Annual and transition report of foreign private issuers pursuant to Section 13 or 15(d)

Stock Options

v3.8.0.1
Stock Options
12 Months Ended
Dec. 31, 2017
Stock Options [Abstract]  
STOCK OPTIONS

NOTE 11 – STOCK OPTIONS

 

On January 11, 2016, the Company’s Board of Directors approved and adopted the Todos Medical Ltd. 2015 Israeli Share Option Plan (the “2015 Plan”), pursuant to which the Board may award options to purchase its ordinary shares to designated participants. Subject to the terms and conditions of the 2015 Plan, the Board of Directors has full authority in its discretion, from time to time and at any time, to determine (i) the designate participants; (ii) the terms and provisions of the respective Option Agreements, including, but not limited to, the number of Options to be granted to each Optionee, the number of Shares to be covered by each Option, provisions concerning the time and the extent to which the Options may be exercised and the nature and duration of restrictions as to the transferability or restrictions constituting substantial risk of forfeiture and to cancel or suspend awards, as necessary; (iii) determine the Fair Market Value of the Shares covered by each Option; (iv) make an election as to the type of Approved 102 Option under Israeli IRS law; (v) designate the type of Options; (vi) take any measures, and to take actions, as deemed necessary or advisable for the administration and implementation of the 2015 Plan; (vii) interpret the provisions of the 2015 Plan and to amend from time to time the terms of the 2015 Plan.

 

The 2015 Plan permits the grant of up to 6,000,000 options to purchase ordinary shares subject to adjustments set in the 2015 Plan. As of December 31, 2017, there were 4,241,685 ordinary shares available for future issuance under the 2015 Plan.

 

The following table presents the Company’s stock option activity for employees and directors of the Company for the years ended December 31, 2017 and December 31, 2016:

 

    Number of Options     Weighted Average Exercise Price  
Outstanding at December 31, 2016     2,068,605       0.0026  
Granted     -       -  
Exercised     (81,432 )     0.0026  
Forfeited or expired     (228,858 )     -  
Outstanding at December 31, 2017     1,758,315       0.0026  
Number of options exercisable at December 31, 2017     827,443       0.0026  

 

    Number of Options     Weighted Average Exercise Price  
Outstanding at December 31, 2015     -       -  
Granted     2,172,033       0.0026  
Exercised     (103,432 )     0.0026  
Forfeited or expired     -       -  
Outstanding at December 31, 2016     2,068,605       0.0026  
Number of options exercisable at December 31, 2016     439,580       0.0026  

 

The fair value of options granted was estimated at the dates of grant using the Black-Scholes option pricing model. The following are the data and assumptions used:

 

    Years ended December 31,  
    2016  
Dividend yield     0  
Expected volatility (%) (*)     100 %
Risk-free interest rate (%)     1 %
Expected term (years) (**)     2.5  
Exercise price (US dollars)     0.0026  
Stock price (US dollars) (***)     0.15  

 

(*) Due to the low trading volume of the Company’s Common Stock, the expected volatility was based on the historical volatility of the share price of other public companies that operate in the same industry sector as the Company.

 

(**) Due to the fact that the Company does not have sufficient historical exercise data, the expected term was determined based on the “simplified method” in accordance with SEC Staff Accounting Bulletin No. 110.

 

(***) The Common Stock price, per share reflects the Company’s management’s estimation of the fair value per share of Common Stock. In reaching its estimation for 2016 grants, management considered, among other things, the valuation of the issuance of the shares under the private placement (see Note 10-F above)

 

Costs incurred in respect of stock-based compensation for employees and directors, for the years ended December 31, 2017 and 2016 amounted to $68,649 and $80,094, respectively.

 

The following table summarizes information about options to employees, officers and directors outstanding at December 31, 2017 under the plan:

 

    Options Outstanding     Options Exercisable  
Exercise Price   Number of Options     Weighted Average Remaining Contractual Life (Years)     Number of Options     Weighted Average Exercise Price  
0.0026     1,758,315       3.03       827,443       0.0026  
      1,758,315       3.03       827,443       0.0026  

 

As of December 31, 2017, the aggregate intrinsic value for the options exercisable was $488,191 with a weighted average remaining contractual life of 3.03 years.

 

The unrecognized compensation expense calculated under the fair value method for the stock options as of December 31, 2017 is $11,440 and is expected to be recognized over a weighted average period of 3 months.