v3.26.1
EQUITY
 12 Months Ended
Dec. 31, 2025
Equity [Abstract]  
EQUITY

NOTE 8 - EQUITY:

 

  a. Private placement:

 

  1. On March 29, 2021, the Company issued to certain investors, including Arkin, a major stockholder of the Company, of which Moshe (Mori) Arkin, a director of the company, is the owner, 2,469,156 units in exchange for an aggregate purchase price of $20 million. Each such unit consisted of (i) one share of common stock and (ii) one warrant to purchase one share of common stock with an exercise price of $10.35 per share. Each such warrant is exercisable until the close of business on March 31, 2026. Pursuant to the terms of the foregoing warrants, following April 1, 2024, if the closing price of Company common stock equal or exceeds 135% of the aforementioned exercise price (subject to appropriate adjustments for stock splits, stock dividends, stock combinations and other similar transactions after the issue date of the warrants) for any thirty (30) consecutive trading days, the Company may force the exercise of the warrants, in whole or in part, by delivering to these investors a notice of forced exercise.
     
  2. On March 16, 2023, the Company consummated a private placement with (i) Moshe Arkin and (ii) The Phoenix Insurance Company Ltd. and Shotfut Menayot Israel – Phoenix Amitim, for the sale of an aggregate amount of 3,294,117 units, at a purchase price of $4.25 per unit resulting in gross proceeds of $14,000,000. Each unit consisted of: (i) one share of common stock and (ii) one warrant to purchase one share of common stock with an exercise price of $5.50 per share. The warrants are immediately exercisable and will expire three years from the date of issuance and will be subject to customary adjustments.
     
  3.

On July 16, 2024, the Company issued 2,144,583 shares of its common stock in consideration for a purchase price of $4.80 per share to new and existing investors, including Mori Arkin and The Phoenix Holdings, through Phoenix Insurance and Phoenix Amitim. The gross proceeds from the issuance of securities offered amounted to approximately $10.3 million. After deducting issuance costs, the Company received proceeds of approximately $9.8 million.

     
  4. On February 12, 2025, the Company completed a U.S. underwritten public offering issuing 3,307,692 shares of the Company’s common stock at a price of $6.50 per share. The Company also granted the underwriters a 30-day over-allotment option to purchase up to an additional 496,153 shares at a purchase price of $6.50 per share. On February 14, 2025, the Company sold an additional 345,432 shares of common stock as a result of a partial exercise of the over-allotment option at the public offering price of $6.50 per share. The unexercised over-allotment option has expired. Following the exercise of the over-allotment option, the Company sold a total of 3,653,124 shares of common stock, generating gross proceeds of approximately $23.7 million, prior to the deduction of underwriting discounts, commissions and estimated offering expenses. After deducting issuance costs, the Company received proceeds of approximately $20.9 million.

 

 

ODYSIGHT.AI INC.

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 8 – EQUITY (continued):

 

Warrants:

 

As of December 31, 2025, the Company had the following outstanding warrants to purchase common stock:

 

             Number of 
             Shares of 
         Exercise Price   common stock 
   Issuance  Expiration  Per Share   Underlying 
Warrant  Date  Date  ($)   Warrants 
               
March 2021 Warrant  March 29, 2021  March 31, 2026   10.35    2,469,156 
March 2023 Warrant  March 27, 2023  March 26, 2026   5.50    3,294,117 
               5,763,273 

 

  b. Stock-based compensation to employees, directors and service providers:

 

In February 2020, the Company’s Board of Directors approved the 2020 Share Incentive Plan (the “Plan”).

 

The Plan initially included a pool of 580,890 shares of common stock for grant to Company employees, consultants, directors and other service providers. On March 15, 2020, the Company’s Board of Directors approved an increase to the Company’s option pool pursuant to the Plan by an additional 64,099 shares of common stock. On June 22, 2020, the Company’s Board of Directors approved an increase to the Company’s option pool pursuant to the Plan by an additional 401,950 shares of common stock. During the second quarter of 2021, the Company’s Board of Directors approved an increase to the Company’s option pool pursuant to the Plan by an additional 777,778 shares of common stock. During the first quarter of 2023, the Company’s Board of Directors approved an increase to the option pool pursuant to the Plan by an additional 1,000,000 shares of common stock.

 

In June 2024, the Company’s Board of Directors approved the 2024 Share Incentive Plan (the “2024 Plan”). With adoption of the 2024 Plan, the Company ceased making new awards under the 2020 Plan.

 

The 2024 Plan initially included a pool of 234,484 shares of common stock, representing the number of shares remaining available for grant under the 2020 Plan. These shares are available for future grant to Company employees, consultants, directors and other service providers. Shares that were subject to awards granted under either the 2020 Plan or the 2024 Plan that have expired or were cancelled or become unexercisable for any reason without having been exercised in full shall become available for future grant under the 2024 Plan.

 

In July 2024, the Company’s Board of Directors approved an increase to the 2024 Plan’s option pool by an additional 850,000 shares of common stock.

 

Also in July 2024, stockholders approved the 2024 Plan.

 

In December 2025, the Company’s Board of Directors approved an increase to the 2024 Plan’s option pool by an additional 777,000 shares of common stock.

 

The 2020 Plan and 2024 Plan each provide for the grant of stock options (including incentive stock options and nonqualified stock options), shares of common stock, restricted shares, restricted share units, and other share-based awards.

 

 

ODYSIGHT.AI INC.

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 8 – EQUITY (continued):

 

Stock Option Activity

 

The following summarizes stock option activity:

 

   Amount of options   Weighted average exercise price   Weighted Average Remaining Contractual Term (years)   Aggregate Intrinsic Value (in thousands) 
       $       $ in
thousands		 
Outstanding - January 1, 2024   2,455,069    3.46    5.04    312 
Granted   795,500    4.77    -    - 
Forfeited   (23,335)   3.00    -    - 
Outstanding - December 31, 2024   3,227,234    3.78    4.66    13,605 
                     
Granted   331,000    5.37    -    - 
Forfeited   (137,286)   3.94    -    - 
Exercised   (80,434)   3.36    -    - 
Outstanding - December 31, 2025   3,340,514    3.95    4.06    650 
                     
Options Exercisable - December 31, 2025   2,413,154    3.68    3.44    589 

 

The aggregate intrinsic value of options granted is calculated as the difference between the closing price and the exercise price on the same date.

 

The Company estimates the fair value of stock option awards on the grant date using the Black-Scholes option pricing model. The weighted-average grant date fair value per option granted during the year ended December 31, 2025 was $4.12. The fair value of each award is estimated using Black-Scholes option-pricing model based on the following assumptions: based on underlying value of shares of $3.97-6.14, exercise price of $4.0-$6.5, expected volatility of 99.39%-99.47%, term of the options – 4.375-7 years and risk-free interest rate 3.57%-4.10%.

 

The unrecognized compensation expense calculated under the fair-value method for stock options expected to vest as of December 31, 2025 is approximately $1.5 million and is expected to be recognized over a weighted-average period of 1.19 years.

 

During 2024, the Company’s Board of Directors authorized the grant of options to purchase 60,000 shares of common stock of the Company to Prof. Goldwasser, the Chairman of the Board.

 

During 2025 and 2024, the Company’s Board of Directors authorized the grant of options to purchase 50,000 shares of common stock of the Company and 120,000 shares of common stock of the Company, respectively to directors of the Company (not including Chairman of the Board).

 

During 2025 and 2024, the Company’s Board of Directors authorized the grant of options to purchase 150,000 shares of common stock of the Company and 285,000 shares of common stock of the Company, respectively, to certain officers of the Company.

 

Compensation expense recorded by the Company in respect of its stock-based employees, directors and service providers compensation awards in accordance with ASC 718-10 for the year ended December 31, 2025 and 2024 amounted to $3,067 thousand and $2,329 thousand, respectively.

 

 

ODYSIGHT.AI INC.

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 8 – EQUITY (continued):

 

  c. Restricted stock unit (“RSU”) to employees and service providers:

 

Each RSU will vest based on continued service which is generally over three years. The grant date fair value of the award will be recognized as stock-based compensation expense over the requisite service period. The fair value of restricted stock units was estimated on the date of grant based on the fair value of the Company’s common stock.

 

The following table summarizes RSU activity:

  

   Amount of RSUs   Weighted Average Grant Date Fair Value per Share   Weighted Average Remaining Contractual Term (years) 
         $          
Outstanding – January 1, 2024   39,585    4.08    6.3 
Granted   -    -    - 
Forfeited   -    -    - 
Vested   (24,166)   4.42    - 
Unvested and Outstanding - December 31, 2024   15,419    3.56    5.5 
Granted   -    -    - 
Forfeited   -    -    - 
Vested   (11,252)   3.76    - 
Unvested and Outstanding - December 31, 2025   4,167    3.0    4.72 

 

Compensation expense recorded by the Company in respect of its stock-based employees, directors and service providers compensation awards in accordance with ASC 718-10 for the year ended December 31, 2025 and 2024 amounted to $11 thousand and $57 thousand, respectively.

 

The unrecognized compensation expense calculated under the fair-value method for RSUs expected to vest as of December 31, 2025 is approximately $1 thousand and is expected to be recognized over a weighted-average period of 0.35 years.

 

The following table sets forth the total stock-based payment expenses resulting from options and RSU granted, included in the statements of operation and comprehensive income:

 

   2025   2024 
   Year ended on
December 31,		 
   2025   2024 
   USD in thousands 
Cost of revenues   (3)   35 
Research and development   908    665 
Sales and marketing expenses   358    265 
General and administrative   1,815    1,421 
Total expenses   3,078    2,386 

 

 

ODYSIGHT.AI INC.

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS