What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2021-02-19 compared with 2020-03-13 · 205 added, 205 removed, 601 unchanged (41% of the section changed)

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We have served as the Company’s auditor since 2015.

March 13, 2020

Los Angeles, CA

February 19, 2021

Atomera Incorporated

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Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

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Operating lease right of use asset

Long-term prepaid rent

Security deposit

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Deferred revenue

Total current liabilities

Long term operating lease liability

Total liabilities

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Loss from operations

Other income/(expense):

Other income:

Interest income

Total other income, net

Total other income

Net loss per common share, basic and diluted

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Atomera Incorporated

Statement of Stockholders’

Statements of Stockholders’

(in thousands)

Total Stockholders’

Stockholders’

Balance January 1, 2019

Stock-based compensation

Issuance of common stock in connection with October 15, 2018 offering, net of commissions, expenses and other offering costs

Registered direct offering

of common stock, net of commissions and other offering expenses

Balance December 31, 2019

Stock-based compensation

Registered direct offering of common stock, net of commissions and other offering expenses

Warrant modification

Warrant exercises

Stock option exercises

Underwritten public offering

of common stock, net of commissions

At-the-market sale of

stock, net of commissions and expenses

Balance December

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Depreciation and amortization

ROU asset amortization

Right of use asset amortization

Stock-based compensation

Loss on disposal of assets

Warrant modification expense

Changes in operating assets and liabilities:

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Prepaid expenses and other current assets

Long-term prepaid rent

Accounts payable

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CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from registered direct offering of common stock, net

Proceeds from public offering, net

Proceeds from at-the-market sale of stock, net of commissions and expenses

Proceeds from underwritten public offering, net of commission and expenses

Proceeds from registered direct offering of common stock, net of commissions and expenses

Proceeds from exercise of stock options

Proceeds from exercise of warrants

Net cash provided by financing activities

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On January 12, 2016, the Company changed its name to Atomera Incorporated.

The Company is in the

development stage, having only recently begun limited revenue-generating activities, and is devoting substantially all of its efforts

toward technology research and development and to obtaining initial customers.

The Company has primarily financed operations through

private placements and public offering of its equity and debt securities, including an underwritten public offering of common stock

consummated on October 15, 2018 and a registered direct offering of common stock consummated on May 30, 2019.

Atomera is an early

stage company, having only recently begun limited revenue-generating activities, and is devoting substantially all of its efforts

toward technology research and development and to commercially licensing its technology to designers and manufacturers of integrated

The Company has primarily financed operations through private placements of equity and debt securities, the Company’s

Initial Public Offering (the “IPO”) which was consummated on August 10, 2016, and subsequent public offerings of its

common stock.

LIQUIDITY AND MANAGEMENT PLANS

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the Company had cash and cash equivalents of approximately $37.9 million and working capital of approximately $36.6 million.

Company has only generated limited revenues since inception and has incurred recurring operating losses.

Company’s operating plans for the next 12 months include increased research and development headcount and increased

spending on outsourced fabrication and testing.

Based on the funds it has available as of the date of the filing of this

report, the Company believes that it has sufficient capital to fund its current business plans and obligations over, at

least, 12 months from the date that these financial statements have been issued.

However, as the Company has generated only

limited revenue from its principal operations, it is subject to all the risks inherent in the initial organization,

financing, expenditures, complications and delays in a new business.

Accordingly, the Company may require additional capital,

the receipt of which cannot be assured.

In the event the Company requires additional capital, there can be no guarantee that

funds will be available on commercially reasonable terms, if at all.

The Company’s future capital requirements and the adequacy

of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its technology,

competing technological and market developments, and the need to enter into collaborations with other companies or acquire technologies

to enhance or complement its current offerings.

If the Company is unable to secure additional capital, it may be required to curtail

its research and development initiatives and take additional measures to reduce costs in order to conserve its cash.

Company has generated only limited revenues since inception and has incurred recurring operating losses.

The Company’s

operating plans for the next 12 months include increased research and development headcount and increased spending on outsourced

fabrication and testing.

Based on the funds it has available as of the date of the filing of this report, the Company believes

that it has sufficient capital to fund its current business plans and obligations over, at least, 12 months from the date that

these financial statements have been issued.

However, as the Company has generated only limited revenue from its principal operations,

it is subject to all the risks inherent in the initial organization, financing, expenditures, complications and delays in a new

Accordingly, the Company may require additional capital, the receipt of which cannot be assured.

In the event the Company

requires additional capital, there can be no guarantee that funds will be available on commercially reasonable terms, if at all.

The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including

the Company’s ability to successfully commercialize its technology, competing technological and market developments, and

the need to enter into collaborations with other companies or acquire technologies to enhance or complement its current offerings.

If the Company is unable to secure additional capital, it may be required to curtail its research and development initiatives and

take additional measures to reduce costs in order to conserve its cash.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Level 1 —

Quoted prices (unadjusted) in active markets for identical assets and liabilities.

prices (unadjusted) in active markets for identical assets and liabilities.

Level 2 —

Inputs other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets

and liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated

other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets and

liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated

by observable market data for substantially the full term of the assets or liabilities.

Level 3 —

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets

or liabilities.

inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Cash and cash equivalents

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accounts and money market funds with maturities of less than three months when purchased, which are readily convertible to known

amounts of cash, and which in the opinion of management are subject to insignificant risk of loss in value.

amounts of cash.

Concentration of Credit Risk and Major Customers

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which potentially subject the Company to concentrations of credit risk, consist principally of cash, cash equivalents and accounts

During the year ended December 31, 2019, six customers each represented approximately 26%, 19%, 16%, 16%, 13% and 9%

During the year ended December 31, 2020, one customer represented 100% of revenue and, no customer represented a balance

of accounts receivable at December 31, 2020.

During the year ended December 31, 2019, six customers each represented approximately

26%, 19%, 16%, 16%, 13% and 9% of revenues.

No customers represented a balance of accounts receivable at December 31, 2019.

During the year ended December 31,

2018, three customers each represented 72%, 20% and 8% of revenues and 43%, 30% and 27% of the accounts receivable balance at December

At times, the amounts

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Board (“FASB”) issued Accounting Standards Update (“ASU”) No 2016-02, Leases (Topic 842).

information on the implementation can be found under “Adoption of Recent Accounting Standards”

Stock-based compensation

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Significant estimates are used when accounting

for revenue recognition, fair value of stock-based compensation and warrants and valuation allowance against deferred tax assets.

for revenue recognition, fair value of stock-based compensation and warrants, borrowing rates used for lease accounting and valuation

allowance against deferred tax assets.

Actual results could differ from those estimates.

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Adoption of recent accounting standards

In February 2016, the

FASB issued ASU No 2016-02, Leases (Topic 842), establishing Accounting Standard Codification (“ASC”) Topic

842, which requires the recognition of the right-of-use assets and related operating and finance lease liabilities on the balance

As permitted by ASC Topic 842, the Company elected the adoption date of January 1, 2019, which is the date of initial application,

using a modified retrospective approach for all leases existing at January 1, 2019 and elected to apply the available practical

expedients and implemented internal controls and key system functionality to enable the preparation of financial information on

ASC Topic 842 requires the Company to make significant judgments and estimates.

Additionally, the Company has expanded

data gathering procedures to comply with the additional disclosure requirements and ongoing contract review requirements.

result, the consolidated balance sheet prior to January 1, 2019 was not restated, continues to be reported under ASC Topic 840,

Leases, which did not require the recognition of operating lease liabilities on the balance sheet, and is not comparative.

ASC Topic 842, all leases are required to be recorded on the balance sheet and are classified as either operating leases or finance

The Company elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of

12 months or less.

The adoption of ASC Topic 842 had an impact on the Company’s balance sheet but did not have an impact

on the Company’s statements of operations or statements of cash flows upon adoption.

See Note 6 for more information.

In June 2018, the FASB

issued ASU No.

2018-07, Compensation –

Stock Compensation (Topic 718):

Improvements to Nonemployee Share-Based Payment

The guidance in this ASU expands the scope of ASC Topic 718 to include all share-based payment arrangements related

to the acquisition of goods and services from both nonemployees and employees.

The Company adopted ASU No.

2018-07 effective January

The Company’s adoption of ASU No.

2018-07 did not have a material impact on its financial position, results of operations

or financial statement disclosure.

Recent accounting standards

The Company has evaluated

all issued but not yet effective accounting pronouncements and determined that they are either immaterial or not relevant to the

Company except as noted below.

In June 2016, the FASB

issued ASU No.

2016-13, Financial Instruments –

In June 2016, the Financial

Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2016-13, Financial

Instruments –

Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments .

The standard’s main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing

receivables and other financial assets in scope.

The standard’s

main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing receivables and other

financial assets in scope.

The new guidance represents significant changes to accounting for credit losses:

(i) full lifetime expected credit losses will be recognized upon initial recognition of an asset in scope;

(ii) the current incurred

loss impairment model that recognizes losses when a probable threshold is met will be replaced with the expected credit loss impairment

method without recognition threshold;

and (iii) the expected credit losses estimate will be based upon historical information,

current conditions, and reasonable and supportable forecasts.

2016-13 introduces two distinctive credit loss impairment

(i) current expected credit losses (“CECL”) impairment model (Subtopic 326-20) applicable to financial assets

measured at amortized cost;

(i) full lifetime expected

credit losses will be recognized upon initial recognition of an asset in scope;

(ii) the current incurred loss impairment model

that recognizes losses when a probable threshold is met will be replaced with the expected credit loss impairment method without

recognition threshold;

and (iii) the estimate of expected credit losses will be based upon historical information, current conditions,

and reasonable and supportable forecasts.

2016-13 introduces two distinctive credit loss impairment models:

expected credit losses (“CECL”) impairment model (Subtopic 326-20) applicable to financial assets measured at amortized

and (ii) available-for-sale debt securities impairment model (Subtopic 326-30).

effective for public entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal

Public entities that qualify as a smaller reporting company can elect to defer compliance effective for fiscal years beginning

after December 15, 2022.

The Company adopted this standard on January 1, 2020 and it did not have a material impact on its financial

position, results of operations or financial statement disclosure.

2016-13 is effective for public entities

for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.

The Company adopted this

standard on January 1, 2020 and it did not have a material impact on its financial position, results of operations or financial

statement disclosure.

Recent accounting standards

The Company has evaluated

all issued but not yet effective accounting pronouncements and determined that they are either immaterial or not relevant to the

Company except as noted below.

In December 2019, the

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to reduce complexity in accounting standards.

Amendments include removal of certain exceptions to the general principles of ASC

740, Income taxes , and simplification in several other areas such as accounting for a franchise tax (or similar tax) that

is partially based on income.

While not required to be adopted until 2021 for most calendar year public business entities, early

adoption is permitted for any financial statements not yet issued to take advantage of the simplifications.

The Company is still

evaluating the impact of the ASU but does not expect the ASU to have a significant impact on its tax provision when adopted.

The Company adopted

2014-09, Topic 606 in January 2018 and accordingly, the amount of revenue that the Company recognizes reflects the

consideration it expects to receive in exchange for goods or services and such revenue is recognized at the time when goods or

services are transferred and/or delivered to its customers.

The Company recognizes revenue when it satisfies a performance obligation

by transferring the product or service to the customer, either at a point in time or over time.

The Company usually recognizes

revenue from integration service agreements at a point in time and integration license service agreements over a period of time.

Amendments include removal of certain exceptions to the general principles of Accounting

Standard Codification (“ASC”) 740, Income taxes , and simplification in several other areas such as accounting

for a franchise tax (or similar tax) that is partially based on income.

While not required to be adopted until 2021 for most calendar

year public business entities, early adoption is permitted for any financial statements not yet issued to take advantage of the

simplifications.

The Company is still evaluating the impact of the ASU but does not expect the ASU to have a significant impact

on its tax provision when adopted.

In August 2020, the

FASB issued ASU No.

2020-06, Debt with Conversion and other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts

in Entity’s Own Equity (Subtopic 815-40).

The new guidance eliminates the beneficial conversion and cash conversion

accounting models for convertible instruments.

It also amends the accounting for certain contracts in an entity’s own equity

that are currently accounted for as derivatives because of specific settlement provisions.

In addition, the new guidance modifies

how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation.

This guidance is effective as of January 1, 2022 (Early adoption is permitted effective January 1, 2021).

is currently evaluating the effect the updated standard will have on its financial position, results of operations or financial

statement disclosure .

The Company recognizes

revenue in accordance with ASC 606.

The amount of revenue that the Company recognizes reflects the consideration it expects to

receive in exchange for goods or services and such revenue is recognized at the time when goods or services are transferred and/or

delivered to its customers.

Revenue is recognized when the Company satisfies a performance obligation by transferring the product

or service to the customer, either at a point in time or over time.

The Company usually recognizes revenue from integration service

agreements at a point in time and integration license agreements over a period of time.

The following table provides information

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Products and services transferred over time

Deferred Revenue:

Unbilled contracts receivable and deferred revenue :

Timing of revenue recognition

may differ from the timing of invoicing customers.

Accounts receivable includes amounts billed and currently due from customers.

Unbilled contracts receivable represents unbilled amounts expected to be received from customers in future periods, where the revenue

recognized to date exceeds the amount billed, and the right to receive payment is subject to the underlying contractual terms.

Unbilled contracts receivable amounts may not exceed their net realizable value and are classified as long-term assets if the payments

are expected to be received more than one year from the reporting date.

The Company records

deferred revenue for customers that were issued invoices, but the Company has not yet recognized the revenue based on its revenue

recognition policy.

During the year ended December 31, 2019, the Company recognized approximately $55,000 of revenue that was included

in deferred revenue as of December 31, 2018.

As of December 31, 2019, the Company has approximately $37,000 of deferred revenue

it expects to recognize in the first quarter of 2020

deferred revenue when revenue will be recognized after invoicing.

During the year ended December 31, 2020, the Company recognized

approximately $37,000 of revenue that was included in deferred revenue as of December 31, 2019.

BASIC AND DILUTED LOSS PER SHARE`

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Computer equipment

Office equipment

Furniture and fixtures

Leasehold improvements

Office equipment

Accumulated depreciation and amortization

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straight-line basis over three years.

Leasehold improvements are amortized over the remaining life of the lease.

The Company leases

corporate office space in Los Gatos, California.

This lease has a remaining term of 13 months as of December 31, 2019.

is accounted for under ASC Topic 842 and, as a result, the most significant impact was the recognition of the operating lease right-of-use

assets and the liability for operating leases.

Upon adoption the Company recorded an operating lease right-of-use asset and the

related lease liability.

The lease liability is based on the present value of the remaining minimum lease payments, discounted

using the Company’s estimated incremental borrowing rate of 10% at the effective date of January 1, 2019.

As permitted under

ASC Topic 842, the Company elected several practical expedients that permit it to not reassess (1) whether a contract is or contains

a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial

indirect costs.

The impact of the adoption

of ASC Topic 842 on the balance sheet at January 1, 2019 was (in thousands):

As reported December 31, 2018

Adoption of ASC Topic 842

Prepaid expenses and other current assets

Operating lease of right-of-use assets

Other current liabilities

Long-term liabilities operating leases

Total liabilities

The current lease accounted

for under ASC Topic 842 contains escalating payments on the anniversary of the commencement.

These additional lease components

are included in the measurement of the initial lease liability.

Additional payments based on a change in the Company’s share

of the operating expenses, including real estate taxes and insurance, are recorded as a period expense when incurred.

Lease modifications

result in remeasurement of the lease liability.

Lease expense for operating leases consists of the lease payments plus any initial

direct costs, primarily brokerage commissions, and is recognized on a straight-line basis over the lease term.

The components of operating lease costs were as follows (in

In August 2020, the Company and its landlord amended the lease of this office.

This amendment extends the expiration date of the lease from January 2021 to January 2026 and increases the space from 3,396 square

feet to 4,101 square feet.

Under ASC 842, the lease amendment was treated as a separate lease for the new space and a modification

of the lease for the original space.

An additional right-of-use (“ROU”) asset and lease liability of approximately

$681,000 were recorded during the year ended December 31, 2020.

The lease liability is based on the present value of the minimum

lease payments, discounted using an estimated incremental borrowing rate of 5.5%.

The lease contains escalating payments on the

anniversary of the original commencement which are included in the measurement of the initial lease liability.

Additional payments

based on a change in the Company’s share of the operating expenses, including property taxes and insurance, are recorded

as a period expense when incurred.

Lease expense for operating leases consists of the lease payments recognized on a straight-line

basis over the lease term.

In January 2021, the Company recorded an additional ROU asset and corresponding liability of approximately

$144,000 when the additional space became available for use.

The components of operating

lease costs were as follows (in thousands):

Year Ended December 31,

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Short term lease costs

Total operating lease costs

Total operating costs

Future minimum payments

under non-cancellable leases as of December 31, 2019 were as follows (in thousands):

under non-cancellable leases as of December 31, 2020 were as follows (in thousands) and do not include the additional space that

the Company took use of in January 2021:

For the Year Ended December 31,

2024 & thereafter

Total future minimum lease payments

Less imputed interest

Total lease liability

The below table provides

supplemental information and non-cash activity related to the Company’s operating leases are as follows (in thousands):

December 31, 2019

Operating cash flow information:

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Right-of-use assets obtained in exchange for the lease obligations

_________________________

Represents the initial right-of-use asset valuation of the Los Gatos lease on January 1, 2019

In October 2016, the

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with current monthly payments of $2,942 per month, commenced on October 24, 2016.

The lease rate will increase to $2,942 on January

Because the lease is month to month and can be cancelled with a 30-day notice, the future lease payments are not included

in the Company’s lease accounting under ASC Topic 842.

Because the lease is month to month and can be

cancelled with a 30-day notice, the future lease payments are not included in the Company’s lease accounting under ASC Topic

In October 2019, the

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five years at $150,000 per month.

The lease commencement date is anticipated to be in April 2020, at which time the Company will

account for the lease under ASC 842.

A prepayment of $450,000 was made in the year ended December 31, 2020, this payment represents

the final three payments under the lease and is recorded as a long-term prepaid until the lease commencement, at which time it

will be record in accordance with ASC 842.

COMMITMENTS AND CONTINGENCIES

Licensing agreement

In December 2006, the

Company entered into licensing agreement with ASM International, NV, a semiconductor OEM located in Almere, The Netherlands, pursuant

to which ASM has granted to the Company a non-exclusive, worldwide license to make, and sublicense others to make, semiconductor

devices using certain ASM patents.

The ASM license restricted the Company and its sublicensees from using the ASM licensed rights

in the manufacture of EPI machines or any other machines used to manufacture semiconductors.

The ASM license was coterminous with

patents licensed by ASM, which expired on January 8, 2019, and required the Company to pay ASM a royalty of 5% of net royalty revenue,

generally defined as gross royalty revenue less certain customer offsets and credits, from the sale of any product incorporating

the ASM licensed patents not manufactured on ASM equipment and a royalty of 2.5% of net revenue from the sale of any product incorporating

ASM licensed patents manufactured on ASM equipment.

All semiconductor devices incorporating the Company’s MST technology

manufactured prior to January 8, 2019 were subject to the ASM license royalty.

The Company incurred approximately $4,000 in royalty

expense under this agreement for the year ended December 31, 2018, which is included in cost of revenue in the statement of operations.

The Company may be

involved, from time to time, in legal proceedings and claims arising in the ordinary course of its business.

Such matters are

subject to many uncertainties and outcomes and are not predictable with assurance.

While management believes that such matters

are currently insignificant, matters arising in the ordinary course of business for which the Company is or could become involved

in litigation may have a material adverse effect on its business and financial condition.

The Company is not party to any material

litigation as of December 31, 2019 or through the date these financial statements have been issued.

Such matters are subject

to many uncertainties and outcomes and are not predictable with assurance.

While management believes that such matters are currently

insignificant, matters arising in the ordinary course of business for which the Company is or could become involved in litigation

may have a material adverse effect on its business and financial condition.

The Company is not party to any material litigation

as of December 31, 2020 or through the date these financial statements have been issued.

STOCKHOLDERS’

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preferences, or both, and may have full or limited voting rights.

In October 2018, the

On May 29, 2019, the

Company closed a registered direct offering of 1,675,000 shares of common stock at a price of $4.00 per share.

The Company received

approximately $6.4 million of net proceeds after deducting commissions and other offering expenses.

On May 15, 2020, the

Company closed an underwritten public offering of 2,024,000 shares of common stock at a public offering price of $5.00 per share,

The Company received approximately $11.4 million of net proceeds after deducting underwriting discounts and commission and other

estimated offering expenses.

In May 2019, the Company

closed a registered direct offering of 1,675,000 shares of common stock at a price of $4.00 per share.

The Company received approximately

$6.4 million of net proceeds after deducting commissions and other offering expenses.

resulting in approximately $9.4 million of net proceeds after deducting underwriting commission and other offering expenses.

On September 2, 2020,

Atomera entered into an Equity Distribution Agreement with Craig-Hallum Capital Group LLC, as agent, under which the Company offered

and sold, from time to time at its sole discretion, shares of its common stock having an aggregate offering price of up to $25.0

million in an “at-the-market”

or ATM offering, to or through the agent.

As of December 31, 2020, 2,206,895 shares

had been sold at an average price of approximately $11.22, resulting in approximately $24.0 million of net proceeds to the Company

after deducting commissions and other offering expenses.

As of December

2019, the Company has reserved approximately 3.7 million shares of common stock for issuance pursuant to outstanding stock options

and warrants.

31, 2020, the Company has reserved approximately 3.8 million shares of common stock for issuance pursuant to outstanding stock

options and warrants.

The Company estimated

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The warrants outstanding at December 31,

2019 had an intrinsic value of approximately $446,000 based on a per-share stock price of $3.08 as of December 31, 2019.

2020 had an intrinsic value of approximately $2.1 million based on a per-share stock price of $16.09 as of December 31, 2020.

On March 17, 2020,

196,602 warrants with an exercise price of $3.75 were set to expire.

Prior to the expiration, the Company entered into an agreement

with the warrant holders, whereby it modified the terms of the warrants to extend the expiration date until September 17, 2020

in exchange for the removal of a cashless exercise provision.

No other terms were modified.

Due to this modification, the Company

incurred a modification expense of approximately $139,000 that is included in general and administrative expenses on the Statement

of Operations for the year ended December 31, 2020.

All of the modified warrants were exercised on August 6, 2020.

3, 2020, the Company modified 12,200 warrants with an original exercise price of $9.375 and an expiration date August 4, 2021.

The warrants were modified to decrease the exercise price to $7.50 and change the expiration date to December 31, 2020.

were then exercised December 4, 2020.

Due to the modification, the Company incurred a modification expense of approximately $2,000

that is included in general and administrative expenses on the Statement of Operations for the year ended December 31, 2020.

December 2020, a warrant for 37,562 shares was presented for cashless exercise resulting in the issuance of 13,165 shares of common

STOCK BASED COMPENSATION

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Service or other similar state or local authority.

The statute of limitations remains effectively open for all tax years from inception

(2007) through 2019.

The statute of limitations remains effectively open for all tax years since

inception (2007).

Tax years outside the normal statute of limitations remain open to examination by tax authorities due to tax

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SUBSEQUENT EVENTS

The Company has evaluated

subsequent events since December 31, 2019, the date of these financials.

On March 11, 2020, the Compensation Committee of the

Board of Directors of the Company approved the issuance of 419,952 shares of Restricted Stock Awards and 630,128 Stock Options

to its employees.

On January 5, 2021

the Company announced the completion of its ATM offering after an additional 14,680 shares were sold for an average price per share

of $16.97 in January 2021 resulting in additional net proceeds of approximately $243,000.

In January 2021, warrants

for 317,488 shares were presented for cashless exercises resulting in the issuance of 223,487 shares of common stock.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data