Annual report pursuant to Section 13 and 15(d)

EQUITY

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EQUITY
12 Months Ended
Nov. 30, 2018
EQUITY [Text Block]

NOTE 13 – EQUITY

a. Share Capital

     The Company’s common shares were traded on the OTCQB Venture Market under OTC Market Group’s OTCQB tier under the symbol “ORGS”. On March 13, 2018, the Company's common stock began to be listed and traded on the Nasdaq Capital Market under the symbol “ORGS.”.

b. Financings

(1) In January 2017, the Company entered into definitive agreements with an institutional investor for the private placement of 2,564,115 units of the Company’s securities for aggregate subscription proceeds to the Company of $16 million at $6.24 price per unit. Each unit is comprised of one share of the Company’s Common Stock and a one warrant, exercisable over a three-years period from the date of issuance, to purchase one additional share of Common Stock at a per share exercise price of $6.24 (“Unit”). The subscription proceeds have been paid to the Company on a periodic basis through October 2018.

     In July 2018, the Company entered into definitive agreements with assignees of the aforementioned institutional investor whereby these assignees remitted $4.6 million in respect of the units available under the original subscription agreement that have not been subscribed for, entitling such investors to 702,307 units, with each unit being comprised of (i) one share of the Company's common stock and (ii) one three-year warrant to purchase up to an additional one share of the Company’s common stock at a per share exercise price of $6.24.

     During the year ended November 30, 2018 and 2017 the investor and the assignees remitted to the Company $11.5 and $4.5 million, and the Company issued 1,813,687 and 721,160 Units, respectively.

     As of November 30, 2018, 550,481 shares have not been issued and therefore the Company has recorded $2.3 million in receipts on account of shares to be allotted in the statement of equity.

     In connection therewith, during the year ended November 30, 2018 and 2017, the Company had transaction costs of approximately $328 and $225 thousand, respectively, out of which $121 and $253 thousand are stock-based compensation expenses due to issuance of warrants and shares. See also Note 15(d).

(2) During the year ended November 30, 2018, the Company entered into definitive agreements with accredited and other qualified investors relating to a private placement of 1,237,642 units. Each unit is comprised of (i) one share of the Company’s common stock and (ii) three-year warrant to purchase up to an additional one share of the Company’s Common Stock at a per share exercise price of $6.24, for aggregate proceeds to the Company of approximately $7.7 million.

The transaction costs were approximately $349 thousand, out of which $125 thousand are stock-based compensation due to issuance of warrants. See also 15(d).

(3) During the year ended November 30, 2018, investors exercised 136,646 warrants into 136,646 shares of the Company’s Common Stock, for aggregate proceeds of $853 thousand.

c. Contingent Shares

     According to the share exchange agreement signed during 2015, the former shareholders of MaSTherCell received a “consideration of shares” of Orgenesis Inc. in exchange of their shares in MaSTherCell. At the time of MaSTherCell’s acquisition by the Company, there was outstanding convertible bonds issued by MaSTherCell in an amount of $1.8 million (Euro 1.6 million). Under the share exchange agreement in case MaSTherCell is repaying the principal amount and the accrued interest of the convertible bonds, the former shareholders will give back to the Company a portion of the consideration shares. To that effect, the number of consideration shares to be released back to the Company, shall be determined by dividing the subscription amount of the outstanding convertible bonds plus interest owed thereunder (converted into USD according to the currency exchange rate applicable on the day of conversion) by the consideration and by applying the resulting quotient to actual total number of consideration shares received by former shareholder of MaSTherCell.

     During January 2017 MaSTherCell repaid all but one of its bondholders and the aggregate payment amounted to $1.7 million (Euro 1.5 million). According to the terms of the release back pursuant the share exchange agreement, the Company returned to treasury a total of 263,148 shares. These shares have been retired and cancelled. See also Note 8(d).

d. Warrants

     A summary of the Company's warrants granted to investors and as finder's fees as of November 30, 2018 and 2017 and changes for the years then ended is presented below:

    2018     2017  
          Weighted           Weighted  
          Average           Average  
          Exercise           Exercise  
    Number of     Price     Number of     Price  
    Warrants     $     Warrants     $  
Warrants outstanding at the beginning of the year   2,609,864     6.26     1,620,993     6.25  
Changes during the year:                        
     Issued   4,488,854     6.27     1,144,647     6.32  
     Exercised   (136,646 )   6.24     -        
     Expired   (382,414 )   6.10     (155,776 )   6.24  
     Cancelled**   (66,667 )   6.24     -        
Warrants outstanding and exercisable at end of the year*   6,512,991     6.27     2,609,864     6.26  

     * As of November 30, 2018, and 2017, 769,411 and 1,066,691 warrants respectively, are subject to exercise price adjustments

      ** see also Note 15(d).