| INX TOKEN WARRANT LIABILITY |
NOTE 13:
INX TOKEN WARRANT LIABILITY
The Company
grants restricted INX Token awards (“RTA”) or INX Token warrants to directors, advisors, employees or service providers as
compensation. The warrant grantees have a right to purchase INX Tokens upon the completion of the term set forth in each warrant agreement.
As of December 31, 2025, and 2024, directors, advisors, employees and service providers held 0 and 8,116,958 restricted INX Tokens or
INX Token warrants, as follows:
| | |
December
31, | |
| | |
2025 | | |
2024 | |
| INX Token warrant liability: | |
| | |
| |
| Warrants
granted to employees, advisors and service providers | |
$ | - | | |
$ | 660 | |
The
liability related to INX Token warrants is presented at fair value based on the below inputs. The level in the fair value hierarchy is
level 3. The
following table lists the inputs to the Black-Scholes pricing model used for the fair value measurement of INX Token warrants:
| | |
| 2025 | | |
| 2024 | |
| | |
| | | |
| | |
| Expected volatility of the token
prices (%) | |
| 95.85%-118.72 | % | |
| 96.95%-129.38 | % |
| Risk-free interest rate (%) | |
| 3.57%-4.41 | % | |
| 4.16%-4.58 | % |
| Expected life of warrant (years) | |
| 0.17-10.00 | | |
| 0.50-10.00 | |
| Exercise price | |
| $0.01-$2.81 | | |
| $0.01-$2.81 | |
The
following table presents changes in the number of INX Token warrants and restricted INX Token awards during the years ended December
31, 2025, and 2024:
| | |
2025 | | |
2024 | |
| | |
Number
of
tokens | | |
Weighted
average
exercise
price | | |
Number
of
tokens | | |
Weighted
average
exercise
price | |
| | |
| | | |
| | | |
| | | |
| | |
| INX
Token warrants outstanding at beginning of year | |
| 8,116,958 | | |
$ | 0.24 | | |
| 5,574,292 | | |
$ | 0.33 | |
| INX Token warrants granted
during the year(*) | |
| 4,430,028 | | |
| 0.10 | | |
| 4,030,000 | | |
| 0.11 | |
| INX Token warrants canceled
during the year(*) | |
| (4,892,994 | ) | |
| 0.32 | | |
| - | | |
| - | |
| INX Token warrants forfeited
during the year | |
| (840,314 | ) | |
| 0.15 | | |
| (854,334 | ) | |
| 0.37 | |
| INX Token warrants expired
during the year | |
| - | | |
| - | | |
| (244,666 | ) | |
| 0.07 | |
| INX
Token warrants exercised (INX Token issued) and INX Tokens vested during the year | |
| (6,813,678 | ) | |
| 0.00 | | |
| (388,334 | ) | |
| 0.00 | |
| | |
| | | |
| | | |
| | | |
| | |
| INX
Token warrants outstanding at the end of year | |
| - | | |
$ | - | | |
| 8,116,958 | | |
$ | 0.24 | |
| | |
| | | |
| | | |
| | | |
| | |
| INX
Token warrants exercisable at the end of year | |
| - | | |
$ | - | | |
| 3,126,000 | | |
$ | 0.26 | |
| (*) | On February 27, 2025, the Board approved the cancellation of 2,386,000 token warrants previously granted by INX Limited to some of the Company’s employees and service providers. On the same date, the BOD approved to grant 1,599,076 token warrants if exercised or vested in accordance with its terms, will entitle the holder to purchase INX Tokens pursuant to the Share and Token Ownership and Award Plan (2021) of INX Limited, with any unspecified terms and conditions to be governed by the Plan. On August 4, 2025, the Board approved the cancellation of additional 2,479,202 token warrants previously granted by INX Limited to some of the Company’s employees and service providers. On the same date, the BOD approved to grant of 2,170,000 token warrants if exercised or vested in accordance with its terms, will entitle the holder to purchase INX Tokens pursuant to the Share and Token Ownership and Award Plan (2021) of INX Limited, with any unspecified terms and conditions to be governed by the Plan. |
Token-based
compensation for the years ended December 31, 2025, 2024 and 2023 is included within the following expenses:
| | |
Year
ended December 31 | |
| | |
2025 | | |
2024 | | |
2023 | |
| Operating expenses (income): | |
| | |
| | |
| |
| Research and
development | |
$ | 169 | | |
$ | 60 | | |
$ | 166 | |
| Sales and marketing | |
| 38 | | |
| 30 | | |
| 268 | |
| General and administrative | |
| 430 | | |
| 372 | | |
| 464 | |
| Change in fair value of
INX Token warrant liability | |
| 528 | | |
| (936 | ) | |
| (204 | ) |
| Total
token-based compensation expense (income) | |
$ | 1,165 | | |
$ | (474 | ) | |
$ | 694 | |
|