Core Insights - Microbot Medical Inc. has been added to the Russell Microcap Index, effective June 30, 2025, enhancing its visibility in the market [1][2] - The inclusion reflects the company's strong execution and momentum, particularly in relation to its LIBERTY Endovascular Robotic System and ongoing FDA interactions [2] - The Russell US Indexes reconstitution captures the 4,000 largest US stocks, and membership in the Russell Microcap Index ensures automatic inclusion in relevant growth and value style indexes [2][3] Company Overview - Microbot Medical is a pre-commercial stage medical technology company focused on redefining endovascular robotics to improve patient care globally [4] - The company has developed the world's first single-use, fully disposable endovascular robotic system, aiming to overcome traditional barriers to advanced robotic systems [4] Market Context - Russell indexes are widely utilized by investment managers and institutional investors, serving as benchmarks for approximately $10.6 trillion in assets as of June 2024 [3]

Core Insights - Microbot Medical Inc. has been granted a critical patent in China for its LIBERTY Endovascular Robotic System, marking a significant step in its global intellectual property expansion strategy [1] - The company currently holds nine patents globally and has 59 pending patent applications, which helps maintain a competitive advantage and protect the unique capabilities of the LIBERTY System [2] - Preparations for the anticipated U.S. launch of the LIBERTY System are underway, with regulatory, operational, and commercial activities accelerating [3] - The company aims to impact both developed and emerging markets, with an estimated 2 million peripheral endovascular procedures performed annually in the U.S. and approximately 2.9 million in China [4] - Microbot Medical is focused on redefining endovascular robotics and improving patient care through its innovative, single-use, fully disposable robotic system [5]

Core Viewpoint - Microbot Medical Inc. (MBOT) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][4]. Earnings Estimates and Ratings - The Zacks rating system is primarily driven by changes in a company's earnings picture, with the Zacks Consensus Estimate reflecting EPS estimates from sell-side analysts [2]. - The Zacks rating upgrade for Microbot Medical signifies an optimistic earnings outlook, likely leading to increased buying pressure and a rise in stock price [4][6]. Impact of Earnings Estimate Revisions - Changes in future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements, particularly due to institutional investors' reliance on these estimates for fair value calculations [5]. - For Microbot Medical, the recent increase in earnings estimates suggests an improvement in the company's underlying business, which should positively influence stock performance [6]. Performance of Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [8]. - The upgrade of Microbot Medical to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [11]. Recent Earnings Estimate Trends - For the fiscal year ending December 2025, Microbot Medical is expected to earn -$0.32 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 38.5% over the past three months [9].

Core Insights - Microbot Medical Inc. is expanding its commercial team in anticipation of the U.S. launch of the LIBERTY Endovascular Robotic System, projected for the third quarter of 2025 [1][2] - The company is actively engaged with the FDA, expecting a 510(k) decision during the third quarter of this year, which aligns with the FDA's original review timeline [1][4] - The addition of Michael Lytle as the head of Sales Operations & Analytics is aimed at enhancing sales infrastructure and optimizing the sales cycle [2][3] Company Developments - The LIBERTY System is currently under FDA review and is not available for sale in the U.S. until clearance is granted [4] - Michael Lytle's previous experience at ZOLL Cardiac Management Solutions is expected to contribute to the company's market targeting and resource allocation [3] - The company aims to redefine endovascular robotics and improve patient care through its innovative, single-use, fully disposable robotic system [5]

Group 1 - Microbot Medical Inc. has been selected for inclusion in the preliminary list of additions to the Russell Microcap Index, effective after U.S. market close on June 27, 2025 [1] - Membership in the Russell Microcap Index is determined by market capitalization rankings and style attributes, and it remains in place for one year [2] - Russell indexes are utilized by investment managers and institutional investors for index funds and serve as benchmarks for approximately $10.6 trillion in assets as of June 2024 [3] Group 2 - Microbot Medical is a pre-commercial stage medical technology company focused on improving patient care globally [4] - The company has developed the LIBERTY Endovascular Robotic System, which is the world's first single-use, fully disposable endovascular robotic system [4]

Part I [Financial Statements](index=4&type=section&id=Item%201%20-%20Financial%20Statements) Microbot Medical Inc.'s unaudited interim financial statements as of March 31, 2025, show total assets increased to $30.9 million, a net loss of $2.6 million, and strong financing cash inflows of $27.8 million [Interim Condensed Consolidated Balance Sheets](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets significantly increased to $30.9 million, driven by marketable securities, while shareholders' equity grew to $29.0 million due to capital raises Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $3,217 | $3,114 | | Marketable securities | $27,173 | $2,356 | | Total current assets | $30,656 | $5,819 | | **Total assets** | **$30,892** | **$6,031** | | **Liabilities & Equity** | | | | Total current liabilities | $1,893 | $2,460 | | Total liabilities | $1,941 | $2,501 | | Total shareholders' equity | $28,951 | $3,530 | | **Total liabilities and shareholders' equity** | **$30,892** | **$6,031** | [Interim Condensed Consolidated Statements of Comprehensive Loss](index=5&type=section&id=Interim%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) For Q1 2025, the company reported a net loss of $2.6 million, an increase from $2.4 million in Q1 2024, primarily due to higher R&D and G&A expenses Statements of Comprehensive Loss (in thousands, except per share data) | Metric | Q1 2025 (Unaudited) | Q1 2024 (Unaudited) | | :--- | :--- | :--- | | Research and development, net | $(1,459) | $(1,169) | | General and administrative | $(1,562) | $(1,215) | | Operating loss | $(3,021) | $(2,384) | | Other income | $316 | $0 | | Net loss | $(2,601) | $(2,371) | | Basic and diluted net loss per share | $(0.08) | $(0.17) | | Weighted average common shares outstanding | 31,085,606 | 14,055,973 | [Interim Condensed Consolidated Statements of Shareholders' Equity](index=6&type=section&id=Interim%20Condensed%20Consolidated%20Statements%20of%20Shareholders'%20Equity) Shareholders' equity significantly increased to $29.0 million by March 31, 2025, primarily driven by $25.9 million from common stock and warrant issuances and $1.0 million from ATM offerings - In Q1 2025, the company issued 13,891,840 shares of common stock and warrants, raising **$25.9 million** net of issuance costs[15](index=15&type=chunk) - An additional 842,606 shares were issued under the at-the-market (ATM) offering program, generating **$997,000** net of costs[15](index=15&type=chunk) - The exercise of 610,517 warrants brought in an additional **$852,000**[15](index=15&type=chunk) [Interim Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Interim%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In Q1 2025, net cash used in operating activities was $2.9 million and investing activities $24.8 million, offset by $27.8 million from financing activities, resulting in a $102,000 increase in cash Statements of Cash Flows Highlights (in thousands) | Activity | Q1 2025 (Unaudited) | Q1 2024 (Unaudited) | | :--- | :--- | :--- | | 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)** | [Notes to Interim Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Interim%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's pre-commercial status, sufficient funding for over twelve months, ongoing monitoring of geopolitical risks, grant obligations, and significant share capital activities - The company is a pre-commercial, clinical-stage medical device company focused on robotic endoluminal surgery devices[22](index=22&type=chunk) - Management has concluded that available funds are sufficient to fund operations for **more than twelve months** from the financial statement issuance date[26](index=26&type=chunk) - The company has received grants from the Israeli Innovation Authority (IIA) and is obligated to pay royalties of **3.0%-5%** on future sales of related products[48](index=48&type=chunk)[49](index=49&type=chunk) - In Q1 2025, the company raised approximately **$28.6 million** in gross proceeds through registered direct offerings and private placements[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) - Subsequent to the quarter end, in April and May 2025, the company raised an additional **$2.56 million** from the exercise of preferred investment options[85](index=85&type=chunk)[86](index=86&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202%20-%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's pre-commercial status, the LIBERTY system's FDA 510(k) submission, strengthened financial condition from **$31.8 million** in capital raises, and increased R&D and G&A expenses in Q1 2025 - The company is a pre-commercial, clinical-stage medical device company developing the **LIBERTY Endovascular Robotic Surgical System**, the first fully disposable robot for endovascular procedures[90](index=90&type=chunk)[91](index=91&type=chunk) - A **510(k) premarket notification** for the LIBERTY system was submitted to the FDA on December 10, 2024, with marketing clearance anticipated in **Q2 2025**[100](index=100&type=chunk)[101](index=101&type=chunk) - The company raised approximately **$31.8 million** in gross proceeds since January 1, 2025, through various offerings and warrant exercises[126](index=126&type=chunk) - Management believes the company has sufficient funds for its operations for **in excess of one year** as of the filing date[128](index=128&type=chunk) [Results of Operations](index=23&type=section&id=MD%26A%20-%20Results%20of%20Operations) In Q1 2025, R&D expenses increased by **$290,000** and G&A expenses by **$347,000**, while other income of **$316,000** was recognized from a litigation settlement Comparison of Results of Operations (in thousands) | Expense/Income | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development expenses, net | $(1,459) | $(1,169) | $(290) | | General and administrative expenses | $(1,562) | $(1,215) | $(347) | | Other income | $316 | $0 | $316 | | Financing income, net | $104 | $13 | $91 | - The increase in R&D expenses was primarily due to an increase in payroll and manufacturing of the **LIBERTY product**[118](index=118&type=chunk) - The increase in G&A expenses was primarily due to increases in payroll, professional services, rent, and travel expenses[119](index=119&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=MD%26A%20-%20Liquidity%20and%20Capital%20Resources) The company's net working capital significantly increased to **$28.8 million** by March 31, 2025, supported by approximately **$31.8 million** in gross proceeds from financing activities since January 1, 2025 - As of March 31, 2025, the company had net working capital of approximately **$28.8 million**[121](index=121&type=chunk) - Since January 1, 2025, the company has raised significant capital, including approximately **$15.6 million** and **$13.0 million** from institutional investors in January and February, respectively, and additional funds from ATM sales and warrant exercises[126](index=126&type=chunk) Summary of Net Cash Flow (in thousands) | Activity | Q1 2025 | Q1 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 | [Quantitative and Qualitative Disclosures About Market Risk](index=25&type=section&id=Item%203%20-%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity on short-term instruments, with foreign exchange risk from non-USD operating expenses, while inflation has not significantly impacted operations - Primary market risk is interest income sensitivity on cash and marketable securities, but the **short-term nature** of these instruments mitigates this risk[131](index=131&type=chunk) - The company has foreign exchange risk as a significant portion of its operating expenses are in currencies other than the U.S. dollar[132](index=132&type=chunk) - Inflation is not considered to have had a significant impact on the company's results of operations[134](index=134&type=chunk) [Controls and Procedures](index=26&type=section&id=Item%204%20-%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were **effective**[135](index=135&type=chunk) - No changes in internal control over financial reporting occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[136](index=136&type=chunk) Part II [Legal Proceedings](index=26&type=section&id=Item%201%20-%20Legal%20Proceedings) Information on legal proceedings is disclosed in Note 3G, detailing the favorable outcome of the Mona litigation, which resulted in the company receiving approximately **$316,000** - For information on legal proceedings, the report refers to **Note 3G** of the financial statements[138](index=138&type=chunk) - Note 3G describes the Mona litigation, where an appellate court ruled in the company's favor, resulting in a judgment of approximately **$316,000**, which was recorded as other income[65](index=65&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A%20-%20Risk%20Factors) This section is not required for a smaller reporting company, and therefore no information is provided - Disclosure of risk factors is not required as the company is classified as a **smaller reporting company**[139](index=139&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=26&type=section&id=Item%202%20-%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported several unregistered sales of common stock from preferred investment option exercises, raising approximately **$916,000** in January 2025, **$2.3 million** in April 2025, and **$262,500** in May 2025 - In January 2025, the company issued 610,517 shares of common stock upon the exercise of Series E options, generating gross proceeds of approximately **$916,000**[140](index=140&type=chunk) - In April 2025, the company issued 1,533,336 shares upon exercise of Series E and F options, generating gross proceeds of approximately **$2,300,000**[141](index=141&type=chunk) - In May 2025, the company issued 175,000 shares upon exercise of Series F options, generating gross proceeds of approximately **$262,500**[142](index=142&type=chunk) [Other Information](index=28&type=section&id=Item%205%20-%20Other%20Information) During the first quarter of 2025, no director or officer of the company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2025[145](index=145&type=chunk) [Exhibits](index=28&type=section&id=Item%206%20-%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including merger agreements, corporate governance documents, forms of warrants and investment options, securities purchase agreements, and officer certifications

Core Insights - Microbot Medical Inc. has strengthened its U.S. commercial leadership team with the addition of a new Vice President of Marketing and a Director of Human Resources, preparing for the launch of its LIBERTY® Endovascular Robotic System [1][4][6] - Positive data from a pivotal study has increased confidence in the market reception of LIBERTY® [1] Leadership Additions - Allison Rosefort has been appointed as Vice President of Marketing, bringing over 15 years of experience in healthcare marketing and a proven track record of driving double-digit revenue growth [2][3] - Lisa Dobbins has joined as Director of Human Resources, with a background in building high-performing teams in the MedTech sector [4][5] Commercialization Strategy - The company aims to be ready for the immediate launch of LIBERTY® following FDA clearance, reflecting its commitment to establishing a robust commercial infrastructure [6] - The recent hiring of Paul Mullen as Vice President of Sales complements the new marketing and HR leadership, enhancing the company's commercialization readiness [1][6] Product Overview - LIBERTY® is an investigational device pending FDA 510(k) clearance and is not currently available for sale in the U.S. [6] - The device is designed to redefine endovascular robotics and improve patient care globally [7]

Core Insights - The LIBERTY® Endovascular Robotic System demonstrated successful robotic navigation in all cases, achieving a 100% success rate and meeting the primary endpoint of the ACCESS-PVI pivotal trial [1][8] - The system resulted in a 92% reduction in radiation exposure with no adverse device events reported, indicating its safety and efficacy [1][2][8] - The study was conducted at three leading medical centers in the U.S., showcasing the credibility of the results [1] Company Overview - Microbot Medical Inc. is a pre-commercial stage medical technology company focused on redefining endovascular robotics to enhance patient care globally [5] - The company has developed the first single-use, fully disposable endovascular robotic system, aiming to overcome traditional barriers in accessing advanced robotic systems [5] Clinical Study Highlights - The ACCESS-PVI study involved 20 cases, with a mean robotic navigation time to target of 3 minutes [8] - Participating physicians reported a 100% satisfaction rate with the performance of the LIBERTY® system [8] - The mean difference in radiation exposure between the operator and control was a reduction of 29.8 µS, confirming the system's effectiveness in minimizing radiation [8] Future Outlook - The company is preparing for the commercial launch of LIBERTY® and is confident in its market reception based on positive clinical data and feedback from investigators [4] - LIBERTY® is currently pending FDA 510(k) clearance and is not available for sale in the U.S. [4]

Core Insights - Microbot Medical Inc. is reaffirming its expectation for the FDA's decision regarding the 510(k) clearance of its LIBERTY Endovascular Robotic System during the current second quarter [1][2] - The ACCESS-PVI trial data will be presented for the first time at a podium presentation on April 2, 2025, by Dr. Francois Cornelis from Memorial Sloan Kettering Cancer Center [1][2] Company Overview - Microbot Medical Inc. is a pre-commercial stage medical technology company focused on improving patient care globally [3] - The company has developed the world's first single-use, fully disposable endovascular robotic system, aiming to overcome traditional barriers to advanced robotic systems [3]

Part I [Business Overview](index=7&type=section&id=Item%201.%20Business) Microbot Medical Inc. is a clinical-stage medical device company developing the LIBERTY Endovascular Robotic Surgical System, a disposable robot for endovascular procedures, with recent FDA 510(k) submission - The company is a clinical-stage medical device firm specializing in robotic endoluminal surgery, primarily focusing on the **LIBERTY Endovascular Robotic Surgical System**[27](index=27&type=chunk) - The LIBERTY system is a unique, fully disposable robot for endovascular procedures, designed to be compact and remotely operated, eliminating the need for large capital equipment[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) - On December 10, 2024, the company submitted a **510(k) premarket notification to the FDA** for the LIBERTY system, with marketing clearance anticipated in the **second quarter of 2025**[39](index=39&type=chunk)[40](index=40&type=chunk) - The company received **ISO 13485:2016 certification** for its quality management system, supporting future CE Mark approval for marketing in Europe, anticipated in the **second half of 2026**[41](index=41&type=chunk) - Microbot relies on third-party manufacturers for its product candidates and has entered into a Turn-Key Manufacturing Agreement to assemble and test its products[70](index=70&type=chunk)[72](index=72&type=chunk) - The company's operations in Israel are exposed to risks from the ongoing military conflict, though no materially adverse effects have been determined as of the report filing date[74](index=74&type=chunk)[75](index=75&type=chunk) [Technological Platforms](index=7&type=section&id=Item%201.%20Business%23Technological%20Platforms) The company's core technology is the LIBERTY Endovascular Robotic Surgical System, a compact, disposable, and remotely controlled device, with successful preclinical studies and a 510(k) FDA submission - The LIBERTY system is designed to be the **first fully disposable robotic system** for endovascular procedures, eliminating the need for large capital equipment[28](index=28&type=chunk)[33](index=33&type=chunk) - A pivotal preclinical study of the LIBERTY system showed **100% usability and technical success** across 48 animal targets, with no observed complications, supporting the IDE submission to the FDA[38](index=38&type=chunk) - The company submitted a **510(k) premarket notification to the FDA** for the LIBERTY system on December 10, 2024, following a successful human trial[39](index=39&type=chunk) - In October 2022, the company acquired the **NovaCross technology platform**, which includes intraluminal revascularization devices with an anchoring mechanism and integrated microcatheter[43](index=43&type=chunk) [Strategy](index=10&type=section&id=Item%201.%20Business%23Strategy) Microbot's strategy focuses on establishing the LIBERTY system as the standard-of-care through product refinement, KOL engagement, R&D investment, and strategic partnerships - Establish the **LIBERTY system as the standard-of-care** by working with healthcare providers and systems[49](index=49&type=chunk) - Continuously invest in **R&D** to refine existing products and develop new surgical robotic solutions[49](index=49&type=chunk)[54](index=54&type=chunk) - Pursue collaborations with global medical device companies that have established sales and distribution networks[54](index=54&type=chunk) - Seek additional IP and technologies to strengthen the current portfolio through licensing, mergers, or acquisitions[54](index=54&type=chunk) [Intellectual Property](index=11&type=section&id=Item%201.%20Business%23Intellectual%20Property) Microbot's IP portfolio includes 16 issued patents and 59 pending applications, with LIBERTY system technology co-owned with TRDF, incurring royalty obligations - The company holds an IP portfolio of **16 issued/allowed patents, 59 pending patent applications, and 14 design patents** worldwide[52](index=52&type=chunk) - The LIBERTY system technology is co-owned with TRDF, and Microbot is obligated to pay TRDF royalties of **1.5% to 3.0% of net sales** of products covered by this joint invention[60](index=60&type=chunk) - Issued U.S. patents covering the company's product candidates are set to expire between **2032 and 2040**[58](index=58&type=chunk) - The company has ceased R&D on the SCS and TipCat platforms and returned the related intellectual property to TRDF[59](index=59&type=chunk) [Research and Development](index=12&type=section&id=Item%201.%20Business%23Research%20and%20Development) The company's R&D efforts focus on product enhancement, with expenses of **$6.63 million in 2024**, partly funded by Israeli Innovation Authority grants repayable via royalties R&D Expenses (Net) | Fiscal Year | R&D Expense (in thousands) | | :--- | :--- | | 2024 | $6,630 | | 2023 | $5,724 | - The company has received approximately **$1.9 million in grants** from the Israeli Innovation Authority (IIA) from 2013 through December 31, 2024[63](index=63&type=chunk) - As part of the Nitiloop asset acquisition, Microbot assumed the liability to repay Nitiloop's IIA grants, totaling approximately **$925 thousand**[64](index=64&type=chunk) - Repayment of government grants is contingent on successful commercialization and will be made through royalties of **3%-5% on future product sales**[64](index=64&type=chunk)[66](index=66&type=chunk)[68](index=68&type=chunk) [Government Regulation](index=14&type=section&id=Item%201.%20Business%23Government%20Regulation) Microbot's products are subject to extensive regulation, requiring FDA 510(k) clearance in the U.S., CE Mark in Europe, and Ministry of Health registration in Israel - In the U.S., the company's products are regulated by the FDA, with pipeline products expected to be classified as **Class II devices**, requiring **510(k) premarket clearance**[82](index=82&type=chunk)[84](index=84&type=chunk) - The company has submitted an **IDE application to the FDA** to commence a pivotal human clinical trial for the LIBERTY system[38](index=38&type=chunk)[85](index=85&type=chunk) - For European commercialization, a **CE Mark certificate** is required under the Medical Devices Regulation (MDR 2017/745), with the company having received ISO 13485 certification and engaged a Notified Body[99](index=99&type=chunk)[108](index=108&type=chunk) - In Israel, medical devices must be registered with the Ministry of Health (MOH), with an expedited process if the device has approval from a recognized country like the U.S. or an E.U. member state[109](index=109&type=chunk)[110](index=110&type=chunk) [Risk Factors](index=22&type=section&id=Item%201A.Risk%20Factors) The company faces significant risks including ongoing operating losses, dependence on the LIBERTY system, reliance on third-party manufacturing, geopolitical instability in Israel, and intense market competition [Risks Relating to Financial Position and Need for Additional Capital](index=22&type=section&id=Item%201A.Risk%20Factors%23Financial%20Position%20and%20Need%20for%20Additional%20Capital) Microbot has a history of significant operating losses with no revenue, requiring substantial additional funding for development and commercialization, with future viability uncertain - The company has had **no revenue and significant operating losses** since inception and expects these losses to continue for the foreseeable future[123](index=123&type=chunk) - Microbot has a limited operating history, making it difficult to evaluate its future viability[126](index=126&type=chunk) - The company will need to raise additional capital to fund its product development and commercialization efforts, and failure to do so could force delays or reductions in its programs[128](index=128&type=chunk)[129](index=129&type=chunk) [Risks Relating to the Development and Commercialization of Product Candidates](index=24&type=section&id=Item%201A.Risk%20Factors%23Development%20and%20Commercialization%20of%20Product%20Candidates) The company's success depends heavily on the LIBERTY system, facing risks in clinical trials, regulatory approval, third-party manufacturing, supply chain disruptions, and market acceptance - The company's business depends heavily on the success of its sole lead product candidate, the **LIBERTY Endovascular Robotic Surgical System**[133](index=133&type=chunk) - There is no guarantee that the data submitted in the **510(k) application** will satisfy all FDA requirements, creating uncertainty and potential for increased costs and delays[138](index=138&type=chunk) - The company relies on third-party manufacturers, which entails risks related to supply availability, regulatory compliance, and potential breaches of agreements[150](index=150&type=chunk) - Failure to obtain and maintain adequate third-party reimbursement for procedures involving its products could materially harm the business[156](index=156&type=chunk) - The company is experiencing delays in the supply of certain components from Israeli-based vendors due to the Israel-Hamas war, which could adversely affect its development timeline[144](index=144&type=chunk) [Risks Relating to Operations in Israel](index=36&type=section&id=Item%201A.Risk%20Factors%23Operations%20in%20Israel) The company's Israeli operations face exacerbated risks from ongoing military conflict, including supply disruptions, employee reserve duty, regional instability, currency fluctuations, and grant restrictions - Risks related to Israeli operations are being exacerbated by the military actions that commenced on **October 7, 2023**, affecting suppliers and logistics[187](index=187&type=chunk)[188](index=188&type=chunk) - Political, economic, and military conditions in Israel, including ongoing hostilities and internal political situations, could directly and materially affect the company's operations[189](index=189&type=chunk) - A significant portion of expenses are in New Israeli Shekels (NIS), exposing the company to adverse effects from **currency exchange rate fluctuations** against the U.S. dollar[193](index=193&type=chunk) - The company receives funding from the Israeli Innovation Authority, which comes with royalty repayment obligations and restrictions on transferring funded technology outside of Israel[195](index=195&type=chunk)[198](index=198&type=chunk) [Cybersecurity](index=43&type=section&id=Item%201C.%20Cybersecurity) Microbot manages cybersecurity through a third-party subcontractor, implementing various security measures, with no material breaches or impacts on pre-commercial operations to date - The company uses a **third-party subcontractor** to manage all Information Technology (IT) issues, including cybersecurity[222](index=222&type=chunk) - Cybersecurity measures include endpoint security solutions, hard drive encryption, email filtering, multi-factor authentication, and cloud-based backups[224](index=224&type=chunk) - The company's Chief Technology Officer and General Manager is responsible for assessing and managing cybersecurity risks[225](index=225&type=chunk) - As of the report date, cybersecurity threats have not materially affected the company, and no material security breaches have been identified[226](index=226&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=45&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ under "MBOT", with no history or plans for cash dividends, and details on equity compensation plans are provided - The company's common stock trades on the **NASDAQ Capital Market** under the symbol **"MBOT"**[231](index=231&type=chunk) - The company has never paid cash dividends and does not plan to in the foreseeable future[232](index=232&type=chunk) Equity Compensation Plan Information as of December 31, 2024 | Plan Category | Number of securities to be issued upon exercise | Weighted average exercise price | Number of securities remaining available for future issuance | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 2,357,943 | $4.59 | 886,427 | | Equity compensation plans not approved by security holders | 139,423 | $2.11 | - | | **Total** | **2,497,366** | | **886,427** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Microbot, a clinical-stage company, continues to incur net losses, with R&D and G&A expenses increasing in 2024, but recent equity raises provide sufficient funds for over one year of operations Results of Operations Comparison (in thousands) | | For the Years Ended December 31, | Change | | :--- | :--- | :--- | :--- | | | **2024** | **2023** | **($)** | | Research and development expenses, net | $(6,630) | $(5,724) | $(906) | | General and administrative expenses, net | $(4,995) | $(4,131) | $(864) | | Financing income, net | $182 | $228 | $(46) | | Loss on legal settlement, net | - | $(1,111) | $1,111 | - The **$0.9 million increase in R&D expenses** in 2024 was driven by higher headcount, salaries, bonuses, and increased costs for clinical studies and regulatory submissions (IDE and 510k)[253](index=253&type=chunk) - The **$0.9 million increase in G&A expenses** in 2024 was mainly due to the relaxation of cost reduction plans from 2023, which had temporarily lowered employee salaries and board fees[254](index=254&type=chunk) - As of December 31, 2024, the company had net working capital of approximately **$3.4 million**, but raised approximately **$30.6 million** in additional funds in January and February 2025[256](index=256&type=chunk)[259](index=259&type=chunk) - Management believes the company has sufficient funds for its operations for **more than one year** from the filing date of this report[263](index=263&type=chunk) Summary of Net Cash Flow (in thousands) | | For the Years Ended December 31, | | :--- | :--- | :--- | | | **2024** | **2023** | | Net cash flows used in operating activities | $(8,827) | $(8,533) | | Net cash flows provided by investing activities | $1,537 | $1,973 | | Net cash flows provided by financing activities | $7,936 | $6,558 | [Quantitative and Qualitative Disclosures About Market Risk](index=50&type=section&id=Item%207A.Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risks are interest rate sensitivity, considered low, and foreign currency exchange risk from non-U.S. dollar operating expenses, which are not currently hedged - The company's primary market risk is interest income sensitivity, but due to the short-term nature of its investments, a sudden change in rates is not expected to have a material impact[266](index=266&type=chunk) - The company is exposed to **foreign exchange risk** as a significant portion of its operating expenses are in non-U.S. dollar currencies, but its financial results are denominated in U.S. dollars[267](index=267&type=chunk) - The company does not currently use financial instruments to hedge its foreign currency exposure[268](index=268&type=chunk) [Controls and Procedures](index=51&type=section&id=Item%209A.Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with no material changes identified - Management concluded that as of December 31, 2024, the company's **disclosure controls and procedures were effective**[272](index=272&type=chunk) - Management concluded that as of December 31, 2024, the company's **internal control over financial reporting was effective**[273](index=273&type=chunk) - The annual report does not include an attestation report from the registered public accounting firm regarding internal control over financial reporting, as permitted by SEC rules[274](index=274&type=chunk) Part III [Directors, Executive Officers, and Corporate Governance](index=53&type=section&id=Item%2010.%20Directors,%20Executive%20Officers,%20and%20Corporate%20Governance) The company's Board of Directors comprises seven members with a classified structure and three independent committees, operating under a Code of Ethics and a clawback policy - The Board of Directors is comprised of **seven members** and is classified into three classes with staggered three-year terms[280](index=280&type=chunk)[281](index=281&type=chunk) - The Board has three standing committees: **Audit, Compensation, and Corporate Governance**, with all members being independent[293](index=293&type=chunk) - The company has adopted a **Code of Ethics and Conduct**, an insider trading policy, and a **clawback policy** as required by the Dodd-Frank Act[301](index=301&type=chunk)[302](index=302&type=chunk)[304](index=304&type=chunk) - **Six of the seven board members** are considered independent: Messrs. Burell, Madden, Laxminarain, Wenderow, and Wilson, and Ms. Stockburger[356](index=356&type=chunk) [Executive Compensation](index=59&type=section&id=Item%2011.%20Executive%20Compensation) This section details compensation for named executive officers, including CEO Harel Gadot's **$1.24 million total compensation in 2024**, and outlines employment agreements and non-management director compensation Summary Compensation Table for Fiscal Year 2024 (in $) | Name and Principal Position | Salary | Bonus | Option Awards | All Other Compensation | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Harel Gadot (CEO, President & Chairman) | 520,249 | 149,189 | 514,141 | 57,900 | 1,241,479 | | Simon Sharon (CTO and GM) | 241,455 | 84,754 | 123,785 | 89,435 | 539,429 | | Juan Diaz-Cartelle (CMO) | 350,000 | - | 26,478 | - | 376,478 | | Rachel Vaknin (CFO) | 162,793 | 40,816 | 105,862 | 53,694 | 363,165 | - CEO Harel Gadot's employment agreement for FY2025 provides for an annual salary of **$557 thousand** and a target annual cash bonus of up to **75% of base salary**[312](index=312&type=chunk)[313](index=313&type=chunk) - Non-management directors receive an annual cash fee of **$35 thousand**, plus additional fees for committee service, and are eligible for annual stock option grants[345](index=345&type=chunk) - Director fees, which had been suspended as part of a May 2023 cost reduction plan, were reinstated effective **January 1, 2024**[345](index=345&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=66&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section details beneficial ownership of common stock as of March 24, 2025, showing executive officers and directors as a group owning **4.76%** of outstanding shares Security Ownership as of March 24, 2025 | Beneficial Owner | Number of Shares Beneficially Owned | Percentage of Common Stock Beneficially Owned | | :--- | :--- | :--- | | Harel Gadot | 1,097,927 | 3.07% | | All current directors and executive officers as a group (10 persons) | 1,729,068 | 4.76% | - The ownership percentages are based on **34,744,476 shares** of common stock outstanding as of March 24, 2025[350](index=350&type=chunk) - Beneficial ownership includes shares an individual has the power to vote or dispose of, and shares acquirable within 60 days of March 24, 2025, primarily through stock options[350](index=350&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=67&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence) The company has procedures for reviewing related party transactions, with no disclosable transactions for the period, and a majority of its directors are independent under NASDAQ standards - The company has policies and procedures, including a code of ethics and committee oversight, to review potential conflicts of interest and related party transactions[353](index=353&type=chunk) - There were no related party transactions required to be disclosed for the period[354](index=354&type=chunk) - The independent members of the Board are Messrs. Burell, Madden, Laxminarain, Wenderow, and Wilson, and Ms. Stockburger, constituting a majority of the board[356](index=356&type=chunk) [Principal Accountant Fees and Services](index=68&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The company's independent auditor is Brightman Almagor Zohar & Co. (Deloitte), with total fees of **$200 thousand in 2024**, primarily for audit services, under Audit Committee pre-approval policies Accountant Fees (for years ended December 31) | Fee Type | 2024 | 2023 | | :--- | :--- | :--- | | Audit Fees | $150,000 | $140,000 | | Tax Fees | - | $11,250 | | All Other Fees | $50,000 | $65,000 | | **Total** | **$200,000** | **$216,250** | - The independent accounting firm is **Brightman Almagor Zohar & Co.**, a Firm in the Deloitte Global Network[358](index=358&type=chunk) - The Audit Committee has adopted policies and procedures for pre-approving all audit and non-audit services performed by the independent auditors[361](index=361&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=69&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists documents filed as part of the Form 10-K, including financial statements, corporate governance documents, material contracts, and Sarbanes-Oxley certifications - The financial statements are filed as part of the report, while financial statement schedules are omitted as they are not applicable[362](index=362&type=chunk) - Key exhibits filed or incorporated by reference include the company's Restated Certificate of Incorporation, Amended and Restated By-Laws, various warrant forms, employment agreements with executive officers, and the Code of Ethics[364](index=364&type=chunk)[366](index=366&type=chunk) - Certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act are included as exhibits[369](index=369&type=chunk) Financial Statements [Report of Independent Registered Public Accounting Firm](index=75&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor issued an unqualified opinion on the financial statements, highlighting a Critical Audit Matter regarding going concern, which was addressed by subsequent financing of approximately **$30 million** - The auditor issued an **unqualified opinion**, stating the financial statements are fairly presented in accordance with U.S. GAAP[377](index=377&type=chunk) - A **Critical Audit Matter** was identified regarding the evaluation of the company's ability to continue as a going concern[381](index=381&type=chunk)[383](index=383&type=chunk) - The going concern issue was addressed by auditing the significant funds (approx. **$30 million**) raised in January and February 2025, which management concluded were sufficient to fund operations for more than one year[385](index=385&type=chunk)[386](index=386&type=chunk)[391](index=391&type=chunk) [Consolidated Financial Statements](index=78&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements report a **net loss of $11.4 million in 2024**, with total assets of **$6.0 million** and total liabilities of **$2.5 million** as of year-end Consolidated Balance Sheet Data (in thousands) | | As of Dec 31, 2024 | As of Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $3,114 | $2,468 | | Total current assets | $5,819 | $7,921 | | Total assets | $6,031 | $8,327 | | Total current liabilities | $2,460 | $3,786 | | Total liabilities | $2,501 | $3,826 | | Total shareholders' equity | $3,530 | $4,501 | Consolidated Statement of Comprehensive Loss Data (in thousands) | | For the Year Ended Dec 31, 2024 | For the Year Ended Dec 31, 2023 | | :--- | :--- | :--- | | Operating loss | $(11,625) | $(9,855) | | Net loss | $(11,443) | $(10,740) | | Basic and diluted net loss per share | $(0.73) | $(1.05) | [Notes to Consolidated Financial Statements](index=82&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail financial statement support, including management's going concern assessment, royalty obligations, lawsuit settlement, share capital activities, and **$30.6 million** in subsequent financing - Management concluded that available funds, combined with capital raised subsequent to the balance sheet date, are sufficient to fund operations for **more than twelve months** (Note 1)[411](index=411&type=chunk) - The company is obligated to pay royalties of **3.0%-5%** on future sales to the IIA and **1.5%-3.0%** to TRDF for licensed technology (Note 9)[477](index=477&type=chunk)[481](index=481&type=chunk) - In January 2024, a lawsuit was settled with a payment of **$1.1 million in cash** (covered by insurance) and **1,005,965 shares** of restricted common stock (Note 9G)[499](index=499&type=chunk)[500](index=500&type=chunk) - In January and February 2025, the company raised approximately **$30 million in gross proceeds** through a series of registered direct offerings and private placements (Note 17A)[565](index=565&type=chunk)[567](index=567&type=chunk)[569](index=569&type=chunk) - In January 2025, the company raised an additional **$916 thousand** from the exercise of outstanding preferred investment options (Note 17B)[572](index=572&type=chunk)