Microbot Medical Inc 10-Q for FY2025 Q1
Microbot Medical Inc. (MBOT)
About this 10-Q
Microbot Medical Inc filed this 10-Q on May 14, 2025, covering the quarter ended March 31, 2025 (FY2025 Q1).
Headline figures
Quarter ended March 31, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- $2.6M
- compared with a net loss of $2.37M a year earlier
- Diluted EPS
- -$0.08
- compared with -$0.17 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
For
the quarterly period ended
For the transition period from ____ to _____
Commission
file number:
(Name of Registrant in Its Charter)
State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices)
(Registrant’s Telephone Number, Including Area Code)
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of exchange on which registered | ||
Indicate
by check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Smaller
reporting company |
Emerging
growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: shares of Common Stock, $ par value at May 12, 2025.
MICROBOT MEDICAL INC. AND SUBSIDIARY
Index
| i |
MICROBOT MEDICAL INC.
Interim Condensed Consolidated Balance Sheets
U.S. dollars in thousands
(Except share and per share data)
| Notes | As of March 31, 2025 | As of December 31, 2024 | ||||||||
| Unaudited | Audited | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | $ | ||||||||
| Marketable securities | 2 | |||||||||
| Restricted cash | ||||||||||
| Prepaid expenses and other current assets | ||||||||||
| Total current assets | ||||||||||
| Property and equipment, net | ||||||||||
| Operating right-of-use assets | ||||||||||
| Total assets | $ | $ | ||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable | $ | $ | ||||||||
| Lease liabilities | ||||||||||
| Accrued liabilities | ||||||||||
| Total current liabilities | ||||||||||
| Non-current liabilities: | ||||||||||
| Long-term lease liabilities | ||||||||||
| Total liabilities | ||||||||||
| Shareholders’ equity: | ||||||||||
| Common stock; $ par value; shares authorized as of March 31, 2025 and December 31, 2024; and shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively. | ||||||||||
| Additional paid-in capital | ||||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||||
| Total shareholders’ equity | ||||||||||
| Total liabilities and shareholders’ equity | $ | $ | ||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 1 |
MICROBOT MEDICAL INC.
Interim Condensed Consolidated Statements of Comprehensive Loss
U.S. dollars in thousands
(Except share and per share data)
| 2025 | 2024 | |||||||
| For the Three Months Ended March 31, | ||||||||
| 2025 | 2024 | |||||||
| Unaudited | ||||||||
| Research and development, net | $ | ( | ) | $ | ( | ) | ||
| General and administrative | ( | ) | ( | ) | ||||
| Operating loss | ( | ) | ( | ) | ||||
| Other income (see Note 3G) | ||||||||
| Financing income, net | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Basic and diluted net loss per share | $ | ) | $ | ) | ||||
| Basic and diluted weighted average common shares outstanding | ||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 2 |
MICROBOT MEDICAL INC.
Interim Condensed Consolidated Statements of Shareholders’ Equity
U.S. dollars in thousands
(Except share and per share data)
| Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
| Common Stock | Additional Paid-In | Accumulated | Total Shareholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
| Balances, December 31, 2023 (Audited) | $ | $ | $ | ( | ) | $ | | |||||||||||||
| Issuance of common stock and warrants net of issuance costs (1) | ||||||||||||||||||||
| Issuance of common stock relating to settlement agreement (2) | ||||||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balances, March 31, 2024 (Unaudited) | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Balances, December 31, 2024 (Audited) | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Balances | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Issuance of common stock and warrants net of issuance costs (3) | ||||||||||||||||||||
| Issuance of common stock under the at-the-market offering program (4) | ||||||||||||||||||||
| Issuance of common stock upon exercise of warrants (5) | ||||||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | |||||||||||||||
| Balances, March 31, 2025 (Unaudited) | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Balances | $ | $ | $ | ( | ) | $ | ||||||||||||||
| (1) | |
| (2) | |
| (3) | |
| (4) | |
| (5) |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 3 |
MICROBOT MEDICAL INC.
Interim Condensed Consolidated Statements of Cash Flows
U.S. dollars in thousands
| 2025 | 2024 | |||||||
| For the Three Months Ended March 31, | ||||||||
| 2025 | 2024 | |||||||
| Unaudited | Unaudited | |||||||
| Operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash flows used in operating activities: | ||||||||
| Depreciation of property and equipment | ||||||||
| Share-based compensation | ||||||||
| Changes in assets and liabilities: | ||||||||
| Prepaid expenses and other assets | ( | ) | ||||||
| Other payables and accrued liabilities | ( | ) | ( | ) | ||||
| Insurance recovery related to legal settlement and legal expenses received in cash | ||||||||
| Legal settlement paid in cash | ( | ) | ||||||
| Net cash flows used in operating activities | ( | ) | ( | ) | ||||
| Investing activities: | ||||||||
| Purchases of property and equipment | ( | ) | ( | ) | ||||
| Purchases of marketable securities | ( | ) | ( | ) | ||||
| Proceeds from sales of a marketable securities | ||||||||
| Proceeds from maturities of marketable securities | ||||||||
| Net cash flows used in investing activities | ( | ) | ( | ) | ||||
| Financing activities: | ||||||||
| Issuance of common stock and warrants, net of issuance costs | ||||||||
| Net cash flows provided by financing activities | ||||||||
| Increase (decrease) in cash, cash equivalents and restricted cash | ( | ) | ||||||
| Cash, cash equivalents and restricted cash at beginning of period | ||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | $ | ||||||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||||
| Right-of-use assets obtained in exchange for lease liabilities | $ | $ | ||||||
| Deferred expenses offset against additional paid in capital | $ | |||||||
| Issuance expenses not paid | $ | |||||||
| Legal settlement settled through issuance of common stock | $ | $ | ||||||
| Accrued bonus settled through grant of stock-option awards | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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MICROBOT MEDICAL INC.
Notes to Interim Unaudited Condensed Consolidated Financial Statements
U.S. dollars in thousands
(Except share and per share data)
NOTE 1 – GENERAL
A. Description of business
Microbot Medical Inc. (the “Company”) is a pre-commercial, clinical-stage medical device company specializing in the research, design and development of next generation robotic endoluminal surgery devices targeting the minimally invasive surgery space. The Company is primarily focused on leveraging its micro-robotic technologies with the goal of redefining surgical robotics while improving surgical outcomes for patients.
The
Company incorporated on
On November 28, 2016, the Company consummated a transaction pursuant to an Agreement and Plan of Merger, dated August 15, 2016, with Microbot Medical Ltd., a private medical device company organized under the laws of the State of Israel (“Microbot Israel”). On the same day and in connection with the Merger, the Company changed its name from StemCells, Inc. to Microbot Medical Inc. On November 29, 2016, the Company’s common stock began trading on the Nasdaq Capital Market under the symbol “MBOT”.
The Company and Microbot Israel, its sole subsidiary, are sometimes collectively referred to as the “Company” as the context may require.
B. Risk Factors
To
date, the Company has not generated revenues from its operations. As of March 31, 2025, the Company had cash equivalents and marketable
securities balance of approximately $
The Company expects to raise additional funds through future issuances of either debt and/or equity securities, including upon the cash exercise of outstanding investment options, and possibly additional grants from the Israeli Innovation Authority and other government institutions. The Company’s ability to raise additional capital in the equity and debt markets is dependent on a number of factors, including, but not limited to, the market demand for the Company’s stock, which itself is subject to a number of development and business risks and uncertainties, as well as the uncertainty that the Company would be able to raise such additional capital at a price or on terms that are favorable to the Company.
Israel-Hamas War
On October 7, 2023, the State of Israel, where our research and development and other operations are primarily based, suffered a surprise attack by hostile forces from Gaza, which led to Israeli military operation at first in Gaza and then in Lebanon. These military operations and related activities, such as the recent collapse of the Assad regime in Syria and Israel’s subsequent military operations in Syria, and the recent escalation of military operations by and against the Houthis in Yemen, are on-going as of the issuance date of these financial statements, although there have been temporary cease fires from time to time.
| 5 |
The Company has considered various ongoing risks relating to the military operations and related matters, including:
| ● | That some of our Israeli subcontractors, vendors, suppliers and other companies in which the Company relies, are currently only partially active, as instructed by the relevant authorities; and |
| ● | A slowdown in the number of international flights in and out of Israel. |
The Company is closely monitoring how the military operations and related activities could adversely affect our anticipated milestones and our Israel-based activities to support future clinical and regulatory milestones, including our ability to import materials that are required to construct the Company’s devices and to ship them outside of Israel. As of the issuance date of these financial statements, the Company has determined that there have not been any materially adverse effects on its business or operations, but the Company continues to monitor the situation, as any collapse of a cease-fire with Hamas or Hezbollah that may be in effect from time to time, or any further or future escalation or change could result in a material adverse effect on the ability of the Company’s Israeli office to support its clinical and regulatory activities. The Company does not have any specific contingency plans in the event of any such escalation or change.
C. Unaudited Interim Financial Statements
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission (“SEC”) regulations. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included (consisting only of normal recurring adjustments except as otherwise discussed). These interim consolidated condensed financial statements should be read in conjunction with the Company’s latest audited financial statements.
Operating results for the three-month period ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed in the preparation of these unaudited interim condensed consolidated financial statements are identical to those applied in the preparation of the Company’s latest annual audited financial statements, except if noted below.
Basis of presentation:
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”).
Use of estimates:
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions pertaining to transactions and matters whose ultimate effect on the financial statements cannot precisely be determined at the time of financial statements preparation. Although these estimates are based on management’s best judgment, actual results may differ from these estimates.
| 6 |
Fair value of financial instruments:
The carrying values of cash and cash equivalents, other receivable and other accounts payable and accrued liabilities approximate their fair value due to the short-term maturity of these instruments.
A fair value hierarchy is used to rank the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:
Level 1 - Quoted prices (unadjusted) in active markets for identical assets and liabilities.
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets and liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The following tables summarizes the Company’s financial assets subject to fair value measurement and the level of inputs used in such measurements as of March 31, 2025 and December 31, 2024:
SCHEDULE OF FAIR VALUE MEASUREMENT INPUTS AND VALUATION TECHNIQUES
| Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| As of March 31, 2025 | ||||||||||||||||
| Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| Marketable securities: | ||||||||||||||||
| Money market mutual funds | $ | $ | $ | $ | ||||||||||||
| Marketable securities | $ | $ | $ | $ | ||||||||||||
| Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| As of December 31, 2024 | ||||||||||||||||
| Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| Marketable securities: | ||||||||||||||||
| Money market mutual funds | $ | $ | $ | $ | ||||||||||||
| Marketable securities | $ | $ | $ | $ | ||||||||||||
The Company’s financial assets are measured at fair value on a recurring basis by level within the fair value hierarchy. The Company’s money market funds are classified as Level 1. Other than that, the Company doesn’t have any other financial assets or financial liabilities marked to market at fair value as of March 31, 2025 and December 31, 2024.
The Company applies ASC 718-10, “Share-Based Payment” (“ASC 718-10”), which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors including stock options under the Company’s stock plans based on estimated fair values.
ASC 718-10 requires companies to estimate the fair value of stock options using an option-pricing model, which is recognized as an expense over the requisite service periods in the Company’s statement of comprehensive loss, based on a straight-line method. The Company recognizes compensation cost for an equity classified award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant date fair value of such award that is vested at that date.
| 7 |
The Company recognizes the expense for an equity classified awards subject to performance-based milestone vesting over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates when the achievement of a performance-based milestone is probable based on the expected satisfaction of the performance conditions at each reporting date. If no explicit service period is determined, the Company estimates the implicit service period based on the timing the employee is expected to achieve the related performance condition.
When no future services are required to be performed by the grantee in exchange for an award of equity instruments, and if such award does not contain a performance condition, the cost of the award is expensed on the grant date.
The Company estimates the fair value of stock options granted as share-based payment awards using a Black-Scholes options pricing model. The option-pricing model requires a number of assumptions, of which the most significant are expected volatility and the expected option term (the time from the grant date until the options are exercised or expire). Expected volatility is estimated based on the standard deviation of the Company’s closing prices according to the expected life (SAB107) for each of the grants. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term.
For stock options that qualify as “plain-vanilla,” the expected term is calculated using the simplified method. For stock options that do not qualify as “plain-vanilla”, the Company’s management estimated that the expected stock option term is the contractual term of the options.
Changes in the determination of each of the inputs can affect the fair value of the stock options granted and the results of operations of the Company.
Recently adopted accounting pronouncements:
In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures” (“ASU 2023-07”) to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses on an interim and annual basis. All disclosure requirements of ASU 2023-07 are required also for entities with a single reportable segment. The ASU was effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and subsequent interim periods. As part of the Annual Report for the year ended December 31, 2024, the Company adopted ASU 2023-07, which was applied retrospectively to all prior periods presented. Refer to Note 5 herein for further details regarding this adoption.
Accounting pronouncements not yet effective:
In November 2024, the FASB issued ASU 2024-03, “Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220- 40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires the disaggregation of certain expenses in the financial statements notes, to provide enhanced transparency into the expense captions presented on the face of the consolidated statement of operations. The ASU is effective for annual fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. Adoption of this ASU should be applied on a prospective basis, although retrospective application is permitted. The Company is currently evaluating the impact that ASU 2024-03 will have on its related disclosures.
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NOTE 3 - COMMITMENTS AND CONTINGENCIES
A. Government grants:
Microbot
Israel has received grants from the IIA for participation in research and development since 2013 through March 31, 2025 totaling approximately
$
In
addition, as a result of the agreement with Nitiloop, on October 6, 2022, Microbot Israel took over the liability to repay Nitiloop’s
IIA grants in the aggregate amount of approximately $
In
relation to the IIA grants described above, the Company is obligated to pay royalties amounting to
The grants are linked to the exchange rate of the dollar to the New Israeli Shekel and bears interest of SOFR per year (SOFR is a benchmark interest rate which replaced LIBOR).
The repayment of the grants is contingent upon the successful completion of the Company’s research and development programs and generating sales. The Company has no obligation to repay these grants, if the project fails, is unsuccessful or aborted or if no sales are generated. The financial risk is assumed completely by the Government of Israel. The grants are received from the Government on a project- by-project basis.
On
December 11, 2022, the Company received approval for a grant from the Ministry of Economy, in the amount of NIS
B. TRDF agreement:
Microbot
Israel signed an agreement with the Technion Research and Development Foundation (“TRDF”) in June 2012 by which TRDF transferred
to Microbot Israel a global, exclusive, royalty-bearing license (as amended, the “License Agreement”) with respect to its
then Self-Cleaning Shunt (SCS) project and TipCat assets, which also governed certain technology relating to the Company’s LIBERTY®
Endovascular Robotic Surgical System. As partial consideration for the license, Microbot Israel shall pay TRDF royalties on net
sales (between
In October 2022 the Company suspended the SCS project and as a result of the Company’s May 2023 implementation of its core-business focus program and cost reduction plan, the Company returned the licensed intellectual property for the TipCat back to TRDF in June 2023 and returned the licensed intellectual property for the SCS (ViRob) back to TRDF in July 2023. As a result, as of the date of these financial statements, the License Agreement is limited to the certain technology relating to the Company’s LIBERTY® Endovascular Robotic Surgical System.
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C. ATM agreement:
On
June 10, 2021, the Company entered into an At-the-Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright &
Co. LLC (“Wainwright”), as sales agent, in connection with an “at the market offering” under which the Company
may offer and sell, from time to time in its sole discretion, shares of its common stock having an aggregate offering price of up to
$
D. Engagement letters with H.C. Wainwright:
In connection with registered direct and private placement offerings, the Company entered into engagement letters (the “Engagement Letters”) with Wainwright on October 3, 2022, on May 16, 2023, on October 24, 2023, and on May 29, 2024 which was amended most recently on February 9, 2025, in each case pursuant to which Wainwright agreed to serve as the exclusive placement agent for the issuance and sale of securities of the Company.
As
compensation for such placement agent services, the Company has agreed to pay Wainwright an aggregate cash fee equal to
E. Acquisition of Nitiloop’s assets:
On October 6, 2022, Microbot Israel purchased substantially all of the assets, including intellectual property, devices, components and product related materials (the “Assets”), of Nitiloop Ltd., an Israeli limited liability company (“Nitiloop”). The Assets include intellectual property and technology in the field of intraluminal revascularization devices with anchoring mechanism and integrated microcatheter (the “Technology”) and the products or potential products incorporating the Technology owned by Nitiloop and designated by Nitiloop as “NovaCross”, “NovaCross Xtreme” and “NovaCross BTK” and any enhancements, modifications and improvements thereof (“Devices”). Microbot Israel did not assume any material liabilities of Nitiloop other than obligations Nitiloop has to the IIA and relating to certain renewal/maintenance fees for a European patent application.
In
consideration for the acquisition of the Assets, Microbot Israel shall pay royalties to Nitiloop, which shall not, in the aggregate,
exceed $
Royalties
at a rate of
Royalties
at a rate of
F. Litigation resulting from the 2017 financing:
The
Company was named as the defendant in a lawsuit captioned Empery Asset Master Ltd., Empery Tax Efficient, LP, Empery Tax Efficient II,
LP, Hudson Bay Master Fund Ltd., (the “Plaintiffs”), against Microbot Medical Inc., Defendant, in the Supreme Court of the
State of New York, County of New York (Index No. 651182/2020) (the “Lawsuit”). The complaint alleged, among other things,
that the Company breached multiple representations and warranties contained in the Securities Purchase Agreement (the “SPA”)
related to the Company’s June 8, 2017 equity financing (the “2017 Financing”), of which the Plaintiffs participated,
and fraudulently induced Plaintiffs into signing the SPA. The complaint sought rescission of the SPA and return of the Plaintiffs’
$
On January 26, 2024 (the “Effective Date”), the Company entered into a settlement agreement and release with the Plaintiffs (the “Settlement Agreement”), effectively resolving the Lawsuit.
| 10 |
Pursuant
to the Settlement Agreement, the Company paid $
The Company concluded the Settlement Agreement gave rise to loss contingencies in the scope of ASC Subtopic 450-20, Contingencies – Loss Contingencies, and as of December 31, 2023, the Company recorded a contingent liability, as the Company deemed it both probable and reasonably estimable.
The Company determined that the loss contingency should be recognized as non-operating losses, offset by loss recoveries received from the Company’s insurance company.
As
a result of the Settlement Agreement and the insurance recovery received from the insurance company, as of December 31, 2023, the Company
recorded a current liability and a current asset on its consolidated balance sheet totaling $
G. Mona litigation:
In March 2025, an appellate
court held in favor of the Company with respect to a 2019 action against Alliance Investment Management, Ltd., later amended to add Joseph
Mona (“Mona”) as a defendant, in the Southern District of New York under Section 16(b) of the Securities Exchange Act of 1934
(the “Exchange Act”), to compel Alliance and/or Mona to disgorge short swing profits realized from purchases and sales of
the Company’s securities within a period of less than six months. As a result, the Company received a judgmet in the amount of approximately
$
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H. Accrued bonuses
As
of March 31, 2025, the Company recorded accrued bonuses to the CEO and other executives, in the aggregate amount of $
NOTE 4 - SHARE CAPITAL
A. Registered direct and private placement offerings
On
January 6, 2025, the Company entered into Securities Purchase Agreements with institutional investors, pursuant to which the Company
agreed to issue and sell, in a registered direct offering priced at-the-market under the rules of the Nasdaq Stock Market, an
aggregate of
shares of the Company’s common stock, par value $
per share, at an offering price of $
per share, for aggregate gross proceeds from the offerings of approximately $
On
January 7, 2025, the Company entered into Securities Purchase Agreements with institutional investors, pursuant to which the Company
agreed to issue and sell, in a registered direct offering priced at-the-market under the rules of the Nasdaq Stock Market, an
aggregate of
shares of the Company’s common stock, par value $
per share, at an offering price of $
per share, for aggregate gross proceeds from the offerings of approximately $
On
February 9, 2025, the Company entered into Securities Purchase Agreements with institutional investors, pursuant to which the
Company agreed to issue and sell, in a registered direct offering priced at-the-market under the rules of the Nasdaq Stock Market,
an aggregate of
shares of the Company’s common stock, par value $
per share, at an offering price of $
per share, for aggregate gross proceeds from the offerings of approximately $
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(ii) the date on which approval as may be required by the applicable rules and regulations of the Nasdaq Stock Market (or any successor entity) from the stockholders of the Company with respect to the issuance of all the series I preferred investment options and the shares of common stock issuable upon the exercise thereof, is received and deemed effective under Delaware law (the “Initial exercise date”), and will expire two years from the initial exercise date. Net cash settlements are not permitted under any event under the Securities Purchase Agreements.
The Company also issued to Wainwright or its designees preferred investment options to purchase up to shares of common stock which have the same terms as investors’ preferred investment options except for an exercise price equal to $ per share.
B. At-the-market offerings
On
July 1, 2024, the Company filed with the SEC a prospectus supplement relating to the offer, issuance and sale of up to $
In
January 2025, the Company issued shares of the Company’s common stock pursuant to the ATM Agreement, for total gross proceeds
of approximately $
C. Exercise of Investment Options
In
January 2025, the Company raised approximately $
D. Equity classification
The common stock of the Company are recognized as equity under the requirements of ASC Topic 505 Equity.
The Company analyzed the accounting treatment for all of the outstanding preferred investment options. Based on the Company’s analysis all such warrants were classified as equity.
The Company analyzed the accounting treatment for all of the outstanding preferred investment options issued to Wainwright. Since the Company did not identify any features causing liability classification according to ASC 718, it concluded that all such preferred investment options are equity-classified awards.
E. Employee Stock Option Grants
During the year ended December 31, 2024:
| ● | The Company granted the CEO, its executives and management, fully vested options to purchase an aggregate of and shares of the Company’s common stock, respectively, at an exercise price per share of $. |
| ● | The Company granted the CEO and certain executives, options to purchase an aggregate of and shares of the Company’s common stock, respectively, at an exercise price per share of $. The vesting of these options is subject to the achievement of specified performance conditions. For the year ended December 31, 2024, the Company recorded an expense of $, reflecting management’s assessment that the specified performance milestones for of the options were achieved by their due date. |
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| ● | The Company granted the CEO, its executives, and certain employees, options to purchase an aggregate of and shares of the Company’s common stock, respectively, at an exercise price per share of $, with a vesting period of three years. |
| ● | The Company granted an advisor options to purchase an aggregate of shares of the Company’s common stock, at an exercise price per share of $, with a vesting period of three years. |
With
respect to the CEO’s 2023 annual bonus, during February 2024, the Company paid % of the CEO’s total 2023 bonus –
amounting to approximately $
During the three months ended March 31, 2025, the Company granted the CEO, executives and certain employees, and certain board members, , and options, respectively. In addition, in February 2025, the Company determined that out of performance-based options granted in February 2024 had met their milestones and been vested, while the remainder options which did not meet their milestones had been forfeited.
F. Warrants:
The remaining outstanding warrants and terms as of March 31, 2025 and December 31, 2024 are as follows:
SCHEDULE OF WARRANTS OUTSTANDING
| Issuance date | Outstanding
and | Outstanding and exercisable as of December 31, 2024 | Exercise Price | Exercisable Through | ||||||||||
| Warrant to underwriters October 2022 | | | $ | |||||||||||
| Warrant to underwriters May 2023 | $ | |||||||||||||
| Warrant to underwriters May 2023 | $ | |||||||||||||
| Warrant to underwriters June 2023 | $ | |||||||||||||
| Warrant to underwriters June 2023 | $ | |||||||||||||
| Warrant series E January 2024 | $ | |||||||||||||
| Warrant to underwriters January 2024 | $ | |||||||||||||
| Warrant series F June 2024 | $ | |||||||||||||
| Warrant to underwriters June 2024 | $ | |||||||||||||
| Warrant series G January 2025 | $ | |||||||||||||
| Warrant to underwriters January 2025 | $ | |||||||||||||
| Warrant series H January 2025 | $ | |||||||||||||
| Warrant to underwriters January 2025 | $ | |||||||||||||
| Warrant to underwriters January 2025 | $ | |||||||||||||
| Warrant series I February 2025 | $ | |||||||||||||
| Warrant to underwriters February 2025 | $ | |||||||||||||
| (*) |
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NOTE 5 – SEGMENT REPORTING
Segment information is prepared on the same basis that the Company’s chief operating decision maker (“CODM”), the Chief Executive Officer, manages the business, makes business decisions and assesses performance. The Company has one operating and reportable segment, which is the development of robotic devices for endoluminal surgery. See Note 1A for further details.
The CODM assesses performance for this segment and decides how to allocate resources based on net loss. The measure of segment assets is reported on the balance sheet as cash and cash equivalents and marketable securities. The chief executive officer performs the assessment of segment performance by using the reported measure of segment loss to monitor actual results.
The table below summarizes the significant expense categories regularly reviewed by the CODM for the three months ended March 31, 2025 and 2024:
SCHEDULE OF STATEMENT OF OPERATION BY SEGMENT
For the three months ended March 31, | ||||||||
| 2025 | 2024 | |||||||
| Significant segment expenses | ||||||||
| Payroll and payroll related | $ | |||||||
| Materials and subcontractors | ||||||||
| Share-based compensation | ||||||||
| Other segment items (*) | ||||||||
| Net loss | $ | |||||||
| (*) |
NOTE 6 – SUBSEQUENT EVENTS
In
April 2025, the Company raised approximately $
In
May 2025, the Company raised approximately $
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Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward Looking Statements
The following discussion should be read in conjunction with our unaudited financial statements and related notes included in Item 1, “Financial Statements,” of this Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Certain information contained in this MD&A includes “forward-looking statements.” Statements which are not historical reflect our current expectations and projections about our future results, performance, liquidity, financial condition and results of operations, prospects and opportunities and are based upon information currently available to us and our management and their interpretation of what is believed to be significant factors affecting our existing and proposed business, including many assumptions regarding future events. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially and perhaps substantially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties and other factors, including those risks described in detail in the section entitled “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024.
Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “would,” “will,” “could,” “scheduled,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “seek,” or “project” or the negative of these words or other variations on these words or comparable terminology.
In light of these risks and uncertainties, and especially given the nature of our existing and proposed business, there can be no assurance that the forward-looking statements contained in this section and elsewhere in this Quarterly Report on Form 10-Q will in fact occur. Potential investors should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.
Overview
Microbot is a pre-commercial, clinical stage medical device company specializing in the research, design and development of next generation robotic endoluminal surgery devices targeting the minimally invasive surgery space. Microbot is primarily focused on leveraging its robotic technologies with the goal of redefining surgical robotics while improving surgical outcomes for patients.
Using our LIBERTY® Endovascular Robotic Surgical System, we are developing the first ever fully disposable robot for various endovascular interventional procedures.
Technological Platforms
LIBERTY® Endovascular Robotic Surgical System
The LIBERTY® Endovascular Robotic Surgical System features a unique compact design with the capability to be operated remotely, reduce radiation exposure and physical strain to the physician, as well as the potential to eliminate the use of multiple consumables when used with its NovaCross® platform or possibly other guidewire/microcatheter technologies.
The LIBERTY® Endovascular Robotic Surgical System is designed to maneuver guidewires and over-the-wire devices (such as microcatheters) within the body’s vasculature. It eliminates the need for extensive capital equipment requiring dedicated Cath-lab rooms as well as dedicated staff.
We believe the addressable markets for the LIBERTY® Endovascular Robotic Surgical System in its current version includes the peripheral interventional radiology market, with future versions expected to include the Interventional Cardiology and Interventional Neuroradiology markets.
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The unique characteristics of the LIBERTY® Endovascular Robotic Surgical System - compact, mobile, disposable and remotely controlled – also may open the opportunity of expanding telerobotic interventions to patients with limited access to life-saving procedures.
The LIBERTY® Endovascular Robotic Surgical System is being designed to have the following attributes:
| ● | Compact size - Eliminates the need for large capital equipment in dedicated cath-lab rooms with dedicated staff. |
| ● | Fully disposable - To our knowledge, the first fully disposable, robotic system for endovascular procedures. |
| ● | One & Done® - Has the potential to be compatible with Microbot’s NitiLoop’s NovaCross® products or possibly other instruments that combines guidewire and microcatheter into a single device. We are currently evaluating this combination in different applications. |
| ● | State of the art maneuverability - Provides linear and rotational control of its guidewire, as well as linear and rotational control of a guide catheter, and the linear motion for an additional microcatheter (“over the wire”) device. |
| ● | Compatibility with a wide range of commercially-available guidewires, microcatheters and guide-catheters. |
| ● | Enhanced operator safety and comfort - Aims to reduce exposure to ionizing radiation and reduce physical strain due to the need for heavy lead vests otherwise to be worn during procedures. |
| ● | Ease of use - Its intuitive remote controls aims to simplify advanced procedures while shortening the physician’s learning curve. |
| ● | Telemedicine capability – May serve as a platform for supporting tele-catheterization, carried out remotely by highly trained specialists. The Company’s research collaboration with Corewell Health™ has demonstrated the feasibility of using the LIBERTY® Endovascular Robotic System between separate and remote facilities in a coronary simulation model. The project assesses the feasibility of using LIBERTY® to perform simulated cardiovascular interventional procedures across two sites within the Corewell Health™ system located 5 miles apart. The telesurgery feature of LIBERTY® is still being evaluated and is not covered under the Company’s pending 510(k) premarket submission with the U.S. Food and Drug Administration (“FDA”). |
On August 17, 2020, Microbot announced the successful conclusion of its feasibility animal study using the LIBERTY® Endovascular Robotic Surgical System. The study met all of its end points with no intraoperative adverse events, which supports Microbot’s objectives to allow physicians to conduct a catheter-based procedure from outside the catheterization laboratory (cath-lab), avoiding radiation exposure, physical strain and the risk of cross contamination. The study was performed by two leading physicians in the neuro vascular and peripheral vascular intervention spaces, and the results demonstrated robust navigation capabilities, intuitive usability and accurate deployment of embolic agents, most of which was conducted remotely from the cath-lab’s control room.
On May 3, 2023, we announced that the LIBERTY® Endovascular Robotic Surgical System has surpassed its 100th catheterization during multiple preclinical studies, with a 95% success rate of reaching pre-determined vascular targets, such as distal branches of hepatic, gastric, splenic, mesenteric, renal and hypogastric arteries. Moreover, all of the procedures were completed without notable signs of intraoperative injury.
On June 29, 2023, we announced the successful completion of a two-day preclinical study held by leading key opinion leaders at a New York-based research lab, where they performed dozens of catheterizations, including the utilization of the LIBERTY® Endovascular Robotic Surgical System’s remote operation capabilities, to pre-determined vascular targets, with a 100% success rate of reaching the intended target with no observable on-site complications.
In October 2023, we announced the successful initial outcomes from our pivotal preclinical study with the LIBERTY® Endovascular Robotic Surgical System. The pivotal study was conducted by three leading interventional radiologists that utilized the LIBERTY® Endovascular Robotic Surgical System to reach a total of 48 animal targets. A total of 6 LIBERTY® Endovascular Robotic Surgical Systems were used in the study. All 6 LIBERTY® Endovascular Robotic Surgical Systems performed flawlessly, with 100% usability and technical success. No acute adverse events or complications were visually observed intra-operative. In December 2023, we announced that the final histopathology and lab report supplements our previous findings, and that the results of the study will support our Investigational Device Exemption (“IDE”) submission to the FDA to commence a human clinical study. On January 29, 2024, the Company submitted an IDE application with the U.S. Food and Drug Administration, in order to commence its pivotal clinical trial in humans.
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On December 10, 2024, we announced that we submitted a 510(k) premarket notification to the FDA for our LIBERTY® Endovascular Robotic System. The 510(k) submission follows the successful completion of our multi-center, single-arm, human trial to evaluate the performance and safety of LIBERTY® in human subjects undergoing Peripheral Vascular Interventions.
We anticipate FDA marketing clearance during the second quarter of 2025, with U.S. commercialization activities expected to commence after the clearance. However, we can give no assurance that we will meet this projected milestone, if ever. See “Risk Factors-Risks Relating to the Development and Commercialization of Microbot’s Product Candidates” below.
On August 13, 2024, we announced that we received ISO 13485:2016 certification for our quality management system. Receiving ISO 13485 certification indicates that a company has developed and implemented robust policies and procedures for the development and manufacture of regulated medical products. This is a certification ensuring compliance with the Quality Management System (QMS) requirements of the EU Medical Devices Regulation (MDR 2017/745) and supporting our future CE Mark approval, and to ultimately allow us to market the LIBERTY® Endovascular Robotic Surgical System in Europe as well as other regions who accept the CE Mark. We anticipate CE Mark approval in the second half of 2026. However, we can give no assurance that we will meet this or any other projected milestones, if ever. In addition, in view of the recent revision published by the FDA regarding the quality system management regulation and its incorporation by reference of the ISO 13485 standard, we believe it will help streamline our transition into this revised FDA regulation.
The Company entered into an agreement with Emory University, which will allow the parties to evaluate and explore the potential for a future collaboration in connection with autonomous robotics in endovascular procedures. Under the terms of the agreement, Emory University will assume the responsibility of exploring the feasibility of integrating the LIBERTY® Endovascular Robotic Surgical System with an imaging system to create an autonomous robotic system for endovascular procedures.
NovaCross®
On October 6, 2022, we purchased substantially all of the assets, including intellectual property, devices, components and product related materials of Nitiloop Ltd., an Israeli limited liability company. The assets include intellectual property and technology in the field of intraluminal revascularization devices with anchoring mechanism and integrated microcatheter, and the products or potential products incorporating the technology owned by Nitiloop and designated by Nitiloop as “NovaCross”, “NovaCross Xtreme” and “NovaCross BTK” and any enhancements, modifications and improvements.
Israel-Hamas War
On October 7, 2023, the State of Israel, where our research and development and other operations are primarily based, suffered a surprise attack by hostile forces from Gaza, which led to Israeli military operation at first in Gaza and then in Lebanon. These military operations and related activities, such as the recent collapse of the Assad regime in Syria and Israel’s subsequent military operations in Syria, and the recent escalation of military operations by and against the Houthis in Yemen, are on-going as of the issuance date of these financial statements, although there have been temporary cease fires from time to time.
The Company has considered various ongoing risks relating to the military operations and related matters, including:
| ● | That some of our Israeli subcontractors, vendors, suppliers and other companies in which the Company relies, are currently only partially active, as instructed by the relevant authorities; and |
| ● | A slowdown in the number of international flights in and out of Israel. |
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The Company is closely monitoring how the military operations and related activities could adversely affect our anticipated milestones and our Israel-based activities to support future clinical and regulatory milestones, including our ability to import materials that are required to construct the Company’s devices and to ship them outside of Israel. As of the filing date of this Quarterly Report on Form 10-Q, the Company has determined that there have not been any materially adverse effects on its business or operations, but the Company continues to monitor the situation, as any collapse of a cease-fire with Hamas or Hezbollah that may be in effect from time to time, or any future or further escalation or change could result in a material adverse effect on the ability of the Company’s Israeli office to support its clinical and regulatory activities. The Company do not have any specific contingency plans in the event of any such escalation or change.
Financial Operations Overview
Research and Development Expenses, net
Research and development expenses consist primarily of salaries and related expenses and overhead for Microbot’s research, development and engineering personnel, prototype materials and research studies, obtaining and maintaining Microbot’s patent portfolio, net of government grants. Microbot expenses its research and development costs as incurred.
General and Administrative Expenses
General and administrative expenses consist primarily of the costs associated with management salaries and benefits, professional fees for accounting, auditing, consulting, legal services, and insurance expenses.
Microbot expects that its general and administrative expenses will increase over the long-term, even if a period-to-period comparison may show a decrease, as it expands its operating activities, maintains compliance with exchange listing and SEC requirements. Microbot expects these potential increases will likely include management costs, legal fees, accounting fees, directors’ and officers’ liability insurance premiums and expenses associated with investor relations.
Income Taxes
Microbot has incurred net losses and has not recorded any income tax benefits for the losses. It is still in its development stage and has not yet generated revenues, therefore, it is more likely than not that sufficient taxable income will not be available for the tax losses to be fully utilized in the future.
Critical Accounting Policies and Significant Judgments and Estimates
Management’s discussion and analysis of Microbot’s financial condition and results of operations are based on its condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP. The preparation of these condensed consolidated financial statements requires Microbot to make estimates and judgments that affect the reported amounts of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. Microbot bases its estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.
While Microbot’s significant accounting policies are described in more detail in the notes to its consolidated financial statements, Microbot believes the following accounting policies are the most critical for fully understanding and evaluating its consolidated financial condition and results of operations.
Contingencies
Management records and discloses legal contingencies in accordance with Accounting Standards Codification (“ASC”) Topic 450 Contingencies. A provision is recorded when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company monitors the stage of progress of its litigation matters to determine if any adjustments are required.
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Fair Value of Financial Instruments
The Company measures the fair value of certain of its financial instruments on a recurring basis.
A fair value hierarchy is used to rank the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:
Level 1 - Quoted prices (unadjusted) in active markets for identical assets and liabilities.
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets and liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
Results of Operations
Comparison of Three Months Ended March 31, 2025 and 2024
The following table sets forth the key components of Microbot’s results of operations for the three-month periods ended March 31, 2025 and 2024 (in thousands):
| Three Months Ended March 31, | ||||||||||||
| 2025 | 2024 | Change | ||||||||||
| Research and development expenses, net | $ | (1,459 | ) | $ | (1,169 | ) | $ | (290 | ) | |||
| General and administrative expenses | (1,562 | ) | (1,215 | ) | (347 | ) | ||||||
| Other income | 316 | - | 316 | |||||||||
| Financing income, net | 104 | 13 | 91 | |||||||||
Research and Development Expenses. The increase in research and development expenses for the three months ended March 31, 2025 compared to March 31, 2024 was primarily due to an increase in payroll and manufacturing of the Company’s LIBERTY product, offset by deduction of government grants and a decrease in share-based compensation expenses.
General and Administrative Expenses. The increase in general and administrative expenses for the three months ended March 31, 2025 compared to March 31, 2024 was primarily due to an increases in payroll and professional services, rent and travel expenses over the prior period, offset by a decrease in stock-based compensation.
Other Income. The increase in other income for the three months ended March 31, 2025, compared to the same period in 2024, was due to funds received in connection with the Mona litigation.
Financing Income. The increase in financing income, net for the three months ended March 31, 2025 compared to March 31, 2024, was primarily due to higher interest income from short-term investments. This increase resulted from the increase in short-term investments due to capital raised in January and February 2025.
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Liquidity and Capital Resources
To date, Microbot has not generated revenues from operations. Microbot has incurred losses since inception and negative cash flows from operating activities for all periods presented. As of March 31, 2025, Microbot had a net working capital of approximately $28.8 million, consisting primarily of cash and cash equivalents and marketable securities. This compares to net working capital of approximately $3.4 million as of December 31, 2024. Microbot anticipates that it will continue to incur net losses for the foreseeable future as it continues research and development efforts of its primary product candidate, continues increasing its commercialization capabilities, and continues to incur costs associated with being a public company.
Microbot has funded its operations through the issuance of capital stock, grants from the Israeli Innovation Authority, and convertible debt. Since inception (November 2010) through March 31, 2025, Microbot has raised cash proceeds of approximately $105.49 million and incurred a total cumulative loss of approximately $93.5 million.
Since January 1, 2025, we have raised the following amounts:
| ● | An aggregate of approximately $1.1 million in January 2025, before fees and expenses of $65,452, through our ATM Agreement; |
| ● | In January 2025, an aggregate of approximately $15.6 million in gross proceeds, before fees and expenses of approximately $1.4 million, from institutional investors; |
| ● | In January 2025, approximately $916,000 in gross proceeds from the exercise of certain outstanding Series E preferred investment options, before fees and expenses of $64,164; |
| ● | In February 2025, an aggregate of approximately $13.0 million in gross proceeds, before fees and expenses of approximately $1.2 million, from institutional investors; and |
| ● | In April 2025, approximately $2.3 million in gross proceeds from the exercise of outstanding Series E and Series F preferred investment options, before fees and expenses of $161. | |
| ● | In May 2025, approximately $262,500 in gross proceeds from the exercise of 175,000 outstanding Series F preferred investment options, before fees and expenses. |
Microbot Israel obtained from the Israeli Innovation Authority (“IIA”) grants for participation in research and development for the years 2013 through March 31, 2025 in the total amount of approximately $1.9 million. This amount includes amounts received in 2023 and 2024 of approximately $378,000, which is a portion of an additional grant from the IIA in the amount of approximately NIS 1.6 million (approximately $447,000) approved by the IIA on June 1, 2023, to further finance the development of the manufacturing process of the LIBERTY® Endovascular Robotic Surgical System. On October 6, 2022, Microbot Israel entered into an agreement with Nitiloop Ltd. to acquire substantially all of its assets. Nitiloop received grants from the IIA in the aggregate amount of approximately $925,000 and Microbot Israel took over the liability to repay such grants.
Microbot Israel is obligated to pay royalties amounting to 3%-5% of its future sales up to the amount of the grants. The grants are linked to the exchange rate of the dollar to the New Israeli Shekel and bears interest at an annual rate of SOFR, a benchmark interest rate which replaced LIBOR. Under the terms of the grants and applicable law, Microbot is restricted from transferring any technologies, know-how, manufacturing or manufacturing rights developed using the grant outside of Israel without the prior approval of the Israel Innovation Authority. Microbot has no obligation to repay the grants, if the applicable project fails, is unsuccessful or aborted before any sales are generated. The financial risk is assumed completely by the IIA.
On March 2, 2023, the Company announced that it received approval for a grant from the Ministry of Economy in the amount of approximately NIS 300,000 to further finance the marketing activities of the LIBERTY® Endovascular Robotic Surgical System in the U.S. market.
In relation to the Ministry of Economy grant, the Company is obligated to pay royalties amounting to 3% of future sales of the LIBERTY® Endovascular Robotic Surgical System up to the grant amount plus interest.
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To the extent available, Microbot intends to continue to raise capital through future public and private issuances of debt and/or equity securities, including upon the cash exercise of its outstanding investment options, to fund its commercial activities and working capital and general business purposes. The capital raises from issuances of convertible debt and equity securities could result in additional dilution to Microbot’s shareholders. In addition, to the extent Microbot determines to incur additional indebtedness, Microbot’s incurrence of additional debt could result in debt service obligations and operating and financing covenants that would restrict its operations. Microbot can provide no assurance that financing will be available in the amounts it needs, at the times it needs it or on terms acceptable to it, if at all, and will need additional funds to continue the commercialization process for the LIBERTY® Endovascular Robotic Surgical System.
As of the filing date of this Quarterly Report on Form 10-Q, management believes we have sufficient funds for our operations for in excess of one year.
Cash Flows
The following table provides a summary of the net cash flow activity for each of the periods presented (in thousands):
| Three Months Ended March 31, | ||||||||
| 2025 | 2024 | |||||||
| Net cash flows used in operating activities | $ | (2,874 | ) | $ | (2,420 | ) | ||
| Net cash flows used in investing activities | (24,830 | ) | (1,284 | ) | ||||
| Net cash flows provided by financing activities | 27,806 | 2,397 | ||||||
| Increase (decrease) in cash, cash equivalents and restricted cash | $ | 102 | $ | (1,307 | ) | |||
The increase in 2025 in net cash flows used in operating activities was primarily from an increase in research and development expenses relating to the LIBERTY® Endovascular Robotic Surgical System as we shift to commercialization of the product and due to an increase in bonus expenses.
The increase in 2025 in net cash flows used in investing activities was mainly due to an increase in the acquisition of marketable securities, due to the increase in capital we raised in January and February 2025, as described elsewhere in this Item 2.
The increase in 2025 in net cash flows provided by financing activities was due to the Company’s raising of capital pursuant to its issuance of common stock and investment options, as well as the exercise of certain outstanding Series E investment options.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
Microbot’s cash and cash equivalents as of March 31, 2025 consisted of readily available checking and money market funds. Microbot’s primary exposure to market risk is interest income sensitivity, which is affected by changes in the general level of U.S. interest rates. However, because of the short-term nature of the instruments in Microbot’s portfolio, a sudden change in market interest rates would not be expected to have a material impact on Microbot’s financial condition and/or results of operations. Microbot does not believe that its cash or cash equivalents have significant risk of default or illiquidity. While Microbot believes its cash and cash equivalents do not contain excessive risk, Microbot cannot provide absolute assurance that in the future its investments will not be subject to adverse changes in market value. In addition, Microbot maintains significant amounts of cash and cash equivalents at one or more financial institutions that are in excess of federally insured limits.
Foreign Exchange Risks
Our financial statements are denominated in U.S. dollars and financial results are denominated in U.S. dollars, while a significant portion of our business is conducted, and a substantial portion of our operating expenses are payable, in currencies other than the U.S. dollar.
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Exchange rate fluctuations may have an adverse impact on our future revenues, if any, or expenses as presented in the financial statements. We may in the future use financial instruments, such as forward foreign currency contracts, in its management of foreign currency exposure. These contracts would primarily require us to purchase and sell certain foreign currencies with or for U.S. dollars at contracted rates. We may be exposed to a credit loss in the event of non-performance by the counterparties of these contracts. In addition, these financial instruments may not adequately manage our foreign currency exposure. Our results of operations could be adversely affected if we are unable to successfully manage currency fluctuations in the future.
Effects of Inflation
Inflation generally affects Microbot by increasing its research and development expenses. Microbot does not believe that inflation and changing prices had a significant impact on its results of operations for any periods presented herein.
Item 4. Controls and Procedures.
Disclosure Controls and Procedures
We maintain a system of disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). As required by Rule 13a-15(b) under the Exchange Act, management of the Company, under the direction of our Chief Executive Officer and Chief Financial Officer, reviewed and performed an evaluation of the effectiveness of design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of March 31, 2025. Based on that review and evaluation, the Chief Executive Officer and Chief Financial Officer, along with the management of the Company, have determined that as of March 31, 2025, the disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and were effective to provide reasonable assurance that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting, identified in connection with the evaluation of such internal control that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
See Note 3G to the unaudited financial statements for the fiscal quarter ended March 31, 2025, earlier in this Quarterly Report on Form 10-Q.
Item 1A. Risk Factors.
Not required for a smaller reporting company.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
In January 2025, we issued 610,517 shares of our common stock, upon the exercise of a like number of outstanding Series E preferred investment options, by the holder thereof. The exercise price per share was $1.50, generating gross proceeds to the Company, before deducting placement agent fees and expenses, of approximately $916,000. The shares were issued pursuant to the exemption provided in Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering.
In April 2025, we issued an aggregate of 1,533,336 shares of our common stock, upon the exercise of a like number of outstanding Series E and Series F preferred investment options, by the holders thereof. The exercise price per share was $1.50, generating gross proceeds to the Company, before deducting placement agent fees and expenses, of approximately $2,300,000. The shares were issued pursuant to the exemption provided in Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering.
In May 2025, we issued an aggregate of 175,000 shares of our common stock, upon the exercise of a like number of outstanding Series F preferred investment options, by the holder thereof. The exercise price per share was $1.50, generating gross proceeds to the Company, before deducting placement agent fees and expenses, of approximately $262,500. The shares were issued pursuant to the exemption provided in Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction by an issuer not involving any public offering.
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Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
During
the three months ended March 31, 2025, no director or officer, as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934,
as amended, of the Company
Item 6. Exhibits
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| 25 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, this 14th day of May, 2025.
| MICROBOT MEDICAL INC. | ||
| By: | /s/ Harel Gadot | |
| Name: | Harel Gadot | |
| Title: | Chairman, President and Chief Executive Officer | |
| (Principal Executive Officer) | ||
| By: | /s/ Rachel Vaknin | |
| Name: | Rachel Vaknin | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
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Exhibit 31.1
Certifications of Principal Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Harel Gadot, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Microbot Medical Inc.; | |
| 2. | Based upon my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
| 3. | Based upon my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| b. | Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrants’ board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| Dated: May 14, 2025 | |
| /s/ Harel Gadot | |
| Chairman, President and Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit 31.2
Certifications of Principal Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Rachel Vaknin, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q of Microbot Medical Inc.; | |
| 2. | Based upon my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
| 3. | Based upon my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report. | |
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| b. | Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrants’ board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting. |
| Dated: May 14, 2025 | |
| /s/ Rachel Vaknin | |
| Chief Financial Officer | |
| (Principal Financial And Accounting Officer) |
Exhibit 32.1
Certification of Principal Executive Officer
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Harel Gadot, Chairman, President and Chief Executive Officer of Microbot Medical Inc., hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge, the quarterly report on Form 10-Q for the period ending March 31, 2025 of Microbot Medical Inc. (the “Form 10-Q”) fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Microbot Medical Inc.
| Dated: May 14, 2025 | /s/ Harel Gadot |
| Harel Gadot | |
| Chairman, President and Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit 32.2
Certification of Principal Financial Officer
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
I, Rachel Vaknin, Chief Financial Officer of Microbot Medical Inc., hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge, the quarterly report on Form 10-Q for the period ending March 31, 2025 of Microbot Medical Inc. (the “Form 10-Q”) fully complies with the requirements of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Microbot Medical Inc.
| Dated: May 14, 2025 | /s/ Rachel Vaknin |
| Rachel Vaknin | |
| Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |