Company also used the Black-Scholes model, using the following principal assumptions: expected volatility of 84.40%, risk-free interest of 1.76%, expected term of 5.5 years. The liability amount is adjusted at each quarter end based on the then relevant assumptions, until the earlier of full exercise or expiration. | |||
Contingent consideration [Member] | ||||
Financial Instruments and Financial Risk Management (Textual) | ||||
Description of valuation anti-dilution feature | The Company used the Monte Carlo method for a period of 6 months, using the following principal assumptions: expected volatility 51.9%, risk-free interest 1.88%. |
Account Receivables - Trade, _2
Account Receivables - Trade, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Account Receivables - Trade, Net (Textual) | ||
Provision for doubtful accounts | $ 95 | |
Recorded debt write-off amount | $ 29 | $ 74 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cost | |||
Balance at beginning of year | $ 2,824 | $ 2,516 | $ 2,516 |
Additions during the year | 12,266 | 308 | |
Retirements during the year | (2,995) | ||
Balance at end of year | 12,095 | 2,824 | 2,516 |
Accumulated amortization | |||
Balance at beginning of year | 1,505 | 1,229 | 978 |
Additions during the year | 829 | 276 | 251 |
Retirements during the year | (1,723) | ||
Balance at end of year | 611 | 1,505 | 1,229 |
Amortized balance | 11,484 | 1,319 | 1,287 |
Technology [Member] | |||
Cost | |||
Balance at beginning of year | 2,263 | 1,955 | 1,955 |
Additions during the year | 4,651 | 308 | |
Retirements during the year | (1,955) | ||
Balance at end of year | 4,959 | 2,263 | 1,955 |
Accumulated amortization | |||
Balance at beginning of year | 1,469 | 1,199 | 954 |
Additions during the year | 808 | 270 | 245 |
Retirements during the year | (1,685) | ||
Balance at end of year | 592 | 1,469 | 1,199 |
Amortized balance | 4,367 | 794 | 756 |
Customer relations [Member] | |||
Cost | |||
Balance at beginning of year | 38 | 38 | 38 |
Additions during the year | 259 | ||
Retirements during the year | (38) | ||
Balance at end of year | 259 | 38 | 38 |
Accumulated amortization | |||
Balance at beginning of year | 36 | 30 | 24 |
Additions during the year | 21 | 6 | 6 |
Retirements during the year | (38) | ||
Balance at end of year | 19 | 36 | 30 |
Amortized balance | 240 | 2 | 8 |
Goodwill [Member] | |||
Cost | |||
Balance at beginning of year | 523 | 523 | 523 |
Additions during the year | 7,356 | ||
Retirements during the year | (1,002) | ||
Balance at end of year | 6,877 | 523 | 523 |
Accumulated amortization | |||
Balance at beginning of year | |||
Additions during the year | |||
Retirements during the year | |||
Balance at end of year | |||
Amortized balance | $ 6,877 | $ 523 | $ 523 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) $ in Thousands | Jun. 12, 2019 | Jul. 02, 2018 | Dec. 31, 2019 |
Intangible Assets (Textual) | |||
Description of intellectual property purchase | Safe-T completed the purchase of the intellectual property of CyKick Labs Ltd. ("CyKick") and the assumption of a royalty liability to the IIA, in consideration of $236 thousand, allocated on a relative basis to the purchased technology ($308 thousand) and IIA liability ($72 thousand). The purchased technology is aimed to recognize hostile attacks on online services through the identification of the users' anomalous behavior. The amortization is classified to cost of revenues and is calculated for 6 years using the straight-line method over the technology's useful life. For further details see Note 10(b). | A hypothetical decrease in the growth rate of 1% or an increase of 1% to the discount rate would reduce the value-in-use of the proxy services business by approximately $300 thousand and $711 thousand, respectively, and could trigger a potential impairment of its goodwill. | |
Goodwill of proxy services business | $ 6,877 | ||
Terminal growth rate, description | The key assumptions used as part purpose of the goodwill impairment testing of the proxy services business are terminal growth rate of 2%, after-tax discount rate of 20.5% and pre-tax discount rate of 22.8%. | ||
Proxy services business [Member] | |||
Intangible Assets (Textual) | |||
Impairment loss | $ 479 | ||
Cyber security business [Member] | |||
Intangible Assets (Textual) | |||
Impairment loss | $ 523 | ||
Customer relations [Member] | |||
Intangible Assets (Textual) | |||
Intangible assets amortization | 7 years 6 months |
Interests in Other Entities (De
Interests in Other Entities (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Safe-T Data A.R Ltd. [Member] | |||
Statement Line Items [Line Items] | |||
Name of company | Safe-T Data A.R Ltd. | Safe-T Data A.R Ltd. | |
Principal place of business | Israel | Israel | |
Nature of business activities | Development of data security software | Development of data security software | |
Percentage held directly by the Company | 100.00% | 100.00% | |
Rate of shares held by the Company | 100.00% | 100.00% | |
Safe-T USA Inc. [Member] | |||
Statement Line Items [Line Items] | |||
Name of company | Safe-T USA Inc. | Safe-T USA Inc. | |
Principal place of business | USA | USA | |
Nature of business activities | Business development and sales in the USA | Business development and sales in the USA | |
Percentage held directly by the Company | |||
Rate of shares held by the Company | 100.00% | 100.00% | |
NetNut Ltd [Member] | |||
Statement Line Items [Line Items] | |||
Name of company | NetNut Ltd. | [1] | NetNut Ltd. |
Principal place of business | Israel | Israel | |
Nature of business activities | Business proxy network solution | Business proxy network solution | |
Percentage held directly by the Company | 100.00% | 100.00% | |
Rate of shares held by the Company | 100.00% | 100.00% | |
[1] | Acquired on June 12, 2019 |
Taxes on Income (Details)
Taxes on Income (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Statement Line Items [Line Items] | |
Balance as of January 1, 2019 | |
Initial recognition due to business combination | (1,026) |
Changes during the year: | |
Taxes on income | (14) |
Balance as of December 31, 2019 | (1,040) |
Property, plant and equipment, net [Member] | |
Statement Line Items [Line Items] | |
Balance as of January 1, 2019 | |
Initial recognition due to business combination | (46) |
Changes during the year: | |
Taxes on income | 13 |
Balance as of December 31, 2019 | (33) |
Intangible assets, net [Member] | |
Statement Line Items [Line Items] | |
Balance as of January 1, 2019 | |
Initial recognition due to business combination | (1,129) |
Changes during the year: | |
Taxes on income | 122 |
Balance as of December 31, 2019 | (1,007) |
Carryforward tax losses [Member] | |
Statement Line Items [Line Items] | |
Balance as of January 1, 2019 | |
Initial recognition due to business combination | 149 |
Changes during the year: | |
Taxes on income | (149) |
Balance as of December 31, 2019 |
Taxes on Income (Details 1)
Taxes on Income (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Taxes on Income [Abstract] | |||
Loss before taxes on income, as reported in the statement of profit or loss | $ (12,975) | $ (11,747) | $ (5,312) |
Loss before taxes on income, as reported in the statement of operations, percentage | 100.00% | 100.00% | 100.00% |
Theoretical tax saving on this profit or loss | $ (2,984) | $ (2,702) | $ (1,275) |
Theoretical tax saving on this profit or loss, percentage | (23.00%) | (23.00%) | (24.00%) |
Increase in taxes resulting from permanent differences - non-deductible expenses | $ 1,039 | $ 524 | $ 83 |
Increase in taxes resulting from permanent differences - non-deductible expenses, percentage | 8.00% | 4.50% | 1.60% |
Increase in taxes resulting from tax losses in the reported year for which deferred taxes were not recognized | $ 1,968 | $ 2,184 | $ 1,193 |
Increase in taxes resulting from tax losses in the reported year for which deferred taxes were not recognized, percentage | 15.20% | 18.60% | 22.50% |
Tax expenses | $ 23 | $ 6 | $ 1 |
Tax expenses, percentage | 0.18% | 0.05% | 0.02% |
Taxes on Income (Details Textua
Taxes on Income (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Taxes on Income (Textual) | |||
Corporate tax rate | 23.00% | 24.00% | |
Federal tax rate | 20.00% | 21.00% | |
Carryforward tax losses in Israel | $ 1,800 | $ 1,700 | |
Carryforward tax losses of Safe-T | 31,500 | 22,000 | |
Carryforward tax losses of NetNut | $ 408 | $ 61 |
Accounts Payable and Accruals_2
Accounts Payable and Accruals (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Payable and Accruals [Abstract] | ||
Employees and related institutions | $ 654 | $ 628 |
Accrued expenses | 899 | 323 |
Accounts payable - other | $ 1,553 | $ 951 |
Commitments and Contingent Li_3
Commitments and Contingent Liabilities (Details) - Office Lease Agreements [Member] $ in Thousands | Dec. 31, 2019USD ($) |
Statement Line Items [Line Items] | |
2019 | $ 231 |
2020 | $ 5 |
Commitments and Contingent Li_4
Commitments and Contingent Liabilities (Details 1) - Vehicles Lease Agreements [Member] $ in Thousands | Dec. 31, 2019USD ($) |
Statement Line Items [Line Items] | |
2019 | $ 89 |
2020 | 47 |
2021 and thereafter | $ 12 |
Commitments and Contingent Li_5
Commitments and Contingent Liabilities (Details 2) - NetNut's former shareholders [Member] $ in Thousands | Dec. 31, 2019USD ($) |
Statement Line Items [Line Items] | |
2020 | $ 346 |
2021 | 174 |
2022 | 150 |
2023 | 121 |
Total undiscounted cash flows | $ 791 |
Commitments and Contingent Li_6
Commitments and Contingent Liabilities (Details Textual) - USD ($) $ in Thousands | Apr. 04, 2019 | Jul. 02, 2018 | Sep. 13, 2017 | Oct. 31, 2019 | Nov. 12, 2018 | May 31, 2018 | Sep. 19, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2013 |
Commitments (Textual) | ||||||||||
Royalties payable, description | Royalties are payable at the rate of 3% to 3.5% of the proceeds from such sales. | Royalties are payable at the rate of 3% to 3.5% of the proceeds from such sales. | ||||||||
Royalties paid | $ 41 | $ 43 | ||||||||
Presents liabilities to IIA | 8 | $ 49 | ||||||||
Liability to pay the IIA royalties for future sales | $ 108 | |||||||||
Lease, description | Safe-T signed an amendment to its office lease agreement, according to which Safe-T will lease its offices for a monthly fee of approximately $17 thousand. | Safe-T signed an amendment to its office lease agreement, according to which Safe-T will lease its offices for a lesser monthly fee of approximately $11.5 thousand through December 31, 2020. | Safe-T signed an amendment to lease additional space for approximately $1.5 thousand per month. | NetNut signed an operating lease agreement for a period of five years starting on October 20, 2018, and ending on October 19, 2023, at a monthly fee of approximately $11 thousand. | Safe-T Inc. signed an extension to its office lease agreement, according to which Safe-T Inc. will lease its offices for a monthly fee of approximately $1.3 thousand. The lease will expire on April 30, 2020. | Safe-T entered into an office lease agreement for the premises it uses, which included an option to extend the lease with a lease fee increase of 6%. | ||||
Lease term, description | The lease periods are generally for three years. | |||||||||
Share and asset purchase agreement, description | On April 4, 2019, the company entered into a share and asset purchase agreement, (the “Share and Asset Purchase Agreement”), with NetNut, pursuant to which the company acquired 100% of the fully diluted share capital of NetNut. In connection with the Share and Asset Purchase Agreement the company was required to transfer $300,000 to NetNut prior to June 15, 2019, for the purposes of its business and activities as a wholly-owned subsidiary of the Company. By December 31, 2019, the Company have transferred only $175,000. Currently, the Company accounted for earnout payment based on the provisions of the Share and Asset Purchase Agreement, as well as a provision for a potential compensation to NetNut's former shareholders due to the above-mentioned breach. | The Share and Asset Purchase Agreement includes an earn-out payment to the previous shareholders of NetNut of up to $5 million based on NetNut's revenues in 2019 and for which the Company has granted a first security interest and pledge in 30% of the NetNut shares. | ||||||||
Payments of shares and asset purchase agreement | $ 1,700 | |||||||||
Bottom of range [member] | ||||||||||
Commitments (Textual) | ||||||||||
Weighted average of lessee's incremental annual borrowing rate | 12.22% | |||||||||
Top of range [member] | ||||||||||
Commitments (Textual) | ||||||||||
Weighted average of lessee's incremental annual borrowing rate | 15.53% |
Leases (Details)
Leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Right-of-use assets [member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | $ 166 |
Additions during year | 472 |
Disposals during year | (60) |
Balance at end of year | 578 |
Properties [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | 19 |
Additions during year | 446 |
Disposals during year | |
Balance at end of year | 465 |
Vehicles [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | 147 |
Additions during year | 26 |
Disposals during year | (60) |
Balance at end of year | $ 113 |
Leases (Details 1)
Leases (Details 1) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Statement Line Items [Line Items] | |
Balance at beginning of year | |
Amortization during year | (115) |
Additions during year | (41) |
Disposals during year | 19 |
Balance at end of year | (137) |
Properties [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | |
Amortization during year | (65) |
Additions during year | (41) |
Disposals during year | |
Balance at end of year | (106) |
Vehicles [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | |
Amortization during year | (50) |
Additions during year | |
Disposals during year | (19) |
Balance at end of year | $ (31) |
Leases (Details 2)
Leases (Details 2) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Statement Line Items [Line Items] | |
Balance at beginning of year | $ 166 |
Additions during year | 469 |
Interest expense during year | 76 |
Termination during year | (44) |
Payments during year | (159) |
Lease liabilities | 508 |
Property [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | 19 |
Additions during year | 443 |
Interest expense during year | 49 |
Termination during year | |
Payments during year | (80) |
Short-term lease liabilities | 135 |
Long-term lease liabilities | 296 |
Vehicles [Member] | |
Statement Line Items [Line Items] | |
Balance at beginning of year | 147 |
Additions during year | 26 |
Interest expense during year | 27 |
Termination during year | (44) |
Payments during year | (79) |
Short-term lease liabilities | 49 |
Long-term lease liabilities | $ 28 |
Leases (Details Textual)
Leases (Details Textual) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Expense relating to short-term leases | $ 211 |
Retirement Benefits Obligation
Retirement Benefits Obligation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Retirement Benefits Obligation (Textual) | |||
Expense in respect of defined contribution plans | $ 205 | $ 234 | $ 157 |
Convertible Debentures (Details
Convertible Debentures (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 05, 2019 | Apr. 09, 2019 | Dec. 26, 2019 | Oct. 31, 2019 | Aug. 30, 2019 | Jul. 24, 2019 | Jul. 22, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Line Items [Line Items] | |||||||||
Debentures principle | $ 7,151 | ||||||||
Lenders [Member] | |||||||||
Statement Line Items [Line Items] | |||||||||
Description of convertible debentures | (i) ADSs at an exchange rate equal to $3.15, the per ADS offering price in the December 2019 Registered Direct Offering, and (ii) an even number of ADS purchase warrants at $3.30 per ADS (the "MFN Warrants"), which MFN Warrants shall be in form and substance identical to the warrants issued in the concurrent private placement to the December 2019 Registered Direct Offering. | ||||||||
Exercise price of other outstanding Warrants | $ 8 | ||||||||
Repaid debentures | $ 470 | ||||||||
Waiving amount | $ 330 | ||||||||
Issued ADSs upon conversion of debentures | 16,401,808 | ||||||||
Net amount was classified to equity | $ 3,262 | ||||||||
Debentures principle | $ 3,854 | ||||||||
Securities Purchase Agreement [Member] | Lenders [Member] | |||||||||
Statement Line Items [Line Items] | |||||||||
Aggregate amount of convertible loan | $ 6,000 | ||||||||
Warrants | 146,341 | ||||||||
Warrants to purchase ADSs | 146,341 | ||||||||
First tranche of loan amount received | $ 1,000 | ||||||||
Second tranche of loan amount received | $ 5,000 | ||||||||
Convertible debentures term | 18 months | ||||||||
Interest per annum | 8.00% | ||||||||
Description of convertible debentures | The Company closed an additional securities purchase agreement, according to which the Company obtained another convertible loan from the Lenders, who partially exercised their Greenshoe Option in the approximate amount of $666 thousand for each Lender, for a total of $1,332 thousand (the "December Greenshoe Debentures"). The December Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. According to the Agreement, the December Greenshoe Debentures as well as all previous outstanding debentures, are convertible at $8.00, subject to adjustments. In addition, the Lenders have a most favored nation right for a subsequent financing on better terms, for the term of the debentures, for the December Greenshoe Debentures as well as for all previous outstanding debentures in the amount of $3,854 thousand, such that the Lenders may convert into the subsequent financing on a dollar-for-dollar basis or at the terms of the December 2019 Registered Direct Offering. | The Company obtained another convertible loan from one of the Lenders, who partially exercised its Greenshoe Option in the amount of $0.5 million (the "October Greenshoe Debentures"). The October Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. The October Greenshoe Debentures' initial conversion price was $8.00 per ADS, subject to adjustments. | The Company obtained another convertible loan from one of the Lenders in the amount of $0.4 million (the "August Greenshoe Debentures"). The August Greenshoe Debentures have an 18-month term from issuance and bear interest at 8% per annum payable quarterly in cash or ADSs. Upon issuance, the August Greenshoe Debentures were convertible at $19.92. The conversion price of the August Greenshoe Debentures will be reset, but not below $8 per ADS, if there is a subsequent issuance of the Company's securities below the conversion price per share, to the price of the subsequent issuance. | The Debentures' initial conversion price was set to $41 per ADS, and then was several times reset following triggering of an adjustment mechanism that was agreed upon in the April 2019 Agreement, setting forth that the conversion price will be reset, if there is a subsequent issuance of the Company's securities, below the conversion price, to the price of the subsequent issuance. The Debentures contain other customary anti-dilution features, with the Black-Scholes value of the Debentures payable upon the occurrence of a fundamental transaction. The Company can redeem the Debentures after the effective date, which was set as June 4, 2019, upon a 20 trading days prior notice to the Lenders at 120% of the principal amount of the Debentures, plus accrued interest. | |||||
Warrants exercise price per ADS | $ 47.15 | ||||||||
Warrant coverage, percentage | 100.00% | ||||||||
Term of warrants | 18 months | ||||||||
Term of participation right in subsequent financing | 12 years | ||||||||
Percentage of subsequent financing | 50.00% | ||||||||
Expire date of subsequent financing | Jun. 5, 2020 | ||||||||
Repricing Agreement [Member] | Lenders [Member] | |||||||||
Statement Line Items [Line Items] | |||||||||
Warrants to purchase ADSs | 36,232 | ||||||||
Warrants exercise price per ADS | $ 27.60 | ||||||||
Exercise price of other outstanding Warrants | $ 27.60 | ||||||||
Description of warrants | Following the execution of the Repricing Agreement, the Lenders exercised the Warrants into 36,232 ADSs (representing 1,449,280 ordinary shares of the Company) on July 24, 2019, for consideration of $1 million. | ||||||||
Second Repricing Agreement [Member] | Lenders [Member] | |||||||||
Statement Line Items [Line Items] | |||||||||
Warrants to purchase ADSs | 5,020 | ||||||||
Warrants exercise price per ADS | $ 19.92 | ||||||||
Exercise price of other outstanding Warrants | $ 19.92 | ||||||||
Description of warrants | Following the execution of the Second Repricing Agreement, the Lender exercised the said Warrants into 5,020 ADSs (representing 200,800 ordinary shares of the Company) on August 30, 2019 for consideration of $0.1 million. |
Share Based Payment (Details)
Share Based Payment (Details) - 12 months ended Dec. 31, 2019 $ / shares in Units, $ in Thousands | USD ($)$ / sharesshares | USD ($)₪ / sharesshares | |
Statement Line Items [Line Items] | |||
Options amount | shares | 5,000 | 5,000 | |
Minimum [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ / shares | $ 1.17 | ||
Maximum [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ / shares | $ 38.86 | ||
March 29, 2017 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | [1] | 37,395 | 37,395 |
Fair value at the date of grant | $ | [2] | $ 655 | $ 655 |
Volatility | [3] | 47.40% | 47.40% |
Risk free interest | 2.31% | 2.31% | |
Expected term | 10 years | 10 years | |
March 29, 2017 [Member] | Minimum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 127.42 | ||
March 29, 2017 [Member] | Maximum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 131.76 | ||
July 24, 2017 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 32,087 | 32,087 | |
Fair value at the date of grant | $ | [2] | $ 784 | $ 784 |
Volatility | [3] | 68.07% | 68.07% |
Risk free interest | 2.05% | 2.05% | |
Expected term | 10 years | 10 years | |
July 24, 2017 [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 139.52 | ||
August 8, 2017 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 50,000 | 50,000 | |
Fair value at the date of grant | $ | [2] | $ 85 | $ 85 |
Volatility | [3] | 68.03% | 68.03% |
Risk free interest | 1.95% | 1.95% | |
Expected term | 6 months | 6 months | |
August 8, 2017 [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 150 | ||
August 29, 2017 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 25,000 | 25,000 | |
Fair value at the date of grant | $ | [2] | $ 473 | $ 473 |
Volatility | [3] | 68.17% | 68.17% |
Risk free interest | 1.81% | 1.81% | |
Expected term | 10 years | 10 years | |
August 29, 2017 [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 113.10 | ||
November 27, 2017 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 15,250 | 15,250 | |
Fair value at the date of grant | $ | [2] | $ 163 | $ 163 |
Volatility | [3] | 65.80% | 65.80% |
Risk free interest | 1.98% | 1.98% | |
Expected term | 10 years | 10 years | |
November 27, 2017 [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 86 | ||
June 20, 2018 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 33,502 | 33,502 | |
Fair value at the date of grant | $ | [2] | $ 130 | $ 130 |
Volatility | [3] | 75.50% | 75.50% |
Risk free interest | 2.24% | 2.24% | |
Expected term | 10 years | 10 years | |
June 20, 2018 [Member] | Minimum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 29.80 | ||
June 20, 2018 [Member] | Maximum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 59.40 | ||
June 20, 2018 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 11,500 | 11,500 | |
Fair value at the date of grant | $ | [2] | $ 72 | $ 72 |
Volatility | [3] | 75.30% | 75.30% |
Risk free interest | 2.24% | 2.24% | |
Expected term | 10 years | 10 years | |
June 20, 2018 [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 28.60 | ||
October 2, 2019 [Member] | |||
Statement Line Items [Line Items] | |||
Options amount | shares | 269,476 | 269,476 | |
Fair value at the date of grant | $ | [2] | $ 189 | $ 189 |
Volatility | [3] | 81.33% | 81.33% |
Risk free interest | 0.72% | 0.72% | |
Expected term | 3 years | 3 years | |
October 2, 2019 [Member] | Minimum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 0.02 | ||
October 2, 2019 [Member] | Maximum [Member] | NIS [Member] | |||
Statement Line Items [Line Items] | |||
Exercise price | $ 4.062 | ||
[1] | Out of which 5,000 options were granted to the Company's Chief Executive Officer at an exercise price of NIS 131.76 and approved by the Company's shareholders on August 8, 2017. | ||
[2] | The early exercise multiple used for the fair value calculations for grants during 2017, 2018 and 2019 is 2.5 for each offeree. | ||
[3] | Volatility until the March 29, 2017 grant is based on volatility data of share price of software companies for periods matching the expected term of the option until exercise. As of the July 24, 2017 grant, volatility is based on volatility data of the traded share price of the Company. |
Share Based Payment (Details 1)
Share Based Payment (Details 1) - Share options [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
Number of options, Outstanding at beginning of year | 173,628 | 202,763 | 119,245 |
Number of options, Granted | 269,476 | 45,002 | 109,732 |
Number of options, Exercised | (66,330) | (8,963) | (7,982) |
Number of options, Forfeited | (20,720) | (47,767) | (17,590) |
Number of options, Expired | (15,476) | (17,407) | (642) |
Number of options, Cancelled | (79,302) | ||
Number of options, Outstanding at end of year | 261,276 | 173,628 | 202,763 |
Number of options, Exercisable at end of year | 253,871 | 93,969 | 77,633 |
Average exercise price, Outstanding at beginning of year | $ 22.19 | $ 25.2 | $ 16.8 |
Average exercise price, Granted | 0.88 | 9.2 | 34 |
Average exercise price, Exercised | 0.01 | 11.4 | 10.2 |
Average exercise price, Forfeited | 11.26 | 24.6 | 30.4 |
Average exercise price, Expired | 16.89 | 22.6 | 22.4 |
Average exercise price, Cancelled | 24.93 | ||
Average exercise price, Outstanding at end of year | 6.2 | 22.19 | 25.2 |
Average exercise price per, Exercisable at end of year | $ 3.22 | $ 17.8 | $ 14.8 |
Share Based Payment (Details 2)
Share Based Payment (Details 2) - shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 261,276 | 173,628 | 202,763 |
0.40 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 203,146 | ||
Weighted average remaining contractual Life | 2 years 9 months 3 days | ||
0.40 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 14,771 | 14,771 | 16,840 |
Weighted average remaining contractual Life | 4 years 4 months 20 days | 5 years 4 months 20 days | 6 years 3 months 26 days |
0.40 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 10,992 | 16,139 | 17,080 |
Weighted average remaining contractual Life | 5 years 2 months 23 days | 6 years 2 months 30 days | 7 years 2 months 30 days |
0.41 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 13,081 | 13,081 | 18,616 |
Weighted average remaining contractual Life | 6 years 18 days | 7 years 18 days | 8 years 18 days |
0.41 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 1,281 | 18,501 | |
Weighted average remaining contractual Life | 8 years 5 months 23 days | 7 years 18 days | |
0.61 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 7,500 | 10,000 | |
Weighted average remaining contractual Life | 8 years 5 months 23 days | 9 years 5 months 23 days | |
0.82 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 941 | 8,135 | |
Weighted average remaining contractual Life | 6 years 4 days | 7 years 4 days | |
1.22 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 5,000 | ||
Weighted average remaining contractual Life | 9 years 5 months 23 days | ||
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 1,000 | 13,500 | 15,250 |
Weighted average remaining contractual Life | 7 years 10 months 28 days | 8 years 10 months 28 days | 9 years 10 months 28 days |
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,004 | 21,570 | |
Weighted average remaining contractual Life | 6 years 7 months 28 days | 7 years 7 months 28 days | |
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 7,778 | ||
Weighted average remaining contractual Life | 7 years 8 months 16 days | ||
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,500 | 16,145 | |
Weighted average remaining contractual Life | 7 years 2 months 27 days | 8 years 2 months 27 days | |
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 11,501 | ||
Weighted average remaining contractual Life | 8 years 6 months 21 days | ||
1.24 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 5,000 | ||
Weighted average remaining contractual Life | 8 years 3 months 26 days | ||
1.28 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,500 | 7,500 | |
Weighted average remaining contractual Life | 1 year 6 months 29 days | 8 years 7 months 28 days | |
1.37 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 8,146 | ||
Weighted average remaining contractual Life | 8 years 8 months 16 days | ||
1.58 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 170 | 30,714 | |
Weighted average remaining contractual Life | 7 years 7 months 28 days | 8 years 7 months 28 days | |
1.73 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,500 | 22,500 | |
Weighted average remaining contractual Life | 8 years 7 months 28 days | 9 years 8 months 2 days | |
1.76 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,500 | 2,500 | |
Weighted average remaining contractual Life | 7 months 28 days | 1 year 7 months 28 days | |
1.83 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 1,406 | 27,395 | |
Weighted average remaining contractual Life | 8 years 2 months 30 days | 9 years 2 months 30 days | |
1.94 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 5,000 | ||
Weighted average remaining contractual Life | 9 years 3 months 26 days | ||
38.80 [Member] | |||
Statement Line Items [Line Items] | |||
Number outstanding at end of year | 2,500 | 5,625 | 30,587 |
Weighted average remaining contractual Life | 7 years 6 months 21 days | 8 years 6 months 21 days | 9 years 6 months 25 days |
Share Based Payment (Details 3)
Share Based Payment (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Payment [Abstract] | |||
Share-based payment plans | $ 612 | $ 381 | $ 1,318 |
Share Based Payment (Details Te
Share Based Payment (Details Textual) | Jun. 20, 2018 | Dec. 31, 2019$ / sharesshares | Dec. 31, 2019$ / shares₪ / sharesshares | Dec. 31, 2018$ / shares | Dec. 31, 2017$ / shares |
Share Based Payment (Textual) | |||||
Fair value | $ 2.5 | $ 2.5 | $ 2.5 | $ 2.5 | |
Granted options | shares | 5,000 | 5,000 | |||
Exercise price, description | The Board of Directors approved the reduction of the exercise price of 86,675 options that were granted as of August 28, 2016, until August 29, 2017, to officers, employees and consultants at exercise prices which ranged between NIS 97.74 (approximately $25.60) to NIS 139.52 (approximately $38.80). The new exercise price was set at NIS 90.0. The reduction was approved also by the tax authorities subject to renewed tax lock-up period of 24 months. The reduction was subject to the grantee's approval - such approval was received only with respect to 69,058 options, while the rest of the options maintained their original terms. The reduction of the exercise price of options granted to certain officers of the Company was subject to the approval of the general meeting of shareholders of the company, which was obtained on August 12, 2018. | ||||
Fair value of the options, description | The fair value of the options just prior to the date of the change, which was computed according to the binomial model, amounted to $228 thousand, and $249 thousand immediately after the date of the change, such that the incremental value that resulted is $21 thousand. This value is based on the following assumptions: expected volatility of 75.48%, risk free interest ranges between 2.00% and 2.13%, expected term until exercise of 8.19-9.20 years and an early exercise multiple of 2.5 for each offeree. Volatility is based on volatility data of share price of software companies for periods matching the expected term of the option until exercise. | ||||
Minimum [Member] | |||||
Share Based Payment (Textual) | |||||
Exercise price of option | $ 1.17 | ||||
Maximum [Member] | |||||
Share Based Payment (Textual) | |||||
Exercise price of option | $ 38.86 | ||||
NIS [Member] | |||||
Share Based Payment (Textual) | |||||
Exercise price | ₪ / shares | $ 131.76 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - Ordinary shares [member] - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Line Items [Line Items] | ||
Number of shares authorized | 250,000,000 | 50,000,000 |
Number of issued and paid | 56,391,512 | 4,067,785 |
Shareholders' Equity (Details 1
Shareholders' Equity (Details 1) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Series 1 Warrants [Member] | ||
Statement Line Items [Line Items] | ||
Outstanding at beginning of year: | 64,614 | |
Issuance | ||
Exercised | (64,514) | |
Expired | (64,263) | (100) |
Outstanding at end of year | ||
Series 2 Warrants [Member] | ||
Statement Line Items [Line Items] | ||
Outstanding at beginning of year: | 64,263 | 64,614 |
Issuance | ||
Exercised | (351) | |
Expired | ||
Outstanding at end of year | 64,263 |
Shareholders' Equity (Details 2
Shareholders' Equity (Details 2) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
April 6, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 67,742 |
Unit price (in NIS) | $ 120 |
Gross proceeds | $ | $ 2,237 |
May 11, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 22,074 |
Unit price (in NIS) | $ 120 |
Gross proceeds | $ | $ 727 |
May 22, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 30,250 |
Unit price (in NIS) | $ 120 |
Gross proceeds | $ | $ 1,001 |
June 13, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 58,714 |
Unit price (in NIS) | $ 140 |
Gross proceeds | $ | $ 2,280 |
June 3, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 381,729 |
Gross proceeds | $ | $ 2,959 |
June 3, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 20,823 |
Unit price (in NIS) | $ 6 |
Gross proceeds | $ | $ 34 |
June 3, 2018 [Member] | Bottom of range [member] | |
Statement Line Items [Line Items] | |
Unit price (in NIS) | $ 26 |
June 3, 2018 [Member] | Top of range [member] | |
Statement Line Items [Line Items] | |
Unit price (in NIS) | $ 30 |
September 25, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of shares | shares | 289,079 |
Unit price (in NIS) | $ 6 |
Gross proceeds | $ | $ 481 |
April 6, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of warrants | shares | 67,942 |
Warrant exercise price | $ 175 |
Expiration date | Nov. 30, 2018 |
May 11, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of warrants | shares | 22,074 |
Warrant exercise price | $ 175 |
Expiration date | Nov. 30, 2018 |
May 22, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of warrants | shares | 30,250 |
Warrant exercise price | $ 175 |
Expiration date | Nov. 30, 2018 |
June 13, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of warrants | shares | 58,714 |
Warrant exercise price | $ 200 |
Expiration date | Nov. 30, 2018 |
June 3, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of warrants | shares | 218,935 |
Warrant exercise price | $ 46.4 |
Expiration date | Nov. 30, 2019 |
April 6, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 569 |
Exercise price | $ 120 |
Expiration date | Apr. 9, 2022 |
April 6, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 2,828 |
Exercise price | $ 120 |
Expiration date | Apr. 9, 2020 |
May 11, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 1,104 |
Exercise price | $ 120 |
Expiration date | May 11, 2020 |
May 22, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 2,269 |
Exercise price | $ 120 |
Expiration date | Jun. 21, 2020 |
June 13, 2017 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 4,225 |
Exercise price | $ 200 |
Expiration date | Jun. 21, 2020 |
June 3, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 20,702 |
Exercise price | $ 46 |
Expiration date | Nov. 30, 2019 |
June 3, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 645 |
Exercise price | $ 200 |
Expiration date | Nov. 30, 2018 |
August 21, 2018 [Member] | |
Statement Line Items [Line Items] | |
Number of non-traded warrants awarded | shares | 745 |
Exercise price | $ 48 |
Expiration date | Nov. 30, 2019 |
Shareholders' Equity (Details T
Shareholders' Equity (Details Textual) $ in Thousands | Dec. 16, 2019USD ($) | Dec. 19, 2018USD ($) | Jun. 03, 2018USD ($)shares | Jun. 03, 2018₪ / shares | Jun. 08, 2016USD ($)shares | Dec. 26, 2019shares | Nov. 05, 2019 | Oct. 21, 2019 | Aug. 21, 2018 | Jun. 26, 2017 | Jan. 30, 2017 | Dec. 31, 2019USD ($)shares | Dec. 31, 2019₪ / sharesshares | Dec. 31, 2018USD ($) | Dec. 19, 2018 | Dec. 31, 2017USD ($) |
Statement Line Items [Line Items] | ||||||||||||||||
Ordinary shares, description | The Company's ADSs are traded on the Nasdaq under the symbol "SFET." Each ADS represents 40 ordinary shares. The last reported market price for the Company's securities on December 31, 2019 was $3.03 per ADS on the Nasdaq and $0.073 per share on the TASE | |||||||||||||||
Warrant description | The terms of the warrants, which were issued were as follows: each Series 1 warrant was exercisable into one ordinary share in consideration for NIS 125 until February 9, 2017. Each Series 2 warrant was exercisable into one share in consideration for NIS 150 until December 9, 2017. | |||||||||||||||
Deductible issuance expenses | $ | $ 20,000 | $ 9,700 | $ 9,700 | |||||||||||||
Reverse stock split, description | The Company effected a 20:1 reverse split of its share capital. No adjustment was made to the number of ordinary shares underlying each ADS of the Company, and each ADS continues to represent 40 of the Company's ordinary shares, no par value. All descriptions of the Company's share capital in these financial statements, including share amounts and per share amounts, are presented after giving effect to the reverse split. | |||||||||||||||
Private offerings description | The Company has undertaken that in case that it will decide to issue additional shares over the course of up to 12 or 24 months from the respective dates of the issuances, at a price per share that is lower than the price per share that was set as part of the private issuances, it will compensate the relevant investors by issuing additional shares in accordance with the difference between the price per share of the relevant private issuance and the price per share in that future issuance, up to a minimal price that ranges between NIS 0.88-6.00 per share, according to the terms of the relevant issuance. | |||||||||||||||
Over the counter related, description | The Company obtained all approvals required for listing the Company's ordinary shares as ADSs that are tradable as part of the OTCQB Venture Market of the Over the Counter (OTC) market in the United States In accordance with the approvals, the Company commenced trading as part of the ADR Level 1 program as from June 27, 2017 under the symbol "SFTTY"; each ADS represented four (currently 40) ordinary shares of the Company. In August 2018, following the Nasdaq public offering and the listing in Nasdaq, the Company's ADS's ceased to trade on the OTC market. | |||||||||||||||
Underwritten public offering, description | The Company completed an additional underwritten public offering of approximately $3.5 million, before deducting underwriting discounts, commissions and other offering expenses. The offering consisted of (i) 121,400 units (the "Units") of ADSs and warrants to purchase 1.5 ADSs per warrant (the "November 2019 Warrants"), with each Unit consisting of one ADS and one November 2019 Warrant, and (ii) 378,500 pre-funded units (the "Pre-Funded Units"), with each Pre-Funded Unit consisting of a pre-funded warrant to purchase one ADS (a "November 2019 Pre-Funded Warrant") and a November 2019 Warrant. | The Company granted the underwriter a 45-day option to purchase up to 3,828 additional ADSs and Series A warrants to purchase up to an additional 5,742 ADSs and Series B warrants to purchase up to an additional 5,742 ADS. The underwriter did not exercise the option. | ||||||||||||||
Pre-funded units related, description | All Pre-Funded Units from this offering were exercised in exchange for the exercise price of $0.001 per ADS, as well as 10,000 warrants that were exercised in an aggregate amount of $77 thousand. | |||||||||||||||
Registered direct offering, description | The Company completed the December 2019 Registered Direct Offering of $1,668 thousand, before deducting offering expenses. The offering consisted of (i) 269,272 ADSs, and (ii) 260,281 pre-funded warrants, each to purchase one ADS and one regular warrant to purchase one ADS at an exercise price of $3.30 (the "December 2019 Pre-Funded Warrants"). | |||||||||||||||
Additional warrants | 74,985 | |||||||||||||||
American depositary shares related, description | Each ADS represents 40 ordinary shares of the Company. Each ADSs was sold at a price of $3.15 per ADS, and each December 2019 Pre-Funded Warrant was sold at a price of $3.15 per warrant, including the December 2019 Pre-Funded Warrant exercise price of $0.001 per full ADS. The December 2019 Pre-Funded Warrants are exercisable at any time after the date of issuance upon payment of the exercise price. The December 2019 Warrants have a per ADS exercise price of $3.30 per full ADS, are exercisable immediately, and will expire 5.5 years from the date of issuance. | Each ADS represents 40 ordinary shares of the Company. Each Unit was sold at a price of $7.00 per unit, and each Pre-Funded Unit was sold at a price of $7.00 per unit, including the November 2019 Pre-Funded Warrant exercise price of $0.001 per full ADS. The November 2019 Pre-Funded Warrants are exercisable at any time after the date of issuance upon payment of the exercise price. The November 2019 Warrants have a per ADS exercise price of $7.70 per full ADS, are exercisable immediately, and will expire five years from the date of issuance. | The Reset Price of the Series B Warrants was set at $86.10 per ADS. As a result, the Series B Warrants holders are entitled to an additional 59,670 ADSs subject to payment of an exercise price of $0.001 per ADS. The exercise period is unlimited. A total of 12,275 ADSs resulting from the Series B Warrants' Reset Price calculations were not registered with the U.S. Securities and Exchange Commission ("SEC"). | |||||||||||||
Fair value of financial liability | $ | $ 3,479 | |||||||||||||||
Issuance expenses | $ | $ 185 | 1,545 | $ 663 | |||||||||||||
Public offering, description | The Company completed an underwritten public offering on the Nasdaq of 25,522 units comprised of 25,522 ADSs at a price of $287 per ADS, 25,522 Series A warrants to purchase up to 38,278 ADSs with an exercise price of $287 per ADS, and 25,522 Series B warrants to purchase up to a maximum of 59,670 ADSs. Each ADS represents 40 of the Company's ordinary shares. The Company received aggregate gross proceeds of approximately $7.335 million from the offering. | |||||||||||||||
NIS [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Exercise price | ₪ / shares | ₪ 131.76 | |||||||||||||||
Series 1 warrants [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Purchase of warrants | 64,614 | |||||||||||||||
Warrant consideration | $ | $ 4,173 | |||||||||||||||
Warrant description | As part of the issuance, offers were received to purchase 1,615 units of 1,615 shares | The Company's general meeting decided to defer the exercise date of the Series 1 warrants from February 9, 2017 to April 30, 2017 and to reduce the exercise price of the warrants from NIS 125 to NIS 110. As of April 30, 2017, 438 warrants were exercised before the reduction of the exercise price, for a total consideration of approximately NIS 55 thousand (approximately $14 thousand), and 64,077 warrants were exercised after the reduction of the exercise price, for a total consideration of approximately NIS 7,048 thousand (approximately $1,930 thousand) (99.85% of all series 1 warrants were exercised in consideration for approximately NIS 7,103 thousand (approximately $ 1,943 thousand)). The remaining warrants expired on April 30, 2017. | ||||||||||||||
Series 2 warrants [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Purchase of warrants | 64,614 | |||||||||||||||
Warrant consideration | $ | $ 4,173 | |||||||||||||||
Warrant description | As part of the issuance, offers were received to purchase 1,615 units of 1,615 shares | 351 warrants were exercised in May 2017 for a total consideration of approximately NIS 53 thousand (approximately $15 thousand). On November 2017, the Company's general meeting and Board of Directors decided to defer the exercise date of the Series 2 warrants from December 9, 2017 to February 9, 2018 and to reduce the exercise price of the warrants from NIS 150 to NIS 125. On February 9, 2018, the Series 2 Warrants expired with no further exercises. | ||||||||||||||
Series B warrants [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
American depositary shares exercised | 58,231 | 58,231 | ||||||||||||||
American depositary shares unexercised | 1,431 | 1,431 | ||||||||||||||
Issuance expenses | $ | $ 1,300 | |||||||||||||||
Purchase of warrant/option, description | In connection with the underwritten public offering, the Company granted the underwriter a 45-day option to purchase up to 3,828 additional ADSs and Series A warrants to purchase up to an additional 5,742 ADSs and Series B warrants to purchase up to an additional 5,742 ADS. The underwriter did not exercise the option. | |||||||||||||||
Series A warrants [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Warrant description | The Series A warrants have a term of six years, are exercisable immediately and have an exercise price of $287 per ADS. The Series B warrants will become exercisable, if at all, commencing 120 days after issuance, at the discretion of the holder thereof until exercised in full, if at the 120th day after issuance, 80% of the lowest volume weighted average price of the ADSs during the five trading days immediately prior to such date (the "Reset Price"), is lower than $287. In such event, each Series B warrant holder will be entitled to additional ADSs at an exercise price of $0.02 per ADS, with the number of ADSs exercisable equal to the aggregate investment by such holder in connection with the closing of the offering divided by the Reset Price, less any ADSs issued to such holder at the closing of the offering. In no event shall the Reset Price be less than $86.10, subject to customary adjustments for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions. | |||||||||||||||
Private offering [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Shares issued | 20,823 | |||||||||||||||
Additional warrants | 645 | |||||||||||||||
Antidilution rights | $ | $ 34 | |||||||||||||||
Private offering [Member] | NIS [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Exercise price | ₪ / shares | ₪ 6 | |||||||||||||||
Public offering [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Shares issued | 289,079 | |||||||||||||||
Additional warrants | 745 | |||||||||||||||
Antidilution rights | $ | $ 481 | |||||||||||||||
Public offering [Member] | NIS [Member] | ||||||||||||||||
Statement Line Items [Line Items] | ||||||||||||||||
Exercise price | ₪ / shares | ₪ 6 |
Business Combination (Details)
Business Combination (Details) $ / shares in Units, $ in Thousands | Dec. 31, 2019USD ($) | Jun. 12, 2019USD ($)shares$ / shares |
Share consideration calculation: | ||
Company's market price per share | $ / shares | $ 1.0274 | |
Number of shares to be issued | shares | 3,473,087 | |
Share consideration | $ 3,568 | |
Cash consideration | 5,587 | |
Contingent consideration | $ 159 | 2,008 |
Total purchase price | $ 11,163 |
Business Combination (Details 1
Business Combination (Details 1) $ in Thousands | Jun. 12, 2019USD ($) | |
The fair values of the identifiable assets and liabilities: | ||
Cash and cash equivalents | $ 79 | |
Accounts receivable - trade | 130 | |
Accounts receivable - other | 175 | |
Property, plant and equipment | 14 | |
Right of use assets | 405 | |
Servers | 199 | |
Technology and supplier relations | 4,651 | [1] |
Customer relations | 259 | [1] |
Short-term loan | (24) | |
Accounts payable - trade | (170) | |
Accounts payable - other | (343) | |
Contract liabilities | (99) | |
Lease liabilities | (443) | |
Deferred taxes liabilities | (1,026) | |
Total identifiable net assets at fair value | 3,807 | |
Goodwill | 7,356 | |
Total purchase price | $ 11,163 | |
[1] | Technology and supplier relations and customer relations are amortized on a straight-line basis over 5 years and 7.5 years, respectively. Goodwill primarily represented the value of expected synergies arising from the acquisition, as well as assembled workforce, and was allocated entirely to the proxy services segment. |
Business Combination (Details T
Business Combination (Details Textual) - USD ($) $ in Thousands | Oct. 03, 2019 | Jun. 12, 2019 | Apr. 04, 2019 | Dec. 31, 2019 |
Business Combination (Textual) | ||||
Acquired outstanding share capital, percentage | 100.00% | |||
Consideration for purchased shares, description | An amount equal to $3,400 thousand (the "Initial Shares Purchase Price"), out of which (i) $1,615 thousand was paid on Closing (as defined below) in immediate funds (in addition to an amount of $250 thousand down payment paid by the Company upon signing of Share and Asset Purchase Agreement); (ii) $175 thousand was deposited in escrow; and (iii) $1,360 thousand was paid by issuance of 1,217,370 ordinary shares of the Company (based on NIS 4.62 which is a per share 30-day average price of the Company's ordinary shares on the TASE prior to the date on which the Share and Asset Purchase Agreement was signed (the "Initial Consideration PPS")). | |||
Contingent consideration payable, description | An amount of up to $5,000 thousand payable in contingent consideration (the "EarnOut Amount"), will be paid and distributed to the shareholders of NetNut upon NetNut achieving certain revenue milestones in 2019, hence, the payment of the payable EarnOut Amount will be deferred to the time when the Company's financial results for the year 2019 are published. The Company, at its sole discretion, may elect to pay up to fifty percent (50%) of the EarnOut Amount in ordinary shares (the "EarnOut Shares"), provided that in any event, the amount of the EarnOut Shares will not exceed 2,237,814 ordinary shares (representing a quotient of half of the maximum EarnOut amount,,i.e. $2,500 thousand, divided by the Initial Consideration PPS). | |||
Assets purchase price, description | An aggregate amount equal to $6,300 thousand (the "Assets Purchase Price"). The Assets Purchase Price was paid as follows: ● An amount equal to $3,455 thousand was paid at Closing in immediately payable funds; ● An amount equal to $325 thousand was deposited in escrow; ● An amount equal to $2,520 thousand, was paid at Closing in ordinary shares, issued at a per share price equal to the Initial Consideration PPS, i.e. 2,255,717 ordinary shares. In connection with the transaction, the Company agreed to pay to certain finders of the transaction a fee equal to the sum of 3% of the total purchase price of the transaction. The Company elected to pay up to 50% of such fee in equity securities of the Company.Accordingly, the Company incurred transaction costs amounting to approximately $312 thousand that were charged to profit or loss within "general and administrative expenses." | |||
Useful lives of intangible assets, description | Technology and supplier relations and customer relations are amortized on a straight-line basis over 5 years and 7.5 years, respectively. | |||
Contribution to revenue | $ 1,976 | |||
Increased loss from continuing operations | 82 | |||
Pro-forma revenue | $ 4,510 | |||
Pro-forma loss from continuing operations | 13,045 | |||
Contingent consideration recognised | 2,008 | 159 | ||
Goodwill | $ 7,356 | |||
Repayment on acquisition | $ 233 | |||
Accrued contingent consideration payment | $ 2,170 |
Revenues and Cost of Revenues_2
Revenues and Cost of Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Revenues from proxy services | $ 1,976 | ||
Revenues from licenses | 625 | 794 | 486 |
Revenues from provision of maintenance and support services | 655 | 606 | 519 |
Revenue from other license related services | 28 | 66 | 91 |
Total revenues | $ 3,284 | $ 1,466 | $ 1,096 |
Revenues and Cost of Revenues_3
Revenues and Cost of Revenues (Details 1) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Revenues and Cost of Revenues [Abstract] | |
2020 | $ 562 |
2021 and thereafter | 82 |
Total | $ 644 |
Revenues and Cost of Revenues_4
Revenues and Cost of Revenues (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues and Cost of Revenues [Abstract] | |||
Payroll and related expenses | $ 206 | $ 367 | $ 203 |
Share-based payment | 31 | 55 | 51 |
Amortization of and depreciation | 863 | 270 | 245 |
Impairment of intangible assets | 270 | ||
Cost of internet services providers | 360 | ||
Cost of networks and servers | 88 | ||
Other | 71 | 99 | 84 |
Cost of revenues | $ 1,889 | $ 791 | $ 583 |
Revenues and Cost of Revenues_5
Revenues and Cost of Revenues (Details Textual) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Revenues and Cost of Revenues (Textual) | |
Revenue related to beginning of the period contract liability balances | $ 469 |
Research and Development Expe_3
Research and Development Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Research and Development Expenses [Abstract] | |||
Payroll and related expenses | $ 1,483 | $ 1,632 | $ 919 |
Share-based payment | 6 | 13 | 103 |
Subcontractors | 668 | 421 | 377 |
Other | 328 | 348 | 209 |
Total | $ 2,485 | $ 2,414 | $ 1,608 |
Selling and Marketing Expense_2
Selling and Marketing Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Selling and Marketing Expenses [Abstract] | |||
Payroll and related expenses | $ 2,007 | $ 2,801 | $ 1,567 |
Share-based payment | 180 | 123 | 573 |
Professional fees | 363 | 1,118 | 823 |
Marketing | 452 | 699 | 490 |
Selling commissions | 378 | 86 | 99 |
Other | 403 | 715 | 499 |
Total | $ 3,783 | $ 5,542 | $ 4,051 |
General and Administrative Ex_3
General and Administrative Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
General and administrative expenses | $ 3,757 | $ 1,925 | $ 2,150 |
Payroll and related expenses [Member] | |||
Statement Line Items [Line Items] | |||
General and administrative expenses | 838 | 667 | 661 |
Share-based payment [Member] | |||
Statement Line Items [Line Items] | |||
General and administrative expenses | 396 | 190 | 576 |
Professional Fees [Member] | |||
Statement Line Items [Line Items] | |||
General and administrative expenses | 2,018 | 885 | 749 |
Other [Member] | |||
Statement Line Items [Line Items] | |||
General and administrative expenses | $ 505 | $ 183 | $ 164 |
Financial Expenses, Net (Detail
Financial Expenses, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Financing expenses: | |||
Bank fees | $ (166) | $ (20) | $ (15) |
Issuance expenses | (447) | (517) | (242) |
Changes financial liabilities at fair value through profit or loss, including day 1 loss | (5,649) | (2,839) | (718) |
Exchange differences | (120) | ||
Total finance expenses | 3,184 | 2,541 | (1,984) |
Financing income: | |||
Changes in financial liabilities at fair value through profit or loss, including day 1 loss | 3,050 | 945 | 2,697 |
Interest received from institutions | 4 | 10 | 9 |
Exchange differences | 24 | 253 | |
Total financing income | (12,975) | (11,747) | (5,312) |
Financing income (expenses), net | $ (3,184) | $ (2,541) | $ 1,984 |
Loss Per Share (Details)
Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Loss Per Share [Abstract] | |||
Loss attributable to Company's owners | $ 12,998 | $ 11,753 | $ 5,313 |
The weighted average of the number of ordinary shares in issue (including pre-funded warrants) | 13,599 | 1,765 | 922 |
Basic loss per share (dollar) | $ (0.96) | $ (6.66) | $ (5.76) |
Loss Per Share (Details 1)
Loss Per Share (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Loss Per Share [Abstract] | |||
Loss attributable to Company's owners, used in computation of basic loss per share | $ 12,998 | $ 11,753 | $ 5,313 |
Adjustment in respect of the finance income relating to derivative financial instruments, anti-dilution mechanism and compensation feature | 1,462 | 710 | |
Total loss per share | $ 14,460 | $ 12,463 | $ 5,313 |
The weighted average of the number of ordinary shares in issue used in computation of basic loss per share (in thousands of shares) | 13,599 | 35,302 | 18,433 |
Adjustment in respect of incremental shares assuming the conversion to derivative financial instruments, anti-dilution mechanism and compensation feature | 421 | 344 | |
Total weighted average of the number of ordinary shares | 14,020 | 35,646 | 18,433 |
Diluted loss per share (dollar) | $ (1.03) | $ (6.99) | $ (5.76) |
Related Parties Transactions _3
Related Parties Transactions and Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Parties Transactions and Balances [Abstract] | |||
Payroll, bonuses, share based compensation and related expenses to interested parties employed by the Company | $ 320 | $ 285 | $ 234 |
Management fees, consulting fees and bonuses to interested parties hired by the Company | 336 | 185 | 344 |
Compensation to directors who are not employed by the Company | $ 80 | $ 66 | $ 57 |
Related Parties Transactions _4
Related Parties Transactions and Balances (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Parties Transactions and Balances [Abstract] | |||
Payroll and other short-term benefits | $ 1,385 | $ 1,573 | $ 1,073 |
Bonuses and Commissions | 173 | 146 | 178 |
Advisory fees | 73 | ||
Management fees | 336 | 185 | 222 |
Share-based payments | 226 | 219 | 665 |
Total benefits | $ 2,120 | $ 2,123 | $ 2,211 |
Related Parties Transactions _5
Related Parties Transactions and Balances (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Parties Transactions and Balances [Abstract] | |||
Monthly payment | $ 9 | $ 15 | |
Management services amounted | 336 | 185 | $ 222 |
Payable balance amounted | $ 90 | 15 | |
Commitments amounted | 121 | ||
Amount paid | $ 10 | 10 | |
Balance payable | $ 12 |
Entity Level Disclosures and _3
Entity Level Disclosures and Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
Revenues | $ 3,284 | $ 1,466 | $ 1,096 |
Adjusted operating loss | (6,626) | ||
Share-based payments | (612) | (381) | (1,318) |
Contingent consideration measurement | (159) | ||
Impairment of goodwill and intangible assets | (1,272) | ||
Depreciation and amortization | (1,122) | (342) | (278) |
Operating loss | (9,791) | (9,206) | (7,296) |
Financial expenses, net | (3,184) | ||
Taxes on income | (23) | (6) | (1) |
Net loss for the period | (12,998) | $ (11,753) | $ (5,313) |
Cyber Security [Member] | |||
Statement Line Items [Line Items] | |||
Revenues | 1,308 | ||
Adjusted operating loss | (6,715) | ||
Proxy Services [Member] | |||
Statement Line Items [Line Items] | |||
Revenues | 1,976 | ||
Adjusted operating loss | $ 89 |
Entity Level Disclosures and _4
Entity Level Disclosures and Segment Information (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Line Items [Line Items] | |||
Revenues | $ 3,284 | $ 1,466 | $ 1,096 |
Israel [Member] | |||
Statement Line Items [Line Items] | |||
Revenues | 1,071 | 988 | 823 |
USA [Member] | |||
Statement Line Items [Line Items] | |||
Revenues | 1,418 | 353 | 227 |
Other [Member] | |||
Statement Line Items [Line Items] | |||
Revenues | $ 795 | $ 125 | $ 46 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Events [Member] - USD ($) $ in Thousands | 1 Months Ended | |
Jan. 31, 2020 | Jan. 28, 2020 | |
Statement Line Items [Line Items] | ||
Warrants issued | 248,889 | |
Exchange for aggregate exercise | $ 249 | |
Converted debentures | $ 315,000 | |
Conversion of shares, description | 248,889 pre-funded warrants (9,955,560 ordinary shares) were exercised in exchange for aggregate exercise amounts of $249. Also, one Lender converted debentures at the amount of $315,000 into 100,000 ADSs (4,000,000 ordinary shares). | |
Minimum [Member] | ||
Statement Line Items [Line Items] | ||
Increase decrease in authorized capital | $ 1,250,000,000 | |
Maximum [Member] | ||
Statement Line Items [Line Items] | ||
Increase decrease in authorized capital | $ 1,500,000,000 |