What changed in this filing

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Item 1A. Risk Factors

2020-11-16 compared with 2020-08-13 · 189 added, 193 removed, 1 unchanged (100% of the section changed)

Related to Our Business and Industry

have a limited commercial history upon which to base our prospects and until this calendar quarter, we have not generated profits

and are not certain that we will sustain profitability in the future.

began operations in April 2013, and we have a limited operating history.

While we were profitable for the three- and six-month

periods ended June 30, 2020, we realized a net loss for the three months ended March 31, 2020 of $1,065,193, and a net loss

of $6.2 million and $6.3 million for the years ended December 31, 2019 and December 31, 2018, respectively.

Our accumulated deficit

was $13.4 million as of June 30, 2020 and $25.0 million and $18.7 million as of December 31, 2019 and December 31,

2018, respectively.

We realized net income for the first time for the three months ended June 30, 2020.

We were able to achieve

net income because we were able to develop and market our LogixSmart COVID-19 test, but we do not have any way to predict how

long our market for that test will continue.

Potential investors should be aware of the difficulties normally encountered by a

new enterprise, many of which are beyond our control, including substantial risks and expenses in the course of developing new

diagnostic tests, establishing or entering new markets, organizing operations and marketing procedures.

The likelihood of our

success must be considered in light of these risks, expenses, complications and delays, and the competitive environment in which

There is, therefore, nothing at this time upon which to base an assumption that our business plan will continue to

prove successful, and we may not be able to generate significant revenue, raise additional capital or operate profitably.

continue to encounter risks and difficulties frequently experienced by early commercial stage companies, including scaling up

our infrastructure and headcount, and may encounter unforeseen expenses, difficulties or delays in connection with our growth.

In addition, as a result of the start-up nature of our business, we can be expected to continue to sustain substantial operating

expenses and may not be able to continue generating sufficient revenues to cover expenditures.

Any investment in our company is

therefore highly speculative and could result in the loss of any investment.

near-term success has been dependent on the market for our COVID-19 test and future success is dependent on continued demand for

the COVID-19 test and upon our ability to develop and market other commercially accepted diagnostic tests.

future success will depend, in part, on the continued market for our LogixSmart COVID-19 test and upon our ability to develop

and sell sufficient quantities of other diagnostics tests.

Attracting new customers and distribution networks requires substantial

time and expense.

Any failure to continue sales of our tests in sufficient quantities to maintain profitability would adversely

affect our operating results.

Many factors could affect the market acceptance and commercial success of any of our diagnostic

tests, including:

ability to develop additional infectious disease diagnostic tests for which there is a commercial market.

ability to convince our potential customers of the advantages and economic value of our tests over competing technologies

and diagnostic tests;

breadth of our test menu relative to competitors;

to policies, procedures or currently accepted best practices in clinical diagnostic testing;

extent and success of our marketing and sales efforts;

ability to manufacture in quantity our commercial diagnostic tests and meet demand in a timely fashion.

Related to Owning our Common Stock and Other Securities

price of our common stock may fluctuate substantially.

market price of our common stock may be subject to wide fluctuation in response to various factors, some of which are beyond our

Some factors that may cause the market price of our common stock to fluctuate, in addition to the other risks mentioned

in this “Risk Factors”

section and elsewhere in this report, are:

of our common stock by our shareholders, executives, and directors;

ability to enter new markets;

or un-anticipated fluctuations in our annual and quarterly financial results;

ability to obtain financings to continue and expand our commercial activities, expand our manufacturing operations, conduct

research and development activities including, but not limited to, human clinical trials, and other business activities;

ability to secure resources and the necessary personnel to continue and expand our commercial activities, develop additional

diagnostic tests, conduct clinical trials and gain approval for our diagnostic tests on our desired schedule;

commencement,

enrollment or results of our clinical trials of our diagnostic tests or any future clinical trials we may conduct;

in the development status of our diagnostic tests;

delays or adverse developments or perceived adverse developments with respect to review by the FDA or other similar foreign

regulatory authorities of our planned clinical trials;

delay in our submission for studies or test approvals or adverse regulatory decisions, including failure to receive regulatory

approval for our diagnostic tests;

announcements or our competitors’

announcements regarding new tests, enhancements, significant contracts, acquisitions

or strategic investments;

to meet external expectations or management guidance;

in our capital structure or dividend policy, including as a result of future issuances of securities and sales of large blocks

of common stock by our shareholders;

announcements

and events surrounding financing efforts, including debt and equity securities;

from existing technologies and diagnostic tests or new technologies and diagnostic tests that may emerge;

announcements

of acquisitions, partnerships, collaborations, joint ventures, new diagnostic tests, capital commitments, or other events

by us or our competitors;

in general economic, political and market conditions in any of the regions in which we conduct our business;

in industry conditions or perceptions;

in valuations of similar companies or groups of companies;

research reports, recommendations and changes in recommendations, price targets and withdrawals of coverage;

and additions of key personnel;

and litigations related to intellectual properties, proprietary rights, and contractual obligations;

in applicable laws, rules, regulations, or accounting practices and other dynamics;

taken by our principal shareholders and release or expiry of lockup or other transfer restrictions;

events or factors, many of which may be out of our control.

addition, if the market for stocks in our industry or industries related to our industry, or the stock market in general, experiences

a loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial

condition and results of operations.

If any of the foregoing occurs, it could cause our stock price to fall and may expose us

to lawsuits that, even if unsuccessful, could be costly to defend and a distraction to management.

sales of our common stock in the public market may cause our stock price to decline and impair our ability to raise future capital

through the sale of our equity securities.

are a substantial number of shares of our common stock held by shareholders who owned shares of our capital stock prior to our

initial public offering that may be able to sell in the public market.

Sales by such shareholders of a substantial number of shares

could significantly reduce the market price of our common stock.

issued by us upon exercise of options granted under our equity plan will be eligible for sale in the public market.

these holders cause a large number of securities to be sold in the public market, the sales could reduce the trading price of

Risks Related to Our Business and Industry

We have a limited commercial history

upon which to base our prospects and until this year, we have not generated profits and are not certain that we will sustain

profitability in the future.

We began operations in April 2013, and we have

a limited operating history.

While we were profitable for the three- and nine-month periods ended September 30, 2020, we realized

a net loss for the three months ended March 31, 2020 of $1,065,193, and a net loss of $6.2 million and $6.3 million for the years

ended December 31, 2019 and December 31, 2018, respectively.

Our accumulated retained earnings was $4,703,534 as of September 30,

2020 and accumulated deficit of $25.0 million and $18.7 million as of December 31, 2019 and December 31, 2018, respectively.

realized net income for the first time for the three months ended June 30, 2020.

We were able to achieve net income because we

were able to develop and market our LogixSmart COVID-19 test, but we do not have any way to predict how long our market for that

test will continue.

Potential investors should be aware of the difficulties normally encountered by a new enterprise, many of which

are beyond our control, including substantial risks and expenses in the course of developing new diagnostic tests, establishing

or entering new markets, organizing operations and marketing procedures.

The likelihood of our success must be considered in light

of these risks, expenses, complications and delays, and the competitive environment in which we operate.

There is, therefore, nothing

at this time upon which to base an assumption that our business plan will continue to prove successful, and we may not be able

to generate significant revenue, raise additional capital or operate profitably.

We will continue to encounter risks and difficulties

frequently experienced by early commercial stage companies, including scaling up our infrastructure and headcount, and may encounter

unforeseen expenses, difficulties or delays in connection with our growth.

In addition, as a result of the start-up nature of our

business, we can be expected to continue to sustain substantial operating expenses and may not be able to continue generating sufficient

revenues to cover expenditures.

Any investment in our company is therefore highly speculative and could result in the loss of any

Our near-term success has been dependent

on the market for our COVID-19 test and future success is dependent on continued demand for the COVID-19 test and upon our ability

to develop and market other commercially accepted diagnostic tests.

Our future success will depend, in part, on

the continued market for our LogixSmart COVID-19 test and upon our ability to develop and sell sufficient quantities of other diagnostics

Attracting new customers and distribution networks requires substantial time and expense.

Any failure to continue sales

of our tests in sufficient quantities to maintain profitability would adversely affect our operating results.

Many factors could

affect the market acceptance and commercial success of any of our diagnostic tests, including:

Our ability to develop additional infectious disease diagnostic tests for which there is a commercial market.

our ability to convince our potential customers of the advantages and economic value of our tests over competing technologies and diagnostic tests;

the breadth of our test menu relative to competitors;

changes to policies, procedures or currently accepted best practices in clinical diagnostic testing;

the extent and success of our marketing and sales efforts;

our ability to manufacture in quantity our commercial diagnostic tests and meet demand in a timely fashion.

Risks Related to Owning our Common Stock

and Other Securities

The price of our common stock may fluctuate

substantially.

The market price of our common stock may be

subject to wide fluctuation in response to various factors, some of which are beyond our control.

Some factors that may cause the

market price of our common stock to fluctuate, in addition to the other risks mentioned in this “Risk Factors”

and elsewhere in this report, are:

sales of our common stock by our shareholders, executives, and directors;

our ability to enter new markets;

actual or un-anticipated fluctuations in our annual and quarterly financial results;

our ability to obtain financings to continue and expand our commercial activities, expand our manufacturing operations, conduct research and development activities including, but not limited to, human clinical trials, and other business activities;

our ability to secure resources and the necessary personnel to continue and expand our commercial activities, develop additional diagnostic tests, conduct clinical trials and gain approval for our diagnostic tests on our desired schedule;

commencement, enrollment or results of our clinical trials of our diagnostic tests or any future clinical trials we may conduct;

changes in the development status of our diagnostic tests;

any delays or adverse developments or perceived adverse developments with respect to review by the FDA or other similar foreign regulatory authorities of our planned clinical trials;

any delay in our submission for studies or test approvals or adverse regulatory decisions, including failure to receive regulatory approval for our diagnostic tests;

our announcements or our competitors’

announcements regarding new tests, enhancements, significant contracts, acquisitions or strategic investments;

failures to meet external expectations or management guidance;

changes in our capital structure or dividend policy, including as a result of future issuances of securities and sales of large blocks of common stock by our shareholders;

announcements and events surrounding financing efforts, including debt and equity securities;

competition from existing technologies and diagnostic tests or new technologies and diagnostic tests that may emerge;

announcements of acquisitions, partnerships, collaborations, joint ventures, new diagnostic tests, capital commitments, or other events by us or our competitors;

changes in general economic, political and market conditions in any of the regions in which we conduct our business;

changes in industry conditions or perceptions;

changes in valuations of similar companies or groups of companies;

analyst research reports, recommendations and changes in recommendations, price targets and withdrawals of coverage;

departures and additions of key personnel;

disputes and litigations related to intellectual properties, proprietary rights, and contractual obligations;

changes in applicable laws, rules, regulations, or accounting practices and other dynamics;

actions taken by our principal shareholders and release or expiry of lockup or other transfer restrictions;

other events or factors, many of which may be out of our control.

In addition, if the market for stocks in our

industry or industries related to our industry, or the stock market in general, experiences a loss of investor confidence, the

trading price of our common stock could decline for reasons unrelated to our business, financial condition and results of operations.

If any of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that, even if unsuccessful,

could be costly to defend and a distraction to management.

Future sales of our common stock in the

public market may cause our stock price to decline and impair our ability to raise future capital through the sale of our equity

There are a substantial number of shares of

our common stock held by shareholders who owned shares of our capital stock prior to our initial public offering that may be able

to sell in the public market.

Sales by such shareholders of a substantial number of shares could significantly reduce the market

price of our common stock.

Shares issued by us upon exercise of options

granted under our equity plan will be eligible for sale in the public market.

If any of these holders cause a large number of securities

to be sold in the public market, the sales could reduce the trading price of our common stock.

These sales also could impede our

ability to raise capital in the future.

Anti-takeover provisions in our charter

documents and Utah law could discourage delay or prevent a change of control of our Company and may affect the trading price of

our common stock.

These sales also could impede our ability to raise capital in the future.

Anti-takeover

provisions in our charter documents and Utah law could discourage delay or prevent a change of control of our Company and may

affect the trading price of our common stock.

are a Utah corporation and the anti-takeover provisions of the Utah Control Shares Acquisition Act may discourage, delay or prevent

a change of control by limiting the voting rights of control shares acquired in a control share acquisition.

In addition, our

Articles of Incorporation and Bylaws may discourage, delay or prevent a change in our management or control over us that shareholders

may consider favorable.

Among other things, our Amended and Restated Articles of Incorporation and Bylaws:

the issuance of “blank check”

preferred stock that could be issued by our board of directors in response to a

takeover attempt;

that vacancies on our board of directors, including newly created directorships, may be filled only by a majority vote of

directors then in office, except a vacancy occurring by reason of the removal of a director without cause shall be filled

by vote of the shareholders;

who may call special meetings of shareholders.

provisions could have the effect of delaying or preventing a change of control, whether or not it is desired by, or beneficial

to, our shareholders.

may delist our common stock from its exchange, which could limit investors’

ability to make transactions in our common stock

and subject us to additional trading restrictions.

we fail to satisfy the continued listing requirements of the NASDAQ Capital Market, such as the corporate governance requirements

or the minimum closing bid price requirement, NASDAQ may take steps to delist our common stock.

Such a delisting would likely

have a negative effect on the price of our common stock, and would impair your ability to sell or purchase our common stock when

you wish to do so.

In the event of a delisting, we would take actions to restore our compliance with the NASDAQ Capital Market’s

listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become

listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping

below the NASDAQ Capital Market’s minimum bid price requirement or prevent future non-compliance with the NASDAQ Capital

Market’s listing requirements.

the NASDAQ Capital Market does not maintain the listing of our securities for trading on its exchange, we could face significant

material adverse consequences, including:

limited availability of market quotations for our securities;

liquidity with respect to our securities;

determination that our shares of common stock are “penny stock”

which will require brokers trading in our shares

of common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary

trading market for our shares of common stock;

limited amount of news and analyst coverage for our company;

ability to issue additional securities or obtain additional financing in the future.

it may be difficult for our shareholders to sell any shares if they desire or need to sell them.

do not currently intend to pay dividends on our common stock

do not expect to pay cash dividends on our common stock.

Any future dividend payments are within the absolute discretion of our

board of directors and will depend on, among other things, our results of operations, working capital requirements, capital expenditure

requirements, financial condition, contractual restrictions, business opportunities, anticipated cash needs, provisions of applicable

law and other factors that our board of directors may deem relevant.

We may not generate sufficient cash from operations in the

future to pay dividends on our common stock.

are an “emerging growth company”

and will be able to avail ourselves of reduced disclosure requirements applicable

to emerging growth companies, which could make our common stock less attractive to investors.

are an “emerging growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act,

and we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public

companies that are not “emerging growth companies”

including not being required to comply with the auditor attestation

requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our

periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive

compensation and shareholder approval of any golden parachute payments not previously approved.

Investors may find our common

stock less attractive because we may rely on these exemptions.

If some investors find our common stock less attractive as a result,

there may be a less active trading market for our common stock and our stock price may be more volatile.

We may take advantage

of these reporting exemptions until we are no longer an “emerging growth company.”

We will remain an “emerging

growth company”

until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of

$1.07 billion or more;

(ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of our

initial public offering;

(iii) the date on which we have issued more than $1.07 billion in nonconvertible debt during the previous

or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the Securities and Exchange

have elected to use the extended transition periods for complying with new or revised accounting standards.

have elected to use the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new

or revised accounting standards that have different effective dates for public and private companies until the earlier of the

date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transaction

period provided in Section 7(a)(2)(B).

As a result, our financial statements may not be comparable to those of companies that

comply with public company effective dates.

management is required to devote substantial time to compliance initiatives.

a public company, we incur significant legal, accounting and other expenses that we did not incur as a newly formed entity.

Sarbanes-Oxley Act, as well as rules subsequently implemented by the Securities and Exchange Commission, and NASDAQ, have imposed

various new requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial

controls and changes in corporate governance practices.

Our management and other personnel devote a substantial amount of time

to these new compliance initiatives.

Moreover, these rules and regulations increase our legal and financial compliance costs and

make some activities more time consuming and costly.

We expect these rules and regulations to make it more difficult and more

expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain

the same or similar coverage.

We are a Utah corporation and the anti-takeover

provisions of the Utah Control Shares Acquisition Act may discourage, delay or prevent a change of control by limiting the voting

rights of control shares acquired in a control share acquisition.

In addition, our Articles of Incorporation and Bylaws may discourage,

delay or prevent a change in our management or control over us that shareholders may consider favorable.

Among other things, our

Amended and Restated Articles of Incorporation and Bylaws:

authorize the issuance of “blank check”

preferred stock that could be issued by our board of directors in response to a takeover attempt;

provide that vacancies on our board of directors, including newly created directorships, may be filled only by a majority vote of directors then in office, except a vacancy occurring by reason of the removal of a director without cause shall be filled by vote of the shareholders;

limit who may call special meetings of shareholders.

These provisions could have the effect of delaying

or preventing a change of control, whether or not it is desired by, or beneficial to, our shareholders.

NASDAQ may delist our common stock from

its exchange, which could limit investors’

ability to make transactions in our common stock and subject us to additional

trading restrictions.

Should we fail to satisfy the continued listing

requirements of the NASDAQ Capital Market, such as the corporate governance requirements or the minimum closing bid price requirement,

NASDAQ may take steps to delist our common stock.

Such a delisting would likely have a negative effect on the price of our common

stock, and would impair your ability to sell or purchase our common stock when you wish to do so.

In the event of a delisting,

we would take actions to restore our compliance with the NASDAQ Capital Market’s listing requirements, but we can provide

no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or

improve the liquidity of our common stock, prevent our common stock from dropping below the NASDAQ Capital Market’s minimum

bid price requirement or prevent future non-compliance with the NASDAQ Capital Market’s listing requirements.

If the NASDAQ Capital Market does not maintain

the listing of our securities for trading on its exchange, we could face significant material adverse consequences, including:

a limited availability of market quotations for our securities;

reduced liquidity with respect to our securities;

a determination that our shares of common stock are “penny stock”

which will require brokers trading in our shares of common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our shares of common stock;

a limited amount of news and analyst coverage for our company;

decreased ability to issue additional securities or obtain additional financing in the future.

Therefore, it may be difficult for our shareholders

to sell any shares if they desire or need to sell them.

We do not currently intend to pay dividends

on our common stock

We do not expect to pay cash dividends on our

common stock.

Any future dividend payments are within the absolute discretion of our board of directors and will depend on, among

other things, our results of operations, working capital requirements, capital expenditure requirements, financial condition, contractual

restrictions, business opportunities, anticipated cash needs, provisions of applicable law and other factors that our board of

directors may deem relevant.

We may not generate sufficient cash from operations in the future to pay dividends on our common stock.

We are an “emerging growth company”

and will be able to avail ourselves of reduced disclosure requirements applicable to emerging growth companies, which could make

our common stock less attractive to investors.

We are an “emerging growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and we intend to take advantage of certain exemptions

from various reporting requirements that are applicable to other public companies that are not “emerging growth companies”

including not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced

disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements

of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously

Investors may find our common stock less attractive because we may rely on these exemptions.

If some investors find our

common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may

be more volatile.

We may take advantage of these reporting exemptions until we are no longer an “emerging growth company.”

We will remain an “emerging growth company”

until the earliest of (i) the last day of the fiscal year in which we have

total annual gross revenues of $1.07 billion or more;

(ii) the last day of our fiscal year following the fifth anniversary of the

date of the completion of our initial public offering;

(iii) the date on which we have issued more than $1.07 billion in nonconvertible

debt during the previous three years;

or (iv) the date on which we are deemed to be a large accelerated filer under the rules of

the Securities and Exchange Commission.

We have elected to use the extended transition

periods for complying with new or revised accounting standards.

We have elected to use the extended transition

period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards that have different

effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company

or (ii) affirmatively and irrevocably opt out of the extended transaction period provided in Section 7(a)(2)(B).

As a result, our

financial statements may not be comparable to those of companies that comply with public company effective dates.

Our management is required to devote

substantial time to compliance initiatives.

As a public company, we incur significant legal,

accounting and other expenses that we did not incur as a newly formed entity.

The Sarbanes-Oxley Act, as well as rules subsequently

implemented by the Securities and Exchange Commission, and NASDAQ, have imposed various new requirements on public companies, including

requiring establishment and maintenance of effective disclosure and financial controls and changes in corporate governance practices.

Our management and other personnel devote a substantial amount of time to these new compliance initiatives.

Moreover, these rules

and regulations increase our legal and financial compliance costs and make some activities more time consuming and costly.

these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance

and we may be required to incur substantial costs to maintain the same or similar coverage.

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-Q

Item 1A. Risk Factors