| The Company and Significant Accounting Policies | Note
1. The Company and Significant Accounting Policies. Organizational
Background: Viewbix
Inc. (formerly known as Virtual Crypto Technologies, Inc.) (the “Company”) was incorporated in the State of Ohio in
1989 under a predecessor name, Zaxis International, Inc. (“Zaxis”). On August 25, 1995, Zaxis merged with a subsidiary
of The InFerGene Company, a Delaware corporation, which entity changed its name to Zaxis International, Inc. and the Company was
reincorporated in Delaware under the name of Zaxis International, Inc. On December 30, 2014, Zaxis entered into an agreement with
Emerald Medical Applications Ltd., a private limited liability company organized under the laws of the State of Israel (“Emerald
Israel”). On
March 16, 2015, Zaxis and Emerald Israel executed a share exchange agreement, which closed on July 14, 2015, and Emerald Israel
became the Company’s wholly-owned subsidiary. Emerald Israel was engaged in the business of developing Emerald Israel’s
DermaCompare technology and the development, sale and service of imaging solutions utilizing its DermaCompare software for use
in derma imaging and analytics for the detection of skin cancer. On
January 17, 2018, the Company formed a new wholly-owned subsidiary under the laws of the State of Israel, Virtual Crypto Technologies
Ltd. (the “Subsidiary”), to develop and market software and hardware products facilitating, allowing and supporting
purchase and/or sale of cryptocurrencies through ATMs, tablets, personal computers (“PCs”) and/or mobile devices. On
February 7, 2019, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with Algomizer
Ltd. (TASE:ALMO), a company organized under the laws of the State of Israel (“Algomizer”), pursuant to which on the
Closing Date, as defined below, Algomizer assigned, transferred and delivered its 99.83% holdings in Viewbix Ltd. (“Viewbix
Israel”) to the Company in exchange for shares of restricted common stock of the Company, representing 65% of the issued
and outstanding share capital of the Company on a fully diluted basis as of the Closing Date, following the conversion of convertible
notes of the Company into shares of the Company’s restricted common stock, and which excludes warrants to purchase shares
of the Company’s common stock expiring in 2020, with an exercise price representing a valuation of the Company equal to
at least $30,000,000 (“Fully Diluted Share Capital”), and additional warrants as further described below. In addition,
upon the earlier of: (a) the launch of a live video product to an American consumer in the United States by Viewbix Israel, or
(b) the launch of an interactive television product to an American consumer in the United States by Viewbix Israel, the Company
will issue to Algomizer an additional 1,642,193 shares of restricted common stock of the Company representing 5% of the Fully
Diluted Share Capital immediately following the Closing Date. On
February 26, 2019, stockholders holding a majority of our outstanding shares of common stock approved to effect a reverse stock
split of the of Company’s common stock on a 1-for-15 basis (“Reverse Stock Split”). The Reverse Stock Split
became effective on May 20, 2019, upon which each fifteen (15) shares of company’s common stock were automatically converted,
without any further action by stockholders, into one share of common stock. No fractional shares were issued as the result of
the reverse stock split. Instead, each stockholder was entitled to receive one share of common stock in lieu of the fractional
share that would have resulted from the reverse stock split. All stock information in this Quarterly Report have been restated
retroactively to reflect the effect of the Reverse Stock Split. On
July 24, 2019, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of
Delaware reflecting its name change from Virtual Crypto Technologies, Inc. to Viewbix Inc. to reflect its new operations and business
focus and, effective on August 7, 2019, FINRA approved the Registrant’s name change and its trading symbol was changed from
VRCP to VBIX on the OTCQB. On
July 25, 2019 (the “Closing Date”), the Company issued 20,281,085 shares of its common stock to Algomizer in consideration
for 99.83% holdings in Viewbix Israel, and 3,434,889 shares of its common stock to holders of convertible notes of which were
converted upon the Closing Date. The shares of common stock were issued under Regulation S. The Company also issued a total of
7,298,636 warrants to Algomizer to purchase the Company’s common stock, whereby (i) 3,649,318 of such warrants have an exercise
price of $0.48, and (ii) 3,649,318 of such warrants have an exercise price of $0.80. Going
Concern: The
Company has incurred significant operating losses and negative cash flows from operating activities in relation to its operations,
since inception. While the Company raised approximately $1.9 million in the year ended December 31, 2018 to fund the operations,
the Company will require additional capital resources in order to support the commercialization of its products and operations
and maintain its research and development activities. The Company is addressing its liquidity needs by seeking additional funding
from public and/or private sources. There are no assurances, however, that the Company will be able to obtain an adequate level
of financial resources that are required for the Company’s short and long-term requirements, or at all these conditions
raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements
do not include any adjustments to reflect the possible future effects on recoverability and classification of assets or the amounts
and classification of liabilities that may result from the outcome of this uncertainty Basis
of Presentation and Significant Accounting Policies: The
accompanying unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiary,
the Subsidiary, prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)
and with the instructions to Form 10-Q. The financial statements presented herein have not been audited by an independent registered
public accounting firm but include all material adjustments (consisting of normal recurring adjustments) which are, in the opinion
of management, necessary for a fair statement of the financial condition, results of operations and cash flows for the period.
However, these results are not necessarily indicative of results for any other interim period or for the full fiscal year. The
preparation of financial statements in conformity with GAAP requires us to make certain estimates and assumptions for the reporting
periods covered by the financial statements. These estimates and assumptions affect the reported amounts of assets, liabilities,
revenues and expenses. Actual amounts could differ from these estimates. Certain
information and footnote disclosures normally included in financial statements in accordance with generally accepted accounting
principles have been omitted pursuant to the rules of the Securities and Exchange Commission (“SEC”). The accompanying
unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes
thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on March 28,
2019 (the “Annual Report”). Recent
Accounting Standards announced In
August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure
Requirements for Fair Value Measurement. The amendments apply to reporting entities that are required to make disclosures about
recurring or nonrecurring fair value measurements and should improve the cost, benefit, and effectiveness of the disclosures.
ASU 2018-13 categorized the changes into those disclosures that were removed, those that were modified, and those that were added.
The primary disclosures that were removed related to transfers between Level 1 and Level 2 investments, along with the policy
for timing of transfers between levels. In addition, disclosing the valuation processes for Level 3 fair value measurements was
removed. The amendments are effective for all organizations for fiscal years, and interim periods within those fiscal years, beginning
after December 15, 2019. Early adoption is permitted. The Company notes that this guidance will impact its disclosures beginning
January 1, 2020. |
