Business Context and Reporting Period
This Form 6-K filing by Check-Cap Ltd. (referred to in metadata as Mbody AI Ltd.) is dated July 2, 2021. The report discloses a definitive agreement entered into on June 30, 2021, for a registered direct offering of ordinary shares and warrants. The offering was expected to close on or about July 2, 2021.
Key Financial Metrics
- Gross Proceeds: Approximately $35,000,000 from the sale of 25,925,926 ordinary shares and accompanying warrants.
- Offering Price: $1.35 per share and accompanying warrant.
- Warrant Terms: 25,925,926 Investor Warrants issued, exercisable immediately at $1.50 per share, expiring January 2, 2024.
- Placement Agent Fees: 7.0% of gross proceeds plus a 1.0% management fee, $25,000 expense allowance, up to $100,000 in fees/expenses, and a $15,950 clearing fee.
- Placement Agent Warrants: Warrants to purchase 1,296,296 shares (5.0% of aggregate shares sold) at an exercise price of $1.6875 per share.
The filing text does not provide clear values for revenue, profit, cash flow, margins, debt, or liquidity metrics as this is a transaction disclosure rather than a financial results report.
Material Changes
The primary material change is the capital raise via the registered direct offering. The Company agreed to a 90-day lock-up period following the closing, during which it cannot issue or announce the issuance of ordinary shares or equivalents, subject to customary exceptions. Additionally, for 12 months post-closing, the Company is restricted from entering into "variable rate transactions."
Guidance, Outlook, and Use of Proceeds
Management intends to use the net proceeds to advance the ongoing clinical development of C-Scan, specifically for its U.S. pivotal study, and for general corporate purposes. The filing does not contain specific financial guidance, risk factors beyond standard transaction terms, or unusual items.
Investor Verification Checklist
- Verify the actual closing date and final net proceeds received after deducting placement agent fees and expenses.
- Confirm the dilution impact of the 25,925,926 new shares and the potential future dilution from the exercise of Investor and Placement Agent Warrants.
- Review the status of the C-Scan U.S. pivotal study to assess the timeline for clinical milestones funded by this capital.
- Check for any subsequent filings regarding the exercise of warrants or changes in the 90-day lock-up restrictions.