REWALK ROBOTICS LTD. – 10-Q – MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of
operation should be read in conjunction with the unaudited condensed
consolidated financial statements and the related notes included elsewhere in
this quarterly report on Form 10-Q and with our audited consolidated financial
statements included in our annual report on Form 10-K for the year ended
2021
discussion contains forward-looking statements that reflect our plans, estimates
and beliefs. Our actual results could differ materially from those discussed in
the forward-looking statements. For a discussion of factors that could cause or
contribute to these differences, see "Special Note Regarding Forward-Looking
Statements" below.
Special Note Regarding Forward-Looking Statements
In addition to historical information, this quarterly report contains
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act"), Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995, that are
based on our management's beliefs and assumptions and on information currently
available to our management. Forward-looking statements include information
concerning our possible or assumed future results of operations, business
strategies, financing plans, competitive position, industry environment,
potential growth opportunities, potential market opportunities and the effects
of competition. Forward-looking statements may include projections regarding our
future performance and, in some cases, can be identified by words like
"anticipate," "assume," "believe," "could," "seek," "estimate," "expect,"
"intend," "may," "plan," "potential," "predict," "project," "future," "should,"
"will," "would" or similar expressions that convey uncertainty of future events
or outcomes and the negatives of those terms. These statements may be found in
this section of this quarterly report on Form 10-Q titled "Part I, Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
Operations" and elsewhere in this quarterly report on Form 10-Q. These
statements include, but are not limited to, statements regarding:
•
our expectations regarding future growth, including our ability to increase
sales in our existing geographic markets and expand to new markets;
•
our ability to maintain and grow our reputation and the market acceptance of our
products;
•
our ability to achieve reimbursement from third-party payors or advance
for Medicare & Medicaid Services
•
the adverse effect that the COVID-19 pandemic has had and continues to have on
our business and results of operations;
•
our ability to have sufficient funds to meet certain future capital
requirements, which could impair our efforts to develop and commercialize
existing and new products;
•
our limited operating history and our ability to leverage our sales, marketing
and training infrastructure;
•
our ability to maintain compliance with the continued listing requirements of
the Nasdaq Capital Market and the risk that our ordinary shares will be delisted
if we cannot do so;
•
our expectations as to our clinical research program and clinical results;
•
our ability to obtain certain components of our products from third-party
suppliers and our continued access to our product manufacturers;
•
our ability to improve our products and develop new products;
•
our compliance with medical device reporting regulations to report adverse
events involving our products, which could result in voluntary corrective
actions or enforcement actions such as mandatory recalls, and the potential
impact of such adverse events on ReWalk's ability to market and sell its
products;
•
our ability to gain and maintain regulatory approvals;
•
our expectations as to the results of the FDA, potential regulatory developments
with respect to our mandatory 522 post-market surveillance study;
•
the risk of a cybersecurity attack or breach of our information technology
systems significantly disrupting our business operations;
•
our ability to maintain adequate protection of our intellectual property and to
avoid violation of the intellectual property rights of others;
•
the impact of substantial sales of our shares by certain shareholders on the
market price of our ordinary shares;
•
our ability to use effectively the proceeds of our offerings of securities;
•
the risk of substantial dilution resulting from the periodic issuances of our
ordinary shares;
•
the impact of the market price of our ordinary shares on the determination of
whether we are a passive foreign investment company;
•
market and other conditions; and
•
other factors discussed in "Part II. Item 1A. Risk Factors."
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The preceding list is not intended to be an exhaustive list of all of our
forward-looking statements. The statements are based on our beliefs,
assumptions, and expectations of future performance, taking into account the
information currently available to us. These statements are only predictions
based upon our current expectations and projections about future events. There
are important factors that could cause our actual results, levels of activity,
performance, or achievements to differ materially from the results, levels of
activity, performance or achievements expressed or implied by the statements. In
particular, you should consider the risks provided under "Part 1, Item 1A. Risk
Factors" of our 2020 Form 10-K, and in other reports subsequently filed by us
with, or furnished to, the
You should not rely upon forward-looking statements as predictions of future
events. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee that future
results, levels of activity, performance and events and circumstances reflected
in the forward-looking statements will be achieved or will occur.
Any forward-looking statement in this quarterly report speaks only as of the
date hereof. Except as required by law, we undertake no obligation to update
publicly any forward-looking statements, whether as a result of new information,
future developments or otherwise.
Overview
We are an innovative medical device company that is designing, developing and
commercializing robotic exoskeletons that allow individuals with mobility
impairments or other medical conditions the ability to stand and walk once
again. We have developed and are continuing to commercialize our ReWalk Personal
and ReWalk Rehabilitation devices for individuals with spinal cord injury ("SCI
Products"), which are exoskeletons designed for individuals with paraplegia that
use our patented tilt-sensor technology and an on-board computer and motion
sensors to drive motorized legs that power movement.
We have also developed our ReStore device, which we began commercializing in
the rehabilitation of individuals with lower limb disability due to stroke.
During the second quarter of 2020, we finalized and moved to implement two
separate agreements to distribute additional product lines in
We are the exclusive distributor of the MediTouch Tutor movement biofeedback
systems in
MYOLYN MyoCycle
through the
personal sales. These Distributed Products will improve our product offering to
clinics as well as patients within the
and patient profile.
Our principal markets are
direct sales operation in
other major countries. We have offices in
Germany
We have in the past generated and expect to generate in the future revenues from
a combination of third-party payors, self-payors (including private and
government employers) and institutions. While a broad uniform policy of coverage
and reimbursement by third-party commercial payors currently does not exist in
Personal, we are pursuing various paths of reimbursement and support fundraising
efforts by institutions and clinics, such as the
exoskeleton systems for all qualifying veterans suffering from spinal cord
injury across
As the
it covers approximately 55% of the spinal cord injury population which are at
least five years post their injury date we have been trying to develop a policy
with CMS. In
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Additionally, to date, several private insurers in
have provided reimbursement for ReWalk in certain cases. In
to make progress toward achieving ReWalk coverage from the various government,
private and worker's compensation payors. In
insurer BARMER GEK ("Barmer") and national social accident insurance provider
Deutsche Gesetzliche Unfallversicherung ("DGUV"), indicated that they will
provide coverage to users who meet certain inclusion and exclusion criteria. In
Spitzenverband ("GKV") confirmed their decision to list the ReWalk Personal 6.0
exoskeleton system in the German Medical Device Directory. This decision means
that ReWalk will be listed among all medical devices for compensation, which SHI
providers can procure for any approved beneficiary on a case-by-case basis.
During the year 2020, we announced several new agreements with German SHIs,
including TK and DAK Gesundheit, as well as the first German Private Health
Insurer ("PHI"), which outline the process of obtaining our devices for eligible
insured patients. We are also currently working with several additional SHIs on
securing a formal operating contract that will establish the process of
obtaining a ReWalk Personal 6.0 device for their beneficiaries within their
system.
Third Quarter 2021 and Subsequent Period Business Highlights
•
Total revenue of
•
Gross margin of approximately 58% in the third quarter of 2021
•
Received FDA breakthrough device designation for ReBoot, a soft exoskeleton for
stroke home and community use
•
Strengthened cash position of
registered direct offering closed in September
Evolving COVID-19 Pandemic
The impact of the COVID-19 pandemic has resulted in, and will likely continue to
result in, significant disruptions to the global economy and the capital
markets, as well as our business. In an effort to halt the outbreak of COVID-19,
a number of countries, including
have placed significant restrictions on travel, and many businesses have
announced extended closures. Despite the distribution of COVID-19 vaccines, it
is unclear how long any total or partial shutdowns could last, and whether
additional shutdowns will be necessary to halt potential future outbreaks
especially as new variants such as the Delta variant are emerging.
The COVID-19 pandemic has affected our ability to engage with our SCI Products,
ReStore and Distributed Products existing customers, conduct trials of new
product candidates, deliver ordered units or repair existing systems and provide
training of our products to new patients who have largely remained at home due
to local movement restrictions and to rehabilitation centers, which have
temporarily shifted priorities and responses to pandemic-related medical
equipment. As a result, our sales and results of operations have been adversely
impacted. We believe that these adverse impacts may continue as long as the
pandemic status remains in our key markets within
especially as long as our ability to conduct trials of new patients is limited
or if our existing customers can't train with our SCI Products and as long as
capital budgets for rehabilitation devices such as the ReStore remain reduced or
on-hold. Additionally, some clinics, such as
restrictions that effect our ability to demonstrate our devices to patients or
start training for qualified potential customers. We continue to monitor our
sales pipeline on a day-to-day basis in order to assess the quarterly effect of
these limitations as some have short term effects and some affects our future
pipeline development. While our sole manufacturer, Sanmina Corporation, has not
shut down its facilities during the COVID-19 pandemic, our manufacturing has had
limited impact due to supply chain delays and component shortages. Other adverse
impacts on our production capacity as a result of government directives or
health protocols can occur. Moreover, the current limitations on our sales
activities has made it difficult to effectively forecast our future requirements
for systems. For more information, see "Part II, Item 1A. Risk Factors."
In addition, our future results of operations and liquidity could be adversely
impacted by delays in payments of outstanding receivable amounts beyond normal
payment terms, supply chain disruptions and operational challenges faced by our
customers. The occurrence of new outbreaks of COVID-19 could result in a
widespread health crisis that could adversely affect the economies and financial
markets of many countries, resulting in an economic downturn or a global
recession that could cause significant volatility or decline in the trading
price of our securities, affect our ability to execute strategic business
activities, affect demand for our products and likely impact our operating
results. These may further limit or restrict our ability to access capital on
favorable terms, or at all, lead to consolidation that negatively impacts our
business, weaken demand, increase competition, cause us to reduce our capital
spend further, or otherwise disrupt our business.
During the pandemic, we have implemented remote working procedures in
States
the spread of COVID-19 according to local regulations. With the vaccination of
most of our employees we have gradually returned to work from our offices. We
have also taken several cost reduction efforts that lasted throughout 2020 as
needed. We will continue to monitor the environment and reinforce cost reduction
measures as the market condition develops. Despite this current situation and
the challenges it imposes, we have developed methods to continue to engage with
our current and prospective customers through video conferencing, virtual
training events, and online education demos to offer our support and showcase
the value of our products.
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Results of Operations for the Three and Nine Months Ended
Our operating results for the three and nine months endedSeptember 30, 2021 , as compared to the same periods in 2020, are presented below. The results set forth below are not necessarily indicative of the results to be expected in future periods. Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Revenues$ 1,972 $ 747 $ 4,724 $ 3,175 Cost of revenues 832 355 2,150 1,388 Gross profit 1,140 392 2,574 1,787 Operating expenses: Research and development 638 756 2,243 2,695 Sales and marketing 1,821 1,507 5,105 4,541 General and administrative 1,343 1,198 4,050 3,774 Total operating expenses 3,802 3,461 11,398 11,010 Operating loss (2,662 ) (3,069 ) (8,824 ) (9,223 ) Financial expenses, net 27 242 14 723 Loss before income taxes (2,689 ) (3,311 ) (8,838 ) (9,946 ) Taxes on income (tax benefit) (14 ) 25 40 85 Net loss$ (2,675 ) $ (3,336 ) $ (8,878 ) $ (10,031 ) Net loss per ordinary share, basic and diluted$ (0.06 ) $ (0.18 ) $ (0.21 ) $ (0.71 ) Weighted average number of shares used in computing net loss per ordinary share, basic and diluted 46,570,130 18,881,694 43,021,972 14,132,375 26
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Three and Nine Months Ended
Ended
Revenues
Our revenues for the three and nine months endedSeptember 30, 2021 and 2020 were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 (in thousands, except (in thousands, except unit amounts) unit amounts) Personal unit revenues$ 1,357 $ 698 $ 3,818 $ 3,079 Rehabilitation unit revenues 615 49 906 96 Revenues$ 1,972 $ 747 $ 4,724 $ 3,175
Personal unit revenues consist of ReWalk Personal 6.0 and Distributed Products
sale, rental, service and warranty revenue for home use.
Rehabilitation unit revenues consist of ReStore, Distributed Products and SCI
Products sale, rental, service and warranty revenue to clinics, hospitals for
treating patients with relevant medical conditions or medical academic centers.
Revenues increased by
increase was driven primarily by higher number of personal and rehabilitation
units sold in Unites States including a multiple unit order to a physical
therapy university as well as an increase in
COVID-19 restrictions.
Revenues increased by approximately
ended
The increase is due to higher number of personal and rehabilitation units sold
in
In the future, we expect our growth to be driven by sales of our ReWalk Personal
device to third-party payors as we continue to focus our resources on broader
commercial coverage policies with third-party payors as well as sales of the
ReStore and other products to rehabilitation clinics and for personal use.
Gross Profit
Our gross profit for the three and nine months ended
were as follows (in thousands):
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Gross profit $ 1,140 $ 392 $ 2,574 $ 1,787
Gross profit was 58% of revenue for the three months ended
compared to 52% for the three months ended
gross profit for the three months ended
higher number of units sold and in higher Average Selling Price ("ASP") offset
partially with sales mix.
Gross profit was 54% of revenue for the nine months ended
compared to 56% for the nine months ended
mainly driven by change in sales mix and higher service-related expenses offset
by increased ASP.
We expect our gross profit to improve, assuming we increase our sales volumes,
which could also decrease the product manufacturing costs. Improvements may be
partially offset by the lower margins we currently expect from ReStore and our
Distributed Products as well as due to an increase in the cost of product parts,
especially as long as COVID-19 pandemic is affecting the market.
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Research and Development Expenses
Our research and development expenses, for the three and nine months ended
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Research and development expenses $ 638 $ 756 $ 2,243 $ 2,695
Research and development expenses, decreased
three months ended
or 17%, for the nine months ended
ended
personnel and personnel related expenses and decreased consulting costs
associated with the development and clinical study costs of our ReStore soft
suit exoskeleton.
We intend to focus our future research and development expenses mainly on our
current products maintenance as well as developing our "soft suit" exoskeleton
for additional indications affecting the ability to walk or a home use design.
Sales and Marketing Expenses
Our sales and marketing expenses for the three and nine months ended
30, 2021
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Sales and marketing expenses
Sales and marketing expenses increased
months ended
2020
months ended
2020
2021
higher sales driven compensation costs.
In the near term our sales and marketing expenses are expected to be driven by
our efforts to commercialize our current products and to increase reimbursement
coverage of the ReWalk Personal device.
General and Administrative Expenses
Our general and administrative expenses for the three and nine months ended
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
General and administrative expenses
General and administrative expenses increased
three months ended
or 7%, for the nine months ended
ended
30, 2020
professional services expenses.
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Financial Expenses, Net
Our financial expenses, net, for the three and nine months ended
2021
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Financial expenses, net $ 27 $ 242 $ 14 $ 723
Financial expenses, net, decreased
ended
Financial expenses, net, decreased
ended
The decrease is mainly due to lower interest expenses related to the Loan
Agreement with Kreos, which was fully repaid in
Income Taxes
Our income tax for the three and nine months ended
was as follows (in thousands):
Three Months Ended Nine Months Ended
September 30, September 30,
2021 2020 2021 2020
Taxes on income
(tax benefit) $ (14 ) $ 25 $ 40 $ 85
Taxes on income decreased
2021
decreased
the nine months ended
deferred income tax resulting from a decrease in deferred revenues.
Critical Accounting Policies and Estimates
Our condensed consolidated financial statements are prepared in accordance with
make estimates, judgments and assumptions that can affect the reported amounts
of assets and liabilities, disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. We base our estimates, judgments and
assumptions on historical experience and other factors that we believe to be
reasonable under the circumstances. Materially different results can occur as
circumstances change and additional information becomes known. Besides the
estimates identified above that are considered critical, we make many other
accounting estimates in preparing our condensed financial statements and related
disclosures. See Note 2 to our audited consolidated financial statements
included in our 2020 Form 10-K for a description of the significant accounting
policies that we used to prepare our consolidated financial statements
There have been no material changes to our critical accounting policies or our
critical judgments from the information provided in "Part II, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations - Critical Accounting Policies" of our 2020 Form 10-K, except for the
updates provided in Note 3 of our unaudited condensed consolidated financial
statements set forth in "Part I, Item 1. Financial Statements" of this quarterly
report on Form 10-Q.
Recent Accounting Pronouncements
See Note 3 to our unaudited condensed consolidated financial statements set
forth in "Part I, Item 1. Financial Statements" of this quarterly report on Form
10-Q for information regarding new accounting pronouncements.
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Liquidity and Capital Resources
Sources of Liquidity and Outlook
Since inception, we have funded our operations primarily through the sale of
certain of our equity securities and convertible promissory notes to investors
in private placements, the sale of our ordinary shares in public offerings and
the incurrence of bank debt.
In the nine months ended
of
the total amount of
the nine months ended
funds to support its operations for more than 12 months following the issuance
date of our condensed consolidated unaudited financial statements for the three
and nine months ended
We expect to incur future net losses and our transition to profitability is
dependent upon, among other things, the successful development and
commercialization of our products and product candidates, the achievement of a
level of revenues adequate to support our cost structure. Until we achieve
profitability or generate positive cash flows, we will continue to need to raise
additional cash. We intend to fund future operations through cash on hand,
additional private and/or public offerings of debt or equity securities, cash
exercises of outstanding warrants or a combination of the foregoing. In
addition, we may seek additional capital through arrangements with strategic
partners or from other sources and we will continue to address our cost
structure. Notwithstanding, there can be no assurance that we will be able to
raise additional funds or achieve or sustain profitability or positive cash
flows from operations.
Our anticipated primary uses of cash are: (i) sales, marketing and reimbursement
expenses related to market development activities of our ReStore and Personal
6.0 devices, broadening third-party payor and CMS coverage for our ReWalk
Personal device and commercializing our new product lines added through
distribution agreements; (ii) ) research and development of our lightweight
exo-suit technology for potential home personal health utilization for multiple
indications and future generation designs for our spinal cord injury device;
(iii) routine product updates; (iv) general corporate purposes, including
working capital needs; and (v) potential acquisitions of business. We do not
currently have any agreement or understanding with respect to an acquisition.
Our future cash requirements will depend on many factors, including our rate of
revenue growth, the expansion of our sales and marketing activities, the timing
and extent of our spending on research and development efforts and international
expansion. If our current estimates of revenue, expenses or capital or liquidity
requirements change or are inaccurate, we may seek to sell additional equity or
debt securities, arrange for additional bank debt financing or refinance our
indebtedness. There can be no assurance that we will be able to raise such funds
on acceptable terms.
Loan Agreement with Kreos and Related Warrant to Purchase Ordinary Shares
On
which Kreos extended a line of credit to us in the amount of
terms of the Loan Agreement we were entitled to draw down up to an additional
issuance of shares of our capital stock (including debt convertible into shares
of our capital stock) by
the remaining
payable monthly in arrears on any amounts drawn down at a rate of 10.75% per
year from the applicable drawdown date through the date on which all principal
is repaid. As of
with the issuance of its share capital and therefore, in accordance with the
terms of the Loan Agreement, the repayment period was extended from 24 months to
36 months. The principal was also reduced in connection with the issuance to
Kreos on
"Kreos Convertible Note"). Pursuant to the Loan Agreement, we paid Kreos a
transaction fee equal to 1.0% of the total available amount of the line of
credit upon the execution of the agreement and we will be required to pay Kreos
an "end of loan payment" equal to 1.0% of the amount of each tranche drawn down
upon the expiration of each such tranche. Pursuant to the Loan Agreement, we
granted Kreos a first priority security interest over all of our assets,
including certain intellectual property and equity interests in its
subsidiaries, subject to certain permitted security interests.
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In connection with the
up to 4,771 of our ordinary shares at an exercise price of
was increased to 6,679 ordinary shares on
terms of the warrant, the warrant is exercisable, in whole or in part, at any
time prior to the earlier of (i)
the consummation of a merger, consolidation, or reorganization of us with or
into, or the sale or license of all or substantially all our assets or shares
to, any other entity or person, other than a wholly owned subsidiary of us,
excluding any transaction in which our shareholders prior to the transaction
will hold more than 50% of the voting and economic rights of the surviving
entity after the transaction.
On
Kreos, under which
Agreement became subject to repayment pursuant to the senior secured Kreos
Convertible Note issued on
On
with Kreos, in which we (i) repaid
costs and end of loan payments, (ii) terminated the Kreos Note, (iii) issued
Kreos 192,000 units and 288,000 pre-funded units as part of an underwritten
public offering at the public offering prices, and (iv) agreed with Kreos to
revise the principal and the repayment schedule under the Kreos Loan.
Additionally, we entered into a Warrant Amendment with Kreos, which amended the
exercise price of the Kreos Warrants from
On
with certain institutional investors of warrants to purchase our ordinary
shares, pursuant to which Kreos agreed to exercise, in cash, the Kreos Warrant
at the then-effective exercise price of
agreements, we also agreed to issue to Kreos new warrants to purchase up to
480,000 ordinary shares at an exercise price of
period of five years.
On
under the Loan Agreement to Kreos including end of loan payments, thereby
discharging all of our obligations to Kreos. Accordingly, as of
2020
Paycheck Protection Program Loan Agreement
On
loan in the amount of
Protection Program ("PPP") as part of the Coronavirus Aid, Relief, and Economic
Security Act (the "CARES Act") enacted on
for an interest rate of 1.00% per year and matures two years after the date of
initial disbursement. Beginning on the seventh month following the date of
initial disbursement, RRI is required to make 18 monthly payments of principal
and interest. The PPP Note may be used for payroll costs, costs related to
certain group health care benefits and insurance premiums, rent payments,
utility payments, mortgage interest payments and interest payments on any other
debt obligation that were incurred before
the CARES Act, PPP loan recipients could apply for and be granted forgiveness
for all or a portion of loan granted under the PPP, with such forgiveness to be
determined, subject to limitations, based on the use of the loan proceeds for
payment of payroll costs and any payments of mortgage interest, rent, and
utilities. The terms of any forgiveness may also be subject to further
requirements in any regulations and guidelines the
may adopt.
On
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Equity Raises
Form S-3 Limitations
Beginning with the filing of our annual report on Form 10-K for the year ended
applicable rules of Form S-3, which constrained our ability to secure capital
pursuant to our At The Market ("ATM") Offering Program or other public offerings
pursuant to our effective registration statement on Form S-3. These rules limit
the size of primary securities offerings conducted by issuers with a public
float of less than
in any 12-month period. As of
at least
apply to our primary offerings under Form S-3 until the filing of our annual
report on Form 10-K in 2022, when we will re-assess our status under these
rules. If our public float subsequently drops below
of that or a subsequent annual report on Form 10-K, or at the time we file a new
Form S-3, we will become subject to these limitations again, until the date that
our public float again reaches
secondary offerings for the resale of our ordinary shares or other securities by
selling shareholders or to the issuance of ordinary shares upon conversion by
holders of convertible securities, such as warrants. Our currently effective
Form S-3 expires on
ordinary shares warrants and/or debt securities and certain other outstanding
securities with registration rights on the Form S-3.
Equity Offerings and Subsequent Warrant Exercises
On
which we issued and sold 728,019 units, each consisting of one ordinary share
and one warrant to purchase one ordinary share. Each unit was sold to the public
at a price of
pre-funded units, each unit was sold to the public at a price of
Each unit containing one pre-funded warrant with an exercise price of
share and one warrant to purchase one ordinary share. The total gross proceeds
received from the follow-on public offering, before deducting commissions,
discounts, and expenses, were
exercise of 90,691 pre- funded warrants at the closing of the offering). As of
562,466 ordinary shares had been exercised, for additional proceeds of
During the nine months ended
and warrants to purchase an aggregate 2,048,752 ordinary shares had been
exercised, for additional proceeds of
role in the offering, we also issued to the underwriters warrants to purchase up
to 106,680 ordinary shares, which are immediately exercisable starting on
On
with
public offering of 760,000 ordinary shares at a price of
total gross proceeds received from the follow-on public offering, before
deducting commissions, discounts, and expenses, were
issued to
ordinary shares, which are immediately exercisable starting on
2019
On
shares, and a concurrent private placement of warrants to purchase ordinary
shares. The ordinary shares were offered pursuant to our effective registration
statement on Form S-3. Also on
with certain institutional investors for the issuance and sale of 816,914
ordinary shares at $5.2025 per ordinary share and warrants to purchase up to
408,457 ordinary shares at an exercise price of
these purchasers were exercisable at any time and from time to time, in whole or
in part, following the date of issuance and ending five and one-half years from
the date of issuance, at an exercise price of
Wainwright
shares. The warrants issued to
and from time to time, in whole or in part, following the date of issuance and
ending five years from the date of the execution of the purchase agreement, at a
price per share equal to
deducting placement agent fees and offering expenses, were approximately
million
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On
with certain institutional investors whereby we issued warrants to purchase up
to 1,464,665 ordinary shares with an exercise price of
exercisable from
2024
ordinary shares, with an exercise price of
exercise agreement and concurrent private placement of warrants.
On
institutional investors for the issuance and sale of 833,334 ordinary shares, at
with an exercise price of
registered direct offering of ordinary shares in
issued warrants to purchase up to 50,000 ordinary shares, with an exercise price
of
certain representatives of
placement agent in our
private placement of warrants.
On
issued an aggregate of 5,600,000 of common units and pre-funded units at a
public offering price of
As part of the public offering, we entered into a securities purchase agreement
with certain institutional purchasers. Each common unit consisted of one
ordinary share, and one common warrant to purchase one ordinary share. Each
pre-funded unit consisted of one pre-funded warrant to purchase one ordinary
share and one common warrant. Additionally, we issued warrants to purchase up to
336,000 ordinary shares, with an exercise price of
representatives of
agent in oue
warrants to purchase ordinary shares had been exercised and 1,831,500 common
warrants to purchase ordinary shares had been exercised.
On
investors for the issuance and sale of 4,938,278 ordinary shares, at
ordinary share and warrants to purchase up to 2,469,139 ordinary shares with an
exercise price of
6, 2026
shares, with an exercise price of
2020
compensation for its role as the placement agent in our
direct offering.
On
institutional investors for the issuance and sale of 5,579,776 ordinary shares,
at
shares with exercise price of
2020
334,787 ordinary shares, with an exercise price of
exercisable from
representatives of
agent in our
On
institutional and other accredited investors for the issuance and sale of
10,921,502 ordinary shares, at
purchase up to an aggregate of 5,460,751 ordinary shares with an exercise price
of
Additionally, we issued warrants to purchase up to 655,290 ordinary shares, with
an exercise price of
until
compensation for its role as the placement agent in our
placement offering.
Equity Offerings in the Third Quarter of 2021
On
investors for the issuance and sale of 15,403,014 ordinary shares, pre-funded
warrants to purchase up to an aggregate of 610,504 ordinary shares and ordinary
warrants to purchase up to an aggregate of 8,006,759 ordinary shares at an
exercise price of
price of
exercised at any time after their original issuance until such pre-funded
warrants are exercised in full. Each ordinary share was sold at an offering
price of
of the pre-funded warrant). The offering of the ordinary shares, the pre-funded
warrants and the ordinary shares that are issuable from time to time upon
exercise of the pre-funded warrants was made pursuant to our shelf registration
statement on Form S-3 initially filed with the
effective by the
concurrent private placement. The ordinary warrants are exercisable at any time
and from time to time, in whole or in part, following the date of issuance and
ending five and one-half years from the date of issuance. All of the pre-funded
warrants were exercised in full on
on
960,811 ordinary shares, with an exercise price of
exercisable from
representatives of
agent in our
33
--------------------------------------------------------------------------------
ATM Offering Program
On
Jaffray
shares having an aggregate offering price of up to
Jaffray
Distribution Agreement,
efforts to sell on our behalf all of the ordinary shares requested to be sold by
us, consistent with its normal trading and sales practices.
also act as principal in the sale of ordinary shares under the Equity
Distribution Agreement. Such sales will be made under our effective registration
statement on Form S-3 in what may be deemed "at-the-market" equity offerings as
defined in Rule 415 promulgated under the Securities Act, directly on or through
the Nasdaq Capital Market, to or through a market maker other than on an
exchange or otherwise, in negotiated transactions at market prices prevailing at
the time of sale or at prices related to such prevailing market prices, and/or
any other method permitted by law, including in privately negotiated
transactions.
the gross sales price per share sold through it as agent under the Equity
Distribution Agreement. Where
ordinary shares under the Equity Distribution Agreement, such rate of
compensation will not apply, but in no event will the total compensation of
out-of-pocket fees and disbursements of its legal counsel, exceed 8.0% of the
gross proceeds received from the sale of the ordinary shares.
We may instruct
effected at or above the price designated by us in any instruction. We or
Jaffray
Program upon proper notice and subject to other conditions, as further described
in the Equity Distribution Agreement. Additionally, the ATM Offering Program
will terminate on the earlier of (i) the sale of all ordinary shares subject to
the Equity Distribution Agreement, (ii) the date that is three years after a new
registration statement on Form S-3 goes effective, (iii) our becoming ineligible
to use Form S-3 and (iv) termination of the Equity Distribution Agreement by the
parties. The Equity Distribution Agreement may be terminated by
us at any time on the close of business on the date of receipt of written
notice, and by
suspension or limitation on the trading of our ordinary shares on the Nasdaq
Capital Market, as further described in the Equity Distribution Agreement. We
temporarily suspended use of the ATM Offering Program on
facilitate our
2020
proceeds to us of
Additionally, as of that date, we had paid
thousand
approximately
We intend to continue using the at-the-market offering or similar continuous
offering programs opportunistically to raise additional funds, although we are
currently subject to restrictions on using the ATM Offering Program with
Jaffray
agreed, for a period of one year following
or agree to issue equity or debt securities convertible into, or exercisable or
exchangeable for, ordinary shares at a conversion price, exercise price or
exchange price which floats with the trading price of the ordinary shares or
which may be adjusted after issuance upon the occurrence of certain events or
(ii) enter into any agreement, including an equity line of credit, whereby we
may issue securities at a future-determined price, other than an at-the-market
facility with the placement agent,
2021
at all.
34
--------------------------------------------------------------------------------
Timwell Private Placement
On
Corporation Limited
2018
aggregate gross proceeds to us of
of 640,000 of our ordinary shares, at a price per share of
Agreement contemplates issuances in three tranches, including
160,000 shares in the first tranche,
second tranche and
The first tranche, consisting of
15, 2018
offering expenses in the amount of approximately
approximately
The closings of the Second Tranche and Third Tranche were subject to specified
closing conditions, including the formation of a joint venture, the signing of a
license agreement and a supply agreement, and the successful production of
certain ReWalk products. The Third Tranche Closing was to have occurred by
committed various material breaches of the Investment Agreement, including
failure to consummate its second and third investment tranches with us for a
total of
and failure to make payments for product-related commitments. Nevertheless,
until
affiliate RealCan) on alternative pathways to allow us to commercialize our
products in
RealCan or an affiliate to invest in us.
In late
third tranches under the Investment Agreement. In response, in early
our Board of Directors also removed Timwell's designee, who was appointed
pursuant to the Investment Agreement, from the Board of Directors, due to this
breach pursuant to the terms of the Investment Agreement. We continue to view
patients, and therefore we continue to evaluate potential relationships with
other groups to penetrate the Chinese market.
Cash Flows for the Nine Months EndedSeptember 30, 2021 andSeptember 30, 2020 (in thousands): Nine Months EndedSeptember 30, 2021 2020
Net cash used in operating activities
Net cash used in investing activities
(28 ) (73 ) Net cash provided by financing activities 79,808 11,948 Net cash flow$ 70,877 $ 1,744 35
--------------------------------------------------------------------------------
Net cash used in operating activities decreased by
improvement in working capital as well as no interest payments to Kreos as we
repaid our debt under the Loan Agreement in full in
Net Cash Provided by Financing Activities
Net cash provided by financing activities increased by
nine months ended
30, 2020
third quarter offering and warrants exercises, as well as the fact that we did
not have any principal payments pursuant to the Loan Agreement with Kreos after
repaying our debt in full in
Obligations and Commercial Commitments
Set forth below is a summary of our contractual obligations as ofSeptember 30, 2021 . Payments due by period (in dollars, in thousands) Less than More than Contractual obligations Total 1 year 1-3 years 3-5 years 5 years Purchase obligations (1)$ 1,367 $ 1,367 $ - $ - $ - Collaboration Agreement and License Agreement obligations (2) 425 425 - - - Operating lease obligations (3) 1,484 678 806 - - Total$ 3,276 $ 2,470 $ 806 $ - $ -
(1) We depend on one contract manufacturer, Sanmina Corporation, for both the
ReStore products and the SCI Products. We place our manufacturing orders with
Sanmina pursuant to purchase orders or by providing forecasts for future
requirements.
(2) Our Collaboration Agreement which was originally signed for a period of six
years and at the end ofSeptember 30, 2021 has a remaining term of approx. 0.5 year, it requires us to pay in quarterly installments for the funding of our joint research collaboration with Harvard, subject to a minimum funding commitment under applicable circumstances. Our License Agreement consists of patent reimbursement expenses payments and of a license upfront fee payment. There are also several milestone payments contingent upon the achievement of certain product development and commercialization milestones and royalty payments on net sales from certain patents licensed to Harvard. These product development milestones have been met as ofSeptember 30, 2021 . There are commercialization milestones which depend on us reaching certain sales amounts some or all of which may not occur.
(3) Our operating leases consist of leases for our facilities and motor vehicles.
We calculated the payments due under our operating lease obligation for our
Israeli office that are to be paid in NIS at a rate of exchange of
3
German subsidiary that are to be paid in euros at a rate of exchange of
€1.15:$1:00, both of which were the applicable exchange rates as of
30, 2021
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements or guarantees of third-party
obligations as of
Centrus Reports Third Quarter 2021 Results
EVEREST REINSURANCE HOLDINGS INC – 10-Q – MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
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