Convertible Loans

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

CONVERTIBLE LOANS

NOTE 3:- CONVERTIBLE LOANS

a. On February 21, 2019, the Company received a convertible loan from third party (“February 2019 Lender”), with a two-year term, in the principal amount of $550, which bears 10% annual interest rate (“February 2019 Loan”).

The Company at its option shall have the right to redeem, in part or in whole, outstanding principal amount and interest under this loan agreement prior to the maturity date. The Company shall pay an amount equal to the principal amount being redeemed plus a redemption premium equal to 20% of the outstanding principal amount being redeemed plus outstanding and accrued interest.

The February 2019 Lender shall be entitled to convert at its option any portion of the outstanding and unpaid principal or accrued interest into fully paid and nonassessable of shares of common stock, at the lower of the fixed conversion price then in effect or the market conversion price. The number of shares of common stock issuable upon conversion of any conversion amount shall be determined by dividing (x) such conversion amount by (y) the fixed conversion price of $20.00 or (z) 80% of the lowest the volume-weighted average price of the Company’s shares of common stock during the 10 trading days immediately preceding the conversion date.

During the year ended December 31, 2020, a portion of the February 2019 Loan in the amount of $190 and accrued interest of $87 was converted into 1,045,521 Shares.

On February 20, 2021, the Company and the February 2019 Lender extended the February 2019 Loan to November 10, 2021. As of December 31, 2021, the Company has defaulted on the February 2019 Loan and the February 2019 Loan is presented in fair value in these financial statements. See note 9b regarding the extension of the February 2019 Loan.

On May 12, 2021, the Company paid accrued interest of the February 2019 Loan in the amount of $74.

The February 2019 Loan is included in the convertible loans in current liabilities as of December 31, 2021, in the amount of $506, and $350 as of December 31, 2020.

During the year ended December 31, 2021, and 2020, the Company recorded financial expenses related to February 2019 Loan in the amount of $230 and $343, respectively.

b. On October 15, 2019, the Company received a convertible loan from a third party (“October 2019 Lender”) in the principal amount of $1,100 that bears an annual 10% interest rate (“October 2019 Loan”). The October 2019 Loan has a two-year term. Prior to the maturity date of the October 2019 Loan, the Company, at its option, has the right to redeem, in cash, in part or in whole, the amounts outstanding provided that as of the date of the redemption notice (i) the volume-weighted average price of the Company’s ordinary shares is less than $12.50 and (ii) there is no equity condition failures as defined therein. In the event that the Company wishes to redeem any amount under the convertible loan, the Company shall pay an amount equal to the principal amount being redeemed plus a redemption premium equal to 20% of the outstanding amount being redeemed in addition to outstanding and accrued interest.

The October 2019 Lender shall be entitled to convert the principal loan and the outstanding interest (the “Conversion Amount”) into such number of ordinary shares determined by dividing (x) such Conversion Amount by (y) the fixed conversion price of $12.50 or (z) 80% of the lowest the volume-weighted average price of the Company’s ordinary shares during the 10 trading days immediately preceding the conversion date.

The Company accounted for the October 2019 Loan in accordance with ASC 470-20, Debt with conversion and other Options. As of December 31, 2020, the BCF was revalued at $610.

The Company estimated the fair value of BCF using the Monte Carlo option pricing model using the following weighted average assumptions:

	December 31, 2020
Share price	$	1.50
Dividend yield		0	%
Risk-free interest rate		0.10	%
Expected term (in years)		0.79
Volatility		133.48	%

As of December 31, 2021, the Company has defaulted on the October 2019 Loan and the October 2019 Loan is presented in fair value in these financial statements. See note 9c regarding the extension of the February 2019 Loan.

The October 2019 Loan is included in the convertible loans in current liabilities as of December 31, 2021, in the amount of $2,142, and $754 as of December 31, 2020.

During the year ended December 31, 2021, and 2020, the Company recorded financial expenses related to October 2019 Loan in the amount of $778 and $594, respectively.

c. On August 7, 2020, the Company received a convertible loan from a third party (“August 2020 Lender”) in the amount of $200 (the “August 2020 Loan”). Per the terms of the Agreement, the August 2020 Loans has a maturity date of August 7, 2022, (“Maturity Date”) and accrues annual interest at a rate of 10%

The August 2020 Loan is convertible by the August 2020 Lender into Shares, at their discretion, at the lower of a fixed price of $1.02 (the “Fixed Conversion Price”) or 80% of the lowest volume weighted average price (“VWAP”) of the Company’s common stock during the 10 trading days immediately preceding the conversion date (the “Market Conversion Price”).

The Company also granted the August 2020 Investor warrants to purchase 50,000 shares of common stock of the Company at an exercise price of $2.00 per share, such exercise price is subject to any future price-based anti-dilution adjustments. Accordance with ASU 2017-11 the warrants were classified in shareholders equity.

The fair value of the warrants granted was $35 using the Black-Scholes-Merton option pricing model using the following assumptions:

	August 2020
Share price	$	0.86
Dividend yield		0	%
Risk-free interest rate		0.21	%
Expected term (in years)		5
Volatility		176.96	%

The Company accounted for the August 2020 Loan in accordance with ASC 470-20, Debt with conversion and other Options. The combined intrinsic value of the BCF for the August 2020 Loan was calculated and valued at $249 as of August 7, 2020, and the Company allocated $249 to the BCF as a liability. As of December 31, 2021, the BCF was revalued at $146 ($339 as of December 31, 2020).

The Company used an independent appraiser to estimate the fair value of BCF which used the Monte Carlo option pricing model using the following weighted average assumptions:

	August 7, 2020			December 31, 2020			December 31, 2021
Share price	$	0.80		$	1.50		$	0.65
Dividend yield		0			0			0	%
Risk-free interest rate		0.13	%		0.12	%		0.23	%
Expected term (in years)		2			1.58			0.58
Volatility		163.31	%		142.65	%		145.70	%

During the year ended December 31, 2021, the Company recorded financial income related to August 2020 Loan in the amount of $73, and interest and financial expenses in the amount of $222 during the year ended December 31, 2020.

d. From November 2020 through to December 31, 2020, the Company received $425 from third party investors from the issuance of convertible promissory notes (“2020 Promissory Notes”). The Promissory Notes bear no interest, are convertible into Shares based on a fixed conversion price of $1.00 per share and mature between 6 and 24 months from the issuance date. Pursuant to the 2020 Promissory Notes, one of the investors received warrants to purchase 33,000 Shares at an exercise price of $1.50 through to December 17, 2021. (“2020 Promissory Warrants”)

From January 2021 through to February 16, 2021, the Company received an additional $530 from third party investors from the issuance of Promissory Notes (“2021 Promissory Notes). One of the investors received 33,000 warrants (“2021 Promissory Warrants”). The 2021 Promissory Warrants have the same terms as the 2020 Promissory Notes. During December 2021 the 2020 Promissory Warrants and the 2021 Promissory Warrants were extended to December 31, 2022. During December 2021 the 2020 Promissory Warrants and the 2021 Promissory Warrants were extended to December 31, 2022.

During the year ended December 31, 2021, Promissory Notes in the amount of $830,000 have been converted into shares.

e. On July 31, 2020, the Company received a convertible loan from Mr. Shmuel Yannay (a third party at that time, and a director of the Company as of October 28, 2021) in the amount of $100 ("Director Loan"). The loan has a maturity date of July 31, 2022 (“Maturity Date”) and accrues annual interest at a rate of 10%

The Director Loan is convertible into Shares, at his discretion, at the lower of a fixed price of $1.02 (the “Fixed Conversion Price”) or 80% of the lowest volume weighted average price (“VWAP”) of the Company’s common stock during the 10 trading days immediately preceding the conversion date (the “Market Conversion Price”).

The Company also granted the Mr. Yannay warrants to purchase 25,000 shares of common stock of the Company at an exercise price of $2.00 per share, such exercise price is subject to any future price-based anti-dilution adjustments. Accordance with ASU 2017-11 the warrants were classified in shareholders equity.

The fair value of the warrants granted was $18 using the Black-Scholes-Merton option pricing model using the following assumptions:

	August 2020
Share price	$	0.86
Dividend yield		0	%
Risk-free interest rate		0.21	%
Expected term (in years)		5
Volatility		176.96	%

The Company accounted for the Director Loan in accordance with ASC 470-20, Debt with conversion and other Options. The combined intrinsic value of the BCF for the August 2020 Loan was calculated and valued at $129 as of July 31, 2020, and the Company allocated $129 to the BCF as a liability. As of December 31, 2021, the BCF was revalued at $76 ($163 as of December 31, 2020).

The Company estimated the fair value of BCF using the Monte Carlo option pricing model using the following weighted average assumptions:

	July 31, 2020			December 31, 2020			December 31, 2021
Share price	$	0.86		$	1.50		$	0.65
Dividend yield		0			0			0	%
Risk-free interest rate		0.11			0.12	%		0.23	%
Expected term (in years)		2			1.58			0.58
Volatility		164.04	%		142.65	%		145.70	%

During the year ended December 31, 2021, the Company recorded interest and financial income related to August 2020 Loan in the amount of $27, and interest and financial expenses in the amount of $105 during the year ended December 31, 2020.