Form 4: My Size, Inc. CEO's Stock Options Repriced Amidst Significant Share Price Decline

My Size, Inc. has repriced stock options for its CEO, Ronen Luzon, and his spouse, the Chief Product Officer and COO, reducing the exercise price from $8.72 to $1.28 per share following a substantial drop in the company's stock value.

Summary

• Ronen Luzon, CEO and Director of My Size, Inc. (MYSZ), reported changes in beneficial ownership via a Form 4 filing.
• On June 4, 2025, the Board of Directors approved a unilateral option repricing for existing stock options.
• The exercise price of these options was reduced from $8.72 per share to $1.28 per share, which was the closing price of the company's common stock on June 4, 2025.
• A total of 800 options held directly by Ronen Luzon were repriced.
• An additional 650 options held indirectly by Ronen Luzon, through his spouse Billy Pardo (Chief Product Officer and Chief Operating Officer), were also repriced.
• All repriced options were granted under the My Size, Inc. 2017 Equity Incentive Plan and are fully vested.
• The expiration date for these options remains August 10, 2025.
• The company previously implemented a 1-for-25 reverse stock split on December 8, 2022, and a 1-for-8 reverse stock split on April 23, 2024, with all reported amounts adjusted to reflect these splits.

Sentiment

Score: 3

Explanation: The sentiment is predominantly negative due to the underlying reason for the repricing: a significant decline in the company's stock price. While it re-incentivizes management, it reflects poor past performance and can be perceived negatively by shareholders.

Positives

• The repricing re-incentivizes key management personnel, including the CEO and COO, by making their stock options 'in the money' again, potentially aligning their interests with future stock price appreciation.
• All repriced options are fully vested, meaning the recipients have immediate rights to exercise them at the new, lower price.

Negatives

• The necessity of option repricing from $8.72 to $1.28 indicates a significant and sustained decline in My Size, Inc.'s stock price, reflecting poor past performance.
• Option repricing can be viewed negatively by existing shareholders as it effectively grants new, more favorable terms to management at a lower valuation, potentially diluting shareholder value if new shares are issued upon exercise.
• The repricing may signal a lack of confidence in the company's ability to reach its previous stock price levels, which would have made the original options valuable.

Risks

• The substantial drop in stock price leading to the repricing highlights ongoing market concerns or operational challenges for My Size, Inc.
• Potential for further dilution if the repriced options are exercised, increasing the number of outstanding shares.
• Negative investor sentiment due to the repricing, which can be perceived as a bailout for management at shareholders' expense.

Future Outlook

The document does not provide explicit forward-looking statements regarding the company's financial performance or strategic direction, beyond the re-incentivization of management through the repriced options, which implies an expectation of future stock price appreciation to make these options valuable.

Management Comments

• The Board of Directors of the Company approved a unilateral option repricing, which resulted in the reduction of the exercise price to $1.28 per share, which is the closing price of the Company's common stock on June 4, 2025. All of the other terms of the option remained unchanged.

Industry Context

Option repricing is a practice typically undertaken by companies whose stock price has significantly underperformed, rendering previously granted stock options 'underwater' (i.e., their exercise price is higher than the current market price). While it serves to re-incentivize management and retain talent, it often signals underlying challenges or a substantial decline in market valuation, which can be viewed critically by investors.

Comparison to Industry Standards

• Option repricing is a known, albeit often controversial, practice in corporate finance, particularly among companies experiencing significant stock price declines. It is not a 'standard' practice in the sense of being a routine event for healthy companies, but rather a remedial action.
• The substantial reduction in exercise price from $8.72 to $1.28 indicates a severe decline in My Size, Inc.'s stock value, suggesting performance significantly below industry benchmarks or market expectations for growth companies.

Corporate Governance

Related Party Transactions

• Options held indirectly by Ronen Luzon are through his spouse, Billy Pardo, who serves as the Chief Product Officer and Chief Operating Officer of My Size, Inc.

Stakeholder Impact

• Shareholders: May view the repricing negatively as it reflects poor stock performance and could lead to dilution if options are exercised.
• Management (Ronen Luzon, Billy Pardo): Directly benefits from the repricing, as their options are now 'in the money' and provide renewed incentive.
• Employees: While not directly mentioned, such actions can affect overall employee morale and perception of company stability.

Next Steps

• The repriced options can be exercised by Ronen Luzon and Billy Pardo at the new $1.28 exercise price before their expiration on August 10, 2025.

Key Dates

Recommendation

Keywords

My Size Inc, MYSZ, SEC Form 4, stock options, option repricing, executive compensation, insider transaction, Ronen Luzon, Billy Pardo, corporate governance, reverse stock split